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HomeMy WebLinkAbout09-158 - ADMIN Resolution - City Council - 2009/11/16CITY OF ST. LOUIS PARK, MINNESOTA RESOLUTION NO. 09-158 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ST. LOUIS PARK, MINNESOTA, AUTHORIZING THE ISSUANCE, SALE, AND DELIVERY OF ITS HEALTH CARE FACILITIES REVENUE REFUNDING BONDS (PARK NICOLLET HEALTH SERVICES), SERIES 2009, FOR THE BENEFIT OF PARK NICOLLET HEALTH SERVICES, PARK NICOLLET METHODIST HOSPITAL, PARK NICOLLET INSTITUTE, PARK NICOLLET CLINIC, PNMC HOLDINGS, AND PARK NICOLLET HEALTH CARE PRODUCTS, PAYABLE SOLELY FROM REVENUES PLEDGED PURSUANT TO THE INDENTURE; APPROVING THE FORM OF AND AUTHORIZING THE EXECUTION AND DELIVERY OF THE HEALTH CARE FACILITIES REVENUE REFUNDING BONDS AND RELATED DOCUMENTS; AND PROVIDING FOR THE SECURITY, RIGHTS, AND REMEDIES WITH RESPECT TO THE HEALTH CARE FACILITIES REVENUE REFUNDING BONDS WHEREAS, the City of St. Louis Park, Minnesota (the "City"), is a home rule city and political subdivision duly organized and existing under its Charter and the Constitution and laws of the State of Minnesota; and WHEREAS, pursuant to the Minnesota Statutes, Sections 469.152 through 469 1651, as amended (the "Act"), the City is authorized to issue revenue bonds for the following purposes: (i) to finance, in whole or in part, the cost of the acquisition, construction, reconstruction, improvement, betterment or extension of a project, defined in the Act as any properties, real or personal, used or useful in connection with a revenue-producing enterprise; and (ii) to refund, in whole or in part, bonds previously issued by the City under the authority of the Act and interest on such bonds, and WHEREAS, Park Nicollet Health Services, a Minnesota nonprofit corporation, Park Nicollet Methodist Hospital, a Minnesota nonprofit corporation, Park Nicollet Institute, a Minnesota nonprofit corporation, Park Nicollet Clinic, a Minnesota association that has elected to be treated as a nonprofit corporation, PNMC Holdings, a Minnesota nonprofit corporation, and Park Nicollet Health Care Products, a Minnesota nonprofit corporation (collectively, the "Obligated Group"), submitted an application to the City requesting the issuance by the City of revenue refunding bonds pursuant to the Act, and the terms of an Indenture of Trust, dated as of December 1, 2009 (the "Indenture"), between the City and Wells Fargo Bank, National Association (the "Trustee"), for the purposes of loaning the proceeds derived from the sale of the revenue refunding bonds to the Obligated Group pursuant to the terms of a Loan Agreement, dated as of December 1, 2009 (the "Loan Agreement"), between the Obligated Group and the City, the proceeds of such loan to be applied to the refunding of the outstanding (i) Variable Rate Demand Revenue Refunding Bonds (Park Nicollet Health Services), Series 2008A (the "Series 2008A Bonds"), dated August 14, 2008, issued by the City in the original aggregate principal amount of $41,830,000; (ii) Variable Rate Demand Revenue Refunding Bonds (Park Nicollet Health Services), Series 2008B-1 (the "Series 2008B-1 Bonds"), dated August 14, 2008, issued by the City in the Resolution No. 09-158 -2- original aggregate principal amount of $57,645,000; and (iii) Variable Rate Demand Revenue Refunding Bonds (Park Nicollet Health Services), Series 2008B-2 (the "Series 2008B-2 Bonds," and collectively with the Series 2008B-1 Bonds, the "Series 2008B Bonds"), dated August 14, 2008, issued by the City in the original aggregate principal amount of $45,400,000; and WHEREAS, proceeds of the Series 2008A Bonds were loaned to the Obligated Group and applied by the Obligated Group to redeem and prepay the outstanding principal amount of the Health Care Facilities Revenue Refunding Bonds (Park Nicollet Health Services), Series 2007A (the "Series 2007A Bonds"), issued by the City in the original aggregate principal amount of $41,600,000. Proceeds of the Series 2007A Bonds were previously loaned to the Obligated Group and applied by the Obligated Group to redeem and prepay the outstanding principal amount of the Health Care Facilities Revenue Bonds (Park Nicollet Health Services), Series 2003B (the "Series 2003B Bonds"), issued by the City in the original aggregate principal amount of $41,550,000. The proceeds of the Series 2003B Bonds were used to finance: (i) the construction and equipping of the Obligated Group's Heart and Vascular Center at Park Nicollet Methodist Hospital located at 6500 Excelsior Boulevard in the City, the construction of a parking ramp and other improvements at Park Nicollet Methodist Hospital, the construction of public infrastructure improvements with respect to the foregoing, and the acquisition and installation of equipment for Park Nicollet Methodist Hospital, and (ii) the acquisition and installation of a computed tomography scanner ("CT Scanner") at Park Nicollet Clinic, located at 14000 Fairview Drive in the City of Burnsville, Minnesota, a CT Scanner at Park Nicollet Clinic, located at 15800 95th Avenue North in the City of Maple Grove, Minnesota, and a CT Scanner and a magnetic resonance imaging scanner ("MRI Scanner") at Park Nicollet Clinic, located at 250 North Central Avenue in the City of Wayzata, Minnesota. WHEREAS, proceeds of the Series 2008B Bonds were loaned to the Obligated Group and applied by the Obligated Group to redeem and prepay the outstanding principal amount of the (i) Health Care Facilities Revenue Bonds (Park Nicollet Health Services), Series 2007B-1, issued by the City in the original aggregate principal amount of $56,595,000 (the "Series 2007B-1 Bonds"); and (ii) Health Care Facilities Revenue Bonds (Park Nicollet Health Services), Series 2007B-1, issued by the City in the original aggregate principal amount of $44,575,000 (the "Series 2007B-2 Bonds," and collectively with the Series 2007B-1 Bonds, the "Series 2007B Bonds"). Proceeds of the Series 2007B Bonds were loaned to the Obligated Group to finance the (i) acquisition, construction, and equipping of an approximately 82,000 square foot building to house the Obligated Group's Cancer Center and related facilities with approximately 31,000 square feet of the building reserved for future expansion, located at 6490 Excelsior Boulevard in the City, (ii) acquisition, construction, and equipping of a new parking ramp including approximately 1,700 parking stalls adjacent to the Cancer Center; (iii) redesign and renovation of the emergency center at Park Nicollet Methodist Hospital located at 6500 Excelsior Boulevard in the City; (iv) construction and equipping of a new common entrance to Park Nicollet Methodist Hospital, the Meadowbrook Building, and the new Cancer Center; and (v) acquisition, construction, and equipping of an approximately 69,000 square foot Eating Disorders Institute, including a parking ramp and surface lot with an estimated 220 parking stalls, located at 3525 Monterey Drive in the City. ' d 'z Resolution No. 09-158 -3- WHEREAS, the Obligated Group has requested that the City issue revenue bonds to be designated the Health Care Facilities Revenue Refunding Bonds (Park Nicollet Health Services), Series 2009 (the "Series 2009 Bonds"), in one or more series, subject to such changes in such designation as elected by the Obligated Group with the consent of the City, in an original aggregate principal amount not to exceed $215,000,000, to be issued as uninsured, fixed-rate revenue bonds of the City; and WHEREAS, Section 147(0 of the Internal Revenue Code of 1986, as amended (the "Code"), and regulations promulgated thereunder, requires that prior to the issuance of bonds, this Council approve the bonds after conducting a public hearing thereon preceded by publication of a notice of public hearing (in the form required by Section 147(0 of the Code and applicable regulations) in a newspaper of general circulation at least fourteen (14) days prior to the public hearing date; and WHEREAS, pursuant to the Code, a notice of public hearing in the form required by Section 147(0 of the Code was published in a newspaper of general circulation in the City at least fourteen days prior to the date hereof; and WHEREAS, on the date hereof, the City Council conducted a public hearing at which a reasonable opportunity was provided for interested individuals to express their views, both orally and in writing, on the proposed issuance of the Series 2009 Bonds; and WHEREAS, the proceeds of the Series 2009 Bonds are to be applied to the defeasance, redemption and prepayment of the Series 2008A Bonds and the Series 2008B Bonds (collectively, the "Prior Bonds"), funding required reserves, the payment of the costs of issuing the Series 2009 Bonds, payment of the costs of terminating one or more interest rate swap agreements related to the Prior Bonds, and the payment of certain other financing costs related to the issuance of the Series 2009 Bonds and the refunding of the Prior Bonds; and WHEREAS, in consideration of the loan by the City of the proceeds of the Series 2009 Bonds to the Obligated Group and to secure the payment of the principal of, premium, if any, and interest on the Series 2009 Bonds when due, the Obligated Group will issue and deliver to the City its Series 2009 Obligation pursuant to a Supplemental Indenture, dated on or after December 1, 2009, pursuant to a Master Trust Indenture, dated as of November 1, 2003, as amended (the "Master Indenture"), between the Obligated Group and the Trustee as Master Trustee, which will be in the same aggregate principal amount and bear interest at the same rates as the Series 2009 Bonds, will have redemption provisions corresponding to those of the Series 2009 Bonds, and will be payable in installments equal to the maturities and mandatory redemptions of the Series 2009 Bonds; and WHEREAS, the loan repayments required to be made by the Obligated Group under the terms of the Loan Agreement will be assigned to the Trustee under the terms of the Indenture and the Series 2009 Obligation will be assigned by the City to the Trustee under the terms of the Indenture; and Resolution No. 09-158 -4- WHEREAS, the Series 2009 Bonds and the interest and any premium on the Series 2009 Bonds: (i) shall be payable solely from the revenues pledged therefor; (ii) shall not constitute a debt of the City within the meaning of any constitutional or statutory limitation; (iii) shall not constitute nor give rise to a pecuniary liability of the City or a charge against its general credit or taxing powers; and (iv) shall not constitute a charge, lien, or encumbrance, legal or equitable, upon any property of the City other than the City's interest in the Loan Agreement and the Series 2009 Obligation. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ST. LOUIS PARK, MINNESOTA, AS FOLLOWS: 1. The City acknowledges, finds, determines, and declares that: (i) the issuance of the Series 2009 Bonds is authorized by the Act; (ii) the application of the proceeds of the Series 2009 Bonds to the defeasance, prepayment and redemption of the Prior Bonds, the funding of required reserves, the payment of the costs of issuing the Series 2009 Bonds, the payment of the costs of terminating one or more interest rate agreements related to the Prior Bonds, and the payment of certain other expenses incurred in connection with the issuance of the Series 2009 Bonds and the refunding of the Prior Bonds is consistent with and furthers the purposes of the Act; and (iii) the facilities refinanced with the proceeds of the Series 2009 Bonds constitute a "project" within the meaning of Section 469.153, subdivisions 2(b) and (d), of the Act. 2. For the purposes set forth above, there is hereby authorized the issuance, sale and delivery of the Series 2009 Bonds in one or more series in the maximum principal amount not to exceed $215,000,000. The Series 2009 Bonds shall bear interest at fixed rates and shall be designated, shall be numbered, shall be dated, shall mature, shall be subject to redemption prior to maturity, shall be in such form, and shall have such other terms, details, and provisions as are prescribed in the Indenture, in the form now on file with the City, with the amendments referenced herein. The City hereby authorizes the Series 2009 Bonds to be issued as "tax-exempt bonds," the interest on which is not includable in gross income for federal and State of Minnesota income tax purposes. All of the provisions of the Series 2009 Bonds, when executed as authorized herein, shall be deemed to be a part of this resolution as fully and to the same extent as if incorporated verbatim herein and shall be in full force and effect from the date of execution and delivery thereof. The Series 2009 Bonds shall be substantially in the form set forth in the Indenture, which form is hereby approved, with such necessary and appropriate variations, omissions and insertions (including changes to the name of the Series 2009 Bonds, the aggregate principal amount of the Series 2009 Bonds, the stated maturities of the Series 2009 Bonds and the maturity dates of the Series 2009 Bonds, the interest rates on the Series 2009 Bonds, and the terms of optional and mandatory redemption of the Series 2009 Bonds) as the Mayor of the City and the City Manager of the City (the "Mayor" and "City Manager"), in their discretion, shall determine. The execution of the Series 2009 Bonds with the manual or facsimile signatures of the Mayor and the City Manager and the delivery of the Series 2009 Bonds by the City shall be conclusive evidence of such determination 3. The Series 2009 Bonds: (i) shall be special limited obligations of the City, (ii) shall be payable solely from the revenues pledged therefor; (iii) shall not constitute a debt of the City V Resolution No. 09-158 -5- t within the meaning of any constitutional or statutory limitation; (iv) shall not constitute nor give rise to a pecuniary liability of the City or a charge against its general credit or taxing powers; and (v) shall not constitute a charge, lien, or encumbrance, legal or equitable, upon any property of the City other than the City's interest in the Loan Agreement and the Series 2009 Obligation. The proceeds of the Series 2009 Bonds shall be disbursed pursuant to the terms of the Indenture and the Loan Agreement, and the principal, premium, and interest on the Series 2009 Bonds shall be payable solely from the proceeds of the Series 2009 Bonds, the revenues derived from the Obligated Group pursuant to the terms of the Loan Agreement and the Series 2009 Obligation, and other funds pledged pursuant to the Indenture. The Series 2009 Bonds shall also be secured by the Bond Reserve Fund established by the terms of the Indenture and funded with a portion of the proceeds of the Series 2009 Bonds (the "Bond Reserve Fund"). 4. The City Council of the City hereby authorizes and directs the Mayor and the City Manager to execute and deliver the Indenture, and to deliver to the Trustee the Indenture, and hereby authorizes and directs the execution of the Series 2009 Bonds in accordance with the terms of the Indenture, and hereby provides that the Indenture shall provide the terms and conditions, covenants, rights, obligations, duties and agreements of the owners of the Series 2009 Bonds, the City and the Trustee as set forth therein. All of the provisions of the Indenture, when executed as authorized herein, shall be deemed to be a part of this resolution as fully and to the same extent as if incorporated verbatim herein and shall be in full force and effect from the date of execution and delivery thereof. The Indenture shall be substantially in the form on file with the City, which is hereby approved, with such necessary and appropriate variations, omissions and insertions as do not materially change the substance thereof, or as the Mayor and the City Manager, in their discretion, shall determine, and the execution and delivery thereof by the Mayor and the City Manager shall be conclusive evidence of such determination. 5. The Mayor and City Manager are hereby authorized and directed to execute and deliver the Loan Agreement, the Purchase Contract, dated on or after December 1, 2009 (the "Purchase Contract"), between Wells Fargo Brokerage Services, LLC and Morgan Stanley & Co. Incorporated (the "Underwriters") and the City, and the Letter of Representations and Indemnification, dated on or after December 1, 2009 (the "Letter of Representations"), between the City, the Underwriters, and the Obligated Group. All of the provisions of the Loan Agreement, the Purchase Contract, and the Letter of Representations, when executed and delivered as authorized herein, shall be deemed to be a part of this resolution as fully and to the same extent as if incorporated verbatim herein and shall be in full force and effect from the date of execution and delivery thereof. The Loan Agreement, the Purchase Contract, and the Letter of Representations shall be substantially in the forms on file with the City which are hereby approved, with such omissions and insertions as do not materially change the substance thereof, or as the Mayor and the City Manager, in their discretion, shall determine, and the execution thereof by the Mayor and the City Manager shall be conclusive evidence of such determination 6. The Trustee is hereby appointed as the initial Bond Registrar with respect to the Series 2009 Bonds. Resolution No. 09-158 -6- 7. The Mayor and City Manager of the City are hereby authorized to execute and deliver, on behalf of the City, such other documents as are necessary or appropriate in connection with the issuance, sale, and delivery of the Series 2009 Bonds, including one or more certificates of the City, an endorsement to the Obligated Group's Tax Certificate, an Information Return for Tax - Exempt Private Activity Bond Issues, IRS Form 8038, and all other documents and certificates as shall be necessary and appropriate in connection with the issuance, sale, and delivery of the Series 2009 Bonds. The City hereby approves the execution and delivery by the Trustee of the Indenture, the Tax Exemption Agreement, dated on or after December 1, 2009, between the Trustee and the Obligated Group, the Continuing Disclosure Agreement, dated on or after December 1, 2009 (the "Continuing Disclosure Agreement"), between the Obligated Group and the Trustee, and all other instruments, certificates, and documents prepared in conjunction with the issuance of the Series 2009 Bonds that require execution by the Trustee. The City hereby authorizes Kennedy & Graven, Chartered, as bond counsel of the City, to prepare, execute, and deliver its approving legal opinion with respect to the Series 2009 Bonds. 8. The City has not participated and will not participate in the preparation of the Preliminary Official Statement or the Official Statement relating to the offer and sale of the Series 2009 Bonds (collectively, the "Official Statement") except for information regarding the City to be set forth in the Official Statement under captions entitled "The City" and "Litigation—The City" (collectively, the "City Information"). The City has not made and will not make any independent investigation with respect to the information contained in the Official Statement (except for the City Information), including the appendices thereto, and the City assumes no responsibility for the sufficiency, accuracy, or completeness of such information. Subject to the foregoing, the Ciry hereby consents to the distribution and the use by the Underwriters in connection with the offer and sale of the Series 2009 Bonds of the Official Statement, substantially in the form on file with the City. The Official Statement is the sole material consented to by the City for use in connection with the offer and sale of the Series 2009 Bonds. The City hereby approves the Continuing Disclosure Agreement to be executed and delivered by the Obligated Group and the Trustee, in the form now on file with the City. 9. Except as otherwise provided in this resolution, all rights, powers and privileges conferred and duties and liabilities imposed upon the City or the City Council by the provisions of this resolution or of the aforementioned documents shall be exercised or performed by the City or by such members of the City Council, or such officers, board, body or agency thereof as may be required or authorized by law to exercise such powers and to perform such duties No covenant, stipulation, obligation or agreement herein contained or contained in the aforementioned documents shall be deemed to be a covenant, stipulation, obligation or agreement of any member of the City Council of the City, or any officer, agent or employee of the City in that person's individual capacity, and neither the City Council of the City nor any officer or employee executing the Series 2009 Bonds shall be liable personally on the Series 2009 Bonds or be subject to any personal liability or accountability by reason of the issuance thereof. No provision, covenant or agreement contained in the aforementioned documents, the Series 2009 Bonds or in any other document relating to the Series 2009 Bonds, and no obligation Resolution No. 09-158 -7- therein or herein imposed upon the City or the breach thereof, shall constitute or give rise to any pecuniary liability of the City or any charge upon its general credit or taxing powers. In making the agreements, provisions, covenants and representations set forth in such documents, the City has not obligated itself to pay or remit any funds or revenues, other than funds and revenues derived from the Loan Agreement and the Series 2009 Obligation which are to be applied to the payment of the Series 2009 Bonds, as provided therein and in the Indenture. 10. Except as herein otherwise expressly provided, nothing in this resolution or in the aforementioned documents expressed or implied is intended or shall be construed to confer upon any person or firm or corporation, other than the City or any holder of the Series 2009 Bonds issued under the provisions of this resolution, any right, remedy or claim, legal or equitable, under and by reason of this resolution or any provisions hereof, this resolution, the aforementioned documents and all of their provisions being intended to be and being for the sole and exclusive benefit of the City and any holder from time to time of the Series 2009 Bonds issued under the provisions of this resolution. 11. In case any one or more of the provisions of this resolution, other than the provisions contained in the first sentence of Section 3 hereof, or of the aforementioned documents, or of the Series 2009 Bonds issued hereunder shall for any reason be held to be illegal or invalid, such illegality or invalidity shall not affect any other provision of this resolution, or of the aforementioned documents, or of the Series 2009 Bonds, but this resolution, the aforementioned documents, and the Series 2009 Bonds shall be construed and endorsed as if such illegal or invalid provisions had not been contained therein. 12. The Series 2009 Bonds, when executed and delivered, shall contain a recital that they are issued pursuant to the Act, and such recital shall be conclusive evidence of the validity of the Series 2009 Bonds and the regularity of the issuance thereof, and that all acts, conditions, and things required by the laws of the State of Minnesota relating to the adoption of this resolution, to the issuance of the Series 2009 Bonds, and to the execution of the aforementioned documents to happen, exist and be performed precedent to the execution of the aforementioned documents have happened, exist and have been performed as so required by law. 13. The officers of the City, bond counsel, other attorneys, engineers, and other agents or employees of the City are hereby authorized to do all acts and things required of them by or in connection with this resolution, the aforementioned documents, and the Series 2009 Bonds for the full, punctual and complete performance of all the terms, covenants and agreements contained in the Series 2009 Bonds, the aforementioned documents and this resolution. In the event that for any reason the Mayor of the City is unable to carry out the execution of any of the documents or other acts provided herein, any persons delegated the duties of the Mayor shall be authorized to act in the capacity of the Mayor and undertake such execution or acts on behalf of the City with full force and effect, which execution or acts shall be valid and binding on the City. If for any reason the City Manager of the City is unable to execute and deliver the documents referred to in this Resolution, such documents may be executed by any person delegated the duties of the City Manager, with the same force and effect as if such documents were executed and delivered by the City Manager of the City. Resolution No. 09-158 -8- 14. The City understands that the Obligated Group will pay directly or through the City any and all costs paid or incurred by the City in connection with the transactions authorized by this resolution, whether or not the Series 2009 Bonds are issued. 15. This resolution shall be in full force and effect from and after its passage. Revi- e• for Administration: City M.aV. er Attest: Adopted by the City Council November 16, 2009