HomeMy WebLinkAbout133 - 09/16/1986 - AUTHORIZING THE ISSUANCE OF INDUSTRIAL DEVELOPMENT REVENUE REFUNDING BONDS (OLD TOWN FORT COLLINS PR D9724 •
09/16/86
ORDINANCE No. 133, 1986
AN ORDINANCE AUTHORIZING AND DIRECTING THE ISSUANCE OF
INDUSTRIAL DEVELOPMENT REVENUE REFUNDING BONDS (OLD
TOWN FORT COLLINS PROJECT II ) SERIES 1986, IN THE
AGGREGATE PRINCIPAL AMOUNT OF $6,915,000 AND THE
EXECUTION AND DELIVERY OF A REFINANCING AGREEMENT, A
TRUST INDENTURE, A REFUNDING TRUST AGREEMENT, A BOND
PURCHASE AGREEMENT, AN INTERCREDITOR AGREEMENT AND
RELATED DOCUMENTS; AUTHORIZING AND DIRECTING THE
EXECUTION AND DELIVERY OF SUCH BONDS; MAKING CERTAIN
DETERMINATIONS WITH RESPECT THERETO; PROVIDING FOR THE
PRINCIPAL AMOUNT, NUMBERS, PROVISIONS FOR REDEMPTION
AND MATURITY OF, AND RATES OF INTEREST ON, THE BONDS;
REQUESTING THE TRUSTEE TO AUTHENTICATE THE BONDS;
AUTHORIZING INVESTMENTS; AUTHORIZING INCIDENTAL ACTION;
AND REPEALING INCONSISTENT ACTIONS.
WHEREAS, the City of Fort Collins, Colorado (the
"City" ) heretofore issued and sold its Industrial Development
Revenue Bonds, Series 1983 (Old Town Fort Collins Project II)
(the "1983 Bonds" ) , under an Indenture of Trust dated as of
December 1, 1983, and amended by a First Supplemental Indenture
of Trust dated its date of execution and delivery (collectively,
the "1983 Indenture" ) between the City and United Bank of Fort
Collins, National Association, as Trustee (the "1983 Trustee" ) ;
and
WHEREAS, the proceeds from the sale of the 1983 Bonds
were loaned to Old Town Partners II , a Wisconsin limited
partnership (the "Partnership" ) , for the purpose of financing the
acquisition and construction of a parcel of land, buildings and
other improvements thereon, as suitable for retail and office
space (the "Project" ) , pursuant to the Colorado County and
Municipality Development Revenue Bond Act as set forth in part 1
of article 3 of title 29, Colorado Revised Statutes, as amended
(the "Act" ) ; and
WHEREAS, on December 1, 1986, the aggregate principal
amount of the 1983 Bonds outstanding will be $6,915,000 plus
$55,000 in aggregate principal amount of 1983 Bonds maturing on
December 1, 1986; and
WHEREAS, the 1983 Bonds are subject to optional
redemption prior to maturity under the terms of the 1983
Indenture on December 1, 1986, at an optional redemption price of
102% of the principal amount of the 1983 Bonds to be redeemed;
and
WHEREAS, pursuant to the Act, the City is authorized to
refinance the Project and refund the 1983 Bonds by issuing
Ar
refunding bonds in such amount as the City may determine and
applying the proceeds thereof to the payment of the principal,
interest, premium and other expenses connected with the refunding
of the 1983 Bonds; and
WHEREAS, the Partnership has requested the City to
refinance the Project and refund the 1983 Bonds pursuant to a
Refinancing Agreement, dated as of October 1, 1986, by and
between the City and the Partnership (the "Refinancing
Agreement" ) , by issuing therefor "City of Fort Collins, Colorado,
Industrial Development Revenue Refunding Bonds (Old Town Fort
Collins Project II ) Series 1986" in the aggregate principal
amount of $6,915,000 (the "Bonds" ) under and secured by a Trust
Indenture, dated as of October 1, 1986 (the "Indenture" ) , from
the City to United Bank of Fort Collins, National Association
(the "Trustee" ) and by making a loan to the Partnership of such
principal amount, upon the terms and conditions set forth in the
Refinancing Agreement; and
WHEREAS, the Bonds will be secured by a pledge of the
Refinancing Agreement, a pledge of the revenues and receipts
derived by the City pursuant to the Refinancing Agreement, a Deed
of Trust, Security Agreement and Financing Statement dated as of
October 1, 1986, from the Partnership to the Public Trustee of
the County of Larimer, Colorado and for the use of the Trustee
and Continental Casualty Company, an insurance corporation
organized under the insurance laws of the State of Illinois
( "CCC" ) and an Assignment of Rents and Leases dated as of
October 1, 1986, from the Partnership to the Trustee and CCC, and
will initially be supported as to principal and interest by a
Surety Bond issued by CCC; and
WHEREAS, as a condition to the issuance of the Surety
Bond, it is necessary that the City enter into an Intercreditor
Agreement, dated as of October 1, 1986, among the City, the
Trustee and CCC (the "Intercreditor Agreement" ) ; and
WHEREAS, in order to provide for the payment of the
outstanding principal of, interest on and premium due in
connection with the redemption of all of the outstanding 1983
Bonds, it is necessary that the City enter into a Refunding Trust
Agreement, dated as of October 1, 1986, among the City, the 1983
Trustee, the Trustee and the Partnership (the "Refunding Trust
Agreement" ) ; and
WHEREAS, the City Council, pursuant to Resolution
85-221, authorized the refinancing of the Project and the
issuance of the Bonds; and
WHEREAS, the City Council held a public hearing on
September 2, 1986, pursuant to public notice, published on
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August 19, 1986, in The Coloradoan, a newspaper of general
circulation within the boundaries of the City, on the proposed
issuance of the Bonds; and
WHEREAS, the Bonds will be issued, sold and delivered
by the City to Dean Witter Reynolds Inc. , Chicago, Illinois (the
"Underwriter" ) , at a price of not less than 98.25% of the
principal amount thereof pursuant to a Bond Purchase Agreement
dated September 16, 1986 (the "Bond Purchase Agreement" ) among
the City, the Partnership and the Underwriter, and the proceeds
of the Bonds used to pay the cost of refinancing the Project by
refunding, in whole, the outstanding principal amount of 1983
Bonds.
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT
COLLINS, COLORADO, AS FOLLOWS:
Section 1. APPROVAL OF DOCUMENTS. The forme of the
Refinancing Agreement, the Indenture, the Bond Purchase
Agreement, the Intercreditor Agreement and the Refunding Trust
Agreement, presented to this meeting (copies of which shall be
filed with the records of the City) are hereby approved, and the
Mayor of the City (the "Mayor" ) is hereby authorized to execute
and deliver, and the City Clerk (the "Clerk" ) is hereby
authorized to affix the seal of the City where appropriate to,
and attest, such documents in substantially such form and upon
the terms and conditions set forth herein and therein, with such
changes therein as such officers shall approve (including changes
in dates and amounts necessary to conform such documents to the
final terms as approved by the City, the Partnership, CCC and the
Underwriter) , such approval to be evidenced by the execution
thereof.
In accordance with the requirements of the Act, the
City hereby determines that the following provisions shall be as
set forth in the form of the Indenture hereinbefore approved,
which form is hereby incorporated by reference as if set forth in
full:
(a) Custody of the proceeds from the sale of the
Bonds, including their investment and reinvestment until
used to refinance the costs of the Project and refund the
1983 Bonds pursuant to the Refunding Trust Agreement;
(b) The creation of funds or accounts into which
any Bond proceeds, revenues and income may be deposited or
created;
(c) Limitation on the purpose to which proceeds
of any Bonds may be applied;
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(d) Limitation on the refunding of Bonds and the
replacement of Bonds;
(e) The procedure by which the terms of any
contract with Bond owners may be amended or abrogated;
(f) Vesting in the Trustee such properties,
rights, powers and duties in trust as the City determines
and limiting the rights, duties and powers of the Trustee;
and
(g) The rights and remedies available in case of
a default to the Bond owners or to the Trustee under the
Refinancing Agreement or the Indenture.
In accordance with the requirements of the Act, the
City hereby determines that the following provisions shall be as
set forth in the form of Refinancing Agreement hereinbefore
approved, which form is hereby incorporated by reference as if
set forth in full:
(a) The fixing and collection of revenues from
the Project; and
(b) The maintenance and insurance of the Project.
Section 3 . ISSUANCE OF BONDS. The issuance of the
Bonds is hereby authorized. The form of the Bonds set forth in
the Indenture is hereby approved; the Bonds shall be executed
with the manual or facsimile signatures of the Mayor, the Clerk
and the Finance Director or Acting Finance Director of the City
(the "Finance Director" ) on the face of the Bonds in
substantially such forms with appropriate insertions and
variations, and the seal of the City or a facsimile thereof is
hereby adopted and authorized to be affixed or imprinted thereon;
and the Mayor, the Clerk or the Finance Director is authorized
and directed to deliver the Bonds to the Trustee for
authentication under the Indenture and, when they have been
authenticated, to deliver them or cause them to be delivered to
the Underwriter against receipt of the purchase price as
specified therein, plus any accrued interest due, and to deposit
the amount so received with the Trustee as provided in the
Indenture.
Section 4. TERMS OF BONDS. The Bonds shall be in the
aggregate principal amount of $6,915,000, shall be dated their
actual date of issuance and delivery or as otherwise provided in
the Indenture, and shall be issued as fully registered bonds in
the denominations authorized by the Indenture, shall mature,
subject to prior redemption on December 1, 2013, and shall bear
interest payable semi-annually on June 1 and December 1 of each
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year, commencing June 1, 1987, at the rate or rates which shall
be determined as provided below and in the form of Bond and in
the Indenture. Pursuant to Section 6 of the Act, the maximum net
effective interest rate for the Bonds, with which the Bond
Purchase Agreement shall comply, shall not exceed 27%. The
numbers and provisions for redemption of the Bonds, the
registration and exchangeability privileges, the medium and place
of payment, and the priorities in revenues of the City, shall be
as set forth (a) in the aforesaid form of such Bonds which form
is hereby approved and incorporated by reference as if set forth
in full, and (b) in the form of the Indenture hereinbefore
approved and so incorporated.
The Bonds shall be subject to scheduled mandatory
redemption, by lot, at a redemption price equal to 100% of the
principal amount outstanding, plus accrued interest to the
redemption date, on December 1 in each of the years and in the
amounts indicated below:
Principal Principal
Year Amount Year Amount
1987 $ 60, 000 2001 $ 200,000
1988 65,000 2002 220,000
1989 70,000 2003 240,000
1990 75,000 2004 260, 000
1991 80, 000 2005 285,000
1992 90,000 2006 310,000
1993 100,000 2007 340,000
1994 105,000 2008 370, 000
1995 120,000 2009 405,000
1996 130,000 2010 445,000
1997 140,000 2011 485,000
1998 155,000 2012 530,000
1999 170,000 2013 ( 1) 1,280, 000
2000 185,000
( 1) Stated maturity.
The Bonds will also be subject to optional and mandatory
redemption as provided in the Indenture.
The Bonds shall bear interest from their dated date to
the first mandatory tender date of December 1, 1993, at the per
annum interest rate of 6.75%. Thereafter, as more fully provided
in the Indenture, the interest rate on the Bonds and the length
of each subsequent period extending from one mandatory tender
date to the day preceding the next mandatory tender date or the
maturity date, as the case may be (a "Reset Period" ) shall be
,redetermined, in the following manner:
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(i) Each Reset Period shall end on the last day
of November, shall not extend beyond the last day of
November, 2013, and shall be a period of at least one year
with the exact length of the Reset Period to be determined
as set forth in subparagraph (ii) below.
(ii) On the 40th day prior to each Reset Date, or
on an earlier day selected by the Remarketing Agent as
hereinafter appointed, but not earlier than the 45th day
prior to such Reset Date, the Remarketing Agent, having due
regard for prevailing market conditions, shall determine the
Reset Period which if used in the remarketing of the Bonds
would be the longest Reset Period that would, in the
judgment of the Remarketing Agent, result in the market
value of the Bonds as of such day, as if such day were the
first day of such Reset Period (the "Determination Date" ) ,
assuming such Bonds were to bear interest at the highest
obtainable rate not in excess of 6. 75% per annum, being 100%
of the principal amount thereof. The Reset Period so
determined by the Remarketing Agent shall be the Reset
Period next in effect for the Bonds and the interest rate so
determined by the Remarketing Agent shall be the interest
rate borne by the Bonds during such Reset Period (the "Reset
Rate" ) ; provided however, that if the Remarketing Agent
determines that an interest rate greater than 6.75% per
annum is required to obtain a market value of 100% of the
principal amount thereof for the Bonds for a Reset Period of
at least one year as of the Determination Date, the Reset
Period shall be one year and the Reset Rate shall be the
rate which would, in the judgment of the Remarketing Agent,
result in the market value of the Bonds as of the
Determination Date being 100% of the principal amount
thereof; and provided, further, that in no event shall the
Reset Rate exceed the maximum rate of 25% per annum.
If the Reset Period and the Reset Rate cannot be,
or are not, determined by the Remarketing Agent in the
manner specified above, the Bonds shall be subject to
redemption in whole as described in the Indenture.
Notwithstanding the foregoing provisions or any provisions
set forth in the Bonds, if CCC or any other Credit
Instrument Obligor, as defined in the Indenture elects to
purchase the Bonds in lieu of redemption on a Reset Date in
accordance with the Indenture, the Reset Period shall be a
period commencing on such Reset Date and extending for one
year through the last day of the following November, and the
Reset Rate for such Reset Period shall be 90% of the
interest rate applicable to one-year United States of
America Treasury ( "Treasury" ) Notes, determined on the basis
of the most recent regular Treasury auction preceding such
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Reset Date, which rate shall not be in excess of the maximum
rate of 25% per annum.
Notwithstanding the foregoing, under the Indenture, the
Partnership may establish one Special Reset Date as of any
business day during the period which is not more than 180 days
nor less than 60 days prior to each Reset Date; provided that the
Qualified Credit Instrument or Alternate Credit Instrument, as
defined in the Indenture, remains in effect for the entire term
of the Reset Period commencing on the Special Reset Date. Upon
the establishment of a Special Reset Date, the next succeeding
Reset Period shall extend to no earlier than the second
succeeding November 30 and no later than the maturity of the
Bonds or the maturity of the Qualified Credit Instrument,
whichever is shorter. The Partnership shall give telegraphic or
telephonic notice of the Special Reset Date to the City, the
Trustee, the Credit Instrument Obligor and the Remarketing Agent
no later than 65 calendar days prior to the proposed Special
Reset Date. Within five calendar days of its receipt of such
notice, the Remarketing Agent shall establish the Reset Rate and
Reset Period (determined in the manner described above) to
commence on the Special Reset Date.
The City hereby appoints Dean Witter Reynolds Inc. ,
Chicago, Illinois as the initial Remarketing Agent (the
"Remarketing Agent" ) under the Indenture. The Remarketing Agent
may be removed or replaced in accordance with the provisions of
the Indenture. The computation or determination of the Reset
Period and the Reset Rate by the Remarketing Agent shall be
conclusive and binding upon the owners of the Bonds, the City,
the Partnership, the Trustee, CCC and any other Credit Instrument
Obligor.
Section S. DETERMINATION OF REVENUES. In accordance
with the Act, it is hereby determined that (a) in view of the
ownership of the Project by the Partnership and the consequent
subjection of the Project to ad valorem taxes, no amount is
necessary for payments in lieu of taxes; and (b) a reserve fund,
funded with proceeds of the 1983 Bonds, in an amount not less
than $250, 000 is necessary and established under the Indenture.
It is hereby determined that, based on the per annum interest
rate of 6. 75% on the Bonds from the original issuance date
thereof through December 1, 1993, the maximum interest rate of
25% per annum on the Bonds after December 1, 1993, and the
mandatory redemptions of principal set forth in Section 4 hereof,
no more than the following amounts will be necessary for the
payment of interest on the Bonds:
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Year Ending December 1 Year Ending December 1
1987 $ 544,556 2000 $1,388.750
1988 462, 713 2001 1,342,500
1989 458,325 2002 1,292,500
1990 453, 600 2003 1,237,500
1991 448,537 2004 1, 177,500
1992 443, 137 2005 1, 112,500
1993 437,063 2006 1,041,250
1994 1,593,750 2007 963,750
1995 1,567,500 2008 878, 750
1996 1,537,500 2009 786,250
1997 1,505,000 2010 685,000
1998 1,470,000 2011 573,750
1999 1,431,250 2012 452,500
2013 320,000
Section 6. AUTHENTICATION OF BONDS. The Trustee is
hereby requested to authenticate the Bonds and to deliver them
to, or upon the order of, the Mayor, the Clerk or the Finance
Director.
Section 7. INVESTMENT OF FUNDS. The Trustee shall be,
by virtue of this Ordinance and without further authorization
from the City, authorized, directed and requested to invest and
reinvest all moneys available therefor held by it pursuant to the
Indenture which by the terms of the Indenture may be invested, or
to deposit and redeposit such moneys in such accounts as may be
permitted by the Indenture, all subject to the terms and
limitations contained in the Indenture.
Section 8. Official Statement. The City acknowledges
the use by the Underwriter in connection with the sale of the
Bonds of preliminary and final official statements (the "Official
Statement" ) to be prepared by the Underwriter in form 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 information contained in the
Official Statement.
Section 9. INCIDENTAL ACTION. The officers of the
City are hereby authorized and directed to execute and deliver
such other documents, and to take such other action as may be
necessary or appropriate in order to effectuate the delivery of
the aforesaid Refinancing Agreement, Indenture, Bond Purchase
Agreement, Intercreditor Agreement, and the Refunding Trust
Agreement, the performance of the City' s obligations thereunder,
and the issuance and sale of the Bonds. Notwithstanding any
other provision of this Ordinance, the officers of the City are
hereby authorized to make or approve such revisions in the
Refinancing Agreement, the Indenture, the Bond Purchase
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Agreement, the Intercreditor Agreement and the Refunding Trust
Agreement as, in the opinion of counsel to the City, may be
necessary or convenient to carry out or assist in carrying out
the purposes of this Ordinance and the refinancing of the
Project.
Section 10. BONDS SHALL NOT CONSTITUTE A PECUNIARY
LIABILITY OF THE CITY. As required by the Act, the Bonds shall
be special, limited obligations of the City, payable solely from
the revenues derived from the Project and shall never constitute
the debt or indebtedness of the City within the meaning of any
provision or limitation of the Colorado Constitution, the
Colorado statutes or the City's Home Rule Charter, and shall not
constitute or give rise to a pecuniary liability of the City or a
charge against its general credit or taxing powers.
Section 11. REPEALER. All acts, orders, resolutions,
or parts thereof, taken by the City in conflict with this
Ordinance are hereby repealed, except that this repealer shall
not be construed so as to revive any act, order, resolution,
ordinance, or part thereof, heretofore repealed.
Section 12. ORDINANCE IRREPEALABLE. This Ordinance
is, and shall constitute, a legislative measure of the City, and
after the Bonds are issued and outstanding, this Ordinance shall
constitute a contract between the City and the owner or owners of
the Bonds, and shall be and remain irrepealable until the Bonds
and the interest accruing thereon shall have been fully paid,
satisfied and discharged.
Section 13 . SEVERABILITY. If any paragraph, clause or
provision of this Ordinance is judicially adjudged invalid or
unenforceable, such judgment shall not affect, impair or
invalidate the remaining paragraphs, clauses or provisions
hereof, the intention being that the various paragraphs, clauses
or provisions hereof are severable.
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READ, AMENDED, FINALLY PASSED AS AMENDED ON SECOND
READING, AND ORDERED PUBLISHED BY NUMBER AND TITLE ONLY this 16th
day of September, 1986.
CITY OF FORT COLLINS, COLORADO
By:,
(CITY) Maycef
(SEAL)
U
City Clerk
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