13-10752r CITY OF RICHFIELD,MINNESOTA
RESOLUTION NO. 10752
RESOLUTION PROVIDING APPROVAL TO THE EXECUTION OF
DOCUMENTS RELATED TO THE SALE OF VARIOUS NOTES ISSUED BY
THE CITY ON BEHALF OF THE ACADEMY OF HOLY ANGELS TO HOME
FEDERAL BANK
WHEREAS, the City of Richfield, Minnesota (the "City"), is authorized by Minnesota Statutes,
Sections 469.152 through 469.165, as amended (the "Act"), to issue revenue obligations to finance, in
whole or in part, the costs of the acquisition, construction, reconstruction, improvement, betterment, or
extension of a"project"to be owned by a contracting party; and
WHEREAS, the City has issued several tax-exempt obligations for the benefit of the Academy of
Holy Angels, a Minnesota nonprofit corporation (the"Borrower"), owner and operator of the Academy of
Holy Angels High School, located at 6600 Nicollet Avenue South in the City(the"Facility"); and
WHEREAS, on December 30, 2002, the City issued its Educational Facilities Revenue Note
(Academy of Holy Angels Project), Series 2002 (as amended, the "2002 Note") in the amount of
$8,540,000; and
WHEREAS, the proceeds of the 2002 Note were loaned to the Borrower, pursuant to a Loan
Agreement, dated as of December 1, 2002 (the "2002 Loan Agreement") and the City assigned all of its
right, title and interest in and to the 2002 Loan Agreement (other than certain rights to indemnification
and payment of expenses)to Wells Fargo Bank, N.A. ("Wells Fargo"), pursuant to a Pledge Agreement,
dated as of December 1, 2002 (the"2002 Pledge Agreement"), between the City and Wells Fargo; and
WHEREAS, on December 12, 2003, the City issued its Educational Facilities Revenue Note
(Academy of Holy Angels Project), Series 2003 (as amended, the "2003 Note"), in the amount of
$1,460,000; and
WHEREAS, the proceeds of the 2003 Note were loaned to the Borrower, pursuant to a Loan
Agreement, dated as of December 1, 2003 (the "2003 Loan Agreement") and the City assigned all of its
right, title and interest in and to the 2003 Loan Agreement (other than certain rights to indemnification
and payment of expenses)to Wells Fargo,pursuant to a Pledge Agreement, dated as of December 1,2003
(the"2003 Pledge Agreement"), between the City and Wells Fargo; and
WHEREAS, on June 28, 2004, the City issued its Educational Facilities Revenue Note (Academy
of Holy Angels Project), Series 2004 (the "2004 Note" and, together with the 2002 Note and the 2003
Note,the"Notes"), in the amount of$3,215,190; and
WHEREAS, the proceeds of the 2004 Note were loaned to the Borrower, pursuant to a Loan
Agreement, dated as of June 1, 2004 (the "2004 Loan Agreement") and the City assigned all of its right,
title and interest in and to the 2004 Loan Agreement (other than certain rights to indemnification and
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payment of expenses) to Wells Fargo, pursuant to a Pledge Agreement, dated as of June 1, 2004 (the
"2004 Pledge Agreement"), between the City and Wells Fargo; and
WHEREAS, the payment of interest on and principal of the Notes is secured by a Mortgage and
Assignment of Rent and Fixture Financing Statement, dated December 30, 2002, as amended (the
"Mortgage"), executed by the Borrower for the benefit of Wells Fargo; and
WHEREAS, pursuant to negotiations with the Borrower, Wells Fargo (the current holder of the
Notes)has agreed to sell the Notes to Home Federal Bank, a federal savings bank(the"Bank"); and
WHEREAS, in conjunction with the sale of the Notes to the Bank, Wells Fargo has assigned all
of its right and interests in the Mortgage, the 2002 Loan Agreement, the 2002 Pledge Agreement, the
2003 Loan Agreement, the 2003 Pledge Agreement, the 2004 Loan Agreement, and the 2004 Pledge
Agreement(collectively,the"Note Documents")to the Bank; and
WHEREAS, in conjunction with the sale of the Notes to the Bank and the assignment of the Note
Documents to the Bank,the City has been asked to approve the execution of an estoppel certificate related
to the Lease Agreement between the City and the Borrower related to the City's lease and use of the
Borrower's softball and soccer fields, a copy of which is on file with the City(the"Estoppel Certificate")
because the property leased by the City under the Lease Agreement is also subject to the Mortgage; and
WHEREAS, in conjunction with the sale of the Notes to the Bank and the assignment of the Note
Documents to the Bank,the interest rate on the Notes may be decreased by the Bank; and
WHEREAS, the City has been advised by its bond counsel that a decrease in the interest rate on
the Notes or other material changes to the Note Documents will cause a"reissuance" of the Notes for tax
purposes pursuant to Section 1.1001-3 of the Treasury Regulations promulgated under the Internal
Revenue Code of 1986, as amended (the "Code") and upon any such reissuance, the Notes are treated as
if refunded on the date such changes become effective; and
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Richfield,
Minnesota, as follows:
1. The City hereby consents to the execution of the Estoppel Certificate by the Mayor and
the City Manager in substantially the form on file with the City on the date hereof, which is hereby
approved, with such changes as shall be approved by the City Manager and Kennedy & Graven,
Chartered, as bond counsel to the City("Bond Counsel").
2. The Mayor and the City Manager are hereby designated as the representatives of the City
with respect to any amendments to the Notes and the reissuance of the Notes. The Mayor, the City
Manager, and other officers of the City are authorized and directed to execute and deliver any and all
certificates, agreements, or other documents which are required by the Note Documents or any other
agreements, certificates, or documents which are deemed necessary by Bond Counsel in connection with
any amendments to the Notes or Note Documents and the reissuance of the Notes, or are required by
Bond Counsel to establish the validity or enforceability of the Notes or the exclusion from gross income
of interest on the Notes for purposes of federal income taxation and State of Minnesota taxation
(including but not limited to the execution of a general certificate of the City, an endorsement to a
certificate of the Borrower as to tax matters and one or more Information Returns for Tax-Exempt Private
Activity Bond Issues, Form 8038 (Rev. April 2011)).
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3. The Notes are special obligations of the City payable by the City solely from the
revenues derived by the City from the 2002 Loan Agreement, the 2003 Loan Agreement and the 2004
Loan Agreement, as assigned to the Bank, and from other security provided by the Borrower, including
but not limited to the Mortgage.
4. The City understands that the Borrower will pay all the costs and fees incurred by the
City related to the sale of the Notes to the Bank, the assignment of the Note Documents to the Bank, and
any reissuance of the Notes, including but not limited to Bond Counsel fees.
5. This Resolution shall take effect immediately upon adoption.
Adopted by the City Council of the City of Richfield, Minnesota,this 8th day of January, 2013.
La--4;
Debbie Goettel, Mayor
Attest:
Nancy Gibbs, Clerk
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