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Res 2002-75 RESOLUTION NO.75-2002 RESOLUTION APPROVING THE ISSUANCE AND SALE OF THE CITY OF FRIDLEY, MINNESOTA EDUCATIONAL FACILITIES REVENUE NOTE,SERIES 2002 (TOTINO- GRACE HIGH SCHOOL PROJECT)AND AUTHORIZING THE EXECUTION OF DOCUMENTS RELATING THERETO BE IT RESOLVED by the City Council (the "City Council") of the City of Fridley, Minnesota (the "City"), as follows: The City is authorized under Minnesota Statutes, Section 469.152 to 469.1651, as amended(the "Act")to issue certain revenue bonds. The City has received a proposal that it issue its revenue Note in the aggregate principal amount of up to $4,000,000 to provide funds to be loaned to Grace High School, a nonprofit corporation organized under the laws of the State of Minnesota (d/b/a Totino-Grace High School) (the "Borrower") to finance and refinance the non-religious portions of the renovation and equipping of, and construction of additions to,a high school known as Totino-Grace High School, owned and operated by the Borrower and located at 1350 Gardena Avenue NE in the City(the"Project"). The City Council held a public hearing on December 9, 2002, on the issuance of the Note to finance the Project. The City hereby determines to issue its Educational Facilities Revenue Note, Series 2002 (Totino-Grace High School Project) (the "Note") to finance the Project, subject to compliance with the conditions referred to herein. It is proposed that the Note be purchased by North American Banking Company, a Minnesota corporation (the "Lender"), as provided herein. The City will loan the proceeds of the Note (the "Loan")to the Borrower to finance and refinance the Project. It is proposed that a Loan Agreement (the "Loan Agreement") be entered into between the City and the Borrower respecting the Project. A draft of the Loan Agreement has been submitted to the City Council. Pursuant to a Pledge Agreement (the "Pledge Agreement") to be entered into between the City and the Lender, the City will pledge and assign all of its rights, title, and interest in the Loan Agreement to the Lender (except for certain rights and interests of the City, including indemnification and to reimbursement for certain costs and expenses). A draft of the Pledge Agreement has been submitted to the City Council. The Note may not and shall not constitute an indebtedness, a pecuniary liability, a moral or general obligation or a loan of the credit of the City, and the Note is not and may not be secured by, and is not and may not be a charge, lien or encumbrance, legal or equitable, against the property, funds, general credit or taxing powers of City. The Note may be and shall be only a special and limited revenue obligation of the City payable solely from the revenues provided for the payment thereof pursuant to the Loan Agreement or pursuant to a mortgage, a security agreement or such other security(if any) as may be provided to the Lender by the Borrower. Briggs and Morgan, in its capacity as bond counsel for the Note, has advised the City that, pursuant to Section 496.154 of the Act, the Project furthers the purposes stated in Section 469.152 of the Act, and based entirely on that representation and without independent investigation, the City Council hereby so finds. The Note issued pursuant to this Resolution shall be in substantially the form submitted to the City Council on the date hereof, and shall bear interest at the rates,mature in the years and amounts and be subject to redemption as therein specified. The total Resolution No.75-2002 Page 2 aggregate principal amount of the Note that may be outstanding hereunder is expressly limited to $4,000,000; provided, however, the Note may be initially issued in a lesser maximum principal amount by agreement of the Borrower and the Lender. The offer of the Lender to purchase the Note at an aggregate purchase price of such amount as is actually disbursed there under is hereby accepted. The Note shall contain a recital that it is issued pursuant to Minnesota Statutes, Sections 469.152 to 469.165. The Note shall be dated as of the date of delivery to the Lender, shall be payable at the times and in the manner, shall bear interest at the rate, and shall be subject to such other terms and conditions as are set forth therein. The Note shall be executed on behalf of the City by the manual or facsimile signatures of its Mayor and City Manager(or by such city officials as may act in their stead upon their absence or disability) and shall be sealed with the seal of the City;provided that the seal may be intentionally omitted as provided by law. In case any officer whose signature shall appear on the Note shall cease to be such officer before the delivery of the Note, such signature shall nevertheless be valid and sufficient for all purposes,the same as if such signatory had remained in office until delivery. The City will cause to be kept at the office of the City Clerk a Note Register in which, subject to such reasonable regulations as it may prescribe, the City shall provide for the registration of transfers of ownership of the Note. The Note shall be initially registered in the name of the Lender and shall be transferable upon the Note Register by the Lender in person or by its agent duly authorized in writing, upon surrender of such Note together with a written instrument of transfer satisfactory to the Clerk, duly executed by the Lender or its duly authorized agent. The following form of assignment shall be sufficient for said purpose: For value received (the "Transferor") hereby sells, assigns and transfers unto undersigned, the within Note of the City of Fridley, Minnesota, and does hereby irrevocably constitute and appoint attorney to transfer the Note on the books of said City with full power of substitution in the premises. The undersigned certifies that the transfer is made in accordance with the provisions of the Note relating to transfer and assignment thereof, including, without limitation, compliance by the Transferor with all applicable securities and other laws and regulations. Dated: Registered Owner,Transferor Upon such transfer the City Clerk shall note the date of registration and the name and address of the new registered owner of the Note in the Note Register and in the registration blank appearing on such Note, and at the request and expense of the Transferee, issue a replacement note registered in the name of the Transferee. In case any Note issued hereunder shall become mutilated or be destroyed or lost, upon written request, the City shall, if not then prohibited by law, cause to be executed and delivered, a new Note of like outstanding principal amount,number and tenor in exchange and substitution for and upon cancellation of such mutilated Note, or in lieu of and in substitution for such Note destroyed or lost, upon the Lender's paying the reasonable expenses and charges of the City in connection therewith, and in the case of a Note destroyed or lost, the filing with the City of evidence satisfactory to the City with indemnity satisfactory to it. If the mutilated, destroyed or lost Note has already matured or been called for redemption in accordance with its terms it shall not be necessary to issue a new Note prior to payment. Resolution No. 75-2002 Page 3 The City may deem and treat the person in whose name a Note is last registered in the Note Register and by notation on such Note whether or not such Note shall be overdue, as the absolute owner of such Note for the purpose of receiving payment of or on account of the principal balance, redemption price or interest and for all other purposes whatsoever, and the City shall not be affected by any notice to the contrary. If any provision of this Resolution shall be held or deemed to be or shall, in fact, be inoperative or unenforceable as applied in any particular case in any jurisdiction or jurisdictions or in all jurisdictions or in all cases because it conflicts with any provisions of any constitution or statute or rule or public policy, or for any other reason, such circumstances shall not have the effect of rendering the provision in question inoperative or unenforceable in any other case or circumstance, or of rendering any other provision or provisions herein contained invalid, inoperative, or unenforceable to any extent whatever. The invalidity of any one or more phrases, sentences, clauses or paragraphs in this Resolution contained shall not affect the remaining portions of this Resolution or any part thereof. The officers of the City are authorized to furnish to Bond Counsel certified copies of this Resolution and affidavits or certificates as to all other matters within their knowledge and control and such other certifications as may be acceptable to the City's special issuer's counsel for the Note. The form of the proposed Note, Loan Agreement and the Pledge Agreement are hereby approved in substantially the form heretofore presented to the City Council together with such additional details therein as may be necessary and appropriate and such modifications thereof, deletions there from and additions thereto as may be necessary and appropriate and approved by Bond Counsel or required by special counsel to the City prior to the execution of the documents, and the Mayor and City Manager are authorized in their discretion, at such time (if any) as they may deem appropriate to execute and deliver the Note,the Loan Agreement and the Pledge Agreement in the name of and on behalf of the City. In the event of the absence or disability of the Mayor or the City Manager such officers of the City as may act in their behalf, shall without further act or authorization of the City Council do all things and execute all instruments and documents required to be done or executed by such absent or disabled officers. 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 documents in accordance with the terms hereof. In order to qualify the Note as "qualified tax-exempt obligations"within the meaning of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended (the "Code"), the City hereby makes the following factual statements and representations; The City hereby designates the Note as a qualified tax-exempt obligation for purposes of Section 265(b)(3) of the Code; The reasonably anticipated amount of tax-exempt obligations (other than obligations described in clause (ii) of Section 265(b)(3)(C) of the Code) which will be issued by the City (and all entities whose obligations will be aggregated with those of the City) during the calendar year 2002 will not exceed $10,000,000; and Not more than $10,000,000 of obligations issued by the City during the calendar year 2002 have been designated for purposes of Section 265(b)(3)of the Code. PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF FRIDLEY THIS 16TH DAY OF DECEMBER, 2002. 4;G, e G� SCO J. LUND,MAYOR DEB • A. SKOGEN—pCLERK