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HomeMy WebLinkAboutResolution 8118 RESOLUTION NO. 8118 CITY OF MOUNDS VIEW COUNTY OF RAMSEY STATE OF MINNESOTA RESOLUTION AUTHORIZING THE ISSUANCE AND SALE OF HEALTH CARE FACILITY REVENUE BONDS, SERIES 2013 (APPLE TREE DENTAL PROJECT) (a) WHEREAS, Minnesota Statutes, Sections 469.152-469.1651,as amended(the"Act"), confers upon cities the powers conferred by the Act, which include the power to issue revenue obligations to finance, in whole or in part, the cost of the acquisition, construction, reconstruction, improvement, betterment, or extension of a "project," defined in the Act, in part, as any properties, real or personal, used or useful in connection with a revenue producing enterprise, whether or not operated for profit, engaged in providing health care services; and (b) WHEREAS, Apple Tree Dental, a Minnesota nonprofit corporation (the "Borrower") has requested that the City of Mounds View, Minnesota (the "City") issue its health care revenue bonds to provide financing, in whole or in part, for a Project (as defined below); and (c) WHEREAS, the Borrower has proposed that the proceeds of the revenue bonds to be issued by the City will be applied to (i) finance the acquisition, construction and equipping of an approximately 16,000 square foot building located at 2442 County Road 10 in the City to be used as a new clinic and headquarters facility (the "Project"); and (ii) pay the costs of issuance of the revenue bonds and other costs related to the Project; a public hearing on the Project was held by the City Council on November 26, 2012, following duly published notice; and (d) WHEREAS, the City's Health Care Facility Revenue Bonds (Apple Tree Dental Project), Series 2013 will be issued in one or more series in an aggregate principal amount not to exceed $4,500,000, and will include a pledge of, among other things, revenues of the Project(the "Bonds"); and (e) WHEREAS, the Borrower has requested that the Bonds be issued pursuant to an Indenture of Trust between the City and Wells Fargo Bank, National Association (the "Trustee"), dated as of or after July 1, 2013 (the "Indenture"); and (f) WHEREAS, the City, the Borrower, and Wells Fargo Bank, National Association and Wells Fargo Equipment Finance, Inc. (collectively, the"Lender") have agreed upon sufficient details of the Bonds and to enable the City to adopt this final bond resolution (the "Resolution") on this date. NOW THEREFORE BE IT RESOLVED by the City Council of the City of Mounds View, Minnesota, as follows: 1. Proposal for Issuance of Bonds. For the purpose of providing funds to finance the Project there is hereby authorized the issuance, sale and delivery of the Bonds in an aggregate principal amount not to exceed $4,500,000, the proceeds of which, together with funds provided by the Borrower or a subordinate lender, shall be used to finance the Project. The proceeds of the Bonds will be disbursed pursuant to a Construction Disbursement Agreement among the Borrower, the Trustee, the Lender, the subordinate lender and a disbursing agent (the "Disbursing Agreement"). The Bonds shall be special, limited obligations of the City payable solely from the funds pledged therein. The Bonds are not to be payable from nor charged upon any funds of the City other than the revenues pledged to their payment, nor is the City subject to any liability thereon; no holders of the Bonds shall ever have the right to compel any exercise of the taxing power of the City to pay any of the principal of, premium, if any, or interest on the Bonds;the Bonds shall not constitute a charge, lien or encumbrance, legal or equitable, upon any property of the City, and each Bond shall recite that the Bonds, including interest thereon, are payable solely from the revenues pledged to the payment thereof and that no Bond shall constitute a debt of the City within the meaning of any constitutional or statutory limitation. The Bonds shall contain a recital that they are issued pursuant to the Act and such recital shall be conclusive evidence of the validity and regularity of the issuance thereof. 2. Bond Structure. Pursuant to a Loan Agreement, to be dated as of or after July 1, 2013, the City will loan the proceeds of the Bonds to the Borrower to finance a portion of the Project (the "Loan Agreement"). The payments to be made by the Borrower under the Loan Agreement are fixed so as to produce revenue sufficient to pay the principal of, premium, if any, and interest on the Bonds when due. When executed, the right, title and interest of the City in, to and under, among other things, the Loan Agreement (except as therein provided) will be assigned to the Trustee pursuant to the Indenture. It is proposed that the Borrower will execute a Mortgage, Security Agreement, Assignment of Leases and Rents and Fixture Financing Statement (the "Mortgage") as security for payment of the Health Care Facility Revenue Bond (Apple Tree Dental Project), Series 2013A (the "Series 2013A Bond"). It is further proposed that the Borrower will execute a Security Agreement (the "Security Agreement") as security for payment of the Health Care Facility Revenue Bond (Apple Tree Dental Project), Series 2013B (the"Series 2013B Bond"). Pursuant to a Continuing Covenant Agreement between the Lender and the Borrower (the "Continuing Covenant Agreement"), the Borrower has agreed to comply with certain covenants for the benefit of the Lender required in connection with the purchase of the Bonds. The Bonds shall be in such principal amounts, shall bear interest at the rates, shall be numbered, shall be dated, shall mature, shall be subject to redemption prior to maturity, and shall be in such form and have such other details and provisions as may be prescribed in the Indenture as executed in accordance with Sections 5 and 6. 3. Forms of Documents Submitted. Forms of the following documents have been submitted to the City Council for approval: (a) the Continuing Covenant Agreement; (b) the Loan Agreement; (c) the Mortgage; (d) the Security Agreement; and (e) the Indenture. 4. Findings. It is hereby found, determined and declared that: (a) the Project furthers the policies of the Act; (b) the Project promotes the public welfare by providing necessary health care facilities, so that adequate health care facilities are available to residents of the City at a reasonable cost; (c) the Act authorizes the acquisition, construction and installation of the facilities and equipment to be financed by the Bonds, the issuance and sale of the Bonds, the execution and delivery by the City of the Loan Agreement and Indenture (collectively, the "Financing Documents"), the performance of all covenants and agreements of the City contained in the Financing Documents, and the performance of all other acts and things required under the constitution and laws of the State of Minnesota to make the Financing Documents and Bonds valid and binding special, limited obligations of the City in accordance with their terms; (d) it is desirable that the Bonds be issued by the City upon the terms set forth in the Indenture; (e) the payments under the Loan Agreement are fixed to produce revenue sufficient to provide for the prompt payment of principal of, premium, if any, and interest on the Bonds issued under the Indenture when due, and the Financing Documents also provide that the Borrower is required to pay all expenses of the operation and maintenance of the facilities to be financed by the Bonds, including, but without limitation, adequate insurance thereon and insurance against all liability for injury to persons or property arising from the operation thereof, and any taxes and special assessments levied upon or with respect to the premises of said facilities and payable during the term of the Financing Documents; (f) as provided therein and in the Financing Documents, the Bonds are not to be payable from or charged upon any funds other than the revenue pledged to the payment thereof; the City is not subject to any liability thereon; no holder of any Bond shall ever have the right to compel any exercise by the City of any taxing powers to pay any of the Bonds or the interest or premium thereon, or to enforce payment thereof against any property of the City, except the interests of the City in the Loan Agreement which has been assigned to the Trustee under the Indenture; the Bonds shall not constitute a charge, lien or encumbrance, legal or equitable, upon any property of the City except the interests of the City in the Loan Agreement which has been assigned to the Trustee under the Indenture; the Bonds shall recite that the Bonds do not constitute or give rise to a pecuniary liability or moral obligation of the City, the State of Minnesota or any political subdivision, and that the Bonds, including interest thereon, are payable solely from the revenues pledged to the payment thereof; and the Bonds shall not constitute a debt of the City within the meaning of any constitutional or statutory limitation. 5. Approval of Forms; Execution. Subject to the provisions of Sections 8 and 9 hereof, the forms of the Financing Documents and exhibits thereto and all other documents listed in Section 6 hereof are approved substantially in the form submitted. Subject to the provisions of Section 8 hereof, the Financing Documents, in substantially the forms submitted, are directed to be executed in the name and on behalf of the City by the Mayor and the City Administrator(the "City Officers"). Subject to the provisions of Section 8 hereof, the Bonds are to be in executed the name of and on behalf of the City by the City Officers, and are to be delivered to the Trustee for authentication and delivery to the Lender. Any other City documents and certificates necessary to the transaction described above may be executed by one or more appropriate officers of the City, including but not limited to the Finance Director. Copies of all of the documents necessary to the transaction herein described shall be delivered, filed and recorded as provided herein and in the Financing Documents. 6. Issuance. The City shall proceed forthwith to issue the Bonds, in the forms and upon the terms set forth in the Indenture and this Resolution, if and to the extent the Borrower, the Lender and the City Officers determine to proceed with the Project, which determination shall be deemed made upon execution of the Financing Documents by the City Officers. The Bonds shall be payable or prepayable at such time or times, shall bear interest at such rates and shall be subject to such other terms and conditions as set forth therein which the Lender, the Borrower and the City Officers shall agree to, which agreement shall be deemed to have been made upon execution and delivery of the Bonds by the City Officers. The City Officers are authorized and directed to execute and deliver the Bonds as prescribed in the Indenture and this Resolution. 7. Records and Certificates. The City Officers and other officers of the City are authorized and directed to prepare and furnish to the Lender certified copies of all proceedings and records of the City relating to the Bonds, and such other affidavits and certificates as may be required to show the facts relating to the legality of the 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. Changes in Forms Approved.,Absent and Disabled Officers. 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 legal counsel to the City and the City Officers; and said City Officers or staff members are hereby authorized to approve said changes on behalf of the City. The execution of any instrument by the City Officers shall be conclusive evidence of the approval of such document in accordance with the terms hereof. In the event of absence or disability of either of the City Officers, any of the documents authorized by this Resolution to be executed may be executed without further act or authorization of the City Council by any member of the City Council or any duly designated acting official, or by such other officer or officers of the City Council as, in the opinion of the City Attorney, may act in their behalf. 9. Future Amendments. The authority to approve, execute and deliver future amendments to Financing Documents entered into by the City in connection with the issuance of the Bonds and consents required under the financing documents is hereby delegated to the City Officers, subject to the following conditions: (a) such amendments or consents do not require the consent of the respective holders of the Bonds or such consent has been obtained; (b) such amendments or consents to not materially adversely affect the interests of the City; (c) such amendments or consents do not contravene or violate any policy of the City, and (d) such amendments or consents are acceptable in form and substance to the counsel retained by the City to review such amendments. The authorization hereby given shall be further construed as authorization for the execution and delivery of such certificates and related items as may be required to demonstrate compliance with the agreements being amended and the terms of this Resolution. The execution of any instrument by the City Officers shall be conclusive evidence of the approval of such instruments in accordance with the terms hereof. In the absence of the Mayor and/or City Administrator, any instrument authorized by this paragraph to be executed and delivered may be executed by the officer of the City authorized to act in his or her place and stead. 10. Payment of Expenses; Indemnification by Borrower. It is understood and agreed by the Borrower that the Borrower shall indemnify the City against all liabilities, losses, damages, costs and expenses (including attorney's fees and expenses incurred by the City) arising with respect to the Project or the Bonds, as provided for and agreed to by and between the Borrower and the City in the Loan Agreement, regardless of whether the Bonds are issued or the Project proceeds to completion. 11. Headings; Terms. Paragraph headings in this Resolution are for convenience of reference only and are not a part hereof, and shall not limit or define the meaning of any provision hereof. Capitalized terms used but not defined herein shall have the meanings given them in the Indenture and Loan Agreement. 12. Qualified Tax Exempt Obligation. In order to qualify the 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 City hereby designates the Bonds as qualified tax-exempt obligations for purposes of Section 265(b)(3) of the Code and in connection therewith makes the following factual findings; (a) the Bonds will be issued after August 7, 1986; (b) the Bonds are not treated as "private activity bonds" under Section 265(b)(3) of the Code; (c) 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 City(and all entities whose obligations will be aggregated with those of the City) during the calendar year 2013 will not exceed $10,000,000; and (d) not more than $10,000,000 of obligations issued by the City during the calendar year 2013 have been designated for purposes of Section 265(b)(3) of the Code. Adopted this 8th day of July, 2013. Joe Flaherty, Mayor ATTEST: Cvvvt James Ericson, City Administrator (seal)