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HomeMy WebLinkAboutResolution 74-1993 RESOLUTION NO. � �� �-� RESOLUTION OF THE CITY OF BROOKINGS, SOUTH DAKOTA, AUTHORIZING THE ISSUANCE AND SALE OF UP TO $1,015,000 PRINCIPAL AMOUNT OF ITS ECONOMIC DEVELOPMENT REFUNDING REVENUE BONDS, SERIES 1993 (HOLIBROOK, INC. ISSUE) ; AUTHORIZING THE EXECUTION AND DELIVERY OF A TRUST INDENTURE, LOAN AGREEMENT, COMBINATION MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT OF LEASES AND RENTS AND FIXTURE FINANCING STATEMENT, AND OTHER DOCUMENTS, IN CONNECTION THEREWITH AND APPROVING THE FORM OF SUCH DOCUMENT5; AND AUTHORIZING AND APPROVING OTHER MATTERS IN CONNECTION THEREWITH. WHEREAS, the City of Brookings, South Dakota (the "City" ) , is a political subdivision of the State of South Dakota and is authorized by SDCL 9-54, as amended, entitled "Economic Development Projects") to issue revenue bonds, the proceeds of which shall be used to purchase, construct, enlarge, improve and remodel buildings, structures or equipment, and to enter into revenue agreements, including loan agreements, with any person, firm, corporation or governmental entity with respect to said projects, provided that the governing body of the City declares that the project would promote the welfare of the municipality, and to secure the payment of such bonds as provided in the Act; WHEREAS, Holibrook, Inc. , a South Dakota corporation (the "Company" ) has heretofore entered into that certain Loan Agreement dated as of December 1, 1985 (the "Prior Loan Agreement" ) , with the City pursuant to which the City lent to the Company the original principal amount of $1,500,000, of which approximately $1,015,000 is currently outstanding and unpaid; WHEREAS, to obtain moneys with which to make such loan to the Company, the City has issued and sold its Economic Development Revenue Bonds, Series 1985 (Holibrook, Inc. Project) , in the original principal amount of $1,500,000, of which approximately $1,015,000 is currently outstanding and unpaid (the "Series 1985 Bonds" ) , which Series 1985 Bonds were issued under and secured by that certain Trust Indenture dated as of December 1, 1985 (the "Prior Indenture" ) between the City and The First National Bank in Brookings, as trustee (the "Trustee" ) , and loaned the proceeds thereof to the Company; WHEREAS, to evidence said loan, the Company executed and delivered to the City its Promissory Note dated as of December 1, 1985 (the "Series 1985 Note" ) payable to the order of the City in the original principal amount of $1,500,000, of which approximately $1,015,000 is currently outstanding and unpaid; WHEREAS, the proceeds of the Series 1985 Bonds were applied to the payment of costs of the purchase and construction of a commercial facility in the form of a convention center and addition to the Company's existing motel facilities within the City of Brookings, which improvements, together with the existing motel facilities, constitute a "pro�ect" within the meaning of the Act, including real estate, buildings, improvements, fixtures, machinery, furnishings and equipment (the "1985 Project" ) ; WHEREAS, pursuant to SDCL 9-54 and SDCL 6-8B (together, the "Act" ) , the City now wishes to effectuate the current refunding of the outstanding Series 1985 Bonds and, in order to provide moneys to do so, the City desires to authorize the issuance and sale of its Economic Development Rev�nue Refunding Bonds, Series 1993 (Holibrook, Inc. Issue) , in a principal amount of up to $1,015,000 (the "Bonds" ) ; WHEREAS, upon the issuance of the Bonds, (a) the City will deposit the proceeds of the Bonds with The First National Bank in Brookings (the "Trustee" ) , acting as trustee under a Trust Indenture dated as of Novembe.r 1, 1993 (the "Indenture" ) between the City and the Trustee, and (b) the proceeds of the Bonds will be applied to fund a loan to the Company pursuant to a Loan Agreement dated as of November 1, 1993 (the "Loan Agreement" ) between the City and the Company, for the purpose of, together with other available funds, (i) refunding on a current basis the Series 1985 Bonds; and (ii) paying certain costs of issuance of the Bonds; WHEREAS, pursuant to the Loan Agreement, the Company will execute and deliver to the City its First Mortgage Note, Series 1993, in a principal amount equal to the original principal amount of the Bonds (the "Series 1993 Note" ) , in which the Company will promise, subject to the conditions and limitations stated therein and in the Loan Agreement, to repay the loan of proceeds of the Bonds in installments on such dates and in such amounts that will provide funds for the City to make payments of principal, redemption price and interest as the same become due on the Bonds; WHEREAS, in order to secure its obligations under the Loan Agreement and the Note the Company will enter into a Combination Mortgage - One Hundred Eighty Day Redemption, Security Agreement, Assignment of Leases and Rents and Fixture Financing Statement dated as of November 1, 1993 (the "Mortgage") with the City granting a mortgage on and a security interest in the 1985 Project; WHEREAS, the Bonds, together with interest thereon, shall be special, limited obligations of the City secured by an assignment of certain of the City' s rights under the Loan Agreement pursuant to the Indenture, and shall be payable solely from the revenues and income derived from the 1985 Project, including but not limited to the payments, revenues and receipts derived by the City under the Loan Agreement, the Note, the Mortgage and as otherwise provided in the Indenture and in the Loan Agreement and shall be a valid claim of the owners thereof only against the revenues and income derived from the Loan Agreement, the Note and the "Trust Estate" under the Indenture; such Bonds and the obligation to pay interest thereon shall not now and shall never constitute an indebtedness of the City, the State of South Dakota or any political subdivision 2 thereof within the purview of any constitutional limitation or provision, and no owner of the Bonds shall have the right to compel any exercise of the taxing power, if any, of the State of South Dakota, the City, or any other political subdivision of the State to pay any principal installment of or interest on the Bonds; WHEREAS, in connection with the issuance of the Bonds by the City it is desirable to authorize the execution of the Indenture, the Loan Agreement, the Mortgage, the Tax Agreement, as defined herein, a Bond Purchase Agreement (the "Bond Purchase Agreement" ) among the City, the Company and O. Dale Larson, as Trustee (the "Purchaser" ) , and to approve the execution and delivery of the Mortgage; WHEREAS, the members of the City Commission desire to delegate the Mayor of the City the authority to determine certain terms of the issuance of the Bonds, as set forth more fully in this Resolution; and WHEREAS, pursuant to the provisions of Section 147(f) of the Internal Revenue Code of 1986, as amended, a public hearing on the proposed issuance of the Bonds was held on October 4, 1993, pursuant to public notice published in newspapers of general circulation in Brookings South Dakota, at least 14 days before the public hearing: NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF BROOKINGS, SOUTH DAKOTA: 5ection 1. Findings. Tlie City hereby determines that the 1985 Project and the issuance of the bonds by the City, as herein recited and provided, will serve the intended accomplishments and in all respects conform to the provisions and requirements of the Act. The City hereby finds and determines that the 1985 Project promotes the welfare of the City and that it is necessary and desirable to apply, if so provided in the Indenture, a portion of the proceeds of the Bonds to discharge any unpaid interest on the Series 1985 Bonds accrued or to accrue to the date on which the indebtedness is finally paid. To accomplish the purpose of the Act, and to provide for the refunding of the Series 1985 Bonds, the City Commission hereby authorizes the issuance of the Bonds by the City in the principal amount not to exceed the lesser of (i) the actual outstanding balance of Series 1985 Bonds outstanding on the date of the issuance of the Bonds, and (ii) $1,015,000, subject to the provisions of this Resolution and the Indenture hereinafter authorized. The Bonds will be dated November 1, 1993 and will be payable ' in monthly installments of principal and interest ending no later than July 1, 2001, unless earlier redeemed as provided in the Indenture. The Bonds shall bear interest at the rate of 5 .50� per annum, unless there shall occur a Determination of Taxability (as 3 defined in the Indenture) , in which event the Bonds shall bear interest at the Taxable Rate (as defined in the Indenture" ) . The Bonds shall be dated, shall ma�ure, shall be subject to redemption prior to maturity, shall be payable in such places and in such manner, and shall have such other details and provisions as prescribed by the Indenture and the form of the Bonds set forth in the Indenture. The provisions for execution, signatures and authentication of the Bonds shall be as set forth in the Indenture and the form of the Bonds set forth therein. Section 2 . The Bonds . The Bonds shall be secured by the pledge made by the Indenture and shall be payable by the City solely from and secured by revenues and income derived from the 1985 Project, including but not limited to the payments, revenues and receipts derived by the City under the Loan Agreement, the Note, the Mortgage and as otherwise provided in the Indenture and the Loan Agreement. Section 3 . Limited Obligations. The Bonds are special, limited obligations of the City, payable solely as provided in the Indenture. The Bonds and the interest thereon shall never constitute an indebtedness of the City, the State of South Dakota or any political subdivision thereof within the meaning of any constitutional limitation or provision. The City shall not be liable on the Bonds, nor shall the Bonds be payable out of any funds of the City other than those pledged therefor pursuant to the terms of the Indenture. Section 4. Indenture. The execution and delivery of the Indenture, substantially in the form attached hereto and incorporated by reference as though set forth in full herein, is hereby authorized. The Mayor of the City is hereby authorized to execute and deliver the Indenture with such changes, insertions and omissions as may be approved by the Mayor, and the City Finance Officer is hereby authorized to affix the seal of the City on the Indenture and attest the same. The execution of the Indenture by the Mayor shall be conclusive evidence of such approval. Section 5. Loan Agreement. The execution and delivery of the Loan Agreement, substantially in the form attached hereto and incorporated by reference as though set forth in full herein, is hereby authorized. The Mayor is hereby authorized to execute and deliver the Loan Agreement with such changes, insertions and omissions as may be approved by the Mayor, and the City Finance Officer is hereby authorized to affix the seal of the City on the Loan Agreement and attest the same. The execution of the Loan Agreement by the Mayor shall be conclusive evidence of such approval . Section 6 . Mortgage. The execution and delivery of the Combination Mortgage - One Hundred Eighty Day Redemption, Security Agreement, Assignment of Leases and Rents and Fixture Financing 4 Statement from the Company to the City, and assigned by the City to the Trustee, substantially in the form attached hereto and incorporated by reference as though set forth in full herein, is hereby approved. The Mayor is hereby authorized approved any changes, insertions and omissions to the Mortgage. The execution of the Mortgage by the Mayor shall be conclusive evidence of such approval. Section 7 . Tax Agreement. The execution and delivery of the Tax Exemption Certificate and Agreement (the "Tax Agreement" ) , substantially in the form attached hereto and made a part of this Resolution as though set forth in full herein, is hereby authorized. The Mayor is hereby authorized to execute and deliver the Tax Agreement with such changes, insertions, and omissions as may be approved by the Mayor, and the City Finance Officer is hereby authorized to affix the seal of the City and attest the same. The execution of the Tax Agreement by the Mayor shall be conclusive evidence of such approval . Section 8. Bond Purchase Agreement. The execution and delivery of the Bond Purchase Agreement, substantially in the form attached hereto and incorporated by reference as though set forth in full herein, is hereby authorized. The Mayor is hereby authorized to execute and deliver the Bond Purchase Agreement with such changes, insertions, and omissions as may be approved by the Mayor, provided, however, that the purchase price of the Bonds shall not be less than par, and the maturity of the Bonds and the interest rate on the Bonds shall not exceed the limits therefor specified in Section 1 hereof. The City Finance Officer is hereby authorized to affix the seal of the City on the Bond Purchase Agreement and attest the same. The execution of the Bond Purchase Agreement by the Mayor shall be conclusive evidence of such approval . The bonds are hereby authorized to be sold to the Purchaser at the purchase price and on the terms and conditions set forth in the executed Indenture and the executed Bond Purchase Agreement. Section 9 . Other pocuments. The City recognizes that the purchasers and owners of the bonds will have accepted them on, and paid therefor a price which reflects, the understanding that interest thereon is excludable from the gross income of the owners thereof for federal income tax purposes under laws in force at the time the Bonds shall have been delivered. In this connection, the Mayor and other appropriate officials of the City are hereby authorized and directed to execute such certificates and agreements as shall be necessary in the opinion of bond counsel to establish that the Bonds are not "arbitrage bonds" within the meaning of Section 148 of the Internal Revenue Code of 1986, as amended, and any lawful regulations promulgated or proposed thereunder, as the same presently exist, or may from time to time hereafter be amended, supplemented or revised. Section 10. Compliance with Section 147(f) . In accordance with Section 147( f) of the Internal Revenue Code of 1986, as 5 - . . amended, and following a public hearing held before the City Commission at the time and place specified in the Notice of Hearing published in the official City newspaper not less than 14 days before the date of the hearing, the City Commission hereby approves the issuance of the Series 1993 Bonds in a principal amount not to exceed $1,015,000 for the purpose of refunding, on a current basis, the outstanding Series 1985 Bonds. Section 11. Application of Proceeds . In accordance with Section 147( f) of the Internal Revenue Code of 1986, as amended, and following a public hearing held before this City Commission on October 4, 1993, the City Commission hereby approves the issuance of the Bonds in a principal amount not to exceed $1,015,000 for the purpose of refunding the Series 1985 Bonds, and the City hereby authorizes the Bond proceeds to be used for such purpose. Section 12 . Binding Effect. All covenants, stipulations, obligations and agreements of the City in this Resolution, the Indenture, the Loan Agreement, the Mortgage and the Bond Purchase Agreement and all other agreements and instruments in connection therewith shall be binding upon the City and its successors from time to time and upon any board or body to which any powers or duties affecting such covenants, stipulations, obligations and agreements shall be transferred by or in accordance with law. Except as otherwise provided in this Resolution, all rights, powers and privileges conferred and duties and liabilities imposed upon the City or members of the City Commission thereof by the provisions of such agreements and instruments shall be exercised or performed by the City or by such members, officers, board or body as may be required by la�r to exercise such powers and to perform such duties . No covenant, stipulation, obligation or agreement herein contained or contained in such agreements and instruments shall be deemed to be a covenant, stipulation, obligation or agreement of any member, officer, agent or employee of the City in his individual capacity. Neither the members of the City Commission nor any officer executing the Bonds shall be liable personally on the Bonds or be sub ject to any personal liability or accountability i by reason of the issuance thereof. j Section 13. Execution and Delivery of Documents . The Mayor ' and the City Finance Officer are hereby designated the authorized I representatives of the City, and each of them is hereby authorized and directed to execute and deliver any and all papers, instruments, opinions, certificates, affidavits, and other documents necessary and proper for carrying out this Resolution, the Indenture, the Loan Agreement, the Mortgage, the Bond Purchase Agreement, and the issuance and sale of the Bonds . Section 14. Authorization and Ratification of Subsequent Acts . The members, agents, officers and employees of the City are hereby authorized and directed to do all such acts and things, and to execute all such documents as may be necessary and proper to 6 carry out and comply with this Resolution, the Indenture, the Loan Agreement, the Mortgage, the Bond Purchase Agreement, and the issuance and sale of the Bonds; and all of the acts and doings of the members, agents, officers and authorized representatives of the city that are in conformity with the intent and purposes of this Resolution, whether heretofore or hereafter taken or done, shall be and are hereby ratified, confirmed and approved. Section 15. Severability. The provisions of this Resolution are hereby declared to be separable, and if any section, phrase or provisions shall for any reason be declared to be invalid, such declaration shall not affect the validity of the remainder of the sections, phrases and provisions hereof. Section 16 . Conflicts. All resolutions and parts thereof in conflict herewith are hereby repealed to the extent of such conflict. Section 17. Public Inspection of Documents. All documents and other materials incorporated herein by reference shall be accessible for inspection during regular business hours at the offices of the City Finance Officer at City Hall, Brookings, South Dakota. Section 18. Effective Date. This Resolution shall take effect on the twentieth day after its publication, unless suspended by operation of a referendum in accordance with law. Dated this '��=� day of October, 1993. APPROVED BY THE CITY COMMISSION: ;��gRopk�N B `�,.2Go�,'voaq���c�, YMayor ' 9 AT'P�SST�� S � . __._ , o �..� ,,- � . s co.�� � City Finance Offi _ 7 _ _ �_-�. _ ,. - _,.�.,�.—_ r - - �. �-- � � Lega1497,�1�c;�f9�ct:86 �. �< ..;,�..y..� ;_� •� �I RESOLUTION Na. QM, RBSO�.UTION • ;y 'A ;.; BROOIQNG3,9d Affidavit of Publication � ��o�mww���s � � �+ivn s�►i.8 0�vr�ro�i,o � PRINCIPAL AMOUNT � State of South Dakota g� ECONOMIC DBVSLOP � SS REFUNDING RHVBNUE County of Brookings +� SBRIES 1993 (HOZ.tBR00 ISSUE); AUTHbRIZING , � EXECUTION AND DBL � A TRUST INDBNTURB, '(,� Nancy P. Skyberg of said county, being first duly sworn, on oath, says: � AGREEMENT, CUMBIN That she is the legal ad coordinator of THE BROOKINGS REGISTER, a — MORTGAGE, sEcv ' , WII AGRBEMBNT,AS9IG daily newspaper, printed and published in the City of Brookings, in said Cal LBASES AND xBHrs , ,h� County of Brookings, and State of South Dakota; that she has full and � FIXTURB FirrArr �',,� personal knowledge of the facts herein stated; that said newspaper is a yj�� STATEMBNT, AND o legal newspaper and has a bona fide circulation of at least two hundred rao Doctn�rrs,uv co� � THEREWITH AND APPlrO copies of eac;h issue daily; that said newspaper has been published THE FORM oP s within the said County of Brookings and State of South Dakota, for more — n o c u N[s rr T s; ' than one year next prior to the first publication of Exhibit "A," hereto � A UTH O R I ZI N G ` , attached and herein mentioned, and was and is printed in th e offi c e ;p� APPROVING OTHBR MA �� IN CONNfiCTION THfiRB :y°,`' maintained at said place of publication; and that the a WHEREAS, the City of Br �`` � South Dakota (the "City") I 4 7 �V S�outh Dakote a d�is�uthor Brookings City (Resolution 74-93) — SDCL 9-54, as ame�ded, �D' "Economic Developa�ent Pro a printed copy of which, taken from the paper in which the same was 'j� i�ue revenue bond4, the p published, is hereto attached marked Exhibit "A," and is made a part of ' whict, shall be usea co p this affidavit,was published in said newspaper for one (1) edition,to-wit: �' 0D11S�`���''�'��°ve and � buildings,structures or ec1�Pm �_ to enter into revenue agr October 26. 1993 incluatng loan agreements, wi � person, firm, corporatio � governmental entity with res a said projects, provided th That the full amount of the fee charged for the publication of said Exhibit " governing body of the City d "A" inures to the sole benefit of the publishers of said newspaper;that no � that the project woula prom agreement or understanding for the division thereof has been made with N welfare of the muntcipauty, any other person, and that no part thereof has been a reed to be id to ��e the pa}�a►ent ;. � in tha: any person whomsoever; that the fees cha�ed for th� putf�lbn "'_�;; ` _�,;, thereof are: D�o� �M�� �;; int one hundred sixty dollars and fifty-two cerrts $160.52 � � t d° �' December 1, 1 85 (the "P�lor a Agrcement"),with the CitY P'� '� which the Gty lent to tb�t.0 i° the original principal amo o 51,500,000, of whfith a rox � , $1,015,000 is currenfly q ��d; ,.��� WHEREAS, to o�t�t �= which to make e�tt 1't��� 3 Company,the Cit��tae issued < its Economic Developmen� � Bonds, Series i9�8�a (HpU Subscribed and sworn to before me this 26th da of October, 1993. '�� P?'P�pcc>, tn �1 y �{� amount of $1, , , o r�r a�roX�,at�y sI,A15,oao i. � o al outstandin� and unpaid (the. C�ti�� f a 1985 Bonds ),which$erles 19�'► xa were issued under and�ec�.. Ro certain Trust Ind�k�lre ►wa December 1, 1965 (Eb�+ie•' Notary Public in and for the County of Brookings, South Dakota. 'w �d�"�")���e c��r, ' Ra� First Natlonal Bank in '; aa� trustee(the"Truat�'?,attd �a proceeds thereof to the F.oa�P�Y My Commissi�m expires January 28.19�.,Q � WHEREAS, co evtaen�e aa� (� the Company executed and deliv the City ita Promiasoryr Note of December l, 1985(the � Note")peyable to tlte o�da of;. d in the ori�ttwl pria�al a , 1 51,500,OU0, of w�h aP b $1.015,000 is currently outs�i unpaid: � �an -.