Res 2002-21 RESOLUTION NO. 21 —2002
RESOLUTION AUTHORIZING EXECUTION OF AN AMENDMENT TO LOAN AGREEMENT
AND A SUPPLEMENTAL TRUST INDENTURE
WHEREAS, the City of Fridley, Minnesota (the "City") has heretofore issued its $10,090,000 Senior
Housing Revenue Bonds (Banfill Crossing Homes Project), Series 1999 (the "Bonds") pursuant to an
Indenture of Trust, dated as of August 1, 1999, (the "Indenture")by and between the City and U.S. Bank
Trust National Association, as Trustee, to finance certain costs associated with the acquisition and
construction of a certain independent living facility for the elderly(the "Project") incurred by Minnesota
Christian Homes of Fridley, Inc., (the "Borrower").
WHEREAS, the City and the Borrower executed a Loan Agreement, dated as of August 1, 1999, as
amended by the Amendment to Loan Agreement, dated as of April 1, 2000 (the "Loan Agreement") in
connection with issuance of the Bonds.
WHEREAS, the Borrower has requested that the Loan Agreement be amended to, among other things,
correct references to certain sections in the Indenture and to correct the monthly Replacement Reserve
Fund deposit amount.
IWHEREAS, the Borrower has requested that the Indenture be amended to, among other things, correct
cross-references to certain sections within the Indenture, to correct the monthly Replacement Reserve
Fund deposit amount and to reverse the order of the ninth and tenth items paid out of the Revenue Fund.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Fridley, Minnesota,
hereby authorizes the Mayor and City Manager to execute the Second Amendment to Loan Agreement
and the Supplemental Trust Indenture on behalf of the City in substantially the forms submitted.
PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF FRIDLEY THIS 25th DAY
OF February, 2002
..Ii: .,. /ALAI
S•,•tt I. Luna -Mayor
Attest:
Pik_ (,/,74-etz'
Debra A. Skogen—City erk
Resolution No. 21-2002 Page 2
SUPPLEMENTAL TRUST INDENTURE
THIS SUPPLEMENTAL TRUST INDENTURE (the "Supplemental Indenture"), dated as of the
1st day of February, 2002, by and between the CITY OF FRIDLEY, MINNESOTA, a Minnesota
municipal corporation(the "Issuer") and U.S. BANK NATIONAL ASSOCIATION, (formerly,
U.S. Bank Trust National Association) a national banking association and having its main office
and place of business in the City of St. Paul,Minnesota(the "Trustee")
WITNESSETH:
WHEREAS,the Issuer has issued under the Indenture of Trust, dated as of August 1, 1999, (the
"Indenture") its $10,090,000 Senior Housing Revenue Bonds(Banfill Crossing Homes Project),
Series 1999 (the "Bonds"),to finance certain costs associated with the acquisition and
construction of a certain independent living facility for the elderly(the "Project") incurred by
Minnesota Christian Homes of Fridley, Inc., a Minnesota non-profit corporation(the
"Corporation"); and
WHEREAS, the Corporation represents that it would like to correct several technical errors in
the Indenture and modify the order of the application of moneys in the Revenue Fund; and
WHEREAS, the Corporation represents that pursuant to a Waiver, Consent and Direction to the
Trustee from the Majority Owner dated February 18, 2002 the Majority Owner has consented to
the changes made to the Indenture by this Supplemental Indenture and has directed the Trustee to
waive certain obligations of the Corporation specified in the Indenture and in the Loan
Agreement, dated as of August 1, 1999, as amended by the Amendment to Loan Agreement,
dated as of April 1, 2000 and by the Second Amendment to Loan Agreement, dated as of the date
hereof(the "Loan Agreement"),between the Issuer and the Corporation; and
NOW, THEREFORE,the Indenture is amended as provided herein.
1. Section 5.3(2) of the Indenture is amended to reverse the order of clauses (i) and
(j) and to restate such clauses to read as follows:
"(i) ninth, if in any prior month the amounts to be deposited in the
funds set forth above have not been deposited, then to such funds the amounts to
be deposited in any prior month to such funds but not so deposited, in the priority
set forth above;
(j) tenth, to the Operating Deficit Fund, the balance, until the
Operating Deficit Fund is fully funded in cash in an amount equal to the
Operating Deficit Requirement($300,000);"
2. Subsection 5.3(2)(h)of the Indenture is amended and restated as follows:
"(h) eighth, to the Replacement Reserve Fund, an amount equal to
$20.83 per unit per month as such amount may be adjusted pursuant to Section
2.3(3) of the Loan Agreement;"
Resolution No. 21-2002 Page 3
3. The third sentence of Section 5.4 of the Indenture is amended to correct the
reference to Section 5.3(2) and is restated as follows:
"Thereafter the Trustee shall deposit in the Bond Fund, as received, each of the Loan
Repayments, any interest on Loan Repayments not paid when due and any other moneys paid to
the Trustee under the Loan Agreement or this Indenture for credit or transfer to the Bond Fund,
including moneys transferred pursuant to Section 5.3(2)(b)hereof."
4. The second to last paragraph of Section 5.5 of the Indenture is amended to correct
the reference to Section 5.3(2) and is restated as follows:
"If any amount is transferred from the Bond Reserve Fund to the Bond Fund pursuant to this
Section 5.5 as a result of the failure of the Corporation to make the Loan Repayments required
by Section 2.2(1), (2)or(3)of the Loan Agreement, the Trustee shall thereafter credit to the
Bond Reserve Fund all payments received by the Trustee from the Corporation pursuant to
Section 2.3(2) of the Loan Agreement and amounts transferred from the Revenue Fund pursuant
to Section 5.3(2)(d)."
5. The second sentence of Section 5.8 of the Indenture is amended to correct the
reference to Section 5.3(2) and is restated as follows:
"The Trustee shall make information regarding the Bonds and investments hereunder available to
the Corporation, shall make deposits (pursuant to Section 5.3(2)(f) hereof or otherwise) and
disbursements from the Rebate Fund in accordance with the instructions received from the
Corporation pursuant to the rebate calculations referred to in Section 7.9(11) of the Loan
Agreement, shall invest the Rebate Fund pursuant to the requirements of the Corporation Tax
Certificate and shall deposit income from such investments immediately upon receipt thereof in
the Rebate Fund."
6. The second sentence of Section 5.13 of the Indenture is amended to correct the
reference to Section 5.3(2)and is restated as follows:
"There shall be deposited into the Operating Deficit Fund all moneys received by the Trustee
pursuant to the provisions of Section 2.3(4)of the Loan Agreement and any amounts transferred
from the Revenue Fund pursuant to Section 5.3(2)(j) hereof and from the Supplemental Reserve
Fund pursuant to Section 5.15 hereof"
7. The second paragraph of Section 5.13 of the Indenture is amended to correct the
reference to Section 5.3(2) and is restated as follows:
"If(a) on any date there exists an Operating Deficit as defined in the Loan Agreement, or(b)on
any Interest Payment Date,Principal Payment Date or Redemption Date there is a deficiency in
the Bond Fund for payment of principal,premium, if any, or interest then due with respect to all
Bonds, the Trustee shall,before making any transfer from the Bond Reserve Fund pursuant to
Section 5.5 hereof, transfer from the Surplus Fund, first,the Supplemental Reserve Fund,
second, the Operating Deficit Fund, third, and from the Replacement Reserve Fund, fourth,to
the Bond Fund an amount equal to such deficiency; provided however, that such amounts
transferred from the Operating Deficit Fund shall be restored to the Operating Deficit Fund by
Resolution No. 21-2002 Page 4
the Corporation making Additional Payments pursuant to Section 2.3(4) of the Loan Agreement
and by transfers from the Revenue Fund pursuant to Section 5.3(2)(j)hereof."
8. Except as herein amended, all terms and provisions of the Indenture as originally
executed as of August 1, 1999 shall remain in full force and effect.
IN WITNESS WHEREOF,the Issuer and the Trustee have caused this Supplemental
Indenture to be duly executed on the date first written above.
U.S. BANK TRUST NATIONAL ASSOCIATION
By:
Its Authorized Officer
CITY OF FRIDLEY,MINNESOTA
By: ,/ it . , - ,/
Mayor 7
By:
City Manager
CORPORATION CONSENT
In accordance with Section 11.6 of the Indenture of Trust, dated as of August 1, 1999,by
and between the City of Fridley, Minnesota, a Minnesota municipal corporation(the "Issuer")
and U.S. Bank National Association, (formerly, U.S. Bank Trust National Association) a national
banking association, (the "Trustee") MINNESOTA CHRISTIAN HOMES OF FRIDLEY, INC.,
a Minnesota non-profit corporation, hereby consents to the foregoing Supplemental Trust
Indenture between the Issuer and the Trustee.
MINNESOTA CHRISTIAN HOMES OF FRIDLEY, INC.
By:
Its:
Resolution No. 21-2002 Page 5
SECOND AMENDMENT TO LOAN AGREEMENT
THIS SECOND AMENDMENT TO LOAN AGREEMENT(the "Amendment"), dated
as of the 1st day of February, 2002,by and between the CITY OF FRIDLEY, MINNESOTA, a
Minnesota municipal corporation(the "Issuer") and MINNESOTA CHRISTIAN HOMES OF
FRIDLEY, INC., a Minnesota nonprofit corporation(the "Corporation")
WITNESSETH:
WHEREAS, the Issuer has issued under the Indenture of Trust between the Issuer and
U.S. Bank Trust National Association(the "Trustee"), dated as of August 1, 1999, (the
"Indenture") its $10,090,000 Senior Housing Revenue Bonds (Banfill Crossing Homes Project),
Series 1999 (the "Bonds"),the proceeds of which were used to finance certain costs of the
acquisition and construction of a certain independent living facility for the elderly(the "Project")
incurred by the Corporation in connection with the proposed financing; and
WHEREAS,the Issuer and the Corporation have entered into a Loan Agreement, dated
as of August 1, 1999, as amended by the Amendment to Loan Agreement, dated as of April 1,
2000 (the "Loan Agreement") in connection with the issuance of the Bonds; and
WHEREAS, the Corporation would like to correct several technical errors in the Loan
Agreement; and
WHEREAS,the Corporation represents that pursuant to a Waiver, Consent and Direction
to the Trustee from the Majority Owner dated February , 2002 the Majority of Owners have
consented to the changes made to the Loan Agreement by this Amendment and have directed the
Trustee to waive certain obligations of the Corporation specified in the Indenture and in the Loan
Agreement; and
NOW, THEREFORE, the Indenture is amended as provided herein.
9. The definition of Project Excess Cash Flow in Section 1.1 of the Loan Agreement
is amended to correct the reference to Section 5.3(2) and is restated as follows:
"Project Excess Cash Flow means an amount equal to Gross Revenues, less the deposits required
to be made pursuant to Sections 5.3, 5.4, 5.5, 5.6, 5.7, 5.8 and 5.9 of the Indenture to the Rebate
Fund, the Bond Reserve Fund,the Operations and Maintenance Fund, the Bond Fund, the
Surplus Fund(pursuant to Section 5.3(2)(g) only) and the Replacement and Reserve Fund."
10. The first sentence of Subsection 2.2(4) of the Loan Agreement is amended to
correct the reference to Section 5.3(2) and is restated as follows:
"The Corporation shall be entitled to a credit against the initial payments
due under subsections (1), (2) and (3) in an amount equal to the accrued interest
and any capitalized interest with respect to the Series 1999 Bonds deposited into
the Bond Fund upon issuance of the Series 1999 Bonds and amounts transferred
to the Bond Fund pursuant to Section 5.3(2)(b) of the Indenture."
5
Resolution No. 21-2002 Page 6
11. The last sentence of Subsection 2.3(2) of the Loan Agreement is amended to
correct the reference to Section 5.3(2) and is restated as follows:
"There shall be credited as Additional Payments hereunder amounts transferred to the Bond
Reserve Fund pursuant to Section 5.3(2)(e) of the Indenture."
12. The first sentence of Subsection 2.3(3) of the Loan Agreement is amended to
correct the monthly Replacement Reserve Fund deposit amount and is restated as follows:
"Commencing on the fifteenth day of the first month after the Completion Date and on the
fifteenth(15th) day of every month thereafter, the Corporation shall make monthly payments to
the Trustee for deposit to the Replacement Reserve Fund equaling$20.83 per unit per month,
adjusted each year for any increase in the consumer price index until September 15, 2004 when
such monthly deposit shall be equal to the amount set out in the most recent report of the
Independent engineer as required by Section 4.9 hereof; provided that such amount shall never
be less than$20.83 per unit per month as such amount may have been adjusted according to the
consumer price index for any such year."
13. The last sentence of Subsection 2.3(4) of the Loan Agreement is amended to
correct the reference to Section 5.3(2) and is restated as follows:
"There shall be credited as Additional Payments under this subsection 2.3(4) amounts
transferred to the Operating Deficit Fund pursuant to Section 5.3(2)(j)of the Indenture."
14. The last sentence of Section 4.9 of the Loan Agreement is amended to correct the
monthly Replacement Reserve Fund deposit amount and is restated as follows:
"In no event,however, shall such monthly deposits into the Replacement Reserve Fund be less
than$20.83 per unit per month as may be increased by the annual consumer price index
adjustments."
15. Except as herein amended, all terms and provisions of the Loan Agreement as
originally executed as of August 1, 1999 and as amended by the Amendment to Loan
Agreement, dated as of April 1, 2000 shall remain in full force and effect.
IN WITNESS WHEREOF, the Issuer and the Corporation have caused this Amendment
to be duly executed on the date first written above.
MINNESOTA CHRISTIAN HOMES CITY OF FRIDLEY,MINNESOTA
OF FRIDLEY, INC. v�� `� �
By: �, �`
By Mayor
Its By:
City Manager