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HomeMy WebLinkAbout10-066 - ADMIN Resolution - City Council - 2010/06/21RESOLUTION NO. 10-066 AUTHORIZING THE ISSUANCE AND SALE OF EDUCATIONAL FACILITY REVENUE BONDS (GROVES ACADEMY PROJECT), SERIES 2010, IN THE ORIGINAL AGGREGATE PRINCIPAL AMOUNT OF $4,590,000; APPROVING THE FORM OF AND AUTHORIZING THE EXECUTION AND DELIVERY OF THE BONDS AND CERTAIN RELATED DOCUMENTS; AND PROVIDING FOR THE SECURITY, RIGHTS, AND REMEDIES WITH RESPECT TO THE 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 Constitution and laws of the State of Minnesota, particularly Minnesota Statutes, Sections 469.152-469-165, as amended (the "Act"), the City is authorized to carry out the public purposes described therein and contemplated thereby by issuing its revenue bonds or other obligations to make a loan to finance or refinance a revenue producing enterprise, including the financing of the costs of the construction of an expansion to and remodeling of an existing educational facility; and WHEREAS, the City received a request from Groves Academy, a Minnesota nonprofit corporation (the `Borrower"), that the City issue its Educational Facility Revenue Bonds (Groves Academy Project), Series 2010 (the "Bonds), in an original, aggregate principal amount not to exceed $4,590,000, and loan the proceeds derived from the sale of the Bonds to the Borrower, and WHEREAS, the proceeds of the loan are proposed to be applied by the Borrower to (i) the redemption and prepayment of the outstanding principal amount of the Educational Facility Revenue Notes (Groves Academy Project), Series 2009 (the "Notes"), issued by the City in the original aggregate principal amount of $3,500,000, to finance the first phase of the renovation, expansion, and improvement of its independent co-educational day school located at 3200 Highway 100 South in the City (the "Facility"); (ii) finance the second phase of the renovation, expansion, and improvement of the Facility (the "Project"); and (ii) pay a portion of the costs of issuance of the Bonds and other related expenses of the Borrower; and WHEREAS, the City has prepared an Application to the Minnesota Department of Employment and Economic Development for approval of the Project pursuant to the requirements of Section 469.154 of the Act; and WHEREAS, a notice of a public hearing (in which a general, functional description of the Project was provided, as well as the maximum aggregate face amount of the obligations to be issued with respect to the Project, the identity of the initial owner, operator, or manager of the Project, and the location of the Project by street address) was published in a newspaper circulating generally in the City at least fifteen (15) days before the regularly -scheduled meeting of the City Council of the City on June 7, 2010; and Resolution No. 10-066 -2- WHEREAS, on June 7, 2010, 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 Bonds, and the location and nature of the Project; and WHEREAS, Wells Fargo Securities, LLC (the "Lender") has agreed to purchase the Bonds in a manner consistent with the policies of the City relating to the issuance and sale of non -rated conduit revenue bonds; and WHEREAS, the proceeds derived from the sale of the Bonds are proposed to be loaned to the Borrower under the terms of a Loan Agreement, dated on or after June 1, 2010 (the "Loan Agreement"), between the City and the Borrower, and applied by the Borrower, together with other funds of the Borrower, to redeem and prepay the Notes, to finance the Project, and to pay certain costs of issuing the Bonds; and WHEREAS, the loan repayments required to be made by the Borrower under the terms of the Loan Agreement will be assigned to the Lenders under the terms of an Assignment of Loan Agreement, dated on or after June 1, 2010 (the "Assignment"), between the City, the Borrower, and the Lender; and WHEREAS, the obligations of the Borrower under the terms of the Loan Agreement will be disbursed by the Lender to the Borrower pursuant to the terms of an Escrow and Disbursing Agreement, dated on or after June 1, 2010 (the "Disbursing Agreement"), between the Borrower and the Lender, and the obligations of the Borrower under the terms of the Loan Agreement and the Assignment will be secured by a Combination Mortgage, Security Agreement, and Fixture Financing Statement, dated on or after June 1, 2010 (the "Mortgage"), from the Borrower in favor of the Lender; and WHEREAS, the Bonds and the interest on the Notes: (i) shall not constitute general or moral obligations of the City and 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 Project and the Loan Agreement. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ST. LOUIS PARK, MINNESOTA, AS FOLLOWS: 1. For the purpose of redeeming and prepaying the Notes, financing the Project, and paying a portion of the costs of issuing the Bonds, there is hereby authorized the issuance of the Bonds in the original aggregate principal amount not to exceed $4,590,000. The Bonds shall bear interest at such rates, shall be in such denomination, 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 details and provisions as are prescribed by the form of the Bonds on file with the City on the date hereof. • • Resolution No. 10-066 -3- The Bonds shall be special limited obligations of the City payable solely from revenues of the Facility, in the manner provided in this resolution and the Loan Agreement. The Bonds do not constitute general or moral obligations of the Issuer, or a pledge of the faith and credit or any taxing power of the City, the State of Minnesota, or any political subdivision thereof. The City hereby authorizes and directs the Mayor of the City (the "Mayor") and the City Manager of the City (the "City Manager") to execute the Bonds, and to deliver the Bonds to the Lender, and hereby authorizes and directs the execution of the Bonds in accordance with its terms and the terms of this resolution The Mayor is hereby authorized to approve the interest rate or rates on the Bonds, approve changes to the maturity schedules, optional and mandatory redemption terms, mandatory sinking fund payment schedules, and other terms and provisions of the Bonds; provided that the maturity date for the Bonds shall not be later than the date set forth in the form of the Bonds on file with the City on the date hereof. The Bonds shall contain a recital that they are issued pursuant to the Act, and such recital shall be conclusive evidence of the validity of the 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 Bonds, and to the execution of the aforementioned documents have happened, exist, and have been performed as so required by law 2. The proceeds derived from the sale of the Bonds shall be loaned by the City to the Borrower pursuant to the Loan Agreement and shall be disbursed by the Lender to the Borrower pursuant to the terms of the Disbursing Agreement. The loan repayments to be made by the Borrower under the Loan Agreement are to be fixed so as to produce revenues sufficient to pay the principal of, premium, if any, and interest on the Bonds when due. The loan made pursuant to the Loan Agreement (the "Loan"), and the City's rights to the Loan repayments and certain other rights under the Loan Agreement shall be assigned to the Lender as security for payment of the Bonds pursuant to the terms of the Assignment. The Bonds, the Loan Agreement, and the Assignment shall be substantially in the forms on file with the City on the date hereof, and are hereby approved, with such necessary and appropriate variations, omissions, and insertions as do not materially change the substance thereof, or as the Mayor and City Manager, in their discretion, shall determine, and the execution and delivery thereof by the Mayor and City Manager shall be conclusive evidence of such determination. The Bonds, the Loan Agreement, and the Assignment are directed to be executed in the name and on behalf of the City by the Mayor and the City Manager. 3. The offer of the Lender to purchase the Bonds at a price of par is hereby accepted Upon approval by the Minnesota Department of Employment and Economic Development, the Mayor and the City Manager are authorized and directed to prepare and execute the Bonds and deliver the Bonds to the Lender. 4. The City has not participated in the preparation of any disclosure documents relating to the offer and sale of the Bonds and has made no independent investigation with respect to the information contained in any such disclosure documents. The City assumes no responsibility for the sufficiency, accuracy, or completeness of any information set forth in any such disclosure documents. Resolution No. 10-066 -4- 5. The Mayor, the City Manager, and other officers of the City are authorized and directed to prepare and furnish to the Lender and to Bond Counsel certified copies of all proceedings and records of the City relating to the Bonds, and such other affidavits and certificates as may be required to show the facts relating to the legality of the Bonds as such facts appear from the books and records in the officers' custody and control or as otherwise known to them; and all such certified copies, certificates and affidavits, including any heretofore furnished, shall constitute representations of the City as to the truth of all statements contained therein. 6. The approval hereby given to the various documents referred to above includes approval of such additional details therein as may be necessary and appropriate and such modifications thereof, deletions therefrom, and additions thereto as may be necessary and appropriate and approved by the officials authorized herein to execute said documents, which approval shall be conclusively evidenced by the execution thereof. The Mayor, the City Manager, and other officers of the City are hereby authorized to execute and deliver, on behalf of the City, all other certificates, instruments, and other written documents that may be requested by Bond Counsel, the Lender, or other persons or entities in conjunction with the issuance of the Bonds and the expenditure of the proceeds of the Bonds Without imposing any limitations on the scope of the preceding sentence, such officers are specifically authorized to execute and deliver a certificate relating to federal tax matters including matters relating to arbitrage and arbitrage rebate, a receipt for the proceeds derived from the sale of the Bonds, a general certificate of the City, and an Information Return for Tax -Exempt Private Activity Bonds Issues, Form 8038 (Rev. September 2007) . 7. All covenants, stipulations, obligations, representations, and agreements of the City contained in this resolution or contained in the Loan Agreement, Assignment, or other documents referred to above shall be deemed to be the covenants, stipulations, obligations, representatives, and agreements of the City to the full extent authorized or permitted by law, and all such covenants, stipulations, obligations, representations, and agreements shall be binding upon the City. Except as otherwise provided in this resolution, all rights, powers, and privileges conferred, and duties and liabilities imposed, upon the City by the provisions of this resolution or of the respective Loan Agreement, Assignment, or other documents referred to above shall be exercised or performed by the City, or by such officers, board, body, or agency as may be required or authorized by law to exercise such powers and to perform such duties. No covenant, stipulation, obligation, representation, or agreement herein contained or contained in the Loan Agreement, Assignment, or other documents referred to above shall be deemed to be a covenant, stipulation, obligation, representation, or agreement of any elected official, officer, agent, or employee of the City in that person's individual capacity, and neither the members of the City Council nor any officer or employee executing the Bonds shall be liable personally on the Bonds or be subject to any personal liability or accountability by reason of the issuance thereof. 8. Except as herein otherwise expressly provided, nothing in this resolution or in the Loan Agreement, expressed or implied, is intended or shall be construed to confer upon any person, firm, or corporation other than the City and the registered and beneficial owners of the Bonds, any right, remedy, or claim, legal or equitable, under and by reason of this resolution or any provision hereof or of the Loan Agreement or any provision thereof; this resolution, the Loan Agreement and all of their provisions being intended to be, and being for the sole and exclusive benefit of the City • • • Resolution No. 10-066 -5- and the registered and beneficial owners of the Bonds issued under the provisions of this resolution and the Loan Agreement, and the Borrower to the extent expressly provided in the Loan Agreement. 9. In case any one or more of the provisions of this resolution, or of the documents mentioned herein, or of the 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 Bonds, but this resolution, the aforementioned documents, and the Bonds shall be construed and endorsed as if such illegal or invalid provisions had not been contained therein. 10. 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 Bonds, and to the execution of the Loan Agreement, the Assignment, and the other documents referred to above to happen, exist, and be performed precedent to and in the enactment of this resolution, and precedent to the issuance of the Bonds, and precedent to the execution of the Loan Agreement, the Assignment, and the other documents referred to above have happened, exist, and have been performed as so required by law. 11. The members of the City Council, officers of the City, and attorneys and other agents or employees of the City are hereby authorized to do all acts and things required by them by or in connection with this resolution and the Loan Agreement and the other documents referred to above for the full, punctual, and complete performance of all the terms, covenants, and agreements contained in the Bonds, the Loan Agreement, the Assignment, and the other documents referred to above, and this resolution. 12. If for any reason the Mayor is unable to execute and deliver those documents referred to in this resolution, any other member of the City Council, or any officer of the City duly delegated to act on behalf of the Mayor, may execute and deliver such documents with the same force and effect as if such documents were executed by the Mayor. If for any reason the City Manager is unable to execute and deliver the documents referred to in this resolution, such documents may be executed and delivered by any member of the City Council, any officer of the City duly delegated to act on behalf of the City Manager, with the same force and effect as if such documents were executed and delivered by the City Manager. 13. The Bonds are to be designated as a "qualified tax-exempt obligations" by the Borrower for purposes of Section 265(6)(3) of the Internal Revenue Code of 1986, as amended, and such designation by the Borrower is approved by the City 14. This resolution shall be in full force and effect from and after its passage. (The remainder of this page is intentionally left blank.) Resolution No. 10-066 -6- Adopted by the City Council of the City of St. Louis Park, Minnesota, on June 21, 2010. Rev -wed f. r Administration City Attest. City Clerk 0 Adopted by the City Council June 21, 2009 Mayor OeeAl