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HomeMy WebLinkAboutNo. 1094 amending resolution no. 1065 which amended resolution no. 1054 regarding the issuance of tax increment revenue refunding bondsR RESOLUTION NO. 1094 RESOLUTION OF THE SOUTH BEND REDEVELOPMENT COMMISSION AMENDING RESOLUTION NO. 1065, WHICH AMENDED RESOLUTION NO. 1054, REGARDING THE ISSUANCE OF TAX INCREMENT REVENUE REFUNDING BONDS WHEREAS, in Resolution amended by Resolution No. Commission has deemed it Redevelopment District for refinance certain maturities bonds of the District; and No. 1054, adopted May 1, 1992, as 1065, adopted May 22, 1992, this advisable to issue bonds of the the purpose of procuring funds to of outstanding tax increment revenue WHEREAS, the Commission now wishes to make certain amendments to said Resolutions in light of changes suggested by the financial advisor to enhance the marketing of the Bonds (as defined in said s Resolutions) , and changes requested by AMBAC Indemnity Corporation, s E which has issued its Commitment for Municipal Bond Insurance for the Bonds. NOW, THEREFORE, BE IT RESOLVED by the South Bend Redevelopment Commission, governing body of the City of South Bend Department of Redevelopment, that Resolution Nos. 1065 and 1054 be amended as follows: Section 1. No bid for less than 98.05% of the par value of the Bonds and accrued interest shall be considered. i Section 2. Section 11 of said Resolutions is amended by i deleting clauses (c) and (g) so that the first paragraph of said Section 11 reads as follows: Without notice to or consent of the owners of the Bonds, the Commission may, from time to time and at any time, adopt such resolutions supplemental hereto as shall not be inconsistent with the terms and provisions hereof (which supplemental resolutions shall thereafter form a part hereof), (a) to cure any ambiguity or formal defect or omission in this Resolution or in any supplemental resolution; (b) to grant to or confer upon the owners of the Bonds any additional benefits, rights, remedies, powers, authority or security that may lawfully be granted to or conferred upon the owners of the Bonds; (c) to modify, amend or supplement this Resolution to permit the qualification of the Bonds for sale under the securities laws of the United States of America or of any of the states of the United States of America or to obtain or maintain bond insurance with respect to payments of principal of and interest on the Bonds; (d) to provide for the refunding or advance refunding of the Bonds; and (e) to procure a rating on the Bonds from a nationally recognized securities rating r agency designated in such supplemental resolution, if such supplemental resolution will not adversely affect the owners of the Bonds. Section 3. A new Section 20 is added to said Resolutions and reads as follows: Section 20. Municipal Bond Insurance. The provisions of this Section shall apply with respect to any Bonds insured by AMBAC Indemnity Corporation. (a) Definitions. The terms: " AMBAC Indemnity" shall mean AMBAC Indemnity Corporation, a Wisconsin - domiciled stock insurance company. "Municipal Bond Insurance Policy" shall mean the municipal bond insurance policy issued by AMBAC Indemnity insuring the payment when due of the principal of and interest on the Bonds as provided therein. (b) Consents of AMBAC Indemnity Required. Any provision of this Resolution expressly recognizing or granting rights in or to AMBAC Indemnity nay not be amended in any manner which affects the rights -2- of AMBAC Indemnity hereunder without the prior written consent of AMBAC Indemnity. Unless otherwise provided in this Section, AMBAC Indemnity's consent shall be required in addition to Bondholder consent, when required, for the following purposes: (i) execution and delivery of any supplemental Resolution; (ii) removal of the Paying Agent and selection and appointment of any successor Paying Agent; and (iii) initiation or approval of any action not described in (i) or (ii) above which requires Bondholder consent. Anything in this Resolution to the contrary notwithstanding, upon the occurrence and continuance of an event of default with respect to the Bonds, AMBAC Indemnity, so long as it is not in default of its obligations under the Municipal Bond Insurance Policy, shall be entitled to control and direct the enforcement of all rights and remedies granted to the Bondholders for the benefit of the Bondholders under this Resolution. (c) Notices. While the Municipal Bond Insurance Policy is in effect, the Commission shall furnish to AMBAC Indemnity: (1) as soon as practicable after the filing thereof, a copy of any financial statement of the City and a copy of any audit and annual report of the City; (2 ) a copy of any notice to be given to the registered owners of the Bonds, including, without limitation, notice of any redemption of or defeasance of Bonds, and any certificate rendered pursuant to this Resolution relating to the security for the Bonds; and (3) such additional information it may reasonably request. The Commission shall notify AMBAC Indemnity of any failure of the Commission to provide relevant notices and certificates. The Commission will permit AMBAC Indemnity to discuss the affairs, finances and accounts of the Department or any information AMBAC Indemnity may reasonably request regarding the security for the Bonds with appropriate officers of the Department. The Commission will permit AMBAC Indemnity to have access to -3- and to make copies of all books and records relating to the Bonds at any reasonable time. AMBAC Indemnity shall have the right to direct an accounting at the Commission's expense, and the Commission's failure to comply with such direction within thirty (30) days after receipt of written notice of the direction from AMBAC Indemnity shall be deemed a default hereunder; provided, however, that if compliance cannot occur within such period, then such period will be extended so long as compliance is begun within such period and diligently pursued, but only if such extension would not materially adversely affect the interests of any registered owner of the Bonds. Notwithstanding any other provision of this Resolution, the Commission shall immediately notify AMBAC Indemnity if at any time there are insufficient moneys to make any payments of principal and /or interest as required and immediately upon the occurrence of any event of default hereunder. (d) obligatio: purposes, refunding investing interest: Permitted Investments. The following ns may be used as permitted investments for all including (i) as defeasance investments in escrow accounts and (ii) for the purpose of (and receiving premium credit for) accrued (1) cash (insured at all times by the Federal Deposit Insurance Corporation or otherwise collateralized with obligations described in paragraph (2) below), and (2) direct obligations of (including obligations issued or held in book entry form on the books of) the Department of the Treasury of the United States of America. The following Obligations may be used as permitted investments for all purposes other than: (i) defeasance investments in refunding escrow accounts and (ii) investing (and receiving credit for) accrued interest: (1) obligations of any of the following federal agencies which obligations represent full faith and credit of the United States of America, including: Export - Import Bank Farmers Home Administration General Services Administration -4- U.S. Maritime Administration Small Business Administration - Government National Mortgage Association (GNMA) U.S. Department of Housing & Urban Development (PHA's) - Federal Housing Administration; (2) bonds, notes or other evidences of indebtedness rated "AAA" by Standard & Poor's Corporation and "Aaa" by Moody's Investors Service issued by the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation with remaining maturities not exceeding three years; (3) U.S. dollar denominated deposit accounts, federal funds and banker's acceptances with domestic commercial banks which have a rating on their short term certificates of deposit on the date of purchase of "A -1" or "A -1 +" by standard & Poor's and 11P1" by Moody's and maturing no more than 360 days after the date of purchase (ratings on holding companies are not considered as the rating of the bank); (4) commercial paper which is rated at the time of purchase in the single highest classification, "A -1 +" by Standard & Poor's and 11P1" by Moody's Investors Service and which matures not more than 270 days after the date of purchase; (5) investments in a money market fund rated "AAAm" or "AAAm -G" or better by Standard & Poor's Corporation; (6) Pre - refunded municipal obligations defined as follows: any bonds or other obligations of any state of the United States of America or of any agency, instrumentality or local governmental unit of any such state which are not callable at the option of the obligor prior to maturity or as to which irrevocable instructions have been given by the obligor to call on the date specified in the notice; and (A) which are rated, based on the escrow, in the highest rating category of Standard & Poor's Corporation and Moody's Investors -5- Service, Inc. or any successors thereto; or (B) (i) which are fully secured as to principal and interest and redemption premium, if any, by a fund consisting only of cash or obligations described in paragraph (1) above, which fund may be applied only to the payment of such principal of and interest and redemption premium, if any, on such bonds or other 3 obligations on the maturity date or dates thereof or the specified redemption date or dates pursuant to such irrevocable instructions, as appropriate, and (ii) which fund is sufficient, as verified by a nationally recognized independent certified public accountant, to pay principal of and interest and redemption premium, if any, on the bonds or other obligations described in this paragraph on the maturity date or dates thereof or on the redemption date or dates specified in the irrevocable instructions referred to above, as appropriate; (7) investment agreements approved in writing by AMBAC Indemnity (supported by appropriate opinions of counsel) with notice to Standard & Poor's Corporation; and (8) other forms of investments approved in writing by AMBAC with notice to Standard & Poor's Corporation. The value of the above investments shall be determined as follows: "Value ", which shall be determined as of the end of each month, means that the value of any investments shall be calculated as follows: (1) as to investments the bid and asked prices of which are published on a regular basis in The Wall Street Journal (or, if not there, then in The New York Times): the average of the bid and asked prices for such investments so published on or most recently prior to such time of determination; (2) as to investments the bid and asked prices of which are not published on a regular basis in The Wall Street Journal S. or The New York Times: the average bid price at such time of determination for such investments by any two nationally recognized government securities dealers (selected by the Paying Agent in its absolute discretion) at the time making a market in such investments or the bid price published by a nationally recognized pricing service; (3) as to certificates of deposit and bankers acceptances: the face amount thereof, plus accrued interest; and (4) as to any investment not specified above: the value thereof established by prior agreement between the Commission and AMBAC Indemnity. (e) Defeasance Provisions. Notwithstanding anything herein to the contrary, in the event that the principal and /or interest due on the Bonds shall be paid by AMBAC Indemnity pursuant to the Municipal Bond Insurance Policy, the Bonds shall remain outstanding for all purposes (including for purposes of Section 9 hereof), not be defeased or otherwise satisfied and not be considered paid by the City, and the pledge of security for the Bonds herein and all covenants, agreements and other obligations of the Commission and the City to the registered owners of Bonds shall continue to exist and shall run to the benefit of AMBAC Indemnity, and AMBAC Indemnity shall be subrogated to the rights of such registered owners. (f) Payment Procedure. As long as the Municipal Bond Insurance Policy shall be in full force and effect, the City, the Commission and any Paying Agent agree to comply with the following provisions: (1) At least one (1) da interest payment dates, will determine whethe sufficient funds in Accounts to pay the interest on the Bonds F prior to all the Paying Agent r there will be the Funds and principal of or on such interest payment date. If the Paying Agent determines that there will be insufficient funds in such Funds or Accounts, the Paying Agent shall so notify AMBAC Indemnity. Such notice shall specify the amount of the anticipated deficiency, the Bonds to which such deficiency is applicable and whether such -7- Bonds will be deficient as to principal or interest, or both. If the Paying i Agent has not so notified AMBAC Indemnity I at least one (1) day prior to an interest payment date, AMBAC Indemnity will make payments of principal or interest due on the Bonds on or before the first (1st) day next following the date on which AMBAC Indemnity shall have received notice of nonpayment from the Paying Agent. (2) The Paying Agent shall, after giving notice to AMBAC Indemnity as provided in (1) above, make available to AMBAC Indemnity and, at AMBAC Indemnity's direction, to the United States Trust company of New York, as insurance trustee for AMBAC Indemnity or any successor insurance trustee (the "Insurance Trustee "), the registration books relating to the Bonds maintained by the Paying Agent and all records relating to the Funds and Accounts maintained under this Resolution. (3) The Paying Agent shall provide AMBAC Indemnity and the Insurance Trustee with a list of registered owners of Bonds entitled to receive principal or interest payments from AMBAC Indemnity under the terms of the Municipal Bond Insurance Policy, and shall make arrangements with the Insurance Trustee (i) to mail checks or drafts to the registered owners of Bonds entitled to receive full or partial interest payments from AMBAC Indemnity and (ii) to pay principal upon Bonds surrendered to the Insurance Trustee by the registered owners of Bonds entitled to receive full or partial principal payments from AMBAC Indemnity. (4) The Paying Agent shall, at the time it provides notice to AMBAC Indemnity pursuant to (1) above, notify registered owners of Bonds entitled to receive the payment of principal or interest thereon from AMBAC Indemnity (i) as to the fact of such entitlement, (ii) that AMBAC Indemnity will remit to them all or a part of the interest payments next coming due upon proof of Bondholder entitlement -8- A , to interest payments and delivery to the Insurance Trustee, in form satisfactory to the Insurance Trustee, of an appropriate assignment of the registered owner's right to payment, (iii) that should they be entitled to receive full payment of principal from AMBAC Indemnity, they must surrender their Bonds (along with an appropriate instrument of assignment in form satisfactory to the Insurance Trustee to permit ownership of such Bonds to be registered in the name of AMBAC Indemnity) for payment to the Insurance Trustee, and not the Paying Agent and (iv) that should they be entitled to receive partial payment of principal from AMBAC Indemnity, they must surrender their Bonds for payment thereon first to the Paying Agent who shall note on such Bonds the portion of the principal paid by the Paying Agent and then, along with an appropriate instrument of assignment in form satisfactory to the Insurance Trustee, to the Insurance Trustee, which will then pay the unpaid portion of principal. (5) In the event that the Paying Agent has notice that any payment of principal of or interest on a Bond which has become due for payment and which is made to a Bondholder by or on behalf of the City has been deemed a preferential transfer and theretofore recovered from its registered owner pursuant to the United States Bankruptcy Code by a trustee in bankruptcy in accordance with the final, nonappealable order of a court having competent jurisdiction, the Paying Agent shall, at the time AMBAC Indemnity is notified pursuant to (1) above, notify all registered owners that in the event that any registered owner's payment is so recovered, such registered owner will be entitled to payment from AMBAC Indemnity to the extent of such recovery if sufficient funds are not otherwise available, and the Paying Agent shall furnish to AMBAC Indemnity its records evidencing the payments of principal of and interest on the Bonds which have been made by the Paying Agent and subsequently recovered from registered owners and the dates on which such payments were made. (6) In addition to those rights granted AMBAC Indemnity under this Resolution, AMBAC Indemnity shall, to the extent it makes payment of principal of or interest on Bonds, become subrogated to the rights of the recipients of such payments in accordance with the terms of the Municipal Bond Insurance Policy, and to evidence such subrogation (i) in the case of subrogation as to claims for past due interest, the Paying Agent shall note AMBAC Indemnity's rights as subrogee on the registration books of the Issuer maintained by the Paying Agent upon receipt from AMBAC Indemnity of proof of the payment of interest thereon to the registered owners of the Bonds, and (ii) in the case of subrogation as to claims for past due principal, the Paying Agent shall note AMBAC Indemnity's rights as subrogee on the registration books of the Issuer maintained by the Paying Agent upon surrender of the Bonds by the registered owners thereof together with proof of the payment of principal thereof. (g) Paying Agent Provisions. The Paying Agent may be removed at any time, at the request of AMBAC Indemnity, for any breach of the duties set forth herein. AMBAC Indemnity shall receive prior written notice of any Paying Agent resignation. Every successor Paying Agent appointed pursuant to this Resolution shall be a trust company or bank in good standing located in or incorporated under the laws of the State of Indiana, duly authorized to exercise trust powers and subject to examination by federal or state authority, having a reported capital and surplus of not less than $75,000,000 and acceptable to AMBAC Indemnity. Any successor Paying Agent shall not be appointed unless AMBAC Indemnity approves such successor in writing. Notwithstanding any other provision of this Resolution, in determining whether the rights of the Bondholders will be adversely affected by any action taken pursuant to the terms and provisions of this Resolution, the Paying Agent shall consider the effect on -10- the Bondholders as if there were no Municipal Bond Insurance Policy. Notwithstanding any other provision of this Resolution, no removal, resignation or termination of the Paying Agent shall take effect until a successor, acceptable to AMBAC Indemnity, shall be appointed. (h) Interested Parties. To the extent that this Resolution confers upon or gives or grants to AMBAC Indemnity any right, remedy or claim under or by reason of this Resolution, AMBAC Indemnity is hereby explicitly recognized as being a third -party beneficiary hereunder and may enforce any such right remedy or claim conferred, given or granted hereunder. Nothing in this Resolution expressed or implied is intended or shall be construed to confer upon, or to give or grant to, any person or entity, other than the City, the Commission, AMBAC Indemnity, the Paying Agent and the registered owners of the Bonds, any right, remedy or claim under or by reason of this Resolution or any covenant, condition or stipulation hereof, and all covenants, stipulations, promises and agreements in this Resolution contained by and on behalf of the Commission or the City shall be for the sole and exclusive benefit of the City, the Commission, AMBAC Indemnity, the Paying Agent and the registered owners of the Bonds. Section 4. Exhibit C of said Resolutions is amended to read in its entirety in the form of the Exhibit C attached hereto. Adopted at a regular meeting of the Commission held on the 21st day of August, 1992. SOUTH B D REDEVELOPMENT COMMISSION By : �� l/v A X T: ' President Secretary -11- EXHIBIT C Bond Maturity Schedule Principal of the Bonds is payable annually on each February 1 in the years and substantially in the amounts as follows: Year Amount 1993 $ 65,000 1994 90,000 1995 90,000 1996 95,000 1997 400,000 1998 545,000 1999 560,000 2000 575,000 2001 615,000 2002 650,000 2003 685,000 2004 530,000 Iftw The District reserves the right to increase or decrease the amounts set forth above in any manner that the Redevelopment Director and Controller deem advisable with the advice of the financial advisor. The Bonds of any maturity may be allocated to the 1985 Bonds to be refunded and the 1986 Bonds to be refunded in any manner that the Redevelopment Director and Controller deem advisable with the advice of bond counsel, and the bonds as so allocated may be sold in separate series if so deemed advisable. MCK01656 -12-