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HomeMy WebLinkAbout06-085 16200 Eagle Creek Avenue S.E. Prior Lake, MN 55372-1714 Extract of Minutes of a Meeting of the City Council of the City of Prior Lake, Minnesota Pursuant to due call and notice thereof, a regular meeting of the City Council of the City of Prior Lake, Minnesota, was duly held at the Prior Lake Fire Station 1 in said City on Monday, the 5th day of June, 2006 at 7:00 o'clock P.M. The following members were present: Mayor Jack Haugen, Councilmembers Cheri Dornbush, Warren E!ickson, Chad LeMair and Steve Millm:: and the following members were absent: None. Member Millar introduced the following resolution and moved its adoption: RESOLUTION 06-085 PROVIDING FOR THE ISSUANCE AND SALE OF SENIOR HOUSING REVENUE BONDS, (SHEPHERD'S PATH SENIOR HOUSING, INC. PROJECT), SERIES 2006B TO PROVIDE FUNDS FOR A SENIOR MUL TIF AMIL Y HOUSING PROJECT The motion for the adoption of the foregoing resolution was du1y seconded by member Dornbush, and after full discussion thereof and upon vote being taken thereon, the following voted in favor thereof: Haugen, Dornbush, Erickson, LeMair and Millar. and the following voted against the same: None. whereupon said resolution was declared duly passed and adopted. 1908315v2 www.cityofpriorlake.com Phone 952.447.4230 / Fax 952.447.4245 RESOLUTION 06-085 PROVIDING FOR THE ISSUANCE AND SALE OF SENIOR HOUSING REVENUE BONDS, (SHEPHERD'S PATH SENIOR HOUSING, INC. PROJECT), SERIES 2006B TO PROVIDE FUNDS FOR A SENIOR MUL TIP AMIL Y HOUSING PROJECT BE IT RESOL YED by the City Council of the City of Prior Lake, Minnesota (the "City"), as follows: 1. Authoritv. The City is, by the Constitution and laws of the State of Minnesota, including Minnesota Statutes, Chapter 462C, as amended (the "Act"), authorized to issue and sell its revenue bonds for the purpose of fmancing the cost of multifamily housing facilities for the elderly and to enter into agreements necessary or convenient in the exercise of the powers granted by the Act. 2. Authorization ofProiect: Documents Presented. Shepherd's Path Senior Housing, Inc., a Minnesota nonprofit corporation (the "Bouvwer"), has proposed that the City issue and sell its Senior Housing Revenue Bonds (Shepherd's Path Senior Housing, Inc. Project), Series 2006B (the "Series 2006B Bonds") in substantially the form set forth in the Indenture (as hereafter defmed) pursuant to the Act and loan the proceeds thereof to the Borrower, in order to assist in fmancing the acquisition, construction and equipping of an approximately 154-unit senior housing and assisted living facility (the "Project") located adjacent to the Shepherd of the Lutheran Lake Church, located at 13760 McKenna Road in the City. Forms of the following documents relating to the Series 2006B Bonds have been submitted to the City, all of which are dated as-of the first day of the month in Which the Series 2006B Bonds are issued, unless otherwise indicated: (a) The Loan Agreement (the "Loan Agreement") between the City and the Borrower, whereby the City agrees to make a loan of the proceeds of sale of the Series 2006B Bonds to the Borrower and pursuant to which agreement the Borrower agrees to undertake and complete the Project and to pay amounts in repayment of the loan sufficient to provide for the full and prompt payment of the principal of, premium, if any, and interest on the Series 2006B Bonds; and (b) The Trust Indenture (the "Indenture") among the City, the Economic Development Authority of the City of Prior Lake, Minnesota (the "EDA") and U.S. Bank National Association, as trustee (the "Trustee"), authorizing the issuance of the Series 2006B Bonds and the EDA's $10,000,000 Senior Housing Revenue Bonds (Shepherd's Path Senior Living, Inc. Project), Series 2006A (the "Series 2006A Bonds" and together with the Series 2006B Bonds, the "Bonds") and pledging certain revenues, including those to be derived from the Loan Agreement, as security for the Bonds, and setting forth proposed recitals, covenants and agreements relating thereto; and (c) The Limited Guaranty Agreement from Presbyterian Homes and Services, a Minnesota nonprofit corporation (the "Guarantor"), to the Trustee, by which the Guarantor guarantees payment of certain obligations of the Borrower relating to payment and purchase of the Bonds (this document not executed by the City); and (d) The Combination Mortgage, Security Agreement and Fixture Financing Statement and Assignment of Leases and Rents (the "Mortgage") between the Borrower, as mortgagor, and the Trustee, as mortgagee, granting to the Trustee a first mortgage lien on and security interest in the Project as security for repayment of the Bonds, (this document not executed by the City); and 1908315v2 2 (e) The Disbursing Agreement (the "Disbursing Agreement") among the Borrower, the Trustee, and a disbursing agent, setting forth the conditions to disbursement of proceeds of the Bonds in payment of costs of the Project (this document not executed by the City); and (f) The Bond Purchase Agreement (the "Bond Purchase Agreement"), among Northland Securities, Inc. (the "Underwriter"), the Borrower and the City, providing for the purchase of the Series 2006B Bonds from the City by the Underwriter and setting forth the terms and conditions of purchase; and (g) The Preliminary Official Statement (together with the form of fmal Official Statement and the insertion of the fmal underwriting details of the Bonds, including the interest rates thereon, and any other changes deemed necessary or desirable, intended to constitute the form of the final Official Statement, and including all Appendices thereto (together the "Official Statement")), describing the offering of the Bonds, and certain terms and provisions of the foregoing documents relating to the Bonds. 3. Findines. It is hereby found, determined and declared that: (a) Based on Borrower representations to the City, the Project constitutes a project authorized by and described in the Act as elderly rental housing. - - .- (b) -=There is no litigation pending or;-'lo. the City's actual knowledge, threatened-~-- against the City relating to the Series 2006B Bonds, the Loan Agreement, the Bond Purchase Agreement or the Indenture (collectively, the "City Bond Documents") or questioning the due organization of the City, or the powers or authority of the City to issue the Series 2006B Bonds and undertake the transactions contemplated hereby. (c) The execution, delivery and performance of the City's obligations under the City Bond Documents 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 }/' vperty 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) It is desirable that the Series 2006B Bonds be issued by the City upon the terms set forth in the Indenture under the provisions of which the City's interest in the Loan Agreement will be pledged to the Trustee as security for the payment of principal of, premium, if any, and interest on the Series 2006B Bonds. (e) Under the provisions of the Act, and as provided in the City Bond Documents, the Series 2006B Bonds are 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 Trustee which are pledged to the payment thereof; the City is not subject to any liability thereon; no owners of the Series 2006B Bonds shall ever have the right to compel the exercise of the taxing power of the City to pay any of the Series 2006B Bonds or the interest thereon, nor to enforce payment thereof against any property of the City; the Series 2006B Bonds shall not constitute a general or moral obligation of the City or 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 each Series 2006B Bond issued under the Indenture shall recite that such Series 2006B Bond, including interest 1908315v2 3 thereon, shall not constitute or give rise to a charge against the general credit or taxing powers of the City. 4. AL.......val of Housinll PrOllfam. The City hereby app.vves the housing program prepared in connection with fmancing the Project. The City has established a governmental program of acquiring purpose investments for qualified SOI(c)(3) projects. The governmental program is one in which the following requirements of ~1.148-1(b) of the federal regulations relating to tax-exempt obligations shall be met: (1) the program involves the origination or acquisition of purpose investments; (2) at least 95% of the cost of the purpose investments acquired under the program represents one or more loans to a substantial number of persons '''p..;.senting the general public, states or political subdivisions, 501(c)(3) organizations, persons who provide housing and related facilities, or any combination of the foregoing; (3) at least 95% of the receipts from the purpose investments are used to pay principal, interest, or redemption prices on issues that financed the program, to payor reimburse administrative costs of those issues or of the program, to payor reimburse anticipated future losses directly related to the program, to fmance additional purpose investments for the same general purposes of the program, or to redeem and retire governmental obligations at the next earliest possible date of redemptioli; - (4) the program documents prohibit any obligor on a purpose investment fmanced by the program or any related party to that obligor from purchasing bonds of an issue that fmances the program in an amount related to the amount of the purpose investment acquired from that obligor; and (5) the City shall not waive the right to treat the investment as a program investment. 5. Aooroval and Execution of Documents. The forms of Series 2006B Bonds and the City Bond Documents are approved. The City Bond Documents, together with such other documents necessary in connection therewith, are authorized to be executed in the name and on behalf of the City by the Mayor and the City Manager at such time, if any, as they may deem appropriate, 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 Trustee. Modifications to the form of Mortgage may be made at the discretion of the parties thereto. 6. Aooroval. Execution and Deliverv of Bonds. The City is authorized to issue the Series 2006B Bonds, in an aggregate principal amount of not to exceed $22,000,000, in the form and upon the terms set forth in the Indenture which terms are for this purpose incorporated in this resolution and made a part hereof; provided, however, that the initial aggregate principal amount of and the maturities of the Series 2006B Bonds, the interest rates thereon, and any provisions for the optional or mandatory ~ redemption thereof shall all be as set forth in the final form of the Indenture to be approved, executed and delivered by the officers of the City authorized to do so by the provisions of this Resolution, which approval shall be conclusively evidenced by such execution and delivery; and provided further that, in no event, shall such maturities exceed forty (40) years. The Underwriter has agreed pursuant to the provisions of the Bond Purchase Agreement and subject to the conditions therein set forth, to purchase the Series 2006B Bonds at the purchase price set forth in the Bond Purchase Agreement and said purchase price is hereby accepted. The Mayor, City Manager, and other City officers are authorized to execute the 1908315v2 4 Series 2006B Bonds as prescribed in the Indenture at such time, if any, as they may deem appropriate, and to deliver them to the Trustee, together with a certified copy of this Resolution and the other documents required by Section 2.08 of the Indenture for authentication, registration and delivery to the Underwriter. 7. Official Statement. As requested by the Underwriter, the City hereby consents to the circulation by the Underwriter of the Official Statement in offering the Series 2006B Bonds for sale; provided, however, that the City has not participated in the preparation of the Official Statement or independently verified the information in the Official Statement and takes no responsibility for, and makes no representations or warranties as to, the accuracy, completeness or sufficiency of such information. 8. Certificates. etc. The Mayor, City Manager, and other officers of the City are authorized at such time, if any, as they may deem appropriate, to p'''pare and furnish to bond counsel and the purchaser of the Series 2006B Bonds, when issued, certified copies of all proceedings and records of the City relating to the Series 2006B Bonds, and such other affidavits and certificates as may be required to show the facts appearing from the books and records in the officers custody and control or as otherwise known to them; and all such certified copies, certificates and affidavits, including any heretofore furnished, shall constitute representations of the City as to the truth of all statements contained therein. Adopted by the City Council of the City of Prior Lake, Minnesota, this 5th day of June, 2006. 'fff~-- Mayor ATTEST: Ci~?::!:~ 1908315v2 5