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Res 1998-35 00074 RESOLUTION NO 35 - 1998 RESOLUTION AUTHORIZING THE ISSUANCE OF $9,300,000 SENIOR HOUSING REVENUE BONDS (NOAH'S ARK OF MINNESOTA, INC. PROJECT) , SERIES 1998 WHEREAS, pursuant to Minnesota Statutes, Chapter 462C, as amended (the "Act") , the City of Fridley, Minnesota (the "City") is authorized to issue revenue bonds for the purpose of financing or refinancing multifamily housing development facilities; and WHEREAS, the City has received from Noah' s Ark of Minnesota, Inc. , a Minnesota nonprofit corporation (the "Company") , a proposal that the City finance a multifamily housing development hereinafter described through the issuance of revenue bonds or obligations (the revenue bonds are referred to as the "Bonds") pursuant to the Act; and WHEREAS, the multifamily housing development to be financed by the Bonds is the acquisition, construction and equipping of a 110-unit multifamily housing facility for occupancy by elderly persons to be located at 83rd Avenue and University Service Drive in the City (the "Project") ; and WHEREAS, the City proposes to finance the Project by the issuance of its $9,300, 000 Senior Housing Revenue Bonds (Noah' s Ark of Minnesota, Inc. Project) Series 1998 under the Act pursuant to this Resolution; and WHEREAS, the City has previously prepared a housing program for the Project under the Act and the use of revenue bonds therefor; and WHEREAS, the City has previously submitted the housing program for the Project to the Metropolitan Council for review and comment as required by the Act; and WHEREAS, the City conducted a public hearing on the proposal of the Company that the City finance the Project by the issuance of the Bonds, at 7:30 p.m. on July 14, 1997, for which hearing the City published advance notice and at which hearing all persons who appeared or submitted comments were given an opportunity to express their views with respect to the Project and the Bonds; and WHEREAS, the Bonds will be issued under an Indenture of Trust (the "Indenture") , dated as of June 1, 1998 between the City and U.S. Bank Trust National Association (the "Trustee") and the Bonds will be secured by the Indenture payable from a pledge and assignment of certain Project (as defined in the Indenture) revenues set forth under the Indenture, 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 City within the meaning of any constitutional or statutory limitation, nor shall the Bonds constitute nor give rise to a pecuniary liability of the City or a charge against the credit or taxing powers and 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 WHEREAS, proceeds of the Bonds will be loaned to the Company pursuant to a Loan Agreement dated as of June 1, 1998 by and between the City and the Company (the "Loan Agreement") and the loan repayments thereunder and the Bonds will be secured by a Mortgage Agreement (the "Mortgage") 00075 Page 2 -- Resolution No. 35 - 1998 IIIdated as of June 1, 1998 from the Company to the City and assigned to the Trustee and by an Assignment of Mortgage Agreement dated as of June 1, 1998 assigned from the City to the Trustee (the "Assignment") ; NOW THEREFORE BE IT RESOLVED by the City Council of the City of Fridley, Minnesota, as follows: 1. Proposal. For the purpose of financing the Project, the issuance, sale and delivery of the Bonds is hereby authorized. The proceeds of the Bonds together with other funds provided by the Company, shall be applied to costs of acquiring, constructing and equipping the Project. The Bonds shall be in such series, principal amounts, shall bear interest at rates, shall be numbered, shall be dated, shall mature, shall be subject to redemption prior to maturity, and shall be in such form and have such other details and provisions as may be prescribed in the Indenture, substantially in the form now on file with the City. The Bonds shall be special obligations of the City payable solely from the revenues provided by the Loan Agreement and other funds pledged pursuant to the Indenture. The Bonds are not to be payable from nor charged upon any funds of the City other than the revenues pledged to their payment, nor is the City subject to any liability thereon; no holders of the Bonds shall ever have the right to compel any exercise of the taxing power of the City to pay any of the principal of, premium, if any, or interest on the Bonds; the Bonds shall not constitute a charge, lien or encumbrance, legal or equitable, upon any property of the City, and each III Bond shall recite that the Bonds, including interest thereon, are payable solely from the revenues pledged to the payment thereof and that no Bond shall constitute a debt of the City within the meaning of any constitutional or statutory limitation. The Bonds shall contain a recital that they are issued pursuant to the Act and such recital shall be conclusive evidence of the validity and regularity of the issuance thereof. 2. Terms of Bonds. The Bonds will bear interest at the rates set forth in the Indenture, not to exceed 7 .00% per annum, and will be in the principal amounts and will mature and be subject to redemption, all as set forth in the Indenture. Pursuant to the Loan Agreement, the City will loan the proceeds of the Bonds to the Company to finance the Project. The payments to be made by the Company under the Loan Agreement are fixed so as to produce revenue sufficient to pay the principal of, premium, if any, and interest on the Bonds when due. It is further proposed that the City assign certain rights under the Loan Agreement, the Mortgage and the Assignment to the Trustee as security for payment of the Bonds under the Indenture. A Bond Purchase Agreement (the "Bond Purchase Agreement") will be entered into by and among the City, the Company and Miller, Johnson & Kuehn, Incorporated (the "Purchaser") with respect to purchase of its Bonds. 3. Forms of Documents Submitted. Forms of the following documents have been submitted to the Council for approval: III (a) the Loan Agreement; (b) the Indenture; 00076 Page 3 -- Resolution No. 35 - 1998 III (c) the Mortgage; (d) the Assignment; and (e) the Bond Purchase Agreement. 4. Findings. It is hereby found, determined and declared that: (a) the financing of the Project furthers the policies of the Act; (b) the Project promotes the public welfare by providing necessary housing facilities, so that adequate housing facilities are available to residents of the State of Minnesota at a reasonable cost; (c) the Act authorizes the acquisition, construction and installation of the facilities and equipment to be financed by the Bonds, the issuance and sale of the Bonds, the execution and delivery by the City of the Loan Agreement, Indenture, the Mortgage, the Assignment and Bond Purchase Agreement (collectively the "Bond Documents") , the performance of all covenants and agreements of the City contained in the Bond Documents, and the performance of all other acts and things required under the constitution and laws of the State of Minnesota to make the Bond Documents and Bonds valid and binding obligations of the III City in accordance with their terms; (d) it is desirable that the Bonds be issued by the City upon the terms set forth in the Indenture; (e) the payments under the Loan Agreement are fixed to produce revenue sufficient to provide for the prompt payment of principal of, premium, if any, and interest on the Bonds issued under the Indenture when due, and the Loan Agreement and Indenture also provide that the Company is required to pay all expenses of the operation and maintenance of the facilities to be financed by the Bonds, including, but without limitation, adequate insurance thereon and insurance against all liability for injury to persons or property arising from the operation thereof, and any taxes and special assessments levied upon or with respect to the premises of said facilities and payable during the term of the Loan Agreement and Indenture; (f) as provided in the Loan Agreement and Indenture, the Bonds are not to be payable from or charged upon any funds other than the revenue pledged to the payment thereof; the City is not subject to any liability thereon; no holder of any Bond shall ever have the right to compel any exercise by the City of its taxing powers to pay any of the Bonds or the interest or premium thereon, or to enforce payment thereof against any property of the City except the interests of the City in the Loan Agreement, the Mortgage and the Assignment, which have been assigned to the Bond Trustee under the Indenture; the Bonds shall not III constitute a charge, lien or encumbrance, legal or equitable, upon any property of the City except the interests of the City in the Loan Agreement, the Mortgage and the Assignment which have been assigned to the Trustee under the Indenture; the Bonds shall recite that the Bonds 00077 Page 4 -- Resolution No. 35 - 1998 do not constitute or give rise to a pecuniary liability or moral obligation of the City, the State of Minnesota or any of its political subdivisions, and that the Bonds, including interest thereon, are payable solely from the revenues pledged to the payment thereof; and the Bonds shall not constitute a debt of the City within the meaning of any constitutional or statutory limitation. 5. Approval of Document Forms; Execution. Subject to the approval of the City Attorney, and the provisions of paragraph 9 hereof, the forms of the Bond Documents and exhibits thereto and all other documents listed in paragraph 3 hereof are approved substantially in the form submitted. Subject to the provisions of paragraph 9 hereof, the Bond Documents, in substantially the forms submitted, are directed to be executed in the name and on behalf of the City by the Mayor and Clerk or Manager. Subject to the provisions of paragraph 9 hereof, the Bonds are to be executed in the name of and on behalf of the City by the Mayor and Clerk or Manager, and are to be delivered to the Trustee for authentication and delivery to the Purchaser. Any other City documents and certificates necessary to the transaction described above may be executed by the appropriate City officers. Copies of all of the documents necessary to the transaction herein described shall be delivered, filed and recorded as provided herein and in the Loan Agreement and Indenture. 6. Official Statement. The City hereby consents to the preparation and distribution of a Preliminary Official Statement dated and a final Official Statement (collectively, the "Official Statement") to the Purchaser. The City has relied upon the Company and the Purchaser and legal counsel retained by them to assure the accuracy and completeness of the information set forth in the Official Statement and therefore the City has not participated, and will not participate significantly, in the preparation of the Official Statement. The City has not made, and will not make, any independent investigation of the information contained therein, except under the headings "THE CITY" or "THE ISSUER", and it assumes no responsibility for the accuracy or completeness of such information. The Preliminary Official Statement will be designated as a "near final" Official Statement for purposes of Rule 15c2-12 of the Securities Exchange Commission. - 7 . Issuance. The City shall proceed forthwith to issue the Bonds, in the form and upon the terms set forth in the Indenture and this Resolution. The Bonds shall be issued in principal amounts, shall be payable or prepayable at such time or times, shall bear interest at such rates and shall be subject to such other terms and conditions as set forth in the Indenture. The City officers are authorized and directed to execute and deliver the Bonds as prescribed in the Indenture. 8 . Records and Certificates. The Mayor, Clerk, Manager and other officers of the City are authorized and directed to prepare and furnish to the Purchaser 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 000' 8 Page 5 -- Resolution No. 35 - 1998 IIIsuch certified copies, certificates and affidavits, including any heretofore furnished, shall constitute representations of the City as to the truth of all statements contained therein. 9. Changes in Forms Approved; Absent and Disabled Officers. 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 counsel to the City, the appropriate City staff person or by the officers authorized herein to execute or accept, as the case may be, said documents prior to their execution; and said officers or staff members are hereby authorized to approve said changes on behalf of the City. The execution of any instrument by the appropriate officer or officers of the City herein authorized shall be conclusive evidence of the approval of such document in accordance with the terms hereof. In the event of absence or disability of the officers, any of the documents authorized by this Resolution to be executed may be executed without further act or authorization of the City Council by any member of the City Council or any duly designated acting official, or by such other officer or officers of the City as, in the opinion of the City Attorney, may act in their behalf. 10. Indemnification by Company. It is understood and agreed that the Company shall indemnify the City against all liabilities, losses, damages, costs and expenses (including attorney's fees and expenses incurred by the City) arising with respect to the Project or the Bonds, as provided for and agreed to by and between the Company and the City in the Loan Agreement. 11. Headings; Terms. Paragraph headings in this Resolution are for convenience of reference only and are not a part hereof, and shall not limit or define the meaning of any provision hereof. Capitalized terms used but not defined herein shall have the meanings given them in the Indenture or Loan Agreement. PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF FRIDLEY THIS 8TH DAY OF JUNE, 1998 . Ad --_. 411LAmeNd-;' ,, J l ' , CY J J9�RG 'So - MAYOR ATTEST: OA.�4', ty,w, a. ci WILLIAM A. CHAMPA - CIIYY CLERK III