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HomeMy WebLinkAboutResolution No. 94-C118RESOLUTION 140. 94-C118 • RECEIVED AUG - 91994 Cl ,-USA REDEVELO7 ,mk_NT AGENCY RESOLUTION AUTHORIZING THE ISSUANCE, SALE AND DELIVERY OF MULTIFAMILY MORTGAGE REVENUE BONDS IN A PRINCIPAL AMOUNT NOT TO EXCEED $19,600,000 FOR THE PURPOSE OF MAKING A LOAN TO PROVIDE FUNDS TO REFINANCE THE COST OF DEVELOPING AN APPROXIMATELY 320 -UNIT MULTIFAMILY RENTAL HOUSING PROJECT KNOWN AS PACIFIC GLEN APARTMENTS AND LOCATED IN THE CITY AT THE NORTHWEST CORNER OF CITRUS AND ALOSTA STREETS, DETERMINING AND PRESCRIBING CERTAIN MATTERS RELATING THERETO, AND APPROVING AND AUTHORIZING THE EXECUTION OF RELATED DOCUMENTS, AGREEMENTS AND ACTIONS. WHEREAS, Chapter 7 of Part 5 of Division 31 of the Health and Safety Code of the State of California (as amended to the date hereof, referred to herein as the "Act") authorizes cities and counties to issue multifamily mortgage revenue bonds (including refunding bonds) for the purpose of making loans or otherwise providing funds to finance the development of multifamily rental housing; and WHEREAS, Article 11 of Chapter 3 of Part 1 of Division 2 of Title 5 of the Government Code of the State of California (as amended to the date hereof, referred to herein as the "Refunding Bond Act") authorizes local agencies to incur indebtedness for the purpose of refunding any revenue bonds of the local agency and provides a complete, additional and alternative method for doing the things authorized thereby; and WHEREAS, pursuant to the Act, the City previously issued its Multifamily Housing Revenue Bonds (Pacific Glen Apartments), Series 1985 (the "Prior Bonds"), for the purpose of financing an approximately 320 -unit multifamily rental housing project (the "Project"), as described in the Indenture of Trust GI -78935 I 41856-2-W WB -(W08194 0 0 dated as of January 1, 1985 (the "Prior Indenture") between the City and Chemical Trust Company of California (formerly known as Manufacturers Hanover Trust Company of California), as trustee thereunder (the "Prior Trustee"), and the Loan Agreement dated as of January 1, 1985 (the "Prior Loan Agreement") between the City and Lincoln Pacific, A California Limited Partnership (the "Original Developer"); and WHEREAS, the City has been advised that the Original Developer defaulted in its payment obligations under the Prior Loan Agreement and related documents; and that the Original Developer filed a petition seeking reorganization under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court, Central District of California (the "Bankruptcy Court"); and WHEREAS, on January 4, 1994, the Bankruptcy Court entered its Order (the "Order") approving (i) a Settlement Agreement dated October 7, 1993 (the "Settlement Agreement") by and among Continental Casualty Company, an Illinois insurance company (the "Surety"), the Prior Trustee, the Original Developer and certain individuals, as guarantors, and (ii) the transfer of the Project to the Surety or its designee; and WHEREAS, the Order specifically provided that the Settlement Agreement and transfers pursuant thereto shall not be deemed to cure any default under the Prior Loan Agreement, the Prior Indenture, the Prior Bonds or the Reimbursement Agreement, dated as of January 1, 1985 (the "Reimbursement Agreement") between the Surety and the Original Developer; and uI-78"5.1 2 4195&2-wws-aa W9e WHEREAS, pursuant to the Order and the Settlement Agreement, by grant deed and bill of sale, the Original Developer has transferred all of its right title and interest in and to the real and personal property constituting the Project to Pacific Glen Apartments, Inc., an Illinois corporation (the "New Owner"), which entity is a wholly-owned subsidiary of Surety; and WHEREAS, as a result of the continuing default under the Prior Loan Agreement and the Reimbursement Agreement, the Surety intends to give notice to the Prior Trustee to call the Prior Bonds for redemption pursuant to the Owner's or the Surety's rights under the Prior Indenture; and WHEREAS, in order to provide the moneys to pay a portion of the redemption price of the Prior Bonds the City has determined to issue its Multi -Family Housing Revenue Refunding Bonds (Pacific Glen Apartments Project) in an aggregate principal amount not to exceed $19,600,000 (the "Bonds"); and WHEREAS, there have been prepared and presented to the City Council for consideration at this meeting the following instruments: (1) The form of Indenture, including the form of Bond; (2) The form of Loan Agreement; (3) The form of Amended and Restated Regulatory Agreement; (4) The form of Intercreditor Agreement; (5) The form of Bond Purchase Agreement; (6) The form of Remarketing Agreement; (7) Preliminary Official Statement relating to the Bonds; LA1a8935.1 3 41836-2-wwB-N/M94 0 0 (8) The form of First Deed of Trust, Security Agreement and Assignment of Rents; and (9) The form of Escrow Agreement; and WHEREAS, it appears that each of the documents and instruments above referred to which are now before this meeting is in appropriate form and is an appropriate instrument to be executed and delivered for the purposes intended; and WHEREAS, John Nuveen & Co., Incorporated (the "Underwriter") has expressed its intention to purchase the Bonds, and the City Council finds that the public interest and necessity require that the City at this time make arrangements for the sale of the Bonds; and WHEREAS, pursuant to Section 147(f) of the Internal Revenue Code of 1986 this City Council has held a public hearing regarding the issuance of the Bonds and now desires to authorize the issuance of the Bonds; NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of Azusa, as follows: Section 1. Finding and Determination. It is hereby found and determined that it is necessary and desirable for the City to provide the refinancing for the Project through the issuance and sale of the Bonds in order to assist in the development and maintenance of the type of dwelling units provided by the Project. Section 2. Authorization of the Bonds. For the purpose of raising moneys with which to effectuate the refinancing of the Project, the City hereby determines to issue uI-75995.1 4 4M&2-wVn1-M0&/94 0 the Bonds, in a principal amount not to exceed $19,600,000. The principal amount of Bonds issued shall not exceed such amount as is necessary to refund all outstanding Prior Bonds (including accrued interest thereon). The Bonds shall bear interest at a rate of interest producing an initial interest rate on the Bonds not to exceed eight percent (8%) per annum, maturing as provided in the Indenture, but not later than 30 years from the date of issue. The Bonds shall be in substantially the forms set forth in the Indenture, with such appropriate variations, omissions, insertions and provisions as are permitted or required by the Indenture, which shall be appropriately completed when the Bonds are prepared. The Bonds shall be limited obligations of the City and shall be payable as to principal and interest, and the obligations of the City under the Indenture shall be paid and satisfied, solely from the revenues, receipts and other moneys pledged therefor under the Indenture. Section 3. Execution and Delivery of the Bonds. The Bonds shall be executed on behalf of the City by the manual or facsimile signature of the Mayor, and the official seal of the City, or a facsimile thereof, shall be impressed or imprinted thereon and attested with the manual or facsimile signature of the City Clerk. Section 4. Approval of Indenture. To provide for the details of the Bonds, and to prescribe the terms and conditions upon which they are to be issued, secured, executed, authenticated and held, the Mayor, City Administrator or the LAI -78935.1 5 41856-2-WWWAAM194 Finance Director and the City Clerk or a deputy City Clerk are hereby authorized to execute and deliver the Indenture, a copy of which is on file in the office of the City Clerk, in substantially the form presented to this meeting or with such changes as may be approved by the officers of the City executing the same, upon consultation with the City Attorney, their execution thereof to constitute conclusive evidence of their approval of all changes from the form of Indenture presented to this meeting, which form of Indenture is hereby in all respects approved and incorporated by reference and made a part hereof. Section 5. Approval of Loan Agreement. To provide for the details of the making of the loan financed by the bonds (the "Loan"), and the duties and obligations of the New Owner, the Mayor, City Administrator or the Finance Director and the City Clerk or a deputy City Clerk are hereby authorized to execute and deliver the Loan Agreement, a copy of which is on file in the office of the City Clerk, in substantially the form presented to this meeting or with such changes as may be approved by the officers of the City executing the same, upon consultation with the City Attorney, their execution thereof to constitute conclusive evidence of their approval of all changes from the form of Loan Agreement presented to this meeting, which form of Loan Agreement is hereby in all respects approved and incorporated by reference and made a part hereof. Section 6. Approval of Amended and Restated Regulatory Agreement. To evidence the requirements of the Act, the Refunding Bond Law and the Internal Revenue Code with respect to LAI -7M5.1 6 4115&2-V/WB-W0V% 0 i the Loan and to implement the public purpose for which the Bonds are to be issued, the Mayor, City Administrator or the Finance Director and the City Clerk or a deputy City Clerk are hereby authorized to execute and deliver the Amended and Restated Regulatory Agreement, a copy of which is on file in the office of the City Clerk, in substantially the form presented to this meeting or with such changes as may be approved by the officers of the City executing the same, upon consultation with the City Attorney, their execution thereof to constitute conclusive evidence of their approval of all changes from the form of Amended and Restated Regulatory Agreement presented to this meeting, which form of Amended and Restated Regulatory Agreement is hereby in all respects approved and incorporated by reference and made a part hereof. Section 7. Approval of Intercreditor Agreement. To provide for certain details with respect to the Loan and the Surety, the Mayor, City Administrator or the Finance Director and the City Clerk or a deputy City Clerk are hereby authorized to execute and deliver the Intercreditor Agreement, a copy of which is on file in the office of the City Clerk, in substantially the form presented to this meeting or with such changes as may be approved by the officers of the City executing the same, upon consultation with the City Attorney, their execution thereof to constitute conclusive evidence of their approval of all changes from the form of Intercreditor Agreement presented to this meeting, which form of Intercreditor Agreement is hereby in all respects approved and incorporated by reference and made a part hereof. ut-78995.1 7 41856-3-WWB-MO8194 0 0 Section 8. Approval of Bond Purchase Agreement. The form of Bond Purchase Agreement presented to this meeting, a copy of which is on file in the office of the City Clerk, is hereby approved in all respects and incorporated herein by reference and made a part hereof, and the Mayor, the City Administrator or the Finance Director is hereby authorized to execute and deliver to the Underwriter a Bond Purchase Agreement in substantially such form or with such changes as may be approved by the officer of the City executing the same, upon consultation with the City Attorney, such execution to constitute conclusive evidence of the approval by such officer of all changes from the form of Bond Purchase Agreement presented to this meeting, which form of Bond Purchase Agreement is in all respects approved and incorporated by reference and made a part hereof. Section 9. Approval of Remarketing Agreement. The form of Remarketing Agreement presented to this meeting, a copy of which is on file in the office of the City Clerk, is hereby approved in all respects and incorporated herein by reference and made a part hereof, and the Mayor, City Administrator or the Finance Director is hereby authorized to execute and deliver to the Underwriter a Remarketing Agreement in substantially such form or with such changes as may be approved by the officer of the City executing the same, upon consultation with the City Attorney, such execution to constitute conclusive evidence of the approval by such officer of all changes from the form of Remarketing Agreement presented to this meeting, which form of uI-79935.1 8 4195&2-wwe-WO8/94 0 0 Remarketing Agreement is in all respects approved and incorporated by reference and made a part hereof. Section 10. Approval of Preliminary Official Statement and Official Statement. The form of Preliminary Official Statement relating to the Bonds, in substantially the form presented to this meeting, a copy of which is on file with the City Clerk, is hereby in all respects approved and incorporated herein by reference and made a part hereof, and the City Council hereby ratifies and approves distribution of the Preliminary Official Statement to prospective purchasers of the Bonds. The Mayor, City Administrator or the Finance Director of the City is hereby authorized to execute and deliver, at the time of sale of the Bonds, said form of Preliminary Official Statement as the final Official Statement, with such changes therein as may be approved by the officer of the City executing the same, upon consultation with the City Attorney, such execution to constitute conclusive evidence of the approval by such officer of all changes from the form of Official Statement presented to this meeting, which form of Official Statement is in all respects approved and incorporated by reference and made a part hereof. Section 11. Approval of First Deed of Trust. The Mayor, City Administrator or the Finance Director and the City Clerk or a deputy City Clerk are hereby authorized to execute an acceptance of the First Deed of Trust, Security Agreement and Assignment of Rents, a copy of which is on file in the office of the City Clerk, in substantially the form presented to this meeting or with such changes as may be approved by the officers LAI -78933 1 9 418562-W WB-MO8/94 0 0 of the City executing the same, upon consultation with the City Attorney, their execution thereof to constitute conclusive evidence of their approval of all changes from the form of First Deed of Trust, Security Agreement and Assignment of Rents presented to this meeting, which form of First Deed of Trust, Security Agreement and Assignment of Rents is hereby in all respects approved and incorporated by reference and made a part hereof. Section 12. Approval of Escrow Agreement. The form of Escrow Agreement by and between the City, the trustee for the Prior Bonds, the trustee for the Bonds and the Surety, substantially in the form submitted to this meeting, a copy of which is on file in the office of the City Clerk, is hereby approved in all respects and incorporated herein by reference and made a part hereof, and the Mayor, City Administrator or the Finance Director is hereby authorized to execute and deliver a Escrow Agreement in substantially such form or with such changes therein as may be approved by the officer of the City executing the same, upon consultation with the City Attorney, such execution to constitute conclusive evidence of the approval by such officer of all changes from the form of Escrow Agreement presented to this meeting, which form of Escrow Agreement is in all respects approved and incorporated by reference and made a part hereof. Section 13. Actions Ratified and Authorized. All actions heretofore taken by the officers and agents of the City with respect to the sale and issuance of the Bonds are hereby LAI -78945.1 10 41856-2-wwe-08/09194 0 0 approved, confirmed and ratified, and the officers of the City are hereby authorized and directed, for and in the name and on behalf of the City, to do any and all things and take any and all actions and execute and deliver any and all certificates, agreements and other documents, including but not limited to those described in the Bond Purchase Agreement or Remarketing Agreement, which they, or any of them, may deem necessary or advisable in order to consummate the lawful issuance and delivery of the Bonds and the making and administration of the Loan in accordance with the Act, the Refunding Bond Act, the Internal Revenue Code and this resolution. Section 14. Conflicting Resolutions Repealed. All ordinances and resolutions or parts thereto in conflict herewith are, to the extent of such conflict, hereby repealed. Section 15. Severability. If any section, paragraph or provision of this resolution shall be held to be invalid or unenforceable for any reason, the invalidity or unenforceability of such section, paragraph or provision shall not affect any remaining provisions of this resolution. Section 16. Resolution Constitutes Approval. It is the purpose and intent of this City Council that this resolution constitute approval of the Bonds by the applicable elected representative in accordance with Section 147(f) of the Internal Revenue Code of 1986. ui-76935.1 11 41956-2-wws.08i09ro4 0 Section 17. Effective Date. This resolution shall take effect upon its adoption. APPROVED AND ADOPTED this August 15, 1994. L Cfty/Clerk of the City of Azusa Mayor of the City of Azusa I HEREBY CERTIFY that the foregoing resolution was duly adopted by the City Council of the city of Azusa at a regular meeting thereof held on the 15th day of August, 1994, by the following vote of the Council: AYES: COUNCILMEMBERS: HARDISON, MADRID, NARNJO, BEEBE NOES: COUNCILMEMBERS: NONE ABSTAIN: COUNCILMEMBERS: ALEXANDER ABSENT: COUNCILMEMBERS: NONE LA14M5.: 12 41&56-2-wwe-W109M