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HomeMy WebLinkAboutResolution - 2001-25 - Issuance of Multi-Family Housing Revenue Refunding Bonds (Eden Glen Apartments Project) Series 2001 - 01/16/2001 CITY OF EDEN PRAIRIE HENNEPIN COUNTY,NIINNESOTA RESOLUTION NO.2001-25 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF EDEN PRAIRIE, MINNESOTA, AUTHORIZING THE ISSUANCE, SALE AND DELIVERY OF THE CITY OF EDEN PRAIRIE'S MULTIFAMILY HOUSING REVENUE REFUNDING BONDS (EDEN GLEN APARTMENTS PROJECT) SERIES 2001 (THE `BONDS"), WHICH BONDS AND THE INTEREST AND ANY PREMIUM THEREON SHALL BE PAYABLE SOLELY FROM REVENUES PLEDGED THERETO; APPROVING THE FORM OF AND AUTHORIZING THE EXECUTION AND DELIVERY OF A TRUST INDENTURE, A FINANCING AGREEMENT, A REMARKETING AGREEMENT, A TAX REGULATORY AGREEMENT, AN ASSIGNMENT AND INTERCREDITOR AGREEMENT AND VARIOUS OTHER MORTGAGE RELATED DOCUMENTS, AND A BOND PURCHASE AGREEMENT; APPROVING THE USE OF AN OFFERING CIRCULAR; APPROVING THE FORM OF AND AUTHORIZING THE EXECUTION AND DELIVERY OF THE BONDS; AND PROVIDING FOR THE SECURITY, RIGHTS AND REMEDIES OF THE OWNERS OF THE BONDS. WHEREAS, the City of Eden Prairie, Minnesota (the "Issuer"), is a statutory city and political subdivision of the State of Minnesota; and WHEREAS, the Issuer has previously issued its $2,715,000 City of Eden Prairie, Minnesota, Multifamily Housing Revenue Refunding Bonds (Eden Investments Partnership Project) Series 1990 (the "Prior Bonds"), the proceeds of which were used to refund the $2,750,000 City of Eden Prairie, Minnesota, Housing Development Revenue Note (Eden Investments Partnership Project) Series 1984 (the "Original Note"), the proceeds of which were used to finance the acquisition, construction and equipping of a 70-unit multifamily rental housing development, known as Eden Glen Apartments, located in Eden Prairie, Minnesota(the "Project"); and WHEREAS,pursuant to the Constitution and laws of the State of Minnesota,particularly Minnesota Statutes, chapter 462C, as amended (the "Act"), the Issuer is authorized to carry out the public purposes described therein and contemplated thereby by issuing its revenue refunding bonds to refund all or a portion of the Prior Bonds; and WHEREAS, the Issuer intends to issue its Multifamily Housing Revenue Refunding Bonds (Eden Glen Apartments Project) Series 2001 in an aggregate principal amount not to exceed $2,490,000 (the "Refunding Bonds") to make a mortgage loan (the "Loan") to Eden Investments, LLP, a Minnesota limited liability partnership (the 'Borrower"), the proceeds of which will be used to pay and redeem the outstanding principal amount of the Prior Bonds pursuant to the provisions of the Act; and 1 WHEREAS, the Loan will be evidenced by a Multifamily Note (the "Note") payable to the Issuer and secured by a Multifamily Mortgage, Assignment of Rents, Security Agreement and Fixture Financing Statement(the"Mortgage'); and WHEREAS, Fannie Mae has agreed to facilitate the refinancing of the Project by providing credit enhancement and liquidity support for the Bonds; and WHEREAS,the Note and the Mortgage will be assigned by the Issuer to U.S.Bank Trust National Association, a national banking association (the "Trustee") and Fannie Mae ("Fannie Mae"), a corporation organized and existing under the Federal National Mortgage Association Charter Act, 12 U.S.C. § 1716 et seq., as amended, as their interests may appear, pursuant to the terms and conditions of an Assignment and Intercreditor Agreement and an Assignment of the Mortgage(collectively,the"Assignment"); and WHEREAS, pursuant to the requirements of the Internal Revenue Code of 1986, as amended, the City Council of the Issuer conducted a public hearing on January 16, 2001, on the issuance of the Bonds to refund the Prior Bonds, after publication of a Notice of Public Hearing in a newspaper of general circulation in the City of Eden Prairie; and WHEREAS, the Loan will be made pursuant to the terms of a Financing Agreement dated as of January 1, 2001 (the "Financing Agreement") by and among the Issuer, the Trustee, and the Borrower; and WHEREAS, the Issuer purposes to finance the refunding and redemption of the Prior Bonds under the Act by the issuance of the Bonds of the Issuer under this resolution and a Trust Indenture dated as of January 1, 2001 (the "Indenture") by and between the Issuer and the Trustee; and WHEREAS, the Bonds are to be secured by the Indenture, and a pledge and assignment of certain other revenues, all in accordance with the terms of the Indenture, and the Bonds and the interest on the Bonds shall be payable solely from the revenues pledged therefor and the Bonds shall not constitute a debt of the Issuer, within the meaning of any constitutional or statutory limitation or constitute or give rise to a pecuniary liability of the Issuer or a charge against its general credit or taxing powers and shall not constitute a charge, lien, or encumbrance, legal or equitable, upon any property of the Issuer other than the Issuer's interest in the Financing Agreement; and WHEREAS, forms of the following documents relating to the Bonds (the `Bond Documents")have been submitted to the Issuer and are now on file in the office of the Issuer: a. Financing Agreement whereby the Issuer agrees to make a loan to the Borrower of the gross proceeds of sale of the Bonds and the Borrower agrees, subject to the terms and provisions thereof, to cause the refunding of the Prior Bonds, and to pay amounts in repayment of the Loan sufficient to provide for the full and prompt payment of the principal of,premium,if any, and interest on the Bonds; 2 b. Indenture, authorizing the issuance of the Bonds and pledging certain revenues,including those to be derived from the Financing Agreement, as security for the Bonds, and setting forth proposed recitals, covenants and agreements relating thereto; C. Multifamily Note (the "Note") dated as of January 1, 2001, from the Borrower to the Issuer, further evidencing the obligations of the Borrower under the Financing Agreement; d. Multifamily Mortgage, Assignment of Rents, Security Agreement and Fixture Financing Statement (the "Mortgage") dated as of January 1, 2001, from the Borrower to the Issuer securing repayment of the Note; e. Assignment and Intercreditor Agreement dated as of January 1, 2001, among the Issuer,the Trustee,Fannie Mae, and the Borrower; f. Assignment of the Mortgage dated as of January 1, 2001, from the Issuer to the Trustee and Fannie Mae, as their interests may appear; g. Tax Regulatory Agreement (the "Regulatory Agreement"), dated as of January 1,2001,by and among the Issuer,the Trustee and the Borrower; h. Bond Purchase Agreement (the `Bond Purchase Agreement"), by and among the Issuer, the Borrower, and U.S. Bancorp Piper Jaffray Inc. (the `Underwriter"), providing for the purchase of the Bonds from the Issuer by the Underwriter and setting the terms and conditions of purchase; i. Remarketing Agreement (the "Remarketing Agreement") by and between the Underwriter as Remarketing Agent and the Borrower; and j. Offering Circular (the "Offering Circular") pursuant to which the Bonds will be offered. WHEREAS, the documents listed in paragraphs c and d above are referred to herein as the "Mortgage Documents," the documents listed in paragraphs e and f above are referred to herein as the "Assignment Documents," and the documents referred to in paragraphs a, b, g,h, i, and j are referred to herein as the`Bond Documents;" WHEREAS, the Issuer is duly authorized under the Constitution and laws of the State, including the Act, to (i) issue the Bonds, (ii) execute and deliver the Bond Documents and the Assignment Documents and to endorse the Note, (iii) assign its interest in the Financing Agreement (except the Reserved Rights, as defined therein) and (iv) pledge and assign the Trust Estate as set forth in the Indenture for the benefit of(A) the Bondholders, to secure the payment of the principal of and interest and any premium on the Bonds in accordance with the terms and provisions of this Indenture and the Bonds and (B) the Credit Provider to secure the payment of 3 all amounts owing to the Credit Provider under the Credit Facility Documents (as such terms are defined in the Indenture); WHEREAS, all actions on the part of the Issuer for the issuance, sale and delivery of the Bonds and for the execution and delivery of the Bond Documents, the Assignment Documents and the endorsement of the Note have been or will be taken duly and effectively. WHEREAS, the Bonds, when duly executed and delivered by the Issuer, and upon authentication by the Trustee, will constitute legal, valid and binding special limited obligations of the Issuer, enforceable against the Issuer in accordance with their terms, subject to bankruptcy, insolvency,reorganization,moratorium and other similar laws affecting the rights of creditors generally and general principles of equity. WHEREAS, the Issuer has the full legal right,power and authority to execute and deliver the Bond Documents, the Assignment Documents and the endorsement of the Note, and to carry out its obligations under each of those documents. WHEREAS, neither the execution and delivery of, nor the fulfillment of or compliance with the terms or conditions of, the Bond Documents, the Assignment Documents and the endorsement of the Note violates the constitution or laws of the State or any judgment, order, writ, injunction or decree to which the Issuer is subject, or conflicts in any material respect with, or results in a material breach of, or material default under, any agreement or instrument to which the Issuer is now a party or by which it is bound. WHEREAS, except as otherwise provided in the Indenture and the Assignment, the Issuer has not created any debt, lien or charge upon the Trust Estate, and has not made any pledge or assignment of or created any encumbrance on the Trust Estate. WHEREAS, no litigation or administrative action of any nature is pending against the Issuer (i) seeking to restrain or enjoin the issuance of the Bonds or the execution and delivery of the Bond Documents, the Assignment Documents or the endorsement of the Note, (ii) questioning the proceedings or authority relating to the Bonds or any other Issuer Document or (iii) questioning the existence or authority of the Issuer or that of its present or former members or officers and,to the best knowledge of the Issuer,none of the foregoing is threatened. NOW, THEREFORE,BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF EDEN PRAIRIE,NM NESOTA,AS FOLLOWS: 1. The Issuer acknowledges, finds, determines, and declares that the refunding of the Prior Bonds,the proceeds of which were used to refund the Original Note,the proceeds of which were used to construct the Project,fiarthers the purposes of the Act. 2. For the purposes set forth above, there is hereby authorized the issuance, sale and delivery of the Bonds in a principal amount not to exceed $2,490,000. The Bonds shall be numbered, shall be dated, shall bear interest, shall mature, shall be subject to redemption prior to 4 maturity, shall be in such form, and shall have such other details and provisions as are prescribed in the Indenture in the form approved by the Issuer in this resolution. 3. The Bonds shall be special obligations of the Issuer payable solely from the revenues provided pursuant to the Financing Agreement and the Note and other funds pledged pursuant to the Indenture. The City Council of the Issuer hereby authorizes and directs the Mayor and the City Manager of the Issuer (together, the "Officials") to execute and deliver the Indenture and to deliver to said Trustee the Indenture, and hereby authorizes and directs the execution of the Bonds in accordance with the Indenture, and hereby provides that the terms and conditions, covenants, rights, obligations, duties and agreements of the bondowners, the Issuer and the Trustee shall be as set forth in the Indenture. All of the provisions of the Indenture,when executed as authorized herein, 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 Issuer, with such necessary and appropriate variations, omissions and insertions as do not materially change the substance thereof, or as the City Manager, in his discretion, shall determine, and the execution thereof by the City Manager shall be conclusive evidence of such determination. 4. The Bond Documents, the Mortgage Documents, and the Assignment Documents are hereby approved substantially in the form on file with the Issuer, with such necessary and appropriate variations, omissions and insertions as do not materially change the substance thereof, or as the City Manager, in his discretion, shall approve or determine, and the execution of the Bond Documents and the Assignment Documents and endorsement of the Note by the City Manager shall be conclusive evidence of such determination. The Officials are hereby authorized and directed to execute and deliver the Bond Documents and Assignment Documents and to endorse the Note,without recourse,to the order of the Trustee and Fannie Mae. All of the provisions of the Bond Documents, the endorsement of the Note, and the provisions of the Assignment Documents, when executed and delivered as authorized herein, shall be in full force and effect from the date of execution and delivery thereof. 5. The proceeds of the Bonds shall be disbursed pursuant to the Indenture and the Financing Agreement. 6. The Trustee is hereby appointed as Tender Agent for the Bonds. The Underwriter is hereby approved as Remarketing Agent for the Bonds. 7. The Officials are hereby authorized to execute and deliver, on behalf of the Issuer, such other documents as are necessary or appropriate in connection with the issuance, sale, and delivery of the Bonds, including an arbitrage certificate, and all other documents and certificates as shall be necessary and appropriate in connection with the issuance, sale and delivery of the Bonds. 8. The Issuer has not participated in the preparation of the Offering Circular and has made no independent investigation with respect to the information contained therein, including any appendices thereto, and the Issuer assumes no responsibility for the sufficiency, accuracy or 5 completeness of such information. Subject to the foregoing, the Issuer hereby consents to the distribution of the Offering Circular in connection with the sale of the Bonds. 9. All covenants, stipulations, obligations and agreements of the Issuer contained in this resolution and the aforementioned documents shall be deemed to be the covenants, stipulations, obligations and agreements of the Issuer to the full extent authorized or permitted by law, and all such covenants, stipulations, obligations and agreements shall be binding upon the Issuer. Except as otherwise provided in this resolution, all rights, powers and privileges conferred and duties and liabilities imposed upon the Issuer by the provisions of this resolution or the aforementioned documents shall be exercised or performed by 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 covenants, 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 Issuer, or any officer, agent or employee of the Issuer in that person's individual capacity, and neither the City Council of the Issuer 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 hereof. No provision, covenant or agreement contained in the aforementioned documents, the Bonds or in any other document related to the Bonds, and no obligation therein or herein imposed upon the Issuer or the breach thereof, shall constitute or give rise to any pecuniary liability of the Issuer or any charge upon its general credit or taxing powers. In making the agreements,provisions, covenants and representations set forth in such documents,the Issuer has obligated itself to pay or remit any funds or revenues, other than funds and revenues derived from the Financing Agreement which are to be applied to the payment of the Bonds, as provided therein and in the Indenture. The Bonds shall contain the following recital: THIS BOND, THE INTEREST THEREON, AND ANY PENALTY, CHARGE, OR PREMIUM OR ANY AMOUNTS PAYABLE HEREUNDER, OR HOWEVER DESIGNATED IS A SPECIAL LIMITED OBLIGATION OF THE ISSUER, PAYABLE SOLELY FROM THE REVENUES AND PROCEEDS PLEDGED THERETO. THIS BOND AND THE INTEREST THEREON DOES NOT CONSTITUTE OR GIVE RISE TO A PECUNIARY LIABILITY, GENERAL OR MORAL OBLIGATION OR A PLEDGE OF THE FULL FAITH AND CREDIT OR TAXING POWER OF THE ISSUER, THE STATE OF MESTNESOTA., OR ANY POLITICAL SUBDIVISION OF THE STATE OF MINNESOTA WITHIN THE MEANING OF ANY CONSTITUTIONAL OR STATUTORY LIMITATIONS AND IS NOT PAYABLE FROM OR A CHARGE UPON ANY FUNDS OF THE ISSUER OTHER THAN THE REVENUES AND PROCEEDS PLEDGED BY THE ISSUER TO THE PAYMENT THEREOF AND DOES NOT GIVE RISE TO A PECUNIARY LIABILITY OF THE ISSUER OR OF ANY OF ITS OFFICERS, AGENTS OR EMPLOYEES AND NO HOLDER OF THIS BOND SHALL EVER HAVE THE RIGHT TO COMPEL ANY EXERCISE OF THE TAXING POWER OF THE ISSUER OR THE STATE OR ANY OF ITS POLITICAL SUBDIVISIONS TO PAY THIS BOND OR TO ENFORCE PAYMENT THEREOF AGAINST ANY PROPERTY OF THE ISSUER. THIS BOND DOES NOT CONSTITUTE A CHARGE, LIEN 6 OR ENCUMBRANCE, LEGAL OR EQUITABLE UPON ANY PROPERTY OF THE ISSUER AND THE AGREEMENT OF THE ISSUER TO PERFORM OR CAUSE THE PERFORMANCE OF THE COVENANTS AND OTHER PROVISIONS HEREIN REFERRED TO SHALL BE SUBJECT AT ALL TIMES TO THE AVAILABILITY OF REVENUES OR OTHER FUNDS FURNISHED FOR SUCH PURPOSE IN ACCORDANCE WITH THE FINANCING AGREEMENT, SUFFICIENT TO PAY ALL COSTS OF SUCH PERFORMANCE OR THE ENFORCEMENT THEREOF. NEITHER THE STATE OF MINNESOTA NOR ANY POLITICAL SUBDIVISION OF THE STATE OF M NNESOTA NOR THE ISSUER SHALL BE OBLIGATED TO PAY THE PRINCIPAL OF THE BONDS, THE INTEREST THEREON OR OTHER COSTS INCIDENT THERETO EXCEPT FROM REVENUES PLEDGED THEREFOR UNDER THE INDENTURE, AS MORE FULLY SET FORTH IN THE INDENTURE. NEITHER THE FULL FAITH AND CREDIT NOR THE TAXING POWER, IF ANY, OF THE ISSUER, THE STATE OF NIINNESOTA, OR ANY POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF THE PRINCIPAL OF THE BONDS OR THE INTEREST THEREON OR OTHER COSTS INCIDENT THERETO. THE BONDS ARE NOT A DEBT OF THE UNITED STATES OF AMERICA, HUD, FHA, GNMA OR ANY OTHER AGENCY THEREOF AND ARE NOT GUARANTEED BY THE FULL FAITH AND CREDIT OF THE UNITED STATES OF AMERICA. THE BONDS ARE NEITHER A MORAL NOR AN ANNUAL APPROPRIATION OBLIGATION OF THE ISSUER, THE STATE OR ANY POLITICAL SUBDIVISION THEREOF. THE PROVISIONS OF THIS PARAGRAPH SHALL, FOR PURPOSES OF THIS BOND, BE CONTROLLING AND SHALL BE GIVEN FULL FORCE AND EFFECT, ANYTHING ELSE TO THE CONTRARY IN THIS BOND NOTWITHSTANDING. 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 Issuer or any owner of the 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 provision hereof, this resolution, the aforementioned documents and all of their provisions being intended to be and being for the sale and exclusive benefit of the Issuer and any owners from time to time of the Bonds issued under the provisions of this resolution. 11. The 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 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 to happen, exist and be performed precedent to and in the enactment of this resolution, and precedent to issuance of the Bonds and precedent to the execution of the aforementioned documents have happened, exist and have been performed as so required by law. 12. The Officials of the Issuer, attorneys and other agents or employees of the Issuer are hereby authorized to do all acts and things required of them by or in connection with this resolution, the aforementioned documents, and the Bonds for the full, punctual and complete 7 performance of all the terms, covenants and agreements contained in the Bonds, the aforementioned documents and this resolution. In the event that for any reason the Mayor of the Issuer is unable to carry out the execution of any of the documents or other acts provided herein, any other member of the City Council of the Issuer shall be authorized to act in his capacity and undertake such execution or acts on behalf of the Issuer with full force and effect, which executions or acts shall be valid and binding on the Issuer. If for any reason the City Manager of the Issuer is unable to execute and deliver the documents referred to in this Resolution, such documents may be executed by the City Director of Finance with the same force and effect as if such documents were executed and delivered by the City Manager of the Issuer. Adopted by the City Council of the City of Ede rairie,this 16th day of January,2001. Jean L. Harris,Mayor ATTEST: KaWeen Porta, City Clerk 8