HomeMy WebLinkAboutOrdinance-1985-0618ORDINANCE NO. 618
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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
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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
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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
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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.
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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:
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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
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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
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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
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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.
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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.
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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
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FRANK STITES, MAYOR
APPROVED AS M ORM BY CITY ATTORNEY:
JOHN HAYES, CITY AT~qXdEY
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