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07-12 - 02-20 - Refunding of Bonds Series 2007 - Breck School Resolution 07-12 February 20, 2007 Member Pentel introduced the following resolution and moved its adoption: RESOLUTION FOR REFUNDING OF REVENUE BONDS SERIES 2007 BRECK SCHOOL BE IT RESOLVED by the City Council of the City of Golden Valley, Minnesota (the "City") as follows: WHEREAS, the City of Golden Valley, Minnesota (the "City") is a municipal corporation duly organized and existing under the Constitution and laws of the State of Minnesota; and WHEREAS, pursuant to the Constitution and laws of the State of Minnesota, particularly Minnesota Statutes, Sections 469.152 to 469.1651, as amended (the "Act"), the City is authorized to carry out the public purposes described therein and contemplated thereby by issuing its revenue bonds to finance the cost of the acquisition, renovation, construction, improving and equipping of certain revenue producing facilities to be located within its corporate boundaries, and is authorized to enter into revenue agreements made in connection therewith and pledge those agreements as security for the payment of the principal of and interest on any such revenue bonds; and WHEREAS, Breck School, a Minnesota nonprofit corporation (the "Company"), has requested the City to issue its Refunding Revenue Bonds (Breck School) Series 2007 (the "Bonds") in the aggregate principal amount not to exceed $8,500,000 to provide funds to refinance the outstanding City of Golden Valley, Minnesota Revenue Bonds (Breck School) Series 1999 (the "Series 1999 Bonds") which were issued to finance the costs of acquisition, construction, improvement, renovation, furnishing and equipping an existing school owned by the Company at 123 Ottawa Avenue North in the City (the "Project"); and WHEREAS, the City conducted a public hearing on February 20, 2007 with respect to the Bonds after publication of notice in the Golden Valley/New Hope Sun Post at least fourteen days prior to the date of the hearing; and WHEREAS, the City will loan the proceeds of the Bonds to the Company pursuant to the terms of a Loan Agreement (the "Loan Agreement") between the City and the Company; and WHEREAS, the City proposes to finance the Project under the Act by the issuance of the Bonds of the City under this resolution; and WHEREAS, the Bonds will be issued under a Trust Indenture (the "Indenture") between the City and U.S. Bank National Association, as trustee (the "Trustee"), and are to be secured by a pledge and assignment of the loan repayments to be made by the Company pursuant to the Loan Agreement, all in accordance with the terms of the Indenture, and said Bonds and the interest on said Bonds shall be payable solely from the Resolution 07-12 - Continued February 20, 2007 revenues pledged therefor and the Bonds shall not constitute a debt of the City within the meaning of any constitutional or statutory limitation or constitute or give rise to a pecuniary liability of the City 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 City; and WHEREAS, the forms of the Indenture, Loan Agreement, Escrow Agreement (as defined hereafter), the Bond Purchase Agreement (as defined hereafter) and the Bonds are on file with the City Clerk; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF GOLDEN VALLEY, MINNESOTA, AS FOLLOWS: 1. The City hereby makes the following findings and authorizations: (a) the City is a municipal corporation under the laws of the State of Minnesota. Under the provisions of the Act, the City is authorized to enter into the transactions contemplated by the Loan Agreement and the Indenture and to carry out its obligations thereunder; (b) to the best knowledge of the City, no public official of the City has either a direct or indirect interest in the Loan Agreement nor will any public official of the City either directly or indirectly benefit financially from the Loan Agreement; (c) the Bonds, the Indenture, the Loan Agreement and the Bond Purchase Agreement (the "Bond Purchase Agreement") among the City, the Company and RBC Dain Rauscher Inc., doing business under the name RBC Capital Markets (the "Underwriter") and the Escrow Agreement (the "Escrow Agreement") among the City, the Company and the Trustee are hereby authorized by the City and, when executed will constitute the valid, binding and enforceable obligation of the City; (d) the execution and delivery of the Bonds, the Indenture, the Bond Purchase Agreement, the Loan Agreement, the Escrow Agreement and the other agreements contemplated by the Official Statement relating to the Bonds (the "Official Statement"), under the circumstances contemplated thereby, and the compliance by the City with the provisions thereof will not conflict with or constitute on the part of the City a breach of or a default under any existing law, court or administrative regulation, decree or order or any agreement or other instrument to which the City is subject or by which it is bound; (e) the City has complied with the provisions of the Act and has full power and authority to issue the Bonds, to loan the proceeds thereof to the Company and to carry out and consummate all transactions contemplated by the Indenture, the Loan Agreement, the Escrow Agreement and the Bond Purchase Agreement; Resolution 07-12 - Continued February 20, 2007 (f) the City has full power and authority to execute and deliver the Indenture, the Loan Agreement, the Escrow Agreement and the Bond Purchase Agreement and to carry out the terms thereof; (g) no approval, authorization, consent or other order of any public board or body is legally required for the transactions contemplated by the Bond Purchase Agreement, the Loan Agreement, the Escrow Agreement or the Indenture; (h) there are no legal or governmental proceedings, pending, threatened or contemplated, or any basis therefor, wherein an unfavorable decision, ruling or finding would adversely affect the validity of or security for the Bonds, the Indenture, the Bond Purchase Agreement, the Loan Agreement, the Escrow Agreement or the transactions contemplated thereby; and (i) The loan payments contained in the Loan Agreement are fixed, and are required to be revised from time to time as necessary, so as to produce income and revenue sufficient to provide for prompt payment of principal of, premium, if any, and interest on all Bonds issued under the Indenture when due; and the Loan Agreement also provides that the Company is required to pay all expenses of the operation and maintenance of the Project, including but without limitation, adequate insurance thereon and insurance against all liability for injury to persons or property arising from the operation thereof, and all taxes and special assessments levied upon or with respect to the site of the Project and payable during the term of the Loan Agreement. 2. There is hereby authorized the issuance, sale and delivery of the Bonds. It is acknowledged that the purchase price of the Bonds, the principal amount of the Bonds, the maturity schedule of the Bonds and the interest rates on the Bonds have not been determined as of this date and are not reflected in the forms of the Loan Agreement, the Indenture, the Bond Purchase Agreement or the Preliminary Official Statement. The Mayor or, in the event of his absence or disability, the City Manager is hereby authorized to approve: (i) the purchase price of the Bonds; provided that the purchase price equals or exceeds 98% of the principal amount of the Bonds (exclusive of any original issue discount on the Bonds); (ii) the initial reoffering prices of the Bonds; provided that the Bonds shall be sold to the ultimate investors with an original issue discount of not more than 5%, if any, of the principal amount payable thereon at maturity; (iii) the principal amount of the Bonds; provided that such principal amount is not in excess of $8,500,000 (without regard to any original issue discount); Resolution 07-12 - Continued February 20, 2007 (iv) the maturity schedule of the Bonds; provided that the Bonds mature at any time or times in such amount or amounts not later than December 31, 2019; (v) the provisions for redemption of the Bonds; and (vi) the interest rates borne by the Bonds; provided that the net interest cost on the Bonds shall not exceed 8% per annum. Such approval shall be conclusively evidenced by the execution of the Bond Purchase Agreement by the officers hereinafter authorized to execute the Bond Purchase Agreement on behalf of the City. 3. The City acknowledges, finds, determines and declares that the financing of the Project, furthers the purposes of the Act. 4. The Bonds shall be special obligations of the City payable solely from the revenues provided pursuant to the Loan Agreement and other funds pledged pursuant to the Indenture. The City Council of the City hereby authorizes and directs the Mayor and the City Clerk of the City (together, the "Officials") to execute and deliver the Indenture by and between the City and the Trustee, and to deliver to the Trustee the Indenture, and hereby authorizes and directs the execution of the Bonds in accordance with the Indenture, and hereby provides that the Indenture shall provide the terms and conditions, covenants, rights, obligations, duties and agreements of the bondowners, the City and the Trustee as set forth therein. 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 City, with such necessary and appropriate variations, omissions and insertions as do not materially change the substance thereof, or as the Officials, in their discretion, shall determine, and the execution thereof by the Officials shall be conclusive evidence of such determination. 5. The Officials are hereby authorized and directed to execute and deliver the Loan Agreement, the Escrow Agreement and the Bond Purchase Agreement. All of the provisions of the Loan Agreement and the Bond Purchase Agreement when executed and delivered as authorized herein, shall be in full force and effect from the date of execution and delivery thereof. The Loan Agreement and the Bond Purchase Agreement shall be substantially in the forms on file with the City, with such omissions and insertions as do not materially change the substance thereof, or as the Officials, in their discretion, shall determine, and the execution thereof by the Officials shall be conclusive evidence of such determination. Resolution 07-12 - Continued February 20, 2007 6. The Bonds shall be revenue obligations of the City the proceeds of which shall be disbursed pursuant to the Indenture and the Loan Agreement, and the principal, premium and interest on the Bonds shall be payable solely from the proceeds of the Bonds and the Loan Agreement. 7. The Trustee is hereby appointed as Paying Agent and Bond Registrar for the Bonds. 8. The Officials are hereby authorized to execute and deliver, on behalf of the City, 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. 9. The City has not participated in the preparation of the Official Statement and has made no independent investigation with respect to the information contained therein, including any appendices thereto, and the City assumes no responsibility for the sufficiency, accuracy or completeness of such information. Subject to the foregoing, the City hereby consents to the distribution of the Official Statement and any preliminary official statement related thereto by the Underwriter in connection with the sale of the Bonds and deem the Preliminary Official Statement "final" for purposes of Rule 15c2-12 promulgated pursuant to the Securities Exchange Act of 1934. 10. All covenants, stipulations, obligations and agreements of the City contained in this Resolution and the aforementioned documents shall be deemed to be the covenants, stipulations, obligations and agreements of the City to the full extent authorized or permitted by law, and all such covenants, stipulations, obligations and agreements shall be binding upon the City. Except as otherwise provided in this Resolution, all rights, powers and privileges conferred and duties and liabilities imposed upon the City 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 covenant, 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 City, or any officer, agent or employee of the City in that person's individual capacity, and neither the City Council of the City 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 thereof. Resolution 07-12 - Continued February 20, 2007 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 City or the breach thereof, shall constitute or give rise to any pecuniary liability of the City or any charge upon its general credit or taxing powers. In making the agreements, provisions, covenants and representations set forth in such documents, the City has not obligated itself to pay or remit any funds or revenues, other than funds and revenues derived from the Loan Agreement which are to be applied to the payment of the Bonds, as provided therein and in the Indenture. 11. 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 City, the Trustee 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 sole and exclusive benefit of the City, the Trustee and any owners from time to time of the Bonds issued under the provisions of this Resolution. 12. In case any one or more of the provisions of this Resolution, or of the aforementioned documents, or of the Bonds issued hereunder shall for any reason be held to be illegal or invalid, such illegality or invalidity shall not affect any other provision of this Resolution, or of the aforementioned documents, or of the Bonds but this Resolution, the aforementioned documents, and the Bonds shall be construed and endorsed as if such illegal or invalid provision had not been contained therein. 13. 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. 14. The Officials of the City, attorneys, engineers and other agents or employees of the City 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 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 or City Clerk of the City is unable to carry out the execution and delivery of any of the documents or other acts provided herein, any other member of the City Council of the City shall be authorized to act in his capacity and undertake such execution or acts on behalf of the City with full force and effect, which executions or acts shall be valid and binding on the City. Resolution 07-12 - Continued February 20, 2007 Linda R. Loomis, Mayor ATTEST: A W)0 Susan M. Virnig, City Clerk I The motion for the adoption of the foregoing resolution was seconded by Member Freiberg and upon a vote being taken thereon, the following voted in favor thereof: Freiberg, Loomis, Pentel, Scanlon and Shaffer; and the following voted against the same: none, whereupon said resolution was declared duly passed and adopted, signed by the Mayor and her signature attested by the City Clerk.