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HomeMy WebLinkAboutResolutions - R-01-005 - 04/21/2001 - PROVIDE FOR REFINANCING WESTSIDE CREAT LP IRBRESOLUTION NO. R-01-005 I A RESOLUTION PROVIDING FOR THE REFINANCING BY THE CITY OF MCHENRY, ILLINOIS OF A RESIDENTIAL RENTAL PROJECT BY TIME REFUNDING OF PRIOR BONDS FOR WESTSIDE CREST LIMITED PARTNERSHIP (THE "BORROWER"); AUTHORMINU THE ISSUANCE OF ITS NOT TO EXCEED $3,640,000 MULTIFAMILY HOUSING REVENUE REFUNDING BONDS (WESTSIDE CREST APARTMENTS PROJECT), SERIES 2001 AND ITS NOT TO EXCEED $1,540,000 TAXABLE MULTIFAMILY HOUSING REVENUE BONDS (WESTSIDE CREST APARTMENTS PROJECT) SERIES 2001 IN CONNECTION THEREWITH; AUTHORIZING THE EXECUTION AND DELIVERY OF A FINANCING AGREEMENT AMONG THE CITY OF MCHENRY, ILLINOIS, THE BORROWER AND THE TRUSTEE; AUTHORIZING THE EXECUTION AND DELIVERY OF A TRUST INDENTURE SECURING SAID BONDS; AND AUTHORIZING THE EXECUTION OF A BOND PURCHASE AGREEMENT'PROVIDING FOR THE SALE OF SAID BONDS TO THE PURCHASER THEkEOF AND RELATED MATTERS. WHEREAS, the City of McHenry, Illinois, a municipal corporation existing under the laws of the State of Illinois (the "Issuer") is authorized and empowered by the provisions of65 ILCS 5/11- 74 et seq., as from time to time supplemented and amended (the "Act") to issue its revenue bonds to finance in whole or in pant the cost of the acquisition, purchase, construction,, reconstruction, improvement, betterment or extension of any industrial project, or to issue bonds to refund in whole or in part bonds theretofore issued by the Issuer under authority of the Act, and WHEREAS, in March, 1996 the Issuer issued its $3,640,000 Variable Rate Demand Multifamily Housing Refunding Revenue Bonds, Series 1996A (Westside Crest Apartments Project) and its $390,000 Variable Rate Demand Taxable Multifamily Housing Revenue Bonds, Series 1996B (Westside Crest Apartments Project) (collectively, the "Prior Bonds") to assist the Borrower with the refinancing of bonds previously issued by the Issuer in 1987 to finance the acquisition, construction and equipping of a residential rental project located within the jurisdiction ofthe Issuer (the "Project"); and WHEREAS, as a result of negotiations between the Issuer and Westside Crest Limited Partnership, an Illinois limited partnership (the "Borrower"), the Borrower has made arrangements, with the assistance and cooperation of the Issuer, to (1) prepay the loan (the "Prior Loan") financed with the proceeds of the Prior Bonds and to correspondingly refund the Prior Bonds, and (ii) be reimbursed for having made certain capital expenditures with respect to the Project, and the Issuer is willing to issue its revenue bonds in two series to refund the Prior Bonds and to allow the Borrower to be reimbursed for certain of its capital expenditures in connection with the Project and to enter into a Financing Agreement (the "Financing Agreement"), dated as of April 1, 2001, among the Issuer, the Borrower and Firstar Bank, National Association„ as trustee (the "Trustee") upon terms which will produce revenues and receipts sufficient to provide for the prompt payment at maturity of the principal and interest on such revenue bonds, all as set forth in the details and provisions of the Financing Agreement hereinafter identified; and WHEREAS, it is necessary and proper for the Issuer, for the benefit of the inhabitants within the Issuer, to authorize the refunding of the Prior Bonds, the reimbursement of the Borrower with respect to its Project -related capital expenditures and the issuance of the Issuer's Multifamily Housing Revenue Refunding Bonds (Westside Crest Apartments Project) Series 2001 in an aggregate principal amount not to exceed $3,640,000 (the "Tax -Exempt Bonds") and its Taxable Multifamily Housing Revenue Bonds (Westside Crest Apartments Project) Series 2001 in an aggregate principal amount not to exceed $1,540,000 (the "Taxable Bonds" and, together with the Tax -Exempt Bonds, the "Bonds"); and WHEREAS, the proceeds of the Bonds will be applied to enable the Issuer to make a mortgage loan to the Borrower (the "Mortgage Loan")which Mortgage Loan will b6 AS8lgled to -2. Firstar Bank, National Association, as Trustee (thc "Trustee") andFannie Mac, as their interests may appear pursuant to an Assignment and Intercreditor Agreement dated as of April 1, 2001, among the Issuer, the Trustee, the Borrower and Fannie Mae (the "Assignment"), and Fannie Mae will issue its Credit Enhanccment Instrument (Stand-By)(the "Credit Instrument") to the Trustee, to be held by the Trustee for the benefit of the holders of the Bonds to provide credit enhancement for the Bonds; and WHEREAS, the proceeds of the Mortgage Loan will be applied to (i) the prepayment of the Prior Loan and the refunding of the Prior Bonds, and (ii) the reimbursement of the Borrower for its Project -based capital expenditures; and WHEREAS, Stern Brothers & Co, (the "Underwriter") has indicated its willingness to purchase the Bonds; and WHEREAS, it is necessary to authorize the execution of the Financing Agreement with respect to the Mortgage Loan, under which the payments to be paid by the Borrowcr to the Issuer in repayment of the Mortgage Loan are intended to be sufficient to pay the principal of, premium, if any, and interest on the Bonds; and WHEREAS, it is necessary for the Issuer to execute and deliver a Trust Indenture dated as of April 1, 2001 (the "Indenture"), between the Issuer and the Trustee, setting forth terms and conditions of, and security for, the Bonds and containing the forms of the Bonds, for the benefit of holders from time to time of the Bonds, pursuant to which the Bonds will be issued; and WHEREAS, it is necessary to authorize the sale of the Bonds and to execute a Bond Purchase Agreement (the "Purchase Contract"), among the Issuer, the Borrower and the Underwriter in connection therewith; and -3- WHEREAS, it is necessary to authorize the execution �nd delivery of an Amended and Restated Declaration of Restrictive Covenants and Regulatory Agreement dated as of April 1, 2001, 1 by and among the Issuer, the Trustee and the Borrower (the "Regulatory Agreement"); and WHEREAS, it is necessary to authorize the execution and delivery of the Assigmnent.; and WHEREAS, a substantially final form of Preliminary Official Statement (the "Preluninary Official Statement") has been prepared and presented to this meeting; and WHEREAS, the Issuer has caused to be prepared and presented to this meeting the following documents, which the Issuer proposes to enter into: The Financing Agreement; 2. The Indenture; 3. The Purchase Contract; 4. The Regulatory Agreement; and 5. The Assignment. WHEREAS, the City Council of the Issuer held a Public Hearing pursuant to Section 147(f) of the Internal Revenue Code of 1986, as amended, on March 21, 2001; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF MCHENRY, MCHENRY COUNTY, ILLINOIS, AS FOLLOWS: Section 1. That the form, terms and provisions of the proposed Financing Agreement and Indenture be, and they hereby are, in all respects approved, and that the Mayor and the City Clerk of the Issuer be, and they are hereby authorized, empowered and dire rted to execute and deliver such instruments in the name and on behalf of the Issuer, to cause the Financing Agreement to be delivered to the Borrower and the Trustee, and to cause the Indenture to be delivered to the Trustee; -4- that the Indenture shall constitute a lien for the security of the Bo ds upon all right, title and interest of the Issuer in and to the Financing Agreement (except fo certain rights of the Issuer to i indemnification and payment of fees and expenses) and in an4 to the payments, revenues and receipts payable to the Issuer pursuant thereto, and said revenuep are hereby and in the Indenture pledged for such purpose; that the Financing Agreement and the Indenture are to be in substantially the respective forms submitted to this meeting and hereby appro ,ed, with such changes therein as shall be approved by the officials of the Issuer executing the same, their execution thereof to constitute conclusive evidence of their approval of any and all changes or revisions therein from the forms of the Financing Agreement and the Indenture as hereby approved; and that from and after the execution and delivery of such instruments, the officials, agents and employees of the Issuer are hereby authorized, empowered and directed to do all such acts and things and to execute all :such documents as may be necessary to carry out and comply with the provisions of such instarumcnt as executed. S—ecif—OD Z. That the forms, terms and provisions of the proposed Purchase Contract, Regulatory Agreement and Assignment, copies ofwhich are before this meeting, be, and they hereby are, in all respects approved, and that the Mayor and the City Clerk ofthe Issuer be, and they hereby are, authorized, empowered and directed to execute and deliver the Purchase Contract, the Assignment and the Regulatory Agreement in the name and on behalf of the Issuer and thereupon to cause the Purchase Contract, the Assignment and the Regulatory Agreement to be delivered tv the other parties thereto; that the Purchase Contract, the Assignment and the Regulatory Agreement are to be in substantially the forms thereof submitted to this meeting and hereby approved, with such changes therein as shall be approved by the officials of the Issuer executing the same, their execution -5- i thereof to constitute conclusive evidence of their approval of any d all changes or revisions therein from the forms of such instruments as hereby approved; and that. from and after the execution and delivery of such instruments, the officials, agents and employees f the Issuer are hereby authorizcd, empowered and directed to do all such acts and things necessary to carry out and comply with the provisions of such instruments as executed. ec ion 3. That the issuance of the Tax -Exempt Bonds in an aggregate principal amount not to exceed S3,640,000 maturing on or before April 1, 2031, pursuant to a mandatory sinking fund or serially, and bearing interest at the rates per annu m as provided for in the Indenture, with the initial interest rate or rates not to exceed % per annum, is hereby authorized and approved and the Mayor and the City Clerk of the Issuer be and are hereby authorized, empowered and directed to cause to be prepared the Tax -Exempt Bonds in the form and having the other terms and provisions specified in the Indenture (as executed and delivered); that the issuaance of the Taxable Bonds in an aggregate principal amount not to exceed S 1,540,000 maturing on or before April 1, , pursuant to a mandatory sinking fund or serially, and bearing interest at the orates per annum as provided for in the Indenture, with the initial interest rate or rates not to exceed % per ann.um, is hereby authorized and approved and the Mayor and the City Clerk of the Issuer be and are hereby authorized, empowered and directred to cause to be prepared the Taxable Bonds in the form and having the other terms and provisions specified in the Indenture (as executed and delivered); that the Bonds shall be executed in the name of the Issuer with the manual or facsimile signature of its Mayor and the manual or facsimile signature of its City Clerk and the seal of the Issuer shall be impressed or reproduced thereon, and that the Mayor or any other gfficer of the Issuer shall cause the Bonds, as so executed and attested, to be delivered to the Trustee for authentication and the -6- Trustee is hereby requested to authenticate the not to exceed $3,+,000 aggregate principal amount of Tax -Exempt Bonds, and to authenticate the not to exceed $1,540,000 aggregate principal amount of Taxable Bonds; and the forms of the Bonds submitted to this eeting as the same appear in the Indenture, subject to appropriate insertion and revision in order totmply with the provisions ofsaid Indenture be, and the same hereby are, approved, and when the same shall be executed on behalf of the Issuer in the manner contemplated by the Indenture and this Resolution in the aggregate principal amount of not to exceed $3,640,000, with respect to the Tax -Exempt Bonds, and $1,540,000, with respect to the Taxable Bonds, they shall represent the approved forms of the Bonds of the Issuer. Section 4. That the distribution and use of the Preliminary official Statement, substantially in the form thereof submitted to this meeting by the Underwriter, are hereby authorized and approved and the distribution and use of a Final Official Stater icnt are hereby authorized and approved. The Mayor is hereby authorized, empowered and directed to certify that the portions of the Preliminary Official Statement and the Official Statement unOr the headings "THE ISSUER" and "LITIGATION", to the extent such disclosure pertains to the Issuer, are in a form "deemed final" by the Issuer for purposes of Rule 15c2-12 under the Securities Exchange Act of 1934. Sction 5_ That the sale of the Bonds to the Underwriter, upon the terms and conditions set out in the Purchase Contract, be, and is, in all respects authorized and approved. Sectio 6. That from and after the execution and delivery of said documents, the proper officials, agents and employees of the Issuer are hereby authorized, empowered and directed to do all such acts and things and to execute all such documents and certi fi;ates and make all such changes as may be necessary to carry out and comply with the provisions of said documents as executed and to Ai then the purposes and intent of this Resolution, including the preamble hereto. -7. Section 1. That all acts and doings of the officials of the Is uer which are in conformity with the purposes and intent of this Resolution and in furtherance of he issuance and sale of the 'rax- Exeixipt Bonds in an aggregate principal amount not to exceed S3;,640,000, the issuance and sale of the Taxable Bonds in; an aggregate principal amount not to exceed S 1,540,000, and the refunding of the Prior Bonds be, and the same hereby are, in all respects, authorized, approved, ratified and confirmed. Lion I. That approval is hereby granted for the issuance of the Bonds pursuant to Section 147(f) of the Code. I Section Q. The Bonds shall be limited obligations of the'Issuer payable solely out of the revenues and receipts to be derived from the Financing Agreement. No holder of any Bond shall ever have the right to compel any exercise of the taxing power of the Issuer to pay the Bonds or the interest or premium, if any, thereon and the Bonds shall not constitute an indebtedness of the Issuer or a loan of credit thereof within the meaning of any constitutional or statutory provision. It shall be plainly stated on the face of each Bond that it has been issued under the provisions of the Act and that it does not constitute an indebtedness of the Issuer or a loan of credit thereofwithin the meaning of any constitutional or statutory provision. Nothing in this Resolution, the Financing Agreement, the Assignment or the Indenture shall be construed as an obligation or commitment by the Issuer to expend any of its funds other than (i) the proceeds of the sale of the Bonds, (ii) the revenues and receipts to be derived from the Finaneiing Agreement, or (iii) any moneys arising out of the investment or reinvestment of said proceeds, revenues or moneys. -8- tion 10. The Bonds shall be issued in compliance wth and under the authority of the provisions of the Act, this Resolution and the Indenture. Section I l . That the provisions of this Resolution are hereby declared to be separable, and if any section, phrase or provision shall, for any reason, be declared to be invalid, such declaration shall not affect the validity of the remainder of the sections, phrases or provisions. Sectign 12. That all ordinances, resolutions, orders or parts thereof in conflict with the provisions of this Resolution axe, to the extent of such conflict, hareby superseded. Section 133_ This Resolution shall be in full force and effect from and after its adoption and approval in accordance with the law. In ADOPTED, this 21" day of April, 2001 AYES: NAYS: ABSENT: APPROVED by me this 21" day of April, 2001. ATTEST: City Clerk ,' I.6m. 1 -10- Mayor