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HomeMy WebLinkAbout06-01EDA 16200 Eagle Creek Avenue S.E. Prior Lake, MN 55372-1714 Extract of Minutes of a Meeting of the Board of Commissioners of the Economic Development Authority of the City of Prior Lake, Minnesota Pursuant to due call and notice thereof, a regular meeting of the Board of Commissioners of the Economic Development Authority of the City of Prior Lake was duly held at the Prior Lake Fire Station I in said City on Monday, the 5th day of June, 2006 at 9:20 p.m. The following commissioners were present: Cheri Dornbush, Warren Erickson, Jack Haugen, Chad LeMair and Steve Millar. and the following commissioners were absent: None Member Millar introduced the following resolution and moved its adoption: RESOLUTION 06-01 EDA PROVIDING FOR THE ISSUANCE AND SALE OF SENIOR HOUSING REVENUE BONDS, (SHEPHERD'S PATH SENIOR HOUSING, INC. PROJECT), SERIES 2006A TO PROVIDE FUNDS FOR A SENIOR MULTIFAMILY HOUSING PROJECT The motion for the adoption of the foregoing resolution was duly seconded by commissioner Haugen, and after full discussion thereof and upon vote being taken thereon, the following voted in favor thereof: Dornbush, Erickson, Haugen, LeMair and Millar. and the following voted against the same: None. whereupon said resolution was declared duly passed and adopted. I:\EDA\Resolutions\06-01EDA Shepherd's Path Revenue\QWk1SS~~JD6e;.com Phone 952.447.4230 / Fax 952.447.4245 RESOLUTION 06-01EDA PROVIDING FOR THE ISSUANCE AND SALE OF SENIOR HOUSING REVENUE BONDS, (SHEPHERD'S PATH SENIOR HOUSING, INC. PROJECT), SERIES 2006A TO PROVIDE FUNDS FOR A SENIOR MUL TIF AMIL Y HOUSING PROJECT BE IT RESOLVED by the Board of Commissioners of the Economic Development Authority of the City of Prior Lake (the "EDA"), as follows: 1. Authoritv. The EDA 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 financing 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 "Borrower"), has proposed that the EDA issue and sell its $10,000,000 Senior Housing Revenue Bonds (Shepherd's Path Senior Housing, Inc. Project), Series 2006A (the "Series 2006A Bonds") in substantially the form set forth in the Indenture (as hereafter defined) pursuant to the Act and loan the proceeds thereof to the Borrower, in order to assist in financing 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 2006A Bonds have been submitted to the EDA, all of which are dated as of the first day of the month in which the Series 2006A Bonds are issued, unless otherwise indicated: (a) The Loan Agreement (the "Loan Agreement") between the EDA and the Borrower, whereby the EDA agrees to make a loan of the proceeds of sale of the Series 2006A 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 2006A Bonds; and (b) The Trust Indenture (the "Indenture") among the EDA, the City of Prior Lake, Minnesota (the "City") and U.S. Bank National Association, as trustee (the "Trustee"), authorizing the issuance of the Series 2006A Bonds and the City's $20,500,000 Senior Housing Revenue Bonds (Shepherd's Path Senior Living, Inc. Project), Series 2006B (the "Series 2006B Bonds" and together with the Series 2006A 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 EDA); and 1910688v2 2 (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 EDA); and (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 EDA); and (f) The Bond Purchase Agreement (the "Bond Purchase Agreement"), among Northland Securities, Inc. (the "Underwriter"), the Borrower and the EDA, providing for the purchase of the Series 2006A Bonds from the EDA by the Underwriter and setting forth the terms and conditions of purchase; and (g) The Preliminary Official Statement (together with the form of final Official Statement and the insertion of the final 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. Findim!s. It is hereby found, determined and declared that: (a) Based on Borrower representations to the EDA, the Project constitutes a project authorized by and described in the Act as elderly rental housing. (b) There is no litigation pending or, to the EDA's actual knowledge, threatened against the EDA relating to the Series 2006A Bonds, the Loan Agreement, the Bond Purchase Agreement or the Indenture (collectively, the "EDA Bond Documents") or questioning the due organization of the EDA, or the powers or authority of the EDA to issue the Series 2006A Bonds and undertake the transactions contemplated hereby. (c) The execution, delivery and performance of the EDA's obligations under the EDA Bond Documents do not and will not violate any order of any court or other agency of government of which the EDA is aware or in which the EDA is a party, or any indenture, agreement or other instrument to which the EDA 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) It is desirable that the Series 2006A Bonds be issued by the EDA upon the terms set forth in the Indenture under the provisions of which the EDA's interest in the Loan Agreement will be pledged to the Trustee as security for the payment of principal of, premium, ifany, and interest on the Series 2006A Bonds. 1910688v2 3 (e) Under the provisions of the Act, and as provided in the EDA Bond Documents, the Series 2006A 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 EDA is not subject to any liability thereon; no owners of the Series 2006A Bonds shall ever have the right to compel the exercise of the taxing power of the EDA to pay any of the Series 2006A Bonds or the interest thereon, nor to enforce payment thereof against any property of the EDA; the Series 2006A Bonds shall not constitute a general or moral obligation of the EDA or a charge, lien or encumbrance, legal or equitable, upon any property of the EDA (other than the interest of the EDA in the Loan Repayments to be made by the Borrower under the Loan Agreement); and each Series 2006A Bond issued under the Indenture shall recite that such Series 2006A Bond, including interest thereon, shall not constitute or give rise to a charge against the general credit or taxing powers of the EDA. 4. Oualified Tax ExemDt Oblh!ations. In order to qualify the Series 2006A Bonds 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 EDA hereby makes the following factual statements and representations; (1) the Bonds are not treated as a "private activity bond" under Section 265(b)(3) of the Code; (2) the EDA hereby designates the Bonds as qualified tax-exempt obligations for purposes of Section 265(b )(3) of the Code; (3) 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 EDA (and all entities whose obligations will be aggregated with those of the EDA) during the calendar year 2006 will not exceed $10,000,000; (4) not more than $10,000,000 of obligations issued by the EDA during the calendar year 2006 have been designated for purposes of Section 265(b)(3) of the Code; and (5) the aggregate face amount of the Bonds does not exceed $10,000,000. 5. Aonroval of Housinl! PrOl!fam. The EDA hereby approves the housing program - - -- prepared in connection with financing the Project. The EDA has established a governmental program of acquiring purpose investments for qualified 501(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: (6) the program involves the origination or acquisition of purpose investments; (7) 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 representing the 1910688v2 4 general public, states or political subdivisions, 501(c)(3) organizations, persons who provide housing and related facilities, or any combination of the foregoing; (8) 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 finance 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 redemption; (9) the program documents prohibit any obligor on a purpose investment financed by the program or any related party to that obligor from purchasing bonds of an issue that finances the program in an amount related to the amount of the purpose investment acquired from that obligor; and (10) the EDA shall not waive the right to treat the investment as a program investment. 6. Annroval and Execution of Documents. The forms of Series 2006A Bonds and the EDA Bond Documents are approved. The EDA Bond Documents, together with such other documents necessary in connection therewith, are authorized to be executed in the name and on behalf of the EDA by the President and the Secretary at such time, if any, as they may deem appropriate, or executed or attested by other officers of the EDA, 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. 7. Aooroval. Execution and Deliverv of Bonds. The EDA is authorized to issue the Series 2006A Bonds, in an aggregate principal amount of not to exceed $10,000,000, 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 2006A 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 EDA 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 2006A Bonds at the purchase price set forth in the Bond Purchase Agreement and said purchase price is hereby accepted. The President, Secretary, and other EDA officers are authorized to execute the Series 2006A 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. 1910688v2 5 8. Official Statement. As requested by the Underwriter, the EDA hereby consents to the circulation by the Underwriter of the Official Statement in offering the Series 2006A Bonds for sale; provided, however, that the EDA 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. 9. Certificates. etc. The President, Secretary, and other officers of the EDA are authorized at such time, if any, as they may deem appropriate, to prepare and furnish to bond counsel and the purchaser of the Series 2006A Bonds, when issued, certified copies of all proceedings and records of the EDA relating to the Series 2006A 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 EDA as to the truth of all statements contained therein. Adopted by the Board of Commissioners of the Economic Development Authority of the City of Prior Lake this 5th day of June, 2006. preSiden~ ATTEST: (P~ Secretary \. 1910688v2 6 STATE OF MINNESOTA ) ) ss. COUNTY OF SCOTT ) I, the undersigned, being the duly qualified Secretary of the Economic Development Authority of the City of Prior Lake, Minnesota (the "EDA"), do hereby certify that attached hereto is a compared, true and correct copy of a resolution giving final approval to an issuance of revenue bonds by the EDA on behalf of Shepherd's Path Senior Housing, Inc., duly adopted by the Board of Commissioners of the EDA on June 5, 2006, at a regular meeting thereof duly called and held, as on file and of record in my office, which resolution has not been amended, modified or rescinded since the date thereof, and is in full force and effect as of the date hereof. WITNESS My hand this ~ day of June, 2006. (J~~ Secretary , - 1910688v2