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HomeMy WebLinkAbout09-098 - ADMIN Resolution - City Council - 2009/07/27• 4111 0 RESOLUTION NO. 09-098 RESOLUTION PROVIDING FOR THE PARTIAL DEFEASANCE, PREPAYMENT AND REDEMPTION OF CERTAIN OUTSTANDING GENERAL OBLIGATION BONDS OF THE CITY AND AUTHORIZING EXECUTION OF AN ESCROW AGREEMENT BE IT RESOLVED By the City Council of the City of St. Louis Park, Hennepin County, Minnesota (the "City"), as follows: Section 1. Background; Findings. 1.01. The City has issued and sold its General Obligation Tax Increment Refunding Bonds, Series 2004A, dated April 7, 2004 (the "Bonds") in the total principal amount of $7,490,000, pursuant to Minnesota Statutes, Chapters 469 and 475 (collectively, the "Act"). Bonds maturing on February 1, 2014 and thereafter, are subject to redemption and prepayment on February 1, 2013 and on any date thereafter at a pnce of par plus accrued interest. 1.02. The City staff has reported to this Council and the Council so finds, that there are monies properly available for the purpose and identified in this Resolution that, if invested in securities authorized by Minnesota Statutes, Chapter 118A, will provide for the payment of principal, interest and redemption premium (if any) on Bonds maturing in years 2010 through 2016 at maturity or prior redemption. 1.03. It is further found and determined that the Bonds maturing in years 2010 through 2016 will be redeemed and prepaid as subsequently provided in this Resolution. 1.04. It is further found and determined that it is the intent of this Council that the partial defeasance of the Bonds as provided for in this Resolution is not to be construed as impairing or affecting the covenants with or pledges to the holders of the Bonds contained in the resolution authorizing issuance of the Bonds. Section 2. Redemption of Bonds. 2.01. Bonds maturing on February 1 in the years 2014 to and including 2016, comprising a portion of the Bonds subject to redemption, shall be prepaid and redeemed on February 1, 2013 (the "Redemption Date") and those Bonds are hereby called for redemption on the Redemption Date. 2.02. The City Clerk is authorized and directed to publish, in accordance with law, a notice of call for redemption of the Bonds maturing in years 2014 through 2016 in the form attached hereto as Exhibit A and to mail a copy of the notice to the registrar for the Bonds and to the original purchaser of the Bonds Resolution No. 09-098 -2- Section 3. Escrow; Defeasance. 3.01. To accomplish defeasance of the Bonds there is established an Escrow Account (the "Escrow Account") with U.S. Bank National Association (the "Escrow Agent"), a suitable financial institution in the state whose deposits are insured by the Federal Deposit Insurance Corporation and combined capital and surplus is not less than $500,000. A form of escrow agreement (the "Escrow Agreement") has been presented to and reviewed by this Council. The form of the Escrow Agreement is approved. The Mayor and City Manager are authorized and directed to execute and deliver the Escrow Agreement on behalf of the City. 3.02. As of the date of execution of the Escrow Agreement (the "Transfer Date"), and in accordance with the Supplement to Pledge Agreement between the City and the St. Louis Park Economic Development Authority ("EDA") of even date with the Escrow Agreement, there will be and are hereby transferred, pledged, and appropriated to the Escrow Account certain funds of the EDA in the amount that, together with interest earnings thereon, is needed for payment of the principal and interest of the Bonds maturing in years 2010 through 2016 on and prior to their maturity dates and on the Redemption Date, as the case may be. It is estimated that such amount is adequate when invested as herein provided to pay the principal of and interest on the Bonds maturing in years 2010 through 2016 on and prior to their maturity dates and on the Redemption Date. 3.03. The funds deposited under the Escrow Agreement are to be invested in securities maturing or callable at the option of the holder on such dates and bearing interest at such rates as may be required to provide sufficient monies together with cash or other monies in the Escrow Account to pay when due the principal amount of and interest on the Bonds maturing in years 2010 through 2016 on and prior to their maturity dates, and on the Redemption Date, as the case may be. The funds may be used only for the purposes stated in this Section, except that any surplus remaining in the Escrow Account when all of the Bonds maturing in years 2010 through 2016 and interest thereon have been paid shall be transferred to the debt service fund for the Bonds. 3.04. Securities to be purchased from the Funds are limited to securities specified in Minnesota Statutes, Section 475.67, Subdivision 8. The Mayor and City Manager are authorized and directed to purchase the securities for the Escrow Account and to transfer then to the Escrow Agent as provided in the Escrow Agreement. 3.05. For the prompt and full payment of the principal and interest on the Bonds maturing in years 2010 through 2016, as the same respectively become due, the full faith, credit and taxing powers of the City have been and are irrevocably pledged. If the balance in the Escrow Account is ever insufficient to pay all principal and interest then due on the bonds maturing on such dates, the deficiency must be promptly paid out of monies of the general fund or other funds of the City that are properly available for such purpose, and such funds may be reimbursed with or without interest from the Escrow Account when a sufficient balance is available therein. Resolution No. 09-098 -3- 3.06. When the portion of the Bonds and interest thereon have been discharged as provided in this Resolution, all pledges, covenant and other rights granted by this Resolution to the holders of the Bonds maturing in years 2010 through 2016 will cease, except that the pledge of the full faith and credit of the City will remain in full force and effect; and further provided that nothing in this Resolution alters or impairs the rights of holders of the Bonds maturing in years 2017 through 2018, which Bonds are not defeased by any action described in this Resolution or the Escrow Agreement. (The remainder of this page is intentionally left blank.) Resolution No. 09-098 -4- Member Sanger introduced the following written resolution and moved its adoption, the reading of which was dispensed with by unanimous consent. The motion for the adoption of the foregoing resolution was duly seconded by Member Paprocki, and upon vote being taken thereon, the following voted in favor thereof: Jacobs, Finkelstein, Sanger, Basill and Paprocki. and the following voted against: None pon said resolution was declared duly passed and adopted. d for Administration Adop - : the City Council July 27, 2009 City Ma ...er MOP Attest: 11-19-7-E2— City Clerk Mayor