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Res 2015-33 Totino Grace Loan Amendment Extract of Minutes of a Meeting of the City Council of the City of Fridley, Minnesota Pursuant to due call and notice thereof, a regular meeting of the City Council of the City of Fridley, Minnesota (the "City"), was duly held at the City Hall in said City on Tuesday, the 26th day of May, 2015, at 7:00 o'clock P.M. The following members were present: Councilmembers Jim Saefke, Dolores Varichak, Ann Bolkcom, Bob Barnette and Mayor Scott Lund. and the following were absent: None Member Barnette introduced the following resolution and moved its adoption: RESOLUTION AUTHORIZING THE AMENDMENT OF A LOAN AGREEMENT RELATED TO A NOTE ISSUED TO FINANCE IMPROVEMENTS TO A PRIVATE SCHOOL PROJECT PURSUANT TO MINNESOTA LAW, AND AUTHORIZING THE EXECUTION OF VARIOUS DOCUMENTS IN CONNECTION THEREWITH (TOTINO-GRACE HIGH SCHOOL PROJECT) The motion for the adoption of the foregoing resolution was duly seconded by Member Varichak and after full discussion thereof and upon vote being taken thereon, the following voted in favor thereof: Members Saefke, Varichak, Bolkcom, Barnette and Mayor Lund and the following voted against the same: None whereupon said resolution was declared duly passed and adopted. 7097111v1 CITY OF FRIDLEY, MINNESOTA RESOLUTION NO. 2015-33 RESOLUTION AUTHORIZING THE AMENDMENT OF A LOAN AGREEMENT RELATED TO A NOTE ISSUED TO FINANCE IMPROVEMENTS TO A PRIVATE SCHOOL PROJECT PURSUANT TO MINNESOTA LAW, AND AUTHORIZING THE EXECUTION OF VARIOUS DOCUMENTS IN CONNECTION THEREWITH (TOTINO-GRACE HIGH SCHOOL PROJECT) 1. Authority. The City is, by the Constitution and laws of the State of Minnesota, including Minnesota Statutes, Sections 469.152 to 469.1655, as amended (the "Act"), authorized to issue and sell its revenue bonds for the purpose of financing and refinancing industrial development within the boundaries of the City and to enter into agreements necessary or convenient in the exercise of the powers granted by the Act. 2.Authorization of Amendment; Documents Presented. Previously, at the request of Grace High School d/b/a Totino-Grace High School (the "Borrower"), a Minnesota nonprofit corporation and an organization described under Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, pursuant to the Act and resolution number 2014-27 of the City Council adopted on March 10, 2014 (the “Bond Resolution”), the City issued and sold its Educational Facilities Revenue Note, Series 2014 (Totino-Grace High School Project) (the "Note") in an aggregate amount of $6,500,000, and pursuant to the Act and a Loan Agreement dated as of April 10, 2014 (the “Original Loan Agreement”) between the City and the Borrower, loaned the proceeds thereof to the Borrower in order to refinance and finance certain improvements to the School Facilities (as defined in the Original Loan Agreement) (the "Project") to be owned and operated by the Borrower. The Note was purchased by North American Banking Company (the “Lender”) and, except for certain reserved rights, the interest of the City in the Original Loan Agreement was pledge and assigned to the Lender pursuant to a Pledge Agreement dated April 10, 2014 (the “Pledge Agreement”). The Borrower has requested of the City and the Lender that certain of the provisions related to the completion of the improvements to the School Facilities be amended. Forms of the following documents relating to the amendment of the Original Loan Agreement have been submitted to the City: (a)First Amendment to Loan Agreement (the "Loan Agreement Amendment" and, with the Original Loan Agreement, the “Loan Agreement”). 3.Findings. It is hereby found, determined and declared that: (a)The findings in the Bond Resolution are ratified and affirmed. (b)There is no litigation pending or, to the best of its knowledge, threatened against the City relating to the Note or the Loan Agreement or questioning the due organization of the City, or the powers or authority of the City to undertake the transactions contemplated hereby. 2 7097111v1 Resolution No. 2015-33 Page 2 (c)The execution, delivery, and performance of the City's obligations under the Note and the Loan Agreement do not and will not violate any order of any court or other agency of government of which the City is aware or in which the City is a party, or any indenture, agreement or other instrument to which the City is a party or by which it or any of its property is bound, or be in conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any such indenture, agreement or other instrument. (d)The Loan Agreement provides for payments by the Borrower to the Lender for the account of the City of such amounts as will be sufficient to pay the principal of, premium, if any, and interest on the Note when due. The Loan Agreement obligates the Borrower to pay for all costs of operation and maintenance of the School Facilities, including adequate insurance, taxes, and special assessments. (e)Under the provisions of the Act, and as provided in the Loan Agreement, the Note is not to be payable from nor charged upon any funds other than amounts payable pursuant to the Loan Agreement and moneys in the funds and accounts held by the Lender which are pledged to the payment thereof; the City is not subject to any liability thereon; no owners of the Note shall ever have the right to compel the exercise of the taxing power of the City to pay the Note or the interest thereon, nor to enforce payment thereof against any property of the City; the Note shall not constitute a charge, lien or encumbrance, legal or equitable, upon any property of the City (other than the interest of the City in the Loan Repayments to be made by the Borrower under the Loan Agreement); and the Note recites that such Note, including interest thereon, shall not constitute or give rise to a charge against the general credit or taxing powers of the City. 4.Approval and Execution of Documents. The forms of the documents referred to in paragraph 2 are approved. The Loan Agreement Amendment shall be executed in the name and on behalf of the City by the Mayor and the City Manager, or executed or attested by other officers of the City, in substantially the form on file, but with all such changes therein, not inconsistent with the Act or other law, as may be approved by the officers executing the same, which approval shall be conclusively evidenced by the execution thereof; and then shall be delivered to the Lender. Modifications to the forms of documents to which the City is not a party may be made at the discretion of the parties thereto. Passed and adopted by the City Council of the City of Fridley, Minnesota this 26th day of May, 2015. ___________________________ Scott J. Lund, Mayor ATTEST: ___________________________ Debra A. Skogen, City Clerk 7097111v1 STATE OF MINNESOTA COUNTY OF ANOKA CITY OF FRIDLEY I, the undersigned, being the duly qualified and acting Clerk of the City of Fridley, Minnesota, DO HEREBY CERTIFY that I have compared the attached and foregoing extract of minutes with the original thereof on file in my office, and that the same is a full, true and complete transcript of the minutes of a meeting of the City Council of said City, duly called and held on the date therein indicated, insofar as such minutes related to a resolution approving the amendment of documents for the Totino-Grace High School Project. th WITNESS my hand this 28 day of May 2015. __________________________ Debra A. Skogen, City Clerk 7097111v1 Resolution No. 2015-33 Page 3 FIRST AMENDMENT TO LOAN AGREEMENT THIS FIRST AMENDMENT TO LOAN AGREEMENT (this “Amendment”) is made CITY OF FRIDLEY, and entered into as of the ___ day of __________, 2015 between the MINNESOTA , a municipal corporation and political subdivision organized under the laws of GRACE HIGH SCHOOL D/B/A TOTINO-GRACE the State of Minnesota (the “Issuer”), HIGH SCHOOL, a Minnesota nonprofit corporation (the “Borrower”), with the consent of NORTH AMERICAN BANKING COMPANY (the “Lender”). RECITALS: A.The Issuer has heretofore issued its $6,500,000 Educational Facilities Revenue Note, Series 2014 (Totino-Grace High School Project) (the “Note”), pursuant to a resolution of its City Council adopted on March 10, 2014 (the “Resolution”); and B.The Issuer and the Borrower have heretofore entered into a Loan Agreement dated as of April 10, 2014 (the “Original Loan Agreement”) whereby, among other things, the Borrower agreed to pay the principal and interest and premium due on the Note and to undertake certain improvements to the School Facilities (as defined in the Original Loan Agreement); and C. The Lender purchased the Note and, except for certain reserved rights, the interest of the Issuer in the Original Loan Agreement was pledged and assigned to the Lender pursuant to a Pledge Agreement dated as of April 10, 2014 (the “Pledge Agreement”); and D. The Borrower has requested that certain provisions related to the completion of the improvements to the School Facilities be amended; and E. Section 7.4 of the Original Loan Agreement permits the Original Loan Agreement to be amended by the Issuer and the Borrower, with the consent of the Lender, to facilitate the amendments requested by the Borrower; and F. The parties hereto wish to amend the Original Loan Agreement; and G. The Original Loan Agreement, as amended by this Amendment, is hereafter defined as the “Loan Agreement.” NOW, THEREFORE, in consideration of $1.00 and other good and valuable consideration and the premises contained herein, the parties hereto agree as follows: 1.Disbursement of the Loan. Section 3.3 of the Original Loan Agreement is hereby amended to delete the reference to “October 10, 2015” and replace it with “October 10, 2016. 2.Spend Down Exception to Rebate. The Borrower hereby acknowledges that the expectations it expressed in paragraph 18(h) of the Borrower’s General and Tax 3 7096838v1 Resolution No. 2015-33 Page 4 Certificate dated April 10, 2014 (the “Certificate”), that it would expend all “gross proceeds” of the Note within 18 months in accordance the Regulations (as defined in the Certificate), will not be achieved. The Borrower further acknowledges that it is not, therefore, entitled to an exception for arbitrage rebate. The Borrower agrees that it will calculate and pay rebate, if any, on the “gross proceeds” of the Note in accordance with Section 4.5(1)(i) of the Loan Agreement. 3.Binding Effect. This Amendment shall inure to the benefit of and shall be binding upon the Issuer, the Borrower, and the Lender and their respective successors and assigns. 4.Invalidity. In the event any provisions of this Amendment shall be held invalid or unenforceable by any court of competent jurisdiction, such holding shall not invalidate or render unenforceable any other provision hereof. 5.Counterparts. This Amendment may be simultaneously executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. 6.Limitation on Liability of Issuer. No agreements or provisions contained in this Amendment nor any agreement, covenant or undertaking by the Issuer contained in any document executed by the Issuer in connection with the Project (as defined in the Loan Agreement) shall give rise to any pecuniary liability of the Issuer or a charge against its general credit or taxing powers, or shall obligate the Issuer financially in any way except with respect to the Project and the application of revenues therefrom and the proceeds of the Note. No failure of the Issuer to comply with any term, condition, covenant or agreement herein shall subject the Issuer to liability for any claim for damages, costs or other financial or pecuniary charge except to the extent that the same can be paid or recovered from the Project or revenues therefrom or from proceeds of the Note; and no execution of any claim, demand, cause of action or judgment shall be levied upon or collected from the general credit, general funds or taxing powers of the Issuer. Nothing herein shall preclude a proper party in interest from seeking and obtaining specific performance against the Issuer for any failure to comply with any term, condition, covenant or agreement herein; provided, that no costs, expenses or other monetary relief shall be recoverable from the Issuer except as may be payable from the Project or its revenues. 7.Full Force and Effect. Except as herein amended, all other terms and provisions of the Original Loan Agreement as originally executed shall remain in full force and effect. The Issuer and the Borrower hereby reaffirm their representations in Article II of the Loan Agreement. [Signature pages follow.] 4 7096838v1 Resolution No. 2015-33 Page 5 IN WITNESS WHEREOF , the Issuer, the Borrower, and the Lender have caused this First Amendment to Loan Agreement to be executed by their duly authorized officers as of the date and year first above written. CITY OF FRIDLEY, MINNESOTA By ____________________________________ Its Mayor By ____________________________________ Its City Manager Signature page to First Amendment to Loan Agreement S-1 7096838v1 Resolution No. 2015-33 Page 6 GRACE HIGH SCHOOL D/B/A TOTINO- GRACE HIGH SCHOOL By ____________________________________ Its _________________________________ Signature page to First Amendment to Loan Agreement S-1 7096838v1 Resolution No. 2015-33 Page 7 NORTH AMERICAN BANKING COMPANY, as Lender By ____________________________________ Its _________________________________ Signature page to First Amendment to Loan Agreement S-1 7096838v1 Resolution No. 2015-33 Page 8 FIRST AMENDMENT TO DISBURSING AGREEMENT THIS FIRST AMENDMENT TO DISBURSING AGREEMENT (this “Amendment”) is GRACE HIGH made and entered into as of the ___ day of __________, 2015 between SCHOOL D/B/A TOTINO-GRACE HIGH SCHOOL, a Minnesota nonprofit corporation (the NORTH AMERICAN BANKING COMPANY LAND “Borrower”), (the “Lender”), and TITLE, INC. (the “Disbursing Agent”). RECITALS: A.The City of Fridley, Minnesota (the “Issuer”) has heretofore issued its $6,500,000 Educational Facilities Revenue Note, Series 2014 (Totino-Grace High School Project) (the “Note”), pursuant to a resolution of its City Council adopted on March 10, 2014 (the “Resolution”); and B.The Issuer and the Borrower have heretofore entered into a Loan Agreement dated as of April 10, 2014 (the “Original Loan Agreement”) whereby, among other things, the Borrower agreed to pay the principal and interest and premium due on the Note and to undertake certain improvements to the School Facilities (as defined in the Original Loan Agreement); and C.The Lender purchased the Note and, except for certain reserved rights, the interest of the Issuer in the Original Loan Agreement was pledged and assigned to the Lender pursuant to a Pledge Agreement dated as of April 10, 2014 (the “Pledge Agreement”); and D. The Borrower, the Lender, and the Disbursing Agent have heretofore entered into a Disbursing Agreement dated as of April 10, 2014 (the “Original Disbursing Agreement”) governing the process for disbursing the proceeds of the Note; and E. The Borrower has requested that certain provisions related to the completion of the improvements to the School Facilities be amended; and F.The Issuer and the Borrower, with the consent of the Lender, have agreed to enter into a First Amendment to Loan Agreement (the “Loan Agreement Amendment” and, with the Original Loan Agreement, the “Loan Agreement”) to facilitate the amendments requested by the Borrower; and G. Section 5.2 of the Original Disbursing Agreement permits it to be amended by a writing signed by the parties thereto; and H. The parties hereto wish to amend the Original Disbursing Agreement; and G. The Original Disbursing Agreement, as amended by this Amendment, is hereafter defined as the “Disbursing Agreement.” 7097132v1 Resolution No. 2015-33 Page 9 NOW, THEREFORE, in consideration of $1.00 and other good and valuable consideration and the premises contained herein, the parties hereto agree as follows: 1.Defined Terms. The definition of “Completion Date” in Section 1.1 of the Original Disbursing Agreement is hereby amended to delete the reference to “October 10, 2015” and replace it with “October 10, 2016.” 2.Disbursement of Funds by Disbursing Agent. Section 4.2 of the Original Disbursing Agreement is hereby amended to delete the reference to “October 10, 2015” and replace it with “October 10, 2016.” 3.Binding Effect. This Amendment shall inure to the benefit of and shall be binding upon the Borrower, the Lender, and the Disbursing Agent, and their respective successors and assigns. 4.Invalidity. In the event any provisions of this Amendment shall be held invalid or unenforceable by any court of competent jurisdiction, such holding shall not invalidate or render unenforceable any other provision hereof. 5.Counterparts. This Amendment may be simultaneously executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. 6.Full Force and Effect. Except as herein amended, all other terms and provisions of the Original Disbursing Agreement as originally executed shall remain in full force and effect. [Signature pages follow.] 2 7097132v1 Resolution No. 2015-33 Page 10 IN WITNESS WHEREOF , the Borrower, the Lender, and the Disbursing Agent have caused this First Amendment to Disbursing Agreement to be executed by their duly authorized officers as of the date and year first above written. GRACE HIGH SCHOOL D/B/A TOTINO- GRACE HIGH SCHOOL By ____________________________________ Its _________________________________ Signature page to First Amendment to Disbursing Agreement S-1 7097132v1 Resolution No. 2015-33 Page 11 NORTH AMERICAN BANKING COMPANY, as Lender By ____________________________________ Its _________________________________ Signature page to First Amendment to Disbursing Agreement S-1 7097132v1 Resolution No. 2015-33 Page 12 LAND TITLE, INC., as Disbursing Agent By ____________________________________ Its _________________________________ Signature page to First Amendment to Disbursing Agreement S-1 7097132v1