99-951Council File # 9� � \5 �
Green Sheet # �0+�3�
nR1GINAL
Resolution #
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Presented By
RESOLUTfON
CITY OF SAINT PAUL, MINNESOTA
Referred To Committee: ➢ate
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RESOLUTION APPROVIIVG EXECUTION OF
SUBORDINATION AGREEMENT IN CONNECTTON WITH
ISSUAI3CE OF ADDITIONAL BONDS
[AND USE OF CITY'S ENTITLEMENT ALLOCATION]
1�.�l.1�J'3�1�Tcg
A. The City of Saint Paul, was awarded an Urban Development Acfion Grant (No. B-81-AA-0028, the
"UDAG") for the purposes of the district heating system (the "System") owned and operated by District Heating
Development Company, Inc. d/b/a District Energy St. Paul, Inc. (the "Company"); and
B. In connection with the development of the System, the City made a loan to the Company from the
proceeds of the UDAG putsuant to a City Loan Ag�eement daYed as of December 1, 1982 as amended by an
Amendment to City Loan Agreement dated Dec,�mber 1, 1985 (collectively, the "Ciry Loan AgreemenY'); and
C. The City Loan Agreement also provided far loans to the Company by the City of Community
Development Block Cnaut and ta�c increment funds, all of which loans are secured by a City Mortgage, Fixbure
Financing Statement and Security Agreement dated as of December 1,1982 and amended by an Amendment to City
Mortgage, Fixture Financing Staxement and Security Agreement dated December 1, 1985 (collectively, the "City
Moztgage"); and
D. The Housing and Redevelopment Authority of the City of Saint Paul, Mimiesota (the "IIIZA") has
issued its $30,500,000 Variable Rate Demand P�chase District Heating Revenue Bonds, 1982 Series A, dated
December 22, 1982 (the "Sezies A Bonds") and its $14,000,000 District Heating Revenue Bonds, 1985 Series B,
dated December 30,1985 (the "Series B Bonds"), and loaned the proceeds thereof to the Company for the purpose of
providing additional financing of the System; and
E. The HRA issued its $2,700,000 Variable Rate Demand Purchase District Heating Revenue Refunding
Bonds 1997 Series C(the "Series C Bonds") to refund and prepay a portion of the outstanding Series B Bonds; and
35 F. The Company has proposed that the IIIZA issue its Variable Rate Demand Purchase District Heating
36 Revenue Bonds, 1999 Series D(the "Series D Bonds") and its Variable Rate Demand Purchase District Heating
37 Revenue Bonds, 1999 Series E(the "Series E Bonds" and, together with the Series D Bonds, the "Bonds") in the
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38 aggregate principal amount of $7,000,000, to provide funds sufficien� together with other available funds to provide
39 funds for the coiLShvcti.on of additional dislribution lines for the System, and improvements to the central heating
40 plant; and
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NOW THEREFORE, BE IT RESOLVED by the City Council of the City of Saint Paui, Mn�nesota, as
57 follows:
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59 Subordination A�eement
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The form of the Subordination Agreement which has been presented to the City Council at tlus
62 meeting is hereby approved.
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64 2, The Chair, Director, O�ice of Financial Services and the City Clerk of the City are hereby authorized
65 to execute the Subordination Agreement in substantially the form on file, with such variations, modifications,
66 additions or deletions as may be necessary and approved by the City Attorney. Execution of the Subordination
67 Agreement by the appropriate officers shall be deemed to be evidence of the approval of any such changes.
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69 UDAG
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71 The loan to be made from the proceeds ofthe Bonds, and the trailsaction contemplated thereby, do not violate
72 any term or condition of the UDAG, as the UDAG has been previously amended.
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74 Terms
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76 Terms capitalized but not otherwise defined in this Resolution have the meauiugs assigned to tliose terms in
77 the HRA's resolution authorizing the issuance of the Bonds and in the documents and agreements relating to the
78 Bonds.
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G. The loan to be made by the �IRA from the proceeds of the Bonds will require subordivation of the
City's securiry interest in the System to the interests of the irus�tee for the District Heating Revenue Bonds (including
the Bonds) and the intexest of the bank which issues the letter(s) of credit securing the Bonds, which subordination
will be evidenced by a Subordination A�eement to be dated as of September 1,1999; and
H. There has been submitted to ttus City Council a form of a 5ubordination Agreement; and
I.. Wlule the Series D Bonds (anticipated to be issued in the originai principal amount of $3,500,000) are
to be issued as qualified 501(c)(3) bonds, which will not require bonding allocation, the Series E Bonds (anticipated
to be issued in the origjnal principal amount of $3,500,000) aze to be issued as exempt facility bonds which do require
the use of bonding allocation; and]
J. The City �vishes to £acilitate the issuance of the Bonds for the purposes described above.
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80 Allocation
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82 The City hereby authorizes the HRA to use $1,000,000 ofthe City's entiUement allocation in connection with
83 the issuance of the Series E Bonds in 1999; and to use up to an addifional $2,500,000 in connection with the issuance
84 of the Series E Bonds in 2000, and the Director, Office of Financial Services of the City is hereby authorized to
85 execute any and all documents reasonably required to reflect the City's authorization of the use of its entiflement
86 allocation pursuan.t to this Resolution_]
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QRIGINAL
Requested by Department of:
Plannin4 & ECOnomiC
BY: iC9 wa ' / V�7/
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Form Approved by City �SExor ey
Adoption Certi£ied by Council Secretary
BY "� a- ' �_l.= �
�`//�j�/� '� APPr
Approved by Mayor: D y�
By:
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By:
]849462v1 (13NIY01!.DOC)
Adopted by Council: Date ���(C`�o�
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RESOLVTION NO. 99-9/22-
a9.
RESOLLITION AUTHORTZING (A) THE ISSUANCE OF VPRIABLE RATE
DEMAND PURCHASE DISTRICT HEATING REVENUE BONDS, 1999
SERIES D AND VARIABLE RATE DEMAND PURCHASE DISTRICT
HEATING REVENUE BONDS, 1949 SERIES E TO FINANCE TF3E
CONSTRUCTION OF ADDITIONAL DISTRIBUTION LINES AND
ADDTTIONAL IMPROVEMENTS TO THE CENTRAL HEATING PLANT;
AND (B) AUTHORIZING THE EXECUTION OF VARIOUS DOCTJMENTS IN
CONNECTION WITH THE SERIES D BONDS, THE SERIES E BONDS AND
RELATED TRANSACTIONS
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Introduced by Councilmember
WHEREAS:
2 A. The Housing and Redevelopment Authority of the City of Saint Pau1, Minnesota
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(the "HRA" or the "Authority") is authorized by the Constitution and laws of the State of
Minnesota, including particulazly Minnesota Statutes, Sections 469.152 to 4691651, as amended
and in effect (the "AcP'), to issue bonds under the Act or under its predecessor statute, Minnesota
Statutes, Chapter 474; and
B. The HRA has issued its $14,000,000 District Heating Revenue Bonds, 1985 Series
B, dated December 30, 1985 (the "Series B Bonds") pursuant to that certain First Supplemental
Indenture of Trust dated as of December 1, 1985 (the "First Supplemental Indenture") which
supplements and amends that certain Indenture of Trust dated as of December 1, 1982 (the
"Original Indenture") between the HRA and U.S. Banl: Trust National Association (as successor to
First Trust National Association and First Trust Company of Saint Paul) as hustee (the "Prustee")
in order to make a loan to District Heating Development Company, d/b/a Dishict Energy St. Paul,
Ina (the "Company") pursuant to a Loan Agreement dated as of December 1, 1982 (the "Orieinal
Loan AgreemenY') as supplemented by a First Supplemental Loan Agreement dated as of December
1, 1985 (the "First Supplemental Loan Agreement"), the proceeds of which loan were applied, in
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part, to finance improvements to the district heating system (the "System") in the City of Saint Paul,
Minnesota, which is owned and operated by the Company, and, in part, to advance refund a portion
of the �30,500,000 Variable Rate Demand Purchase District Heating Revenue Bonds, 1982 Series
A(the "Series A Bonds") issued under the Original Indenture; and
C. The Series A Bonds were originalty secured by a letter of credit (the "Original Letter
of CrediP') issued by The First National Bank of �aint Paul, now laiown as U.S. Bank Narional
Association ("U.S. Bank") which Original Letter of Credit was replaced on September 25, 1990 by
a letter of credit issued by The Sumitomo Bank, Limited (Chicago Branch) (the "Sumitomo Letter
of CrediY'); and
26 D. The HRA issued its Variable Rate Demand Purchase Dishict Hearing Revenue
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Refunding Bonds, 1997 Series C(the "Series C Bonds") in order to prepay and refund, together
with other funds, the remaining debt evidenced by the Series B Bonds; and
29 E. The I3RA and the Trustee have previously entered into an Amended and Restated
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Indenture of Trust (the "Restated Indenture"), and the HRA and the Company have entered into an
Amended and Restated Loan Agreement (the "Restated Loan AgreemenY') both dated as of 7uly 1,
1997, which amend and restate the provisions, respectively, of the Original Indenture, the First
Supplemental Indenture, the Second Supplemental Tndenture and the Third Supplemental Indenhxre,
and the Original Loan Agreement, the First Supplemental Loan Agreement and the Second
Supplemental Loan Agreement for the purpose of consolidating the provisions thereof, eliminating
certain provisions which no longer apply, and to make certain other changes to clarify the terms
thereof, correct ambiguiries, ar to make changes which were not to the material prejudice of the
holders of the Series A Bonds, the Series B Bonds or the Series C Bonds;
39 F. The HRA has now determined that Variable Rate Demand Purchase District Heating
40 Revenue Bonds 1999 Series D(the "Series D Bonds") and Variable Rate Demand Purchase Dishict
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Heating Revenue Bonds 1999 Series E(the "Series E Bond" and together with the Series D Bonds,
the `Bonds") should be issued and the proceeds lent to the Company in order to provide funds to
consh additional distribution lines for the System and provide for additional improvements to the
central hearing plant (the "ProjecP'); and
45 G. The HRA proposes to issue the Bonds in the aggregate principal amount not to
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exceed $7,0�0,�00 pursuant to a Fifth Supplemental Indenture of Trust to be dated as of September
1, 1999 (the "Fifth Supplemental 3ndenture"), by and between the HRA and the Trustee and to loan
the proceeds thereof to the Company pursuant to the terms of a Fourth Supplemental Loan
Agreement to be dated as of September 1, 1999, by and beriveen the IIl2A and the Company (the
"Fourth Supplemental Loan Agreement and, together with the Original Loan Agreement and all
previous supplements, the "Loan Agreement"); and
52 H. The Bonds shall be issued as set forth in the Fifth Supplemental Indenture, and shall
53 mature, bear interest and be subject to redemption as therein and hereinafter provided; and
54 I. Payment of principal and interest on the Series D Bonds and the Series E Bonds will
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be secured by separate letters of credit (the "Series D Letter of CrediP' and the "Series E Letter of
Credit," respectively) both issued by Credit Local de France, acting through its New Yark Agency
("CLF"); and
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The Company shall pay the Franchise Feedirectly to the City; and
Leonard, Street and Deinazd Professional Association will act as Bond Counsel. The
Company has requested that Dougherty Suimnit Securities LLC act as Undenvriter and
Remarketing Agent and that Qppenheimer Wolff & Donnelly LLP act as Underwriter's Counsel, in
connection with the transacUons contemplated hereby.
L. All of the terms and provisions of Parts T, II and III of trus Resolution are subject to
the conditions stated in Part IV of this Resolution;
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65 NOW, THEREFORE, BE IT RFSOLVED by the Boazd of Comznissioners of the Housing
66 and Redevelopment Authority of the CiTy of Saint Paul, Minnesota as follows:
67 PART I-'TIiE SERIES D SONDS AND THE SERIES E BONDS
68 1.01. In connecrion with the proposed issuance of the Bonds, the forms of the following
69 documents have been submitted to this Boazd for approval:
70 a. the Fifth Supplemental Indenture;
71 b, the Fourth Supplemental I,oan Agreement;
72 c. a Bond Purchase Agreement (the "Bond Purchase AgreemenP') to be entered
73 into by and among the HRA, the Company and Dougherty Sununit
74 Securities LLC (the "Undenvriter"); and
75 d. a forxn of Official Statement(s) relaring to the Series D Bonds and the Series
76 E Bonds (the "Official StatemenP');
77 e. the Remarketing Agreement to be entered into between the Undenvriter (in
78 its sepazate capacity as Remarketing Agent), the Company and the Trustee in
79 connection with the Bonds (the "Remarketing AgreemenY'); and
80 f. the Fourth Amendment to Mortgage, Fixture Financing Statement and
81 Security Agreement to be dated as of September l, 1999 to be entered into
82 by and among the Company, the Trustee, and CLF (the "Fourth Amendment
83 to Mortgage").
84 Items (a), (b), (c) and (� are referred to in this Resolution as the `Bond Documents."
85 1.02. It is hereby found, detemuned and declared that:
86 a. the issuance and sale of the Bonds, the execurion and delivery by the HRA
87 of the Bond Documents, and the performance of all covenants and
88 agreements of the HRA contained in the Bond Documents and of all other
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acts- and things required under the Constitution and laws of the State of
Minnesota to make the Bond Documents and the Bonds valid and binding
special obligations of the HRA in accordance with their terms, aze authorized
by applicable Minnesota law and this Resolution;
it is desirable that the Bonds be issued by the HRA upon the tenns set forth
in the Fifth Supplemental Indenture;
under the provisions of the Act, and as provided in the Fifth
Supplemental Indenture and the Fourth Supplemental Loan
Agreement, the Bonds are not to be payable from or chargeable against
any funds other than the revenues and assets pledged to the payment
thereof; the HRA and the City shall not be subject to any liability
thereon other than from such revenues and assets; no holder of any of
the Bonds shall ever have the right to compel any exercise by the HRA
or the City of their taxing powers to pay any of the Bonds or the interest
or premium thereon, or to enforce payment thereof against any
property of the HRA or the City ot�er than the property expressly
pledged thereto; the Bonds shall not constitute a charge, lien or
106 encumbrance, legal or equitable, upon any property of the HRA or the
107 City other than the revenues or assets described in the Granting Clauses
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of the Fifth Supplemental Indenture, all of which have been assigned to
the Trustee under such Fifth Supplemental Indenture; the Bonds shall
recite that the Bonds are issued without moral obligation on the part of
the State of Minnesota ar its political subdivisions, or the HRA or the
City, and that the Bonds, including interest thereon, are payable solely
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from the revenues and assets pledged to the payment thereof; and, the
Bonds shall not consritute a debt of the HRA or the City within the
meaning of any consiitutional or statutory limitation of indebteduess;
and
a public hearing was held on September 8, 1999 pursuant to the requirements
of Section 147(fl of the Intemal Revenue Code of 1986, as amended, and
pursuant to a notice published by the HRA not less than 15 days prior to the
public hearing, a public hearing was held on the issuance of the Bonds on
September 8, 1995, at which public hearing all persons were given an
opportunity to speak.
1.03. The HRA shall proceed forthwith to issue its Bonds, in the form and upon the terms
set forth in the Fifth Supplemental Indenture and in tkus Resolution. The initial principal amount of
the Bonds shall not exceed $7,000,000. The Bonds shall be subject to redemption prior to mahuity
as set forth in the Fifth Supplemental Indenture.
1.04. The I3RA hereby delegates to the Execurive Director or its designee the authority to
(i) consent to the distribution of the Official Statement in connection with the offering and sale of
the Bonds, and (ii) if required, execute a letter to the LTnderwriter that the Official Statement, or
portions thereof, are "deemed final" within the meaning of Rule 15c2-12(b) under the Securities
Exchange Act of 1934, as amended.
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PART II- AUTHORIZATION TO EXECUTE DOCUMENTS
AND TAKE OTHER ACTIONS
2A1. For the �urposes of this Part II, the Bond Documents, the Official Statement and all
otker certificates, certified proceedings, instruments, a�eements, and other items necessary or
desirable to effectuate the purposes of this Resolution are referred to as the "Resolution
Documents."
2A2. Subject to the approval of the City Attorney, bond counsel and appropriate HRA
staff, and the provisions of paragraph 2.05 of this Resolution, the forms of the Resolution
Documents and exhibits thereto are approved substantially in the forms submitted and on file in the
offices of the HI2A, with such subsequent changes as may be approved by the City Attorney, bond
counsel and the fIl2A staff or as may be consistent with the determinations made herein. Except as
otherwise specifically provided herein, the Resolurion Documents and er,hibits thereto, in
substantially the forms approved hereby, are directed to be executed or consented to in the name and
on behalf of the HRA by the Chair, the Secretary, the Executive Director and the Director, Office of
Financial Services, provided that the Bond Purchase Agreement and all closing certificates may be
executed in the name and on behalf of the HRA by its Executive Director. Any other documents
and certificates necessary to the transactions herein described shall be executed by the appropriate
HRA officers. Copies of all of the documents necessary to the transactions herein described shall be
delivered, filed and recorded as provided herein and in related docusnents.
2.03. Subject to approval of final forms of the Bonds and the Bond Documents by the City
Attomey, bond counsel and HI2A staff, the Chair, Secretary, Executive Director and Director,
Office of Financial Services of the �3RA aze authorized and directed to prepare and execute the
Bonds as prescribed in the Fifth Supplemental Indenture and to deliver the Bonds to the Trustee for
authentication and delivery to the purchaser thereof.
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2.04. The Chair, Secretary, Execurive Airector and Director, Office of Financial Services
and other officers of the HRA aze authorized and directed to prepaze and fumish to the purchaser of
the Bonds, bond counsel, the Trustee, and others as appropriate, certified copies of a11 proceedinas
and records of the HRA relating to the transactions contemplated by this Resolution, and such other
affidavits and certificates as may be required to show the facts relatin� to the legality of such
transactions as such facts appeaz from the books and records in the officers' custody and control or
as otherwise Imown to them; and all such certified copies, certificates and affidavits, including any
heretofore furnished, shall constitute representations of the HI2A as to the truth of all statements
contained therein.
2.05. The approval hereby given to the various Resolution Documents referred to above
includes approval of such additional details therein as may be necessary and appropriate, such
modifications thereof, deletions therefrom and addirions thereto as may be necessary and
appropriate and approved by the City Attorney, bond counsel and appropriate HRA staff, and
includes approval of such related inshwnents as may be required to be executed in connection with
the various documents referred to above; and said City Attomey, bond counsel, and HRt1 staff are
hereby authorized to approve said changes and related instruments on behalf of the HRA upon
detennination by them that such changes and related instruments are consistent with this Resolution
and necessary or desirable to effectuate the purposes hereof. The execurion of any instrument by
the appropriate officer or officers of the F-IRA herein authorized shall be conclusive evidence of the
approval of such documents in accordance with the terms hereof. In the absence of the Chair,
Executive Director, Airector, Office of Financial Services or Secretary, any of the documents
authorized by this Resolution to be executed by them may be executed by the Vice Chair, Acting
Executive Director, Acting Director, Office of Financial Services or Acting Secretary, respectively,
or by any other duly designated acting official. Certificates, directions and instrucrions may be
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executed by the Executive Director on behalf of the HRA, and no other officer's execution thereof
shall be required.
2.06. The authority to approve, execute and deliver future amendments to the Resolution
Documents entered into by the HRA in connection with the transactions contemplated hereby is
hereby delegated to the Executive Director and Director, Office of Financial Services, subj ect to the
following conditions: (a) such amendments do not require the consent of the holders of the
applicable series of Bonds or, if required, such consent has been obtained; (b) such amendments do
not materially adversely affect the interests of the HRA as the issuer of the related series of Bonds;
(c) such amendments do not contravene or violate any policy of the HRA; (d) such amendments aze
acceptable in form and substance to the Saint Paul City Attomey, bond counsel or other counsel
retained by the HRA to review such amendments; and (e) the HRA has received, if necessary, an
opinion of bond counsel to the effect that the amendments will not adversely affect the tax-exempt
character of interest on the related series of Bonds, if such Bonds are then tax-exempt obligations.
The authorization hereby given shall be further construed as authorization for the execution and
delivery of such certificates and related items as may be required to demonstrate compliance with
the agreements being amended and the terms of tlus Resolution. The execution of any instrument
by the Executive Director and Director, Office of Financial Services shall be conclusive evidence of
the approval of such instruments in accordance with the terms hereof. In the absence of the
Executive Director or Director, Office of Financial Services, any instnxment authorized by this
paragraph to be executed and delivered may be executed by the officer of the HRA authorized to act
in their place and stead.
201 2.07 The Company has covenanted in the Loan Ab eement that it wiil defend, save
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hannless and indemnify the City and HRA officials, officers and employees from and against all
liabilities, losses, damages, costs and expenses arising with respect to their participation in the
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project financed by ffie Series A Bonds, the Series C Bonds and the issuance of the Bonds,
includin� but not limited to research, data prepazation, document preparation and execution,
certifications, the rendering of _ financial or legal advice and written opinions and other
representation of the City and HI2A in the transactions.
PART III - FRANCHISE FEES
3.01 The Company shall collect Franchise Fees from its customers, and shall remit the
Franchise Fees directly to the City. Each such remittance by the Company: (a) shall be made on
or before the 25th day of the month; and (b) shall be in the amount of Franchise Fees actually
billed to customers during the preceding month, with appropriate adjustments for non-payments
and billing changes.
PARTIV-MISCELLANEOUS
4.01 Leonud, Street and Deinard, Professional Association is hereby appointed to act as
Bond Counsel and approval is hereby given for Oppenheimer Wolff & Donnelly LLP to act as
Underwriter's Counsel, and for pougherty Summit Securities LLC to act as Undenvriter and
Remarkefing Agent, in connection with the transactions contemplated by this Resolution.
Adopted by the Board of Comxnissioners of the Housing and Redevelopment Authority of
the City of Saint Paul, Mirmesota on September 22, 1999.
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Council File # 9� � \5 �
Green Sheet # �0+�3�
nR1GINAL
Resolution #
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Presented By
RESOLUTfON
CITY OF SAINT PAUL, MINNESOTA
Referred To Committee: ➢ate
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RESOLUTION APPROVIIVG EXECUTION OF
SUBORDINATION AGREEMENT IN CONNECTTON WITH
ISSUAI3CE OF ADDITIONAL BONDS
[AND USE OF CITY'S ENTITLEMENT ALLOCATION]
1�.�l.1�J'3�1�Tcg
A. The City of Saint Paul, was awarded an Urban Development Acfion Grant (No. B-81-AA-0028, the
"UDAG") for the purposes of the district heating system (the "System") owned and operated by District Heating
Development Company, Inc. d/b/a District Energy St. Paul, Inc. (the "Company"); and
B. In connection with the development of the System, the City made a loan to the Company from the
proceeds of the UDAG putsuant to a City Loan Ag�eement daYed as of December 1, 1982 as amended by an
Amendment to City Loan Agreement dated Dec,�mber 1, 1985 (collectively, the "Ciry Loan AgreemenY'); and
C. The City Loan Agreement also provided far loans to the Company by the City of Community
Development Block Cnaut and ta�c increment funds, all of which loans are secured by a City Mortgage, Fixbure
Financing Statement and Security Agreement dated as of December 1,1982 and amended by an Amendment to City
Mortgage, Fixture Financing Staxement and Security Agreement dated December 1, 1985 (collectively, the "City
Moztgage"); and
D. The Housing and Redevelopment Authority of the City of Saint Paul, Mimiesota (the "IIIZA") has
issued its $30,500,000 Variable Rate Demand P�chase District Heating Revenue Bonds, 1982 Series A, dated
December 22, 1982 (the "Sezies A Bonds") and its $14,000,000 District Heating Revenue Bonds, 1985 Series B,
dated December 30,1985 (the "Series B Bonds"), and loaned the proceeds thereof to the Company for the purpose of
providing additional financing of the System; and
E. The HRA issued its $2,700,000 Variable Rate Demand Purchase District Heating Revenue Refunding
Bonds 1997 Series C(the "Series C Bonds") to refund and prepay a portion of the outstanding Series B Bonds; and
35 F. The Company has proposed that the IIIZA issue its Variable Rate Demand Purchase District Heating
36 Revenue Bonds, 1999 Series D(the "Series D Bonds") and its Variable Rate Demand Purchase District Heating
37 Revenue Bonds, 1999 Series E(the "Series E Bonds" and, together with the Series D Bonds, the "Bonds") in the
1849462v1 (13N1Y01!.DOC)
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38 aggregate principal amount of $7,000,000, to provide funds sufficien� together with other available funds to provide
39 funds for the coiLShvcti.on of additional dislribution lines for the System, and improvements to the central heating
40 plant; and
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NOW THEREFORE, BE IT RESOLVED by the City Council of the City of Saint Paui, Mn�nesota, as
57 follows:
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59 Subordination A�eement
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The form of the Subordination Agreement which has been presented to the City Council at tlus
62 meeting is hereby approved.
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64 2, The Chair, Director, O�ice of Financial Services and the City Clerk of the City are hereby authorized
65 to execute the Subordination Agreement in substantially the form on file, with such variations, modifications,
66 additions or deletions as may be necessary and approved by the City Attorney. Execution of the Subordination
67 Agreement by the appropriate officers shall be deemed to be evidence of the approval of any such changes.
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69 UDAG
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71 The loan to be made from the proceeds ofthe Bonds, and the trailsaction contemplated thereby, do not violate
72 any term or condition of the UDAG, as the UDAG has been previously amended.
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74 Terms
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76 Terms capitalized but not otherwise defined in this Resolution have the meauiugs assigned to tliose terms in
77 the HRA's resolution authorizing the issuance of the Bonds and in the documents and agreements relating to the
78 Bonds.
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G. The loan to be made by the �IRA from the proceeds of the Bonds will require subordivation of the
City's securiry interest in the System to the interests of the irus�tee for the District Heating Revenue Bonds (including
the Bonds) and the intexest of the bank which issues the letter(s) of credit securing the Bonds, which subordination
will be evidenced by a Subordination A�eement to be dated as of September 1,1999; and
H. There has been submitted to ttus City Council a form of a 5ubordination Agreement; and
I.. Wlule the Series D Bonds (anticipated to be issued in the originai principal amount of $3,500,000) are
to be issued as qualified 501(c)(3) bonds, which will not require bonding allocation, the Series E Bonds (anticipated
to be issued in the origjnal principal amount of $3,500,000) aze to be issued as exempt facility bonds which do require
the use of bonding allocation; and]
J. The City �vishes to £acilitate the issuance of the Bonds for the purposes described above.
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80 Allocation
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82 The City hereby authorizes the HRA to use $1,000,000 ofthe City's entiUement allocation in connection with
83 the issuance of the Series E Bonds in 1999; and to use up to an addifional $2,500,000 in connection with the issuance
84 of the Series E Bonds in 2000, and the Director, Office of Financial Services of the City is hereby authorized to
85 execute any and all documents reasonably required to reflect the City's authorization of the use of its entiflement
86 allocation pursuan.t to this Resolution_]
87
QRIGINAL
Requested by Department of:
Plannin4 & ECOnomiC
BY: iC9 wa ' / V�7/
�
Form Approved by City �SExor ey
Adoption Certi£ied by Council Secretary
BY "� a- ' �_l.= �
�`//�j�/� '� APPr
Approved by Mayor: D y�
By:
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By:
]849462v1 (13NIY01!.DOC)
Adopted by Council: Date ���(C`�o�
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RESOLVTION NO. 99-9/22-
a9.
RESOLLITION AUTHORTZING (A) THE ISSUANCE OF VPRIABLE RATE
DEMAND PURCHASE DISTRICT HEATING REVENUE BONDS, 1999
SERIES D AND VARIABLE RATE DEMAND PURCHASE DISTRICT
HEATING REVENUE BONDS, 1949 SERIES E TO FINANCE TF3E
CONSTRUCTION OF ADDITIONAL DISTRIBUTION LINES AND
ADDTTIONAL IMPROVEMENTS TO THE CENTRAL HEATING PLANT;
AND (B) AUTHORIZING THE EXECUTION OF VARIOUS DOCTJMENTS IN
CONNECTION WITH THE SERIES D BONDS, THE SERIES E BONDS AND
RELATED TRANSACTIONS
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Introduced by Councilmember
WHEREAS:
2 A. The Housing and Redevelopment Authority of the City of Saint Pau1, Minnesota
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(the "HRA" or the "Authority") is authorized by the Constitution and laws of the State of
Minnesota, including particulazly Minnesota Statutes, Sections 469.152 to 4691651, as amended
and in effect (the "AcP'), to issue bonds under the Act or under its predecessor statute, Minnesota
Statutes, Chapter 474; and
B. The HRA has issued its $14,000,000 District Heating Revenue Bonds, 1985 Series
B, dated December 30, 1985 (the "Series B Bonds") pursuant to that certain First Supplemental
Indenture of Trust dated as of December 1, 1985 (the "First Supplemental Indenture") which
supplements and amends that certain Indenture of Trust dated as of December 1, 1982 (the
"Original Indenture") between the HRA and U.S. Banl: Trust National Association (as successor to
First Trust National Association and First Trust Company of Saint Paul) as hustee (the "Prustee")
in order to make a loan to District Heating Development Company, d/b/a Dishict Energy St. Paul,
Ina (the "Company") pursuant to a Loan Agreement dated as of December 1, 1982 (the "Orieinal
Loan AgreemenY') as supplemented by a First Supplemental Loan Agreement dated as of December
1, 1985 (the "First Supplemental Loan Agreement"), the proceeds of which loan were applied, in
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part, to finance improvements to the district heating system (the "System") in the City of Saint Paul,
Minnesota, which is owned and operated by the Company, and, in part, to advance refund a portion
of the �30,500,000 Variable Rate Demand Purchase District Heating Revenue Bonds, 1982 Series
A(the "Series A Bonds") issued under the Original Indenture; and
C. The Series A Bonds were originalty secured by a letter of credit (the "Original Letter
of CrediP') issued by The First National Bank of �aint Paul, now laiown as U.S. Bank Narional
Association ("U.S. Bank") which Original Letter of Credit was replaced on September 25, 1990 by
a letter of credit issued by The Sumitomo Bank, Limited (Chicago Branch) (the "Sumitomo Letter
of CrediY'); and
26 D. The HRA issued its Variable Rate Demand Purchase Dishict Hearing Revenue
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Refunding Bonds, 1997 Series C(the "Series C Bonds") in order to prepay and refund, together
with other funds, the remaining debt evidenced by the Series B Bonds; and
29 E. The I3RA and the Trustee have previously entered into an Amended and Restated
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Indenture of Trust (the "Restated Indenture"), and the HRA and the Company have entered into an
Amended and Restated Loan Agreement (the "Restated Loan AgreemenY') both dated as of 7uly 1,
1997, which amend and restate the provisions, respectively, of the Original Indenture, the First
Supplemental Indenture, the Second Supplemental Tndenture and the Third Supplemental Indenhxre,
and the Original Loan Agreement, the First Supplemental Loan Agreement and the Second
Supplemental Loan Agreement for the purpose of consolidating the provisions thereof, eliminating
certain provisions which no longer apply, and to make certain other changes to clarify the terms
thereof, correct ambiguiries, ar to make changes which were not to the material prejudice of the
holders of the Series A Bonds, the Series B Bonds or the Series C Bonds;
39 F. The HRA has now determined that Variable Rate Demand Purchase District Heating
40 Revenue Bonds 1999 Series D(the "Series D Bonds") and Variable Rate Demand Purchase Dishict
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Heating Revenue Bonds 1999 Series E(the "Series E Bond" and together with the Series D Bonds,
the `Bonds") should be issued and the proceeds lent to the Company in order to provide funds to
consh additional distribution lines for the System and provide for additional improvements to the
central hearing plant (the "ProjecP'); and
45 G. The HRA proposes to issue the Bonds in the aggregate principal amount not to
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exceed $7,0�0,�00 pursuant to a Fifth Supplemental Indenture of Trust to be dated as of September
1, 1999 (the "Fifth Supplemental 3ndenture"), by and between the HRA and the Trustee and to loan
the proceeds thereof to the Company pursuant to the terms of a Fourth Supplemental Loan
Agreement to be dated as of September 1, 1999, by and beriveen the IIl2A and the Company (the
"Fourth Supplemental Loan Agreement and, together with the Original Loan Agreement and all
previous supplements, the "Loan Agreement"); and
52 H. The Bonds shall be issued as set forth in the Fifth Supplemental Indenture, and shall
53 mature, bear interest and be subject to redemption as therein and hereinafter provided; and
54 I. Payment of principal and interest on the Series D Bonds and the Series E Bonds will
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be secured by separate letters of credit (the "Series D Letter of CrediP' and the "Series E Letter of
Credit," respectively) both issued by Credit Local de France, acting through its New Yark Agency
("CLF"); and
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The Company shall pay the Franchise Feedirectly to the City; and
Leonard, Street and Deinazd Professional Association will act as Bond Counsel. The
Company has requested that Dougherty Suimnit Securities LLC act as Undenvriter and
Remarketing Agent and that Qppenheimer Wolff & Donnelly LLP act as Underwriter's Counsel, in
connection with the transacUons contemplated hereby.
L. All of the terms and provisions of Parts T, II and III of trus Resolution are subject to
the conditions stated in Part IV of this Resolution;
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65 NOW, THEREFORE, BE IT RFSOLVED by the Boazd of Comznissioners of the Housing
66 and Redevelopment Authority of the CiTy of Saint Paul, Minnesota as follows:
67 PART I-'TIiE SERIES D SONDS AND THE SERIES E BONDS
68 1.01. In connecrion with the proposed issuance of the Bonds, the forms of the following
69 documents have been submitted to this Boazd for approval:
70 a. the Fifth Supplemental Indenture;
71 b, the Fourth Supplemental I,oan Agreement;
72 c. a Bond Purchase Agreement (the "Bond Purchase AgreemenP') to be entered
73 into by and among the HRA, the Company and Dougherty Sununit
74 Securities LLC (the "Undenvriter"); and
75 d. a forxn of Official Statement(s) relaring to the Series D Bonds and the Series
76 E Bonds (the "Official StatemenP');
77 e. the Remarketing Agreement to be entered into between the Undenvriter (in
78 its sepazate capacity as Remarketing Agent), the Company and the Trustee in
79 connection with the Bonds (the "Remarketing AgreemenY'); and
80 f. the Fourth Amendment to Mortgage, Fixture Financing Statement and
81 Security Agreement to be dated as of September l, 1999 to be entered into
82 by and among the Company, the Trustee, and CLF (the "Fourth Amendment
83 to Mortgage").
84 Items (a), (b), (c) and (� are referred to in this Resolution as the `Bond Documents."
85 1.02. It is hereby found, detemuned and declared that:
86 a. the issuance and sale of the Bonds, the execurion and delivery by the HRA
87 of the Bond Documents, and the performance of all covenants and
88 agreements of the HRA contained in the Bond Documents and of all other
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acts- and things required under the Constitution and laws of the State of
Minnesota to make the Bond Documents and the Bonds valid and binding
special obligations of the HRA in accordance with their terms, aze authorized
by applicable Minnesota law and this Resolution;
it is desirable that the Bonds be issued by the HRA upon the tenns set forth
in the Fifth Supplemental Indenture;
under the provisions of the Act, and as provided in the Fifth
Supplemental Indenture and the Fourth Supplemental Loan
Agreement, the Bonds are not to be payable from or chargeable against
any funds other than the revenues and assets pledged to the payment
thereof; the HRA and the City shall not be subject to any liability
thereon other than from such revenues and assets; no holder of any of
the Bonds shall ever have the right to compel any exercise by the HRA
or the City of their taxing powers to pay any of the Bonds or the interest
or premium thereon, or to enforce payment thereof against any
property of the HRA or the City ot�er than the property expressly
pledged thereto; the Bonds shall not constitute a charge, lien or
106 encumbrance, legal or equitable, upon any property of the HRA or the
107 City other than the revenues or assets described in the Granting Clauses
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1849442v1 (13Ni#Ol!.DOC)
of the Fifth Supplemental Indenture, all of which have been assigned to
the Trustee under such Fifth Supplemental Indenture; the Bonds shall
recite that the Bonds are issued without moral obligation on the part of
the State of Minnesota ar its political subdivisions, or the HRA or the
City, and that the Bonds, including interest thereon, are payable solely
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from the revenues and assets pledged to the payment thereof; and, the
Bonds shall not consritute a debt of the HRA or the City within the
meaning of any consiitutional or statutory limitation of indebteduess;
and
a public hearing was held on September 8, 1999 pursuant to the requirements
of Section 147(fl of the Intemal Revenue Code of 1986, as amended, and
pursuant to a notice published by the HRA not less than 15 days prior to the
public hearing, a public hearing was held on the issuance of the Bonds on
September 8, 1995, at which public hearing all persons were given an
opportunity to speak.
1.03. The HRA shall proceed forthwith to issue its Bonds, in the form and upon the terms
set forth in the Fifth Supplemental Indenture and in tkus Resolution. The initial principal amount of
the Bonds shall not exceed $7,000,000. The Bonds shall be subject to redemption prior to mahuity
as set forth in the Fifth Supplemental Indenture.
1.04. The I3RA hereby delegates to the Execurive Director or its designee the authority to
(i) consent to the distribution of the Official Statement in connection with the offering and sale of
the Bonds, and (ii) if required, execute a letter to the LTnderwriter that the Official Statement, or
portions thereof, are "deemed final" within the meaning of Rule 15c2-12(b) under the Securities
Exchange Act of 1934, as amended.
1849442vi (13N1�01!.DOC)
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PART II- AUTHORIZATION TO EXECUTE DOCUMENTS
AND TAKE OTHER ACTIONS
2A1. For the �urposes of this Part II, the Bond Documents, the Official Statement and all
otker certificates, certified proceedings, instruments, a�eements, and other items necessary or
desirable to effectuate the purposes of this Resolution are referred to as the "Resolution
Documents."
2A2. Subject to the approval of the City Attorney, bond counsel and appropriate HRA
staff, and the provisions of paragraph 2.05 of this Resolution, the forms of the Resolution
Documents and exhibits thereto are approved substantially in the forms submitted and on file in the
offices of the HI2A, with such subsequent changes as may be approved by the City Attorney, bond
counsel and the fIl2A staff or as may be consistent with the determinations made herein. Except as
otherwise specifically provided herein, the Resolurion Documents and er,hibits thereto, in
substantially the forms approved hereby, are directed to be executed or consented to in the name and
on behalf of the HRA by the Chair, the Secretary, the Executive Director and the Director, Office of
Financial Services, provided that the Bond Purchase Agreement and all closing certificates may be
executed in the name and on behalf of the HRA by its Executive Director. Any other documents
and certificates necessary to the transactions herein described shall be executed by the appropriate
HRA officers. Copies of all of the documents necessary to the transactions herein described shall be
delivered, filed and recorded as provided herein and in related docusnents.
2.03. Subject to approval of final forms of the Bonds and the Bond Documents by the City
Attomey, bond counsel and HI2A staff, the Chair, Secretary, Executive Director and Director,
Office of Financial Services of the �3RA aze authorized and directed to prepare and execute the
Bonds as prescribed in the Fifth Supplemental Indenture and to deliver the Bonds to the Trustee for
authentication and delivery to the purchaser thereof.
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2.04. The Chair, Secretary, Execurive Airector and Director, Office of Financial Services
and other officers of the HRA aze authorized and directed to prepaze and fumish to the purchaser of
the Bonds, bond counsel, the Trustee, and others as appropriate, certified copies of a11 proceedinas
and records of the HRA relating to the transactions contemplated by this Resolution, and such other
affidavits and certificates as may be required to show the facts relatin� to the legality of such
transactions as such facts appeaz from the books and records in the officers' custody and control or
as otherwise Imown to them; and all such certified copies, certificates and affidavits, including any
heretofore furnished, shall constitute representations of the HI2A as to the truth of all statements
contained therein.
2.05. The approval hereby given to the various Resolution Documents referred to above
includes approval of such additional details therein as may be necessary and appropriate, such
modifications thereof, deletions therefrom and addirions thereto as may be necessary and
appropriate and approved by the City Attorney, bond counsel and appropriate HRA staff, and
includes approval of such related inshwnents as may be required to be executed in connection with
the various documents referred to above; and said City Attomey, bond counsel, and HRt1 staff are
hereby authorized to approve said changes and related instruments on behalf of the HRA upon
detennination by them that such changes and related instruments are consistent with this Resolution
and necessary or desirable to effectuate the purposes hereof. The execurion of any instrument by
the appropriate officer or officers of the F-IRA herein authorized shall be conclusive evidence of the
approval of such documents in accordance with the terms hereof. In the absence of the Chair,
Executive Director, Airector, Office of Financial Services or Secretary, any of the documents
authorized by this Resolution to be executed by them may be executed by the Vice Chair, Acting
Executive Director, Acting Director, Office of Financial Services or Acting Secretary, respectively,
or by any other duly designated acting official. Certificates, directions and instrucrions may be
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executed by the Executive Director on behalf of the HRA, and no other officer's execution thereof
shall be required.
2.06. The authority to approve, execute and deliver future amendments to the Resolution
Documents entered into by the HRA in connection with the transactions contemplated hereby is
hereby delegated to the Executive Director and Director, Office of Financial Services, subj ect to the
following conditions: (a) such amendments do not require the consent of the holders of the
applicable series of Bonds or, if required, such consent has been obtained; (b) such amendments do
not materially adversely affect the interests of the HRA as the issuer of the related series of Bonds;
(c) such amendments do not contravene or violate any policy of the HRA; (d) such amendments aze
acceptable in form and substance to the Saint Paul City Attomey, bond counsel or other counsel
retained by the HRA to review such amendments; and (e) the HRA has received, if necessary, an
opinion of bond counsel to the effect that the amendments will not adversely affect the tax-exempt
character of interest on the related series of Bonds, if such Bonds are then tax-exempt obligations.
The authorization hereby given shall be further construed as authorization for the execution and
delivery of such certificates and related items as may be required to demonstrate compliance with
the agreements being amended and the terms of tlus Resolution. The execution of any instrument
by the Executive Director and Director, Office of Financial Services shall be conclusive evidence of
the approval of such instruments in accordance with the terms hereof. In the absence of the
Executive Director or Director, Office of Financial Services, any instnxment authorized by this
paragraph to be executed and delivered may be executed by the officer of the HRA authorized to act
in their place and stead.
201 2.07 The Company has covenanted in the Loan Ab eement that it wiil defend, save
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hannless and indemnify the City and HRA officials, officers and employees from and against all
liabilities, losses, damages, costs and expenses arising with respect to their participation in the
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project financed by ffie Series A Bonds, the Series C Bonds and the issuance of the Bonds,
includin� but not limited to research, data prepazation, document preparation and execution,
certifications, the rendering of _ financial or legal advice and written opinions and other
representation of the City and HI2A in the transactions.
PART III - FRANCHISE FEES
3.01 The Company shall collect Franchise Fees from its customers, and shall remit the
Franchise Fees directly to the City. Each such remittance by the Company: (a) shall be made on
or before the 25th day of the month; and (b) shall be in the amount of Franchise Fees actually
billed to customers during the preceding month, with appropriate adjustments for non-payments
and billing changes.
PARTIV-MISCELLANEOUS
4.01 Leonud, Street and Deinard, Professional Association is hereby appointed to act as
Bond Counsel and approval is hereby given for Oppenheimer Wolff & Donnelly LLP to act as
Underwriter's Counsel, and for pougherty Summit Securities LLC to act as Undenvriter and
Remarkefing Agent, in connection with the transactions contemplated by this Resolution.
Adopted by the Board of Comxnissioners of the Housing and Redevelopment Authority of
the City of Saint Paul, Mirmesota on September 22, 1999.
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Council File # 9� � \5 �
Green Sheet # �0+�3�
nR1GINAL
Resolution #
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Presented By
RESOLUTfON
CITY OF SAINT PAUL, MINNESOTA
Referred To Committee: ➢ate
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RESOLUTION APPROVIIVG EXECUTION OF
SUBORDINATION AGREEMENT IN CONNECTTON WITH
ISSUAI3CE OF ADDITIONAL BONDS
[AND USE OF CITY'S ENTITLEMENT ALLOCATION]
1�.�l.1�J'3�1�Tcg
A. The City of Saint Paul, was awarded an Urban Development Acfion Grant (No. B-81-AA-0028, the
"UDAG") for the purposes of the district heating system (the "System") owned and operated by District Heating
Development Company, Inc. d/b/a District Energy St. Paul, Inc. (the "Company"); and
B. In connection with the development of the System, the City made a loan to the Company from the
proceeds of the UDAG putsuant to a City Loan Ag�eement daYed as of December 1, 1982 as amended by an
Amendment to City Loan Agreement dated Dec,�mber 1, 1985 (collectively, the "Ciry Loan AgreemenY'); and
C. The City Loan Agreement also provided far loans to the Company by the City of Community
Development Block Cnaut and ta�c increment funds, all of which loans are secured by a City Mortgage, Fixbure
Financing Statement and Security Agreement dated as of December 1,1982 and amended by an Amendment to City
Mortgage, Fixture Financing Staxement and Security Agreement dated December 1, 1985 (collectively, the "City
Moztgage"); and
D. The Housing and Redevelopment Authority of the City of Saint Paul, Mimiesota (the "IIIZA") has
issued its $30,500,000 Variable Rate Demand P�chase District Heating Revenue Bonds, 1982 Series A, dated
December 22, 1982 (the "Sezies A Bonds") and its $14,000,000 District Heating Revenue Bonds, 1985 Series B,
dated December 30,1985 (the "Series B Bonds"), and loaned the proceeds thereof to the Company for the purpose of
providing additional financing of the System; and
E. The HRA issued its $2,700,000 Variable Rate Demand Purchase District Heating Revenue Refunding
Bonds 1997 Series C(the "Series C Bonds") to refund and prepay a portion of the outstanding Series B Bonds; and
35 F. The Company has proposed that the IIIZA issue its Variable Rate Demand Purchase District Heating
36 Revenue Bonds, 1999 Series D(the "Series D Bonds") and its Variable Rate Demand Purchase District Heating
37 Revenue Bonds, 1999 Series E(the "Series E Bonds" and, together with the Series D Bonds, the "Bonds") in the
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38 aggregate principal amount of $7,000,000, to provide funds sufficien� together with other available funds to provide
39 funds for the coiLShvcti.on of additional dislribution lines for the System, and improvements to the central heating
40 plant; and
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NOW THEREFORE, BE IT RESOLVED by the City Council of the City of Saint Paui, Mn�nesota, as
57 follows:
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59 Subordination A�eement
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The form of the Subordination Agreement which has been presented to the City Council at tlus
62 meeting is hereby approved.
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64 2, The Chair, Director, O�ice of Financial Services and the City Clerk of the City are hereby authorized
65 to execute the Subordination Agreement in substantially the form on file, with such variations, modifications,
66 additions or deletions as may be necessary and approved by the City Attorney. Execution of the Subordination
67 Agreement by the appropriate officers shall be deemed to be evidence of the approval of any such changes.
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69 UDAG
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71 The loan to be made from the proceeds ofthe Bonds, and the trailsaction contemplated thereby, do not violate
72 any term or condition of the UDAG, as the UDAG has been previously amended.
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74 Terms
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76 Terms capitalized but not otherwise defined in this Resolution have the meauiugs assigned to tliose terms in
77 the HRA's resolution authorizing the issuance of the Bonds and in the documents and agreements relating to the
78 Bonds.
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G. The loan to be made by the �IRA from the proceeds of the Bonds will require subordivation of the
City's securiry interest in the System to the interests of the irus�tee for the District Heating Revenue Bonds (including
the Bonds) and the intexest of the bank which issues the letter(s) of credit securing the Bonds, which subordination
will be evidenced by a Subordination A�eement to be dated as of September 1,1999; and
H. There has been submitted to ttus City Council a form of a 5ubordination Agreement; and
I.. Wlule the Series D Bonds (anticipated to be issued in the originai principal amount of $3,500,000) are
to be issued as qualified 501(c)(3) bonds, which will not require bonding allocation, the Series E Bonds (anticipated
to be issued in the origjnal principal amount of $3,500,000) aze to be issued as exempt facility bonds which do require
the use of bonding allocation; and]
J. The City �vishes to £acilitate the issuance of the Bonds for the purposes described above.
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80 Allocation
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82 The City hereby authorizes the HRA to use $1,000,000 ofthe City's entiUement allocation in connection with
83 the issuance of the Series E Bonds in 1999; and to use up to an addifional $2,500,000 in connection with the issuance
84 of the Series E Bonds in 2000, and the Director, Office of Financial Services of the City is hereby authorized to
85 execute any and all documents reasonably required to reflect the City's authorization of the use of its entiflement
86 allocation pursuan.t to this Resolution_]
87
QRIGINAL
Requested by Department of:
Plannin4 & ECOnomiC
BY: iC9 wa ' / V�7/
�
Form Approved by City �SExor ey
Adoption Certi£ied by Council Secretary
BY "� a- ' �_l.= �
�`//�j�/� '� APPr
Approved by Mayor: D y�
By:
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By:
]849462v1 (13NIY01!.DOC)
Adopted by Council: Date ���(C`�o�
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RESOLVTION NO. 99-9/22-
a9.
RESOLLITION AUTHORTZING (A) THE ISSUANCE OF VPRIABLE RATE
DEMAND PURCHASE DISTRICT HEATING REVENUE BONDS, 1999
SERIES D AND VARIABLE RATE DEMAND PURCHASE DISTRICT
HEATING REVENUE BONDS, 1949 SERIES E TO FINANCE TF3E
CONSTRUCTION OF ADDITIONAL DISTRIBUTION LINES AND
ADDTTIONAL IMPROVEMENTS TO THE CENTRAL HEATING PLANT;
AND (B) AUTHORIZING THE EXECUTION OF VARIOUS DOCTJMENTS IN
CONNECTION WITH THE SERIES D BONDS, THE SERIES E BONDS AND
RELATED TRANSACTIONS
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Introduced by Councilmember
WHEREAS:
2 A. The Housing and Redevelopment Authority of the City of Saint Pau1, Minnesota
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(the "HRA" or the "Authority") is authorized by the Constitution and laws of the State of
Minnesota, including particulazly Minnesota Statutes, Sections 469.152 to 4691651, as amended
and in effect (the "AcP'), to issue bonds under the Act or under its predecessor statute, Minnesota
Statutes, Chapter 474; and
B. The HRA has issued its $14,000,000 District Heating Revenue Bonds, 1985 Series
B, dated December 30, 1985 (the "Series B Bonds") pursuant to that certain First Supplemental
Indenture of Trust dated as of December 1, 1985 (the "First Supplemental Indenture") which
supplements and amends that certain Indenture of Trust dated as of December 1, 1982 (the
"Original Indenture") between the HRA and U.S. Banl: Trust National Association (as successor to
First Trust National Association and First Trust Company of Saint Paul) as hustee (the "Prustee")
in order to make a loan to District Heating Development Company, d/b/a Dishict Energy St. Paul,
Ina (the "Company") pursuant to a Loan Agreement dated as of December 1, 1982 (the "Orieinal
Loan AgreemenY') as supplemented by a First Supplemental Loan Agreement dated as of December
1, 1985 (the "First Supplemental Loan Agreement"), the proceeds of which loan were applied, in
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part, to finance improvements to the district heating system (the "System") in the City of Saint Paul,
Minnesota, which is owned and operated by the Company, and, in part, to advance refund a portion
of the �30,500,000 Variable Rate Demand Purchase District Heating Revenue Bonds, 1982 Series
A(the "Series A Bonds") issued under the Original Indenture; and
C. The Series A Bonds were originalty secured by a letter of credit (the "Original Letter
of CrediP') issued by The First National Bank of �aint Paul, now laiown as U.S. Bank Narional
Association ("U.S. Bank") which Original Letter of Credit was replaced on September 25, 1990 by
a letter of credit issued by The Sumitomo Bank, Limited (Chicago Branch) (the "Sumitomo Letter
of CrediY'); and
26 D. The HRA issued its Variable Rate Demand Purchase Dishict Hearing Revenue
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Refunding Bonds, 1997 Series C(the "Series C Bonds") in order to prepay and refund, together
with other funds, the remaining debt evidenced by the Series B Bonds; and
29 E. The I3RA and the Trustee have previously entered into an Amended and Restated
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Indenture of Trust (the "Restated Indenture"), and the HRA and the Company have entered into an
Amended and Restated Loan Agreement (the "Restated Loan AgreemenY') both dated as of 7uly 1,
1997, which amend and restate the provisions, respectively, of the Original Indenture, the First
Supplemental Indenture, the Second Supplemental Tndenture and the Third Supplemental Indenhxre,
and the Original Loan Agreement, the First Supplemental Loan Agreement and the Second
Supplemental Loan Agreement for the purpose of consolidating the provisions thereof, eliminating
certain provisions which no longer apply, and to make certain other changes to clarify the terms
thereof, correct ambiguiries, ar to make changes which were not to the material prejudice of the
holders of the Series A Bonds, the Series B Bonds or the Series C Bonds;
39 F. The HRA has now determined that Variable Rate Demand Purchase District Heating
40 Revenue Bonds 1999 Series D(the "Series D Bonds") and Variable Rate Demand Purchase Dishict
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Heating Revenue Bonds 1999 Series E(the "Series E Bond" and together with the Series D Bonds,
the `Bonds") should be issued and the proceeds lent to the Company in order to provide funds to
consh additional distribution lines for the System and provide for additional improvements to the
central hearing plant (the "ProjecP'); and
45 G. The HRA proposes to issue the Bonds in the aggregate principal amount not to
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exceed $7,0�0,�00 pursuant to a Fifth Supplemental Indenture of Trust to be dated as of September
1, 1999 (the "Fifth Supplemental 3ndenture"), by and between the HRA and the Trustee and to loan
the proceeds thereof to the Company pursuant to the terms of a Fourth Supplemental Loan
Agreement to be dated as of September 1, 1999, by and beriveen the IIl2A and the Company (the
"Fourth Supplemental Loan Agreement and, together with the Original Loan Agreement and all
previous supplements, the "Loan Agreement"); and
52 H. The Bonds shall be issued as set forth in the Fifth Supplemental Indenture, and shall
53 mature, bear interest and be subject to redemption as therein and hereinafter provided; and
54 I. Payment of principal and interest on the Series D Bonds and the Series E Bonds will
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be secured by separate letters of credit (the "Series D Letter of CrediP' and the "Series E Letter of
Credit," respectively) both issued by Credit Local de France, acting through its New Yark Agency
("CLF"); and
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K.
The Company shall pay the Franchise Feedirectly to the City; and
Leonard, Street and Deinazd Professional Association will act as Bond Counsel. The
Company has requested that Dougherty Suimnit Securities LLC act as Undenvriter and
Remarketing Agent and that Qppenheimer Wolff & Donnelly LLP act as Underwriter's Counsel, in
connection with the transacUons contemplated hereby.
L. All of the terms and provisions of Parts T, II and III of trus Resolution are subject to
the conditions stated in Part IV of this Resolution;
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65 NOW, THEREFORE, BE IT RFSOLVED by the Boazd of Comznissioners of the Housing
66 and Redevelopment Authority of the CiTy of Saint Paul, Minnesota as follows:
67 PART I-'TIiE SERIES D SONDS AND THE SERIES E BONDS
68 1.01. In connecrion with the proposed issuance of the Bonds, the forms of the following
69 documents have been submitted to this Boazd for approval:
70 a. the Fifth Supplemental Indenture;
71 b, the Fourth Supplemental I,oan Agreement;
72 c. a Bond Purchase Agreement (the "Bond Purchase AgreemenP') to be entered
73 into by and among the HRA, the Company and Dougherty Sununit
74 Securities LLC (the "Undenvriter"); and
75 d. a forxn of Official Statement(s) relaring to the Series D Bonds and the Series
76 E Bonds (the "Official StatemenP');
77 e. the Remarketing Agreement to be entered into between the Undenvriter (in
78 its sepazate capacity as Remarketing Agent), the Company and the Trustee in
79 connection with the Bonds (the "Remarketing AgreemenY'); and
80 f. the Fourth Amendment to Mortgage, Fixture Financing Statement and
81 Security Agreement to be dated as of September l, 1999 to be entered into
82 by and among the Company, the Trustee, and CLF (the "Fourth Amendment
83 to Mortgage").
84 Items (a), (b), (c) and (� are referred to in this Resolution as the `Bond Documents."
85 1.02. It is hereby found, detemuned and declared that:
86 a. the issuance and sale of the Bonds, the execurion and delivery by the HRA
87 of the Bond Documents, and the performance of all covenants and
88 agreements of the HRA contained in the Bond Documents and of all other
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acts- and things required under the Constitution and laws of the State of
Minnesota to make the Bond Documents and the Bonds valid and binding
special obligations of the HRA in accordance with their terms, aze authorized
by applicable Minnesota law and this Resolution;
it is desirable that the Bonds be issued by the HRA upon the tenns set forth
in the Fifth Supplemental Indenture;
under the provisions of the Act, and as provided in the Fifth
Supplemental Indenture and the Fourth Supplemental Loan
Agreement, the Bonds are not to be payable from or chargeable against
any funds other than the revenues and assets pledged to the payment
thereof; the HRA and the City shall not be subject to any liability
thereon other than from such revenues and assets; no holder of any of
the Bonds shall ever have the right to compel any exercise by the HRA
or the City of their taxing powers to pay any of the Bonds or the interest
or premium thereon, or to enforce payment thereof against any
property of the HRA or the City ot�er than the property expressly
pledged thereto; the Bonds shall not constitute a charge, lien or
106 encumbrance, legal or equitable, upon any property of the HRA or the
107 City other than the revenues or assets described in the Granting Clauses
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1849442v1 (13Ni#Ol!.DOC)
of the Fifth Supplemental Indenture, all of which have been assigned to
the Trustee under such Fifth Supplemental Indenture; the Bonds shall
recite that the Bonds are issued without moral obligation on the part of
the State of Minnesota ar its political subdivisions, or the HRA or the
City, and that the Bonds, including interest thereon, are payable solely
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from the revenues and assets pledged to the payment thereof; and, the
Bonds shall not consritute a debt of the HRA or the City within the
meaning of any consiitutional or statutory limitation of indebteduess;
and
a public hearing was held on September 8, 1999 pursuant to the requirements
of Section 147(fl of the Intemal Revenue Code of 1986, as amended, and
pursuant to a notice published by the HRA not less than 15 days prior to the
public hearing, a public hearing was held on the issuance of the Bonds on
September 8, 1995, at which public hearing all persons were given an
opportunity to speak.
1.03. The HRA shall proceed forthwith to issue its Bonds, in the form and upon the terms
set forth in the Fifth Supplemental Indenture and in tkus Resolution. The initial principal amount of
the Bonds shall not exceed $7,000,000. The Bonds shall be subject to redemption prior to mahuity
as set forth in the Fifth Supplemental Indenture.
1.04. The I3RA hereby delegates to the Execurive Director or its designee the authority to
(i) consent to the distribution of the Official Statement in connection with the offering and sale of
the Bonds, and (ii) if required, execute a letter to the LTnderwriter that the Official Statement, or
portions thereof, are "deemed final" within the meaning of Rule 15c2-12(b) under the Securities
Exchange Act of 1934, as amended.
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PART II- AUTHORIZATION TO EXECUTE DOCUMENTS
AND TAKE OTHER ACTIONS
2A1. For the �urposes of this Part II, the Bond Documents, the Official Statement and all
otker certificates, certified proceedings, instruments, a�eements, and other items necessary or
desirable to effectuate the purposes of this Resolution are referred to as the "Resolution
Documents."
2A2. Subject to the approval of the City Attorney, bond counsel and appropriate HRA
staff, and the provisions of paragraph 2.05 of this Resolution, the forms of the Resolution
Documents and exhibits thereto are approved substantially in the forms submitted and on file in the
offices of the HI2A, with such subsequent changes as may be approved by the City Attorney, bond
counsel and the fIl2A staff or as may be consistent with the determinations made herein. Except as
otherwise specifically provided herein, the Resolurion Documents and er,hibits thereto, in
substantially the forms approved hereby, are directed to be executed or consented to in the name and
on behalf of the HRA by the Chair, the Secretary, the Executive Director and the Director, Office of
Financial Services, provided that the Bond Purchase Agreement and all closing certificates may be
executed in the name and on behalf of the HRA by its Executive Director. Any other documents
and certificates necessary to the transactions herein described shall be executed by the appropriate
HRA officers. Copies of all of the documents necessary to the transactions herein described shall be
delivered, filed and recorded as provided herein and in related docusnents.
2.03. Subject to approval of final forms of the Bonds and the Bond Documents by the City
Attomey, bond counsel and HI2A staff, the Chair, Secretary, Executive Director and Director,
Office of Financial Services of the �3RA aze authorized and directed to prepare and execute the
Bonds as prescribed in the Fifth Supplemental Indenture and to deliver the Bonds to the Trustee for
authentication and delivery to the purchaser thereof.
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2.04. The Chair, Secretary, Execurive Airector and Director, Office of Financial Services
and other officers of the HRA aze authorized and directed to prepaze and fumish to the purchaser of
the Bonds, bond counsel, the Trustee, and others as appropriate, certified copies of a11 proceedinas
and records of the HRA relating to the transactions contemplated by this Resolution, and such other
affidavits and certificates as may be required to show the facts relatin� to the legality of such
transactions as such facts appeaz from the books and records in the officers' custody and control or
as otherwise Imown to them; and all such certified copies, certificates and affidavits, including any
heretofore furnished, shall constitute representations of the HI2A as to the truth of all statements
contained therein.
2.05. The approval hereby given to the various Resolution Documents referred to above
includes approval of such additional details therein as may be necessary and appropriate, such
modifications thereof, deletions therefrom and addirions thereto as may be necessary and
appropriate and approved by the City Attorney, bond counsel and appropriate HRA staff, and
includes approval of such related inshwnents as may be required to be executed in connection with
the various documents referred to above; and said City Attomey, bond counsel, and HRt1 staff are
hereby authorized to approve said changes and related instruments on behalf of the HRA upon
detennination by them that such changes and related instruments are consistent with this Resolution
and necessary or desirable to effectuate the purposes hereof. The execurion of any instrument by
the appropriate officer or officers of the F-IRA herein authorized shall be conclusive evidence of the
approval of such documents in accordance with the terms hereof. In the absence of the Chair,
Executive Director, Airector, Office of Financial Services or Secretary, any of the documents
authorized by this Resolution to be executed by them may be executed by the Vice Chair, Acting
Executive Director, Acting Director, Office of Financial Services or Acting Secretary, respectively,
or by any other duly designated acting official. Certificates, directions and instrucrions may be
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executed by the Executive Director on behalf of the HRA, and no other officer's execution thereof
shall be required.
2.06. The authority to approve, execute and deliver future amendments to the Resolution
Documents entered into by the HRA in connection with the transactions contemplated hereby is
hereby delegated to the Executive Director and Director, Office of Financial Services, subj ect to the
following conditions: (a) such amendments do not require the consent of the holders of the
applicable series of Bonds or, if required, such consent has been obtained; (b) such amendments do
not materially adversely affect the interests of the HRA as the issuer of the related series of Bonds;
(c) such amendments do not contravene or violate any policy of the HRA; (d) such amendments aze
acceptable in form and substance to the Saint Paul City Attomey, bond counsel or other counsel
retained by the HRA to review such amendments; and (e) the HRA has received, if necessary, an
opinion of bond counsel to the effect that the amendments will not adversely affect the tax-exempt
character of interest on the related series of Bonds, if such Bonds are then tax-exempt obligations.
The authorization hereby given shall be further construed as authorization for the execution and
delivery of such certificates and related items as may be required to demonstrate compliance with
the agreements being amended and the terms of tlus Resolution. The execution of any instrument
by the Executive Director and Director, Office of Financial Services shall be conclusive evidence of
the approval of such instruments in accordance with the terms hereof. In the absence of the
Executive Director or Director, Office of Financial Services, any instnxment authorized by this
paragraph to be executed and delivered may be executed by the officer of the HRA authorized to act
in their place and stead.
201 2.07 The Company has covenanted in the Loan Ab eement that it wiil defend, save
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hannless and indemnify the City and HRA officials, officers and employees from and against all
liabilities, losses, damages, costs and expenses arising with respect to their participation in the
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project financed by ffie Series A Bonds, the Series C Bonds and the issuance of the Bonds,
includin� but not limited to research, data prepazation, document preparation and execution,
certifications, the rendering of _ financial or legal advice and written opinions and other
representation of the City and HI2A in the transactions.
PART III - FRANCHISE FEES
3.01 The Company shall collect Franchise Fees from its customers, and shall remit the
Franchise Fees directly to the City. Each such remittance by the Company: (a) shall be made on
or before the 25th day of the month; and (b) shall be in the amount of Franchise Fees actually
billed to customers during the preceding month, with appropriate adjustments for non-payments
and billing changes.
PARTIV-MISCELLANEOUS
4.01 Leonud, Street and Deinard, Professional Association is hereby appointed to act as
Bond Counsel and approval is hereby given for Oppenheimer Wolff & Donnelly LLP to act as
Underwriter's Counsel, and for pougherty Summit Securities LLC to act as Undenvriter and
Remarkefing Agent, in connection with the transactions contemplated by this Resolution.
Adopted by the Board of Comxnissioners of the Housing and Redevelopment Authority of
the City of Saint Paul, Mirmesota on September 22, 1999.
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