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THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR
THE CITY OF RICHFIELD
RESOLUTION NO. 805
RESOLUTION AWARDING THE SALE OF, AND
PROVIDING THE FORM, TERMS, COVENANTS AND
DIRECTIONS FOR THE ISSUANCE OF ITS LIMITED
REVENUE TAX INCREMENT NOTE, SERIES 2001B
BE IT RESOLVED BY the Board of Commissioners ("Board") of the Housing and
Redevelopment Authority in and for the City of Richfield (the "Authority") as follows:
Section 1. Authorization: Award of Sale.
1.01. Authorization, The Authority and City of Richfield ("City") have heretofore
approved the establishment of Gramercy Redevelopment Tax Increment District (the "TIF
District") within Richfield Redevelopment Project Area ("Project"), and have adopted a tax
increment financing plan for the purpose of financing certain improvements within the Project.
.
Pursuant to Minnesota Statutes, Section 469.178, the Authority is authorized to issue and
sell its bonds for the purpose of financing a portion of the public development costs of the
Project. Such bonds are payable from all or any portion of revenues derived from the TIF
District and pledged to the payment of the bonds. The Authority hereby finds and determines that
it is in the best interests of the Authority that it issue and sell its Limited Revenue Tax Increment
Note, Series 2001B (the "Note"), in the maximum principal amount of $2,230,174, for the
purpose of financing certain public costs of the Proj ect.
The Note, together with the Authority's Limited Revenue Tax Increment Note, Series
2001A (the "Series 2001A Note") is issued as replacement for the Authority's $2,230,174
Limited Revenue Tax Increment Note issued pursuant to the First Amendment (the "Prior
Note"), and the Redeveloper shall return the Prior Note to the Authority as a condition precedent
to delivery ofthe Note.
1.02. Issuance. Sale. and Terms of the Note. The Note is issued in accordance with that
certain Contract for Private Redevelopment between the Authority and Gramercy Park
Cooperative at Lake Shore Drive, a Minnesota Cooperative Corporation ("Redeveloper") dated
July 20, 1998, as amended by the First Amendment thereto dated December 21, 1998 ("First
Amendment") and the Second Amendment thereto dated January 16, 2001 ("Second
Amendment") (the Contract and the Amendments thereto are collectively referred to herein as
the "Agreement"). The Authority hereby authorizes issuance of the Note in accordance with terms
set forth in this resolution to the Redeveloper, at a price of par. The Note shall be dated as of the
date of delivery thereof and shall bear interest at the rate of * % per annum to the earlier of
maturity or prepayment. The Note shall be payable in semi-annual installments of principal and
interest on each February 1 and August 1 commencing February 1, 2001 and continuing through
February 1,2026 (the "Payment Dates").
*To be determined
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The principal amount and interest rate of the Note shall be as requested by the Owner in I
writing prior to the issuance of the Note, provided that: (a) in no case shall the combined principal
amounts of the Note and the Series 2001A Note exceed $2,,230,174; (b) in no case shall the sum of
the present value of the maximum amounts of principal and interest payable on the Note and the
present value of the maximum amounts of principal and interest payable on the 2001A Note exceed
the present value of the maximum I;lmount of principal and interest that would have been payable on
the Prior Note; and (c) in no case shall the principal amount of the Note exceed $324,000 or the
interest rate on the Note exceed 9.75%. The A\ltJ,writy's Executive Director is directed to complete
the Note in accordance with the provisions of this paragraph and is further directed to deliver upon
closing a certificate attesting to the calculation of the principal amount and interest rate of the Note
in accordance with the terms of this Resolution.
1.03. Optional Prepayment. The Authority may prepay the Note in whole or in part
without premium or penalty at any time at the option of the Autl).ority.
Section 2. Form ofNote~ The Note shall be in substantially the following form, with
the blanks to be properly filled in as of the d~te of issue:
$
UNITED STATES OF AMERICA
STATE OF MINNESOTA
COUNTY OF HENNEPIN
THE HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF RICHFIELD
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LIMITED REVENUE TAX INCREMENT NOTE, 2001B
The Housing and Redevelopment Authority in and for the City of Richfield (the
"Authority"), hereby acknowledges it,~elf to be illdebted ancl, for vall!e received, promises to pay to
the order of Gramercy Park Cooperative at Lake Shore Drive or its permitted assigns (the "Owner"),
to the extent and in the manner hereinafter provided, the original principal amount of this Note,
being $ (the "Principal Amount"), together with interest thereon accrued from the date
of this Note, at the rate of interest of _% per anIlum (the "Stated Rate"), payable on each
February 1 and August 1 commencing February 1,2001 and continuing through February 1,2026
(the "Payment Dates").
Any payments on this Note shall be applied first to accrued interest and then to the Principal
Amount in respect of which such payment is made.
Each payment on this Note is payable in any coin or currency of the United States of
America which on the date of such payment is legal tender for public and private debts and shall be
made by check or draft made payable to the Owner and mailed to the Owner at it postal address I
within the United States which shall be designated from time to time by the Owner.
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The Note is a special and limit~d~?li9ation and.n~ta general obligation of the Authority,
which has been issued by the Authorii1lb'"~id in fihancing a "project," as defined in Minnesota
Statutes, Section 469.174, of the Authority within and for the benefit of the Gramercy
Redevelopment Tax Increment District ("District").
THE NOTE IS NOT A DEBT OF THE AUTHORITY, THE CITY OF RICHFIELD, OR
THE STATE OF MINNESOTA (THE "STATE"), AND NEITHER THE AUTHORITY, THE
CITY OF RICHFIELD, THE STATE NOR ANY POLITICAL SUBDIVISION THEREOF
SHALL BE LIABLE ON THE NOTE, NOR SHALL THE NOTE BE PAYABLE OUT OF ANY
FUNDS OR PROPERTIES OTHER THAN AVAILABLE TAX INCREMENT, AS DEFINED
BELOW.
Payments on this Note are payable solely from proceeds of this Note and from and only to
the extent that the Authority shall have received as of such Payment Date "Available Tax
Increment." For the purpose of this Note, "Available Tax Increment" means: Seventy-five Percent
(75%) of the tax increment received from the real estate described in Exhibit C to the Agreement
(the "Redevelopment Property") for years beginning with 2001 and ending in 2026.
Payment on any Payment Date of the principal and interest on this Note is expressly subject
to and subordinate to the payment of any amounts due as of that Payment Date on the Authority's
$ Limited Revenue Tax Increment Note, Series 2001A (the "Series 2001A Note")
and Available Tax Increment shall be applied first to amounts due on the Series 2001A Note, and
second to amounts due on this Note.
To the extent that on any Payment Date the Authority does not have on hand sufficient
Available Tax Increment together with capitalized interest to make the scheduled payment
(which insufficiency is not due to a failure of the Owner to pay full real estate taxes payable on the
Redevelopment Property), such deficiency shall be deferred and paid to the extent possible on the
next Payment Date on which the Authority has received Available Tax Increment sufficient to do
so. This Note shall terminate upon the "Maturity Date", hereby defined as the earlier of: (i) the date
when the Redeveloper has been fully reimbursed according to the terms hereof; or (ii) February 1,
2026. This Note may be prepaid in full at any time at the option ofthe Authority.
This Note shall also terminate and the Authority's obligation to make any payments under
this Note shall be discharged and the Authority shall have no obligation and incur no liability to
make any payments hereunder immediately upon the occurrence of an Event of Default under the
Contract for Private Development, dated July 20, 1998, as amended by the First Amendment
thereto dated December 21, 1998 and the Second Amendment thereto dated ,
2001 (the Contract and the Amendments thereto are collectively referred to herein as the
"Development Contract") between the Authority and the Owner, subject to the notice and cure
provisions of Section 9.2 thereof.
This Note shall not be payable from or constitute a charge upon any funds of the Authority
or the City of Richfield and the Authority shall not be subject to any liability hereon or be deemed
to have obligated itselfto pay hereon from any funds except the Available Tax Increments, and then
only to the extent and in the manner herein specified.
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The Owner shall never have or be deemed to have the right to compel any exercise of any I
taxing power of the Authority or the City of Richfield or of any other public body, and neither the
Authority or the City of Richfield nor any director, commissioner, council member, board member,
officer, employee or agent of the Authority or the City of Richfield, nor any person executing or
registering this Note shall be liable personally hereon by reason of the issuance or registration
hereof or oth<;;:rwise.
This Note shall not be transferred to any person without the prior written consent of the
Authority.
IT IS HEREBY CERTIFIED AND RECITED that, except as provided in the Development
Contract, any acts, conditions, and things required by the Constitution and laws of the State of
Minnesota to be done, to have happened, and to be performed precedent to and in the issuance of
this Note have been done, have happened, and have been performed in regular and due form, time,
and manner as required by law; and that this Note, together with all otlwr indebtedness of the
Authority or the City of Richfield outstanding on the date hereof and on the date of its actual
issuance ap.d delivery; does not cause the in<;leQtedness of the Authority or the City of Richfield to
exc~e4. any COl,lsti'Ntional or statutory limitation thereqn.
IN WITNESS WHEREOF, the Board of Commission~rs of the Authority has caused this
Note to be executed by the manual signatures of the Chairperson and the Executive Director of the
Authority and has caused this Note to be dated ,2001.
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Chairperson
Executive Director
AUTHENTICATION AND REGISTRATION PROVISIONS
This is one of the Notes describeq in the within mentioned Resolution. The ownership of
the unpaid balance of the within Note is registered in the bond register of the City Clerk~
Treasurer, in the name of the person last listed below.
Date of Registration
Registered Owner
Name
Tax J.D. No:
Signature of Registrar
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Section 3.
Terms, Execution and Delivery.
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3.01. Denomination, Payment. The Note shall be issued as one or more typewritten
notes numbered from R-l upwards. The Note shall be issuable only in fully registered form.
Principal of and interest on the Note shall "Qe payable by check or draft issued by the Registrar
described herein.
3.02. Dates: Interest Payment Dates. Principal of and interest on the Note shall be
payable by mail to the owner of record thereof as of the close of business on the fifteenth day of
the month preceding the Payment Date, whether or not such day is a business day.
3.03. Registration. The Authority hereby appoints the City's Finance Director to
perform the functions of registrar, transfer agent and paying agent (the "Registrar"). The effect of
registration and the rights and duties of the Authority and the Registrar with respect thereto shall
be as follows:
(a) Register. The Registrar shall keep at its office a bond register in which the
Registrar shall provide for the registration of ownership of the Note and the registration of
transfers apd exchang,es of the Note.
(b) Transfer of Note. Except as provided in the Development Contract, the Note shall
not be transferred to any person without the prior written consent of the Authority.
(c) Cancellation. The Note surrendered upon any transfer shall be promptly
cancelled by the Registrar and thereafter disposed of as directed by the Authority.
(d) Improper or Unauthorized Transfer. When the Note is presented to the Registrar
for transfer, the Registrar may refuse to transfer the same until it is satisfied that the endorsement
on such Note or separate instrument of transfer is legally authorized. The Registrar shall incur
no liability for its refusal, in good faith, to make transfers which it, in its judgment, deems
improper or unauthorized.
(e) Persons Deemed Owners. The Authority and the Registrar may treat the person in
whose name the Note is at any time registered in the bond register as the absolute owner of the
Note, whether the Note shall be overdue or not, for the purpose of receiving payment of, or on
account of, the principal of and interest on such Note and for all other purposes, and all such
payments so made to any such registered owner or upon the owner's order shall be valid and
effectual to satisfy and discharge the liability of the Authority upon such Note to the extent of the
sum or sums so paid.
(f) Taxes, Fees and Charges. For every transfer or exchange of the Note, the
Registrar may impose a charge upon the owner thereof sufficient to reimburse the Registrar for
any tax, fee, or other governmental charge required to be paid with respect to such transfer or
exchange.
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(g) Mutilated, Lost. Stolen or Destroyed Note. In case any Note shall become
mutilated or be lost, stolen, or destroyed, the Registrar shall deliver a new Note of like amount, I
maturity dates and tenor in exchMg~ and substitution for and upon cancellation of such mutilated
Note or in lieu of and in substitution for such Note lo~t, stolen, or destroyed, upon the payment
of the reasonable expenses and charges of the Registr~ in connection therewith; and, in the case
the Note lost, stolen, or destroyed, upon filing with the Registrar of evidence satisfactory to it
that such Note was lost, stolen, or destroyed, and of the ownership thereof, and upon furnishing
to the Registrar of an appropriate bond or indemnity in form, substance, and amount satisfactory
to it, in which both the Authority and. t)1e Registrar shall be named as obligees. The Note so
surrendered to the Registrar shall be cancelled by it and evidence of such cancellation shall be
given to the Authbrity. If the mutilated, lost, stolen, or destroyed Note has already matured or
been called for redemption in accorqance with its terms, it shall not be necessary to issue a new
Note prior to payment.
(h) Prepayment. In the event thy Note is prepaid in whole or in part, notice thereof will
be given by the Registrar by mailing a copy of the redemption notice by first class mail (postage
prepaid) not more than 60 and not less than 30 days prior to the date fixed for redemption to the
registered owner of the Note at the address shown on the registration books kept by the Registrar.
Failure to give notice by mail to any registered owner, any defect therein, will not affect the validity
of any proceeding for the redemption ofthe Note. The Note so called for redemption will cease to
bear interest after the specified redemption date, provided that the funds for the redemption are on
deposit with the place of payment at that tim~. '
3.04. Preparation and Delivery. The Note shall be prepared under the direction of the I
Secretary and shall be executed on behalf of the Authority by the signatures of its Chair and
Secretary. In case any officer whose signature shall appear on the Note shall cease to be sueh
officer before the delivery of the Note, such signature shall nevertheless be valid and sufficient
for all purpose~, the same a~ if such officer had remained in office until delivery.
Notwithstanding such execution, the Note shall not be valid or obligatory for any purpose or entitled
to any security or benefit under this resolution unless and until a certificate of authentication on such
Note has been duly executed by the manual signature of an authorized representative of the
Registrar. Certificates of authentication on different Note~ certificates need not be signed by the
same representative. The executed certificate of authentication on each Note shall be conclusive
evidence that it has been authenticated and delivered under this resolution. When the Note has
been so executed and authenticated, it shall be delivered by the Secretary to the Owner upon
payment of the purchase price therefor, and the Owner shall not be obligated to see to the
application of the purchase price.
Section 4. Security Provisions.
4.01. Pledge. The Authority hereby pledges to the payment of the principal of and
interest on the Note all Available Tax Increment as defined in the Note. Available Tax
Increment shall be deposited in the Debt Service Fund in accordance with Section 4.02 hereof
and applied to payment of the principal of and interest on the Note in accordance with the terms
of the form of Note set forth in Section 2 of this resolution.
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4.02. Debt Service Fund. So lqn,gasthe Note is outstanding and any principal thereof or
interest thereon remains unpaid, the Authority shall maintain a separate Limited Revenue Tax
Increment Note Series 2001B Debt Service Fund (the "Debt Service Fund") to be used for no
purpose other than the payment of the principal of and interest on the Note. The Authority
appropriates and irrevocably pledges to the Debt Service Fund: (a) Available Tax Increment
pledged pursuant to Section 4.01 of this Resolution; (b) all investment earnings on funds held in the
Debt Service Fund; and (c) any other funds appropriated to the Debt Service Fund. The Debt
Service Fund and all moneys deposited therein pursuant to this Resolution are hereby pledged to the
payment of principal of and interest on the Note.
4.02. Investment of Funds. All amounts held in the Debt Service Fund will be invested in
accordance with the provisions of Minnesota Statutes, Chapter 118A, governing the investment of
funds of governmental entities.
Section 5.
Certification of Proceedings.
5.01. Certification of Proceedings. The officers of the Authority are hereby authorized
and directed to prepare and furnish to the Owner of the Note certified copies of all proceedings
and records of the Authority, and such other affidavits, certificates, and information as may be
required to show the facts relating to the legality and marketability of the Note as the same
appear from the books and records under their custody and control or as otherwise known to
them, and all such certified copies, certificates, and affidavits, including any heretofore
furnished, shall be deemed representations of the Authority as to the facts recited therein.
Section 6. Continuing Disclosure. The continuing disclosure requirements of Rule 15c2-12
promulgated by the Secutities and Exchange Commission under the Securities Exchange Act of
1934 (the "Rule") do not apply to the Note, because the offering is exempt from such requirements
unqer Syction 15c2-12(d)(1)(i). Consequently, the Authority will not enter into any undertaking to
provide continuing disclosure of any kind with respect to the Note.
Section 7. Effective Date. This resolution shall be effective upon full execution of the
Second Amendment.
Adopted this 16th day of January, 2001.
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