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HomeMy WebLinkAbout2005-177 CCRMember Kay Lasman its adoption: introduced the following resolution and moved RESOLUTION NO. 2005-177 RESOLUTION AUTHORIZING THE ISSUANCE AND SALE OF THE $127,500 SUBORDINATE HEALTH CARE REVENUE NOTE OF 2005 (CENTER PARK SENIOR APARTMENTS, INC. PROJECT) follows: RESOLVED by the City Council of the City of Brooklyn Center, Minnesota (the "City"). Section 1. Findings. The Council has heretofore determined, and does hereby determine, as 1.1. the City is authorized by Minnesota Statutes, Chapter 462C as amended (the "Act"), (a) to finance the acquisition of the 65-unit senior housing facility located at 5415 691h Avenue North in the City (the "Project") to be undertaken by Presbyterian Homes Housing and Assisted Living, Inc., a Minnesota nonprofit corporation or a related entity who will acquire all membership interest in Center Park Senior Apartments, Inc., a Minnesota nonprofit corporation (the "Borrower") and (b) to enter into a Loan Agreement with the Borrower (the "Loan Agreement") for the public purposes expressed in the Act; 1.2. in authorizing the financing of the Project the City's purpose is, and in its judgment the effect thereof will be, to promote the public welfare by: continuing to provide adequate senior housing; the halting of the movement of talented, educated personnel of all ages to other areas thus preserving the economic and human resources needed as a base for providing governmental services and facilities; the provision of accessible employment opportunities for residents in the area; 1.3. it is desirable, feasible and consistent with the objects and purposes of the Act to issue the $127,500 Subordinate Health Care Revenue Note of 2005 (Center Park Senior Apartments, Inc. Project) (the "Note") to provide a portion of the purchase money financing for the Project; and 1.4. the Note and the interest accruing thereon do not constitute an indebtedness of the City within the meaning of any constitutional or statutory limitation and do not constitute or give rise to a pecuniary liability or a charge against the general credit or taxing powers of the City and neither the full faith and credit nor the taxing powers of the City is pledged for the payment of the Note or interest thereon. Section 2. The Note. 2.1. Authorized Amount and Form of Note. The Note issued pursuant to this Resolution shall be in substantially the form set forth on Exhibit A to the Loan Agreement, with such appropriate variations, omissions and insertions as are permitted or required by this Resolution, and in accordance with the further provisions hereof; and the total principal amount of the Note that may be outstanding hereunder is expressly limited to $955,000 unless a replacement Note is issued pursuant to Section 2.7. RESOLUTION NO. 2005-177 2.2. The Note. The Note shall be dated as of the date of delivery, shall be payable at the times and in the manner, shall bear interest at the initial rate not to exceed of 6.00% per annum, and shall be subject to such other terms and conditions as are set forth therein. 2.3. Execution. The Note shall be executed on behalf of the City by the signatures of its Mayor and Manager (collectively, the "Officials"). In case any of the Officials whose signature shall appear on the Note shall cease to be such Official before the delivery of the Note, such signature shall nevertheless be valid and sufficient for all purposes, the same as if he had remained in office until delivery. In the event of the absence or disability of any of the Officials such other officers of the City as, in the opinion of the Bond Counsel, may act in their behalf, shall without further act or authorization of the Council execute and deliver the Note. Execution of the Note by the Officials shall constitute approval of the exact interest rate on the Note. 2.4. Delivery of Note. Before delivery of the Note there shall be filed with the purchaser of the Note (except to the extent waived by the purchaser) the following items: (a) an executed copy of each of the following documents: (1) the Loan Agreement; (2) the Pledge Agreement between the City and the Purchaser (the "Pledge Agreement"); and (3) the Subordinate Mortgage, Security Agreement and Fixture Financing Statement from the Borrower to the Purchaser (the "Mortgage"); (b) an opinion of Counsel for the Borrower as prescribed by Bond Counsel and the purchaser; (c) the opinion of Bond Counsel as to the validity and tax exempt status of the Note; and (d) such other documents and opinions as Bond Counsel may reasonably require for purposes of rendering its opinion required in subsection (c) above or that the purchaser may reasonably require for the closing. 2.5. Disposition of Note Proceeds. The Note will be delivered to provide payment of a portion of the purchase price for acquisition of the Project. 2.6. Registration of Transfer. The City will cause to be kept at the office of the Manager 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 original purchaser and shall be transferable upon the Note Register by the holders in person or by an agent duly authorized in writing, upon surrender of a Note together with a written instrument of transfer satisfactory to the Manager, duly executed by the holder or its duly authorized agent. The following form of assignment shall be sufficient for such purpose. 2 RESOLUTION NO. 2005-177 For value received hereby sells, assigns and transfers unto the within Note of the City of Brooklyn Center and does hereby irrevocably constitute and appoint attorney to transfer such Note on the books of the City with full power of substitution in the premises. The undersigned certifies that the transfer be made in accordance with the provisions of Section 2.9 of the Resolution relating to the above Note. Dated: Registered Owner Upon such transfer the Manager shall note the date of registration and the name and address of the new holder in the Note Register and in the registration blank appearing on the Note. 2.7. Mutilated, Lost or Destroyed Note. In case any Note issued hereunder shall become mutilated or be destroyed or lost, 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 holder'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. 2.8. Ownership of Note. The City may deem and treat the person in whose name the Note is last registered in the Note Register and by notation on the 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. 2.9. Limitation on Note Transfers. The Note has been issued to an "accredited investor" and without registration under state or other securities laws, pursuant to an exemption for such issuance; and accordingly the Note may not be assigned or transferred in whole or part, nor may a participation interest in the Note be given pursuant to any participation agreement, except to another "accredited investor" or "financial institution" in accordance with an applicable exemption from such registration requirements. 2.10. Issuance of New Note. Subject to the provisions of Section 2.9, the City shall, at the request and expense of a holder, issue a new Note or Notes, in aggregate outstanding principal amount equal to that of the Note surrendered but in no event in an amount less than $100,000, and of like tenor except as to number, principal amount, and the amount of the monthly installments payable thereunder, and registered in the name of the holder or such transferee as may be designated by the holder. Section 3. General Covenants. 3.1. Payment of Principal and Interest. The City covenants that it will promptly pay or cause to be paid the principal of and interest on the Note at the place, on the dates, solely from the source and in the manner provided herein and in the Note. The principal and interest are payable solely from and secured by revenues and proceeds derived from the Loan Agreement, the Pledge Agreement, and the Mortgage (the "Security Documents"), which revenues and proceeds 3 RESOLUTION NO. 2005-177 are hereby specifically pledged to the payment thereof in the manner and to the extent specified in the Note and the Security Documents; and nothing in the Note or in this Resolution shall be considered as assigning, pledging or otherwise encumbering any other funds or assets of the City or the City. 3.2. Performance of and Authority for Covenants. The City covenants that it will faithfully perform at all times any and all covenants, undertakings, stipulations and provisions contained in this Resolution, in the Note and in all proceedings of the Board pertaining thereto; that it is duly authorized under the Constitution and laws of the State of Minnesota including particularly and without limitation the Act, to issue the Note, pledge the revenues and assign the Loan Agreement in the manner and to the extent set forth in this Resolution, the Note, the Loan Agreement and the Pledge Agreement; that all action on its part for the issuance of the Note and for the execution and delivery thereof has been duly and effectively taken; and that the Note in the hands of the holders are and will be valid and enforceable special limited obligations of the City according to the terms thereof. 3.3. Enforcement and Performance of Covenants. The City agrees to enforce all covenants and obligations of the Borrower under the Loan Agreement, upon request of the holders of the Note and being indemnified to the satisfaction of the City for all expenses and claims arising therefrom, and to perform all covenants and other provisions pertaining to the City contained in the Note and the Loan Agreement and subject to Section 3.4. 3.4. Nature of Security. Notwithstanding anything contained in the Note, the Security Documents or any other document referred to in Section 2.4 to the contrary, nothing in this resolution or in the documents prepared pursuant hereto shall authorize the expenditure of any municipal funds on the Project or the Note other than the revenues derived from the Project. The Note shall not constitute a charge, lien or encumbrance, legal or equitable, upon any property or funds of the City except the revenue and proceeds pledged to the payment thereof, nor shall the City be subject to any liability thereon. The holder of the Note shall never have the right to compel any exercise of the taxing power of the City to pay the outstanding principal on the Note or the interest thereon, or to enforce payment thereof against any property of the City. The Note shall recite in substance that the Note, including interest thereon, is payable solely from the revenue and proceeds pledged to the payment thereof. The Note shall not constitute a debt of the City within the meaning of any constitutional or statutory limitation. However, nothing in the Act impairs the rights of the holders of the Note to enforce the covenants made for the security thereof as provided in this Resolution, the Loan Agreement and the Pledge Agreement, and in the Act, and by authority of the Act, the City has made the covenants and agreements herein for the benefit of the purchaser; provided that in any event, the agreement of the City to perform or enforce the covenants and other provisions contained in the Note, the Loan Agreement and the Pledge Agreement shall be subject at all times to the availability of revenues under the Loan Agreement sufficient to pay all costs of such performance or the enforcement thereof, and the City shall not be subject to any personal or pecuniary liability thereon. Section 4. Miscellaneous. 4.1. Severability. 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 4 RESOLUTION NO. 2005-177 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. 4.2. Authentication of Transcript. The Officials are directed to furnish to Bond Counsel certified copies of this Resolution and all documents referred to herein, and affidavits or certificates as to all other matters which are reasonably necessary to evidence the validity of the Note. All such certified copies, certificates and affidavits, including any heretofore furnished, shall constitute recitals of the City as to the correctness of all statements contained therein. 4.3. Authorization to Execute Agreements. The forms of the proposed Loan Agreement and the Pledge Agreement are hereby approved in substantially the form heretofore presented to the Board, together with such additional details therein as may be necessary and appropriate and such modifications thereof, deletions therefrom and additions thereto as may be necessary and appropriate and approved by Bond Counsel prior to the execution of the documents, and the Officials are authorized to execute the Loan Agreement and the Pledge Agreement in the name of and on behalf of the City and such other documents as Bond Counsel consider appropriate in connection with the issuance of the Note. In the event of the absence or disability of the Officials, other such officers of the City as, in the opinion of the City Attorney, may act in their behalf, shall without further act or authorization of the Board do all things and execute all instruments and documents required to be done or executed by such absent or disabled Officials. 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. December 12. 2005 Date e Mar ATTEST: City Clerk The motion for the adoption of the foregoing resolution was duly seconded by member Kathleen Carmody and upon vote being taken thereon, the following voted in favor thereof: Myrna Kragness, Kathleen Carmody, Kay Lasman, and Diane Niesen; and the following voted against the same: Mary O'Connor; whereupon said resolution was declared duly passed and adopted. 5