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HomeMy WebLinkAboutOrdinance-1985-0618ORDINANCE NO. 618 CB- 187 T INTRODUCED BY: Councilmember Merkl AN ORDINANCE AUTHORIZING THE ISSUANCE AND SALE OF $5,125,000 CITY OF WHEAT RIDGE, COLORADO INDUSTRIAL DEVELOPMENT REVENUE BONDS, SERIES 1985A (FIRST FEDERAL SAVINGS BANK OF COLORADO COLLATERALIZED LETTER OF CREDIT FIRSTBANK OF WHEAT RIDGE PROJECT) TO FINANCE A PROJECT FOR WHEAT RIDGE BANK BUILDING LIMITED PARTNERSHIP; RATIFYING CERTAIN ACTION HERETOFORE TAKEN; AUTHORIZING THE EXECUTION AND DELIVERY BY THE CITY OF A FINANCING AGREEMENT, INDENTURE OF TRUST, BOND PURCHASE AGREEMENT, SUCH BONDS AND CLOSING DOCUMENTS IN CONNECTION THEREWITH; MAKING DETERMINATIONS AS TO THE SUFFICIENCY OF REVENUES AND AS TO OTHER MATTERS RELATED TO SUCH PROJECT; AND REPEALING ACTION HERETOFORE TAKEN IN CONFLICT THEREWITH. WHEREAS, the City of Wheat Ridge, Colorado (the "City"), is a legally and regularly created, established, organized and existing municipal corporation under the provisions of Article XX of the Constitution of the State of Colorado and the Charter of the City; and WHEREAS, the Colorado County and Municipality Development Revenue Bond Act, constituting Article 3, Title 29, Colorado Revised Statutes (the "Act"), authorizes municipalities to issue revenue bonds to defray the cost of acquiring, constructing or improving any project, as defined in the Act, in order to promote industry and develop trade or other economic activity by inducing manufacturing, industrial, commercial or business enterprises to locate, remain or expand in the State of Colorado, to mitigate the serious threat of extensive unemployment in parts of the State of Colorado, to secure and maintain a balanced and stable economy in all parts of the State of Colorado or to further the use of its agricultural products or natural resources, and WHEREAS, such municipalities are further authorized by the Act to (a) issue revenue bonds for the purpose of defraying the cost of financing any project and all incidental expenses incurred in issuing such bonds, (b) secure the payment of the principal of, pre- mium, if any, and interest on such bonds as provided in the Act, and (c) enter into financing agreements with others for the purpose of providing revenues to pay such bonds upon such terms and conditions as the municipality may deem advisable, and WHEREAS, representatives of Wheat Ridge Bank Building Limited Partnership, a limited partnership duly organized and exist- ing under the laws of the State of Colorado (the "Company") and FirstBank of Wheat Ridge, N.A., a national banking association (the "Association"), have presented to the City a proposal whereby the City will, pursuant to the Act, finance a project which will be owned by the Company, and which will consist of a building to be con- structed on a parcel of land within the City leased from the Association and certain equipment to be installed therein (the "Project"), which Project will be leased in part to the Association and operated as a banking and office facility and which Project qual- ifies as a "project" within the meaning of the Act; and WHEREAS, the City has determined it is advisable and in the best interests of the City to issue, sell and deliver its City of Wheat Ridge, Colorado Industrial Development Revenue Bonds, Series 1985A (First Federal Savings Bank of Colorado Collateralized Letter of Credit FirstBank of Wheat Ridge Project) in the aggregate prin- cipal amount of $5,125,000 (the "Bonds") to Coughlin & Co., Inc. (the "Underwriter") in order to provide financing for the Project, to establish a reserve fund for the Bonds and to pay the costs inciden- tal to the authorization and issuance of the Bonds; and -2- WHEREAS, the City's expressed willingness to issue the Bonds to finance the Project has constituted one of the inducements whereby the Company and the Association have determined to locate the Project within the City; and WHEREAS, on October 21, 1981, the City Council of the City (the "Council") adopted a resolution whereby the City agreed to authorize the issuance of the Bonds, it being understood that no costs of issuance were to be borne by the City and that the necessary financing documents were subject to formal approval by ordinance of the Council pursuant to the Act (the "1981 Inducement Resolution"); and WHEREAS, on October 1, 1982, the Council adopted a resolu- tion whereby the City corrected the 1981 Inducement Resolution and on September 26, 1983, the Council adopted a resolution whereby the City extended the time period of the 1981 Inducement Resolution to October 1, 1985; and WHEREAS, the City will issue the Bonds pursuant to and the Bonds will be secured by an Indenture of Trust dated as of May 15, 1985 (the "Indenture"), between the City and Central Bank of Denver, a banking corporation, with its principal corporate trust office in Denver, Colorado, as trustee (the "Trustee"), and concurrently with the issuance of the Bonds the Company will enter into a Financing Agreement with the City dated as of May 15, 1985 (the "Agreement"), pursuant to which the City will loan the proceeds of the Bonds to the Company to finance the cost of the Project, to establish a reserve fund for the Bonds and to pay the costs incidental to the authoriza- tion and issuance of the Bonds and the Company will make payments sufficient to pay the principal of, premium, if any, and interest on the Bonds and to meet other obligations as herein and therein pro- vided; and WHEREAS, the Company and the Association will execute a Deed of Trust to Public Trustee, Security Agreement, Financing -3- Statement and Assignment of Rents and Leases dated as of May 15, 1985 (the "Deed of Trust"), to the Public Trustee of Jefferson County, Colorado, to secure the payment of principal of, premium, if any, and interest on the Bonds; and WHEREAS, the Bonds will be supported as to principal by an irrevocable letter of credit in the amount of $5,125,000 to be dated the date of issuance and sale of the Bonds (the "Letter of Credit") by First Federal Savings Bank of Colorado, a federally chartered mutual savings bank (the "Bank") and which Letter of Credit will be collateralized by the pledging of certain cash and conventional mort- gage loans on single-family residential property pursuant to a Collateral Pledge Agreement, dated as of May 15, 1985, between the Bank and the Trustee (the "Pledge Agreement"); and WHEREAS, there have been presented to the Council (a) the proposed form of the Agreement, (b) the proposed form of the Indenture, (c) the proposed form of a Bond Purchase Agreement dated May 13, 1985 (the "Bond Purchase Agreement") between the City and the Underwriter as purchaser of the Bonds, (d) the proposed form of the Deed of Trust, (e) the proposed form of the Letter of Credit, (f) the proposed form of the Collateral Pledge Agreement and (g) the form of Preliminary Official Statement (the "Preliminary Official Statement") previously distributed by the Underwriter to prospective purchasers of the Bonds. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF WHEAT RIDGE: Section 1. All action (not inconsistent with the provi- sions of this ordinance) heretofore taken by the Council and the officers of the City directed toward the financing of the Project and the issuance and sale of the Bonds therefor is hereby ratified, con- firmed and approved. Section 2. The City shall finance the Project by loaning the proceeds of the Bonds to the Company in accordance with the -4- provisions of the Agreement and the Indenture for the purpose described above. Section 3. To defray the cost of financing the Project, to establish a reserve fund for the Bonds and to pay the costs incurred in connection with the authorization, issuance and sale of the Bonds, there is hereby authorized and created an issue of indus- trial development revenue bonds designated "City of Wheat Ridge, Colorado Industrial Development Revenue Bonds, Series 1985A (First Federal Savings Bank of Colorado Collateralized Letter of Credit FirstBank of Wheat Ridge Project)" in the aggregate principal amount of $5,125,000, issuable as fully registered bonds in the denomination of $5,000 or any integral multiple thereof. The Bonds shall be dated as provided in the Indenture. The Bonds shall bear interest from their date payable semiannually on each June 1 and December 1, com- mencing December 1, 1985, except as otherwise provided in the Indenture. The Bonds shall bear interest (a) from May 15, 1985, to and including May 31, 19_2~, at the rate per annum of 9%, and (b) from June 1, 19_25 and any subsequent June 1 as designated by the Company (a "Rate Adjustment Date"), to the May 31 immediately preceding the next Rate Adjustment Date or the final maturity of the Bonds as the case may be (the "Rate Period") at the rate which in the judgment of Coughlin & Co., Inc., Denver, Colorado, as remarketing agent (the "Remarketing Agent"), having due regard for prevailing financial market conditions, is the interest rate necessary, but not in excess of the interest rate necessary, to enable the Remarketing Agent to sell any Bonds which may be delivered to it pursuant to the Remarketing Agreement, dated as of May 15, 1985 (the "Remarketing Agreement") between the Company and the Remarketing Agent, on or before the May 22 preceding the Rate Adjustment Date on which the Rate Period commences at a price equal to 100% of the principal amount thereof. In no event shall the rate of interest on the Bonds, determined as described above, exceed 20% per annum. -5- The Bonds shall mature on June 1, 2005, and shall be subject to mandatory sinking fund redemption on June 1 of the years and in the amounts set forth below: 1988 15,000.00 1989 40 ,000 .00 1990 45400.00 1991 50400.00 1992 55,000.00 1993 60 ,000 .00 1994 65,000.00 1995 75,000.00 1996 80 ,000 .00 1997 90 ,000 .00 1998 100 ,000 .00 1999 110 ,000 .00 2000 120,000.00 2001 135400.00 2002 150 ,000.00 2003 165400.00 2004 180,000.00 The Bonds shall be payable, shall be subject to redemption prior to maturity and shall be in substantially the form as provided in the Indenture. The Bonds shall be sold to the Underwriter at a negotiated sale at a purchase price equal to $4,971,250 plus accrued interest to the date of issuance and delivery of the Bonds. The max- imum net effective interest rate on the Bonds is 22.25% per annum, which rate is hereby determined to be the maximum net effective interest rate on the Bonds. Section 4. The following determinations and findings are hereby made in accordance with Sections 29-3-113, 29-3-114 and 29-3-120 of the Act: (a) The maximum amount necessary in each year to pay the principal of and the interest on the Bonds assuming the interest rate on the Bonds after 19 95 remains 98 is as follows: -6- Annual Period Maximum Maximum To and Interest Principal to be Annual Including December 1 for Such period Retired in Such Period Debt Service Requirement 1985 $251,125 $ -0- $ 251,125.00 1986 461r250 $ -0- 461 ,250 .00 1987 461,250 -0- 461,250.00 1988 460 , 575 15 ,000 .00 475r575.00 1989 458,100 40,000.00 498,100.00 1990 454,275 45,000.00 499,275.00 1991 450,000 50,000.00 500,000.00 1992 445,275 55,000.00 500,275.00 1993 440,100 60,000.00 500,100.00 1994 434,475 65,000.00 499,475.00 1995 428,175 75,000.00 503,175.00 1996 421 ,200 80 ,000 .00 501 ,200 .00 1997 413,550 90,000.00 503,550.00 1998 405 ,000 100 ,000 .00 505 ,000 .00 1999 395,550 110,000.00 505,550.00 2000 385,200 120,000.00 505,200.00 2001 373,725 135,000.00 508,725.00 2002 360 , 900 150 ,000 .00 510f900.00 2003 346,725 165,000.00 511,725.00 2004 331r200 180 ,000 .00 511 ,200 .00 2005 161,550 3,590,000.00 3,751,550.00 (b) The Council has deemed it advisable to establish for contingent use in connection with the retirement of the Bonds, among other purposes, the trust fund created and established by the Indenture designated the Reserve Account within the Debt Service Reserve Fund. Moneys on deposit in the Reserve Account shall be used to provide a reserve for (i) the payment of the interest on the Bonds and (ii) the payment of the principal of, premium, if any, and inter- est on Bonds to be redeemed as provided in the Indenture. There shall be deposited into the Reserve Account from the proceeds of the Bonds an amount equal to the Debt Service Reserve Fund Requirement (as defined in the Agreement) of the Bonds. Except for such deposit of proceeds of the Bonds into the Reserve Account, it is not necessary for the Company to pay any amount into the Reserve Account -7- in any year, absent occurrences of the contingencies described in the Agreement and the Indenture, which occurrences and their magnitude cannot now be accurately foreseen. (c) The terms under which the Project is to be financed provide that the Company shall maintain, or cause to be maintained, the Project and carry, or cause to be carried, all proper insurance with respect thereto. (d) The revenues payable under the Agreement are sufficient to pay, in addition to all other requirements of the Agreement and this ordinance, all sums referred to in paragraphs (a), (b) and (c) of this Section. (e) The revenues payable under the Agreement are sufficient to pay, in addition to all other requirements of the Agreement and this ordinance, all taxes payable pursuant to Section 29-3-120 of the Act. Section 5. The forms, terms and provisions of the Agreement, the Indenture, the Bond Purchase Agreement, the Deed of Trust, the Letter of Credit and the Pledge Agreement are hereby approved and the City shall enter into the Agreement, the Indenture and the Bond Purchase Agreement in their respective forms as presented to the Council at this meeting with such changes therein as are not inconsistent herewith; and the Mayor is hereby authorized and directed to execute and deliver the Agreement, the Indenture and the Bond Purchase Agreement and the City Clerk is hereby authorized and directed to affix the City seal to and to attest the Agreement, the Indenture and the Bond Purchase Agreement. Section 6. The City acknowledges the use by the Underwriter, prior to the date hereof, of the Preliminary Official Statement in connection with the offering of the Bonds to the public. The City acknowledges the use by the Underwriter in connection with the sale of the Bonds of a final official statement (the "Official Statement") to be prepared by the Underwriter and to -8- be substantially in the form of the Preliminary Official Statement but containing such amendments as may be deemed appropriate by the Underwriter. The City makes no representation or warranty as to, and has no responsibility for, the accuracy or completeness of the infor- mation contained in the Preliminary Official Statement or the Official Statement. Section 7. The forms, terms and provisions of the Bonds are hereby approved and the City shall issue the Bonds in the form set forth in the Indenture with such changes therein as are not inconsistent herewith; and the Mayor is hereby authorized and directed to execute and deliver the Bonds and the City Clerk is hereby authorized and directed to affix the seal of the City to the Bonds and to attest the Bonds. The signatures of the Mayor and the City Clerk on the Bonds and the seal of the City on the Bonds shall be affixed manually or by facsimile. Section 8. The officers of the City shall take all action in conformity with the Act necessary or reasonably required to effec- tuate the issuance and delivery of the Bonds and necessary or desir- able in conformity with the Act to finance the Project and to carry out, give effect to and consummate the transactions contemplated by this ordinance, the Agreement and the Indenture, including without limitation the execution and delivery of any documents necessary to elect to have Section 103 (b) (6) (D) of the Internal Revenue Code of 1954, as amended, apply to the Bonds, the filing of any statements or reports with the Internal Revenue Service or with the Secretary of the Treasury or his delegate necessary to maintain the exemption of interest on the Bonds from federal income taxation and the execution and delivery of any closing documents to be delivered in connection with the issuance and delivery of the Bonds. Section 9. For the purposes of Section 103(k) of the Internal Revenue Code of 1954, as amended, the Council hereby approves the Bonds and the Project, including the following -9- information regarding the Project: the Project consists of a banking and office facility of approximately 52,000 square feet located at the southeast corner of 44th Avenue and Wadsworth Boulevard within the City. Section 10. The cost of financing the Project will be paid out of the proceeds of the Bonds and the Bonds will not be the general obligations of the City nor shall the Bonds, including inter- est thereon, constitute the debt or indebtedness of the City within the meaning of the Constitution or statutes of the State of Colorado or of the home rule charter of the City nor shall anything contained in this ordinance or in the Bonds, the Agreement, the Indenture, the Bond Purchase Agreement, the Deed of Trust, the Letter of Credit, the Pledge Agreement or any other instrument give rise to a pecuniary liability or a charge upon the general credit or taxing powers of the City, nor shall the breach of any agreement contained in this ordi- nance or in the Bonds, the Agreement, the Indenture, the Bond Purchase Agreement, the Deed of Trust, the Letter of Credit, the Pledge Agreement or any other instrument impose any pecuniary liabil- ity upon the City or any charge upon its general credit or against its taxing powers, the City having no power to pay out of its general funds, or otherwise contribute any part of the costs of financing the Project, nor power to operate the Project as a business or in any manner, nor shall the City condemn any land or other property for the Project, nor contribute any land or other property to the Project. Section 11. After the Bonds are issued, this ordinance shall be and remain irrepealable until the Bonds and the interest thereon shall have been fully paid, cancelled and discharged. Section 12. If any section, paragraph, clause or provi- sion of this ordinance shall for any reason be held to be invalid or unenforceable, the invalidity or unenforceability of such section, paragraph, clause or provision shall not affect any of the remaining provisions of this ordinance. -10- Section 13. All bylaws, orders, regulations, resolutions and ordinances, or parts thereof, of the City inconsistent herewith and with the documents hereby approved are hereby repealed to the extent only of such inconsistency. This repealer shall not be con- strued as reviving any bylaw, order, regulation, resolution or ordi- nance, or part thereof. Section 14. A public hearing concerning this ordinance shall be held by the Council before final adoption of this ordinance at a meeting of the Council at the Council Chambers in the City Hall Building, 7500 W. 29th Avenue, in the City. Section 15. This ordinance, immediately on its approval on first reading, shall be published in full in the Wheat Ridge Sentinel, a legal newspaper of general circulation in the City. After final approval at a meeting not earlier than seven days after first publication, this ordinance shall be published by title or in full, as the Council may determine, in the Wheat Ridge Sentinel, a legal newspaper of general circulation in the City. if amended, this ordinance shall be published by title and summary and the full text of the amendment or in full as the Council may determine. This ordi- nance, immediately on its final passage and adoption, shall be num- bered and recorded in the Ordinance Book of the City kept for that purpose, authenticated by the signatures of the Mayor and City Clerk and by the certificate of publication. section 16. This ordinance shall take effect immediately. INTRODUCED, READ, AND ADOPTED on first reading by a vote of 6 to 1 on this 22nd day of April , 1985, ordered published in full in a news- paper of general circulation in the City of Wheat Ridge and Public Hearing and consideration on final passage set for P4a_y 13, , 1985, at 7:30 o'clock p.m., in the Council Chambers, 7500 West 29th Avenue, Wheat Ridge, Colorado. -11- READ, ADOPTED, AND ORDERED PUBLISHED on second and final reading by a vote of 7 to I , this 13th day of May , 1985. SIGNED by the Mayor on this 14th day of May , 1985. c , WANDA SANG, CITY CLERK 1st Publication: April 25, 1985 2nd Publication: May 16, 1985 Wheat Ridge Sentinel Effective Date: May 13, 1985 - 12 - FRANK STITES, MAYOR APPROVED AS M ORM BY CITY ATTORNEY: JOHN HAYES, CITY AT~qXdEY r