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1996-086:, ~ CITY OF HOPKINS, MINNESOTA RESOLUTION NO. 96-86 RESOLUTION AUTHORIZING THE ISSUANCE OF THE CITY'S X3,795,000 UNLIMITED TAX GENERAL OBLIGATION BONDS (OAKS OF MAIN STREET PROJECT) TAXABLE SERIES 1996B AND APPROVING AND AUTHORIZING THE EXECUTION OF VARIOUS DOCUMENTS IN CONNECTION THEREWITH BE IT RESOLVED by the City Council of the City of Hopkins, Minnesota (the "City"), as follows: 1. The City has received a proposal from The Oaks of Mainstreet, a Minnesota limited liability company, that the City undertake to finance a portion of the costs of the Project described herein pursuant to Minnesota Statutes, Chapter 469 (the "Act"), through issuance by the City of its Unlimited Tax General Obligation Bonds (The Oaks of Mainstreet Project), Taxable Series 1996B in a principal amount of $3,795,000 (the "Series 1996B Bonds"), pursuant to an Indenture of Trust dated as of October 1, 1996 (the "Indenture"), among the City, The Housing and Redevelopment Authority in and for the City of Hopkins, Minnesota (the ' "Authority"), and First Trust National Association, as trustee (the "Trustee"). 2. It is proposed that, pursuant to a Series 1996A Bonds and Series 1996B Bonds Loan Agreement dated as of October 1, 1996, among the City, the Authority and the Borrower (the "Loan Agreement"), the City lend the proceeds of the Series 1996B Bonds to the Borrower to finance a portion of the cost of acquisition, construction and equipping of 66 townhomes to be marketed for sale and on a lease-to-own basis (the "Project"). The loan repayments to be made by the Borrower under the Loan Agreement and other moneys pledged to the payment of the Series 1996B Bonds under the Indenture are fixed so as to produce revenue sufficient to pay the principal of, premium, if any, and interest on the Series 1996B Bonds when due. It is further proposed that the City assign its rights to the loan repayments and certain other rights under the Loan Agreement to the Trustee as provided in the Indenture. Payment of the Series 1996B Bonds is additionally secured by a pledge of the full faith and credit of the City as set forth herein, a Short Term Bonds Tax Increment Pledge Agreement dated as of October 1, 1996 (the "Tax Increment Pledge Agreement"), between the Authority and the City and assigned to the Trustee under the Indenture, and pledges of certain other moneys and agreements as provided in the Indenture. Proceeds of the Series 1996B Bonds and certain other bonds to be issued in connection with the Project will be disbursed pursuant to a Disbursing Agreement dated as of October 1, 1996 (the "Disbursing Agreement"), among the Authority, the City, the Borrower, the Trustee and the title insurance company named therein. 3. Forms of the following documents have been submitted to the City for approval: (a) The Loan Agreement, (b) The Indenture (c) The Tax Increment Pledge Agreement, and (d) The Disbursing Agreement. SJB111623 HP110-51 4. It is hereby found, determined and declared that: (a) it is desirable that the Series 1996B Bonds be issued by the City upon the terms set forth in the four. of Series 1996B Bond set forth in the Indenture; (b) the Loan Agreement provides that the Borrower is required to pay loan repayments which are fixed to produce revenue sufficient (with other moneys pledged to the Series 1996B Bonds and available for the purpose) to provide for the prompt payment of principal of, premium, if any, and interest on the Series 1996B Bonds when due, and all expenses of the operation and maintenance of unsold units in 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 Project and payable during the term of the Loan Agreement; and (c) as provided. in the Indenture, the Series 1996B Bonds are general obligations of the City, and the full faith and credit and taxing power of the City are pledged for the payment of principal thereof and interest and premium, if any, thereon; and the City will levy a general ad valorem tax on all taxable property in the City, without limitation as to rate or amount, if necessary for the purpose. The obligation of the Borrower to reimburse the City for payments made pursuant to the foregoing pledge is secured by a Second Mortgage, Security Agreement and Financing Statement dated as of October 1, 1996 (the "Second Mortgage"), from the Borrower to the City, which is hereby approved. 5. Subject to the final approval of Bond Counsel, the Loan Agreement, Indenture, Tax Increment Pledge Agreement and Disbursing Agreement and exhibits thereto are approved, substantially in the forms submitted. The Loan Agreement, the Indenture, the Tax Increment Pledge Agreement and the Disbursing Agreement are directed to be executed in the name and on behalf of the City by the signatures of the Mayor and the City Manager. Any other documents and certificates necessary to the transaction described above shall be executed and delivered by the appropriate City officials. Copies of all of the documents necessary to the transaction herein described shall be delivered, filed and recorded as provided herein and in the Indenture, the Loan Agreement and the Tax Increment Pledge Agreement. 6. The City shall proceed forthwith to issue the Series 1996B Bonds, substantially in the form and upon the terms set forth in the Indenture. The offer of Miller & Schroeder Financial, Inc. (the "Purchaser") to purchase the Series 1996B Bonds at a price of par, bearing interest at a rate not to exceed percent per annum, is hereby accepted. The Mayor and City Manager are authorized and directed to prepare and execute the Series 1996B Bonds and to deliver the Series 1996B Bonds to the Purchaser. The Mayor and City Manager are authorized and directed to execute a Bond Purchase Agreement with the Purchaser, the Borrower and such other parties as may be appropriate. 7. The Mayor, the City Manager and other officers of the City are authorized and directed to prepare and furnish to the Purchaser and to Bond Counsel certified copies of all proceedings and records of the City relating to the Series 1996B Bonds, and such other affidavits SJB111623 HP110-51 and certificates as may be required to show the facts relating to the legality of the Series 1996B - Bonds as such facts appear 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. 8. The approval hereby given to the various documents referred to above includes approval of 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 the officials authorized herein to execute said documents, which approval shall be conclusively evidenced by the execution thereof. 9. The City hereby approves and ratifies the preparation and distribution of a Preliminary Official Statement for the Series 1996B Bonds, from which an Official Statement will be generated. The City takes no responsibility for any of the information contained in the Preliminary Official Statement or the Official Statement, other than the information describing the City set forth in Appendix A thereto. 10. The City Manager is authorized and directed to file a certified copy of this resolution with the Taxpayer Services Division Manager of Hennepin County and to obtain the certificate required by Minnesota Statutes, Section 475.63. 11. The City hereby covenants and agrees that it will comply with and carry out all of the provisions of the Continuing Disclosure Certificate to be executed by the Mayor and City Manager and dated the date of issuance and delivery of the Series 1996B Bonds, as originally executed and as it may be amended from time to time in accordance with the terms thereof. Notwithstanding any other provision of this Resolution, failure of the City to comply with the Continuing Disclosure Certificate is not to be considered an event of default with respect to the Series 1996B Bonds; however, the Trustee may (and, at the request of any Participating Underwriter or the Holders of at least 25% in aggregate principal amount of the Series 1996B Bonds Outstanding under the Indenture, the Trustee must) or any Bondholder may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the City to comply with its obligations under this Section. Adopted: October 22, 1996 P_ for Atte City lerk (sEAI/y SJB:,1623 HP117-51