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HomeMy WebLinkAbout1986-338-06.09.1986 III Waterloo , Iowa, June 9 , 19 86 . m The City Council of Waterloo , Iowa, met on the above date in the Council Chambers, City Hall , in Waterloo , Iowa, at 7 :00 o'clock P .M. , in open regular/special session, pursuant to Iaw and the rules of the Council . The meeting was called to order by Bernard L. McKinley , Mayor, presiding , and on roll call the following Council members were present: Rose Angel Tony Budak Frank Dowie Mary Lichty Jim Miller Jack Seeber Willie Mae Wright Absent: -1- Matters were discussed relative to the final authorization and issuance of the Issuer's $177,000.00 Industrial Development Revenue Bond ( Depot Restoration Corporation Project). Following an explanation of the proposed Project by representatives of the Borrower and a discussion of the proposal , Council Member Wright proposed the following Resolution in written - form and moved its adoption. Council Member Miller seconded the motion to adopt. After due consideration of the motion, the roll was called and the Resolution was adopted by the following vote: AYES: Angel Budak Dowie Lichty Miller Seeber Wright NAYS: The Resolution was thereupon signed by the Mayor and in evidence of his approval was attested by the City Clerk, and declared to be effective. The Resolution is as follows: -2- RESOLUTION NO. 1986-338 A RESOLUTION AUTHORIZING THE ISSUANCE OF A $177,000.00 INDUSTRIAL DEVELOPMENT REVENUE BOND (DEPOT RESTORATION CORPORATION PROJECT) OF THE CITY OF WATERLOO , IOWA, FOR THE PURPOSE OF MAKING A LOAN TO ASSIST DEPOT RESTORATION CORPORATION IN THE FINANCING OF COSTS OF A "PROJECT" WITHIN THE MEANING OF CHAPTER 419, CODE OF IOWA; PROVIDING FOR THE ASSIGNMENT OF AND GRANT OF A SECURITY INTEREST IN REVENUES FOR THE PAYMENT OF THE BOND TO FURTHER SECURE THE PAYMENT OF THE BOND; AUTHORIZING THE EXECUTION AND DELIVERY OF A LOAN AGREEMENT PERTAINING TO THE PROJECT; AND AUTHORIZING THE ACCEPTANCE OF A MORTGAGE AND SECURITY AGREEMENT AND AN ASSIGNMENT THEREOF AND OF THE LOAN AGREEMENT FOR SECURITY FURTHER THE PAYMENT OF THE BOND. WHEREAS, the City of Waterloo , by virtue of the laws of the State of Iowa, including Chapter 419, Code of Iowa (the "Act"), is authorized and empowered, among other things, (a) to issue revenue bonds for the purpose of making a loan to assist in the financing of costs of acquiring, constructing, equipping, improving and installing a "project" as defined in Section 419.1 of the Act, (b) to enter into a loan agreement and to accept security interests to evidence and secure such indebtedness and to provide for "revenues", as defined in Section 419.1 of the Act, sufficient to pay the principal of, premium, if any, and interest on such revenue bonds, (c) to secure such revenue bonds by an assignment of and grant of a security interest in revenues, as provided for herein, and (d) to enact this Bond Legislation and enter into the Agreement and the acceptance and assignment of the Mortgage and to execute and deliver the Assignment, all as hereinafter defined, upon the terms and conditions provided therein; WHEREAS, the Legislative Authority has determined that the Project is located within the area of and is consistent with and authorized by the Issuer's Urban Renewal/Revitalization Plan (as hereinafter defined) and there is a public need in the area of the Issuer and its surrounding environs for implementation of the Urban Renewal/ Revitalization Plan which will promote urban renewal , rehabilitation and redevelopment of the Issuer, will eliminate blighted areas within the Issuer's corporate boundaries and provide employment opportunities for residents of the Issuer in the surrounding areas; NOW, THEREFORE, BE IT RESOLVED BY THE Council of the City of Waterloo , Iowa as follows : -3- Section 1. Definitions. In addition to the words and terms elsewhere defined in this Bond Legislation, in the Mortgage or in the Agreement, the following words and terms as used in this Bond Legislation shall have the following meanings unless the context or use clearly indicates another or different meaning or intent: "Act" means Chapter 419 of the Code of Iowa, as enacted and amended. "Agreement" means the Loan Agreement between the Issuer and the Borrower, dated as of July 1, , 1986, as the same may be amended from time to time in accordance with tie applicable provisions thereof. "Assignment" means the Assignment of the Mortgage, the Agreement and the Revenues, of even date with the Agreement, from the Issuer to the Holder. "Authorized Borrower Representative" means the person at the time designated pursuant to the Agreement to act on behalf of the Borrower. "Bond Legislation" means this resolution as the same may from time to time be lawfully amended or supplemented. "Bond service charges" for any time period means the principal , interest and prepayment or redemption premium, if any, required to be paid by the Issuer on the Project Bond for such time period. "Borrower" means Depot Restoration Corporation, a corporation, and its lawful successors and assigns. "Code" means the Internal Revenue Code of 1954 as amended and references to the Code and Sections of the Code shall include relevant regulations and proposed regulations thereunder and any successor provisions to such Sections, regulations or proposed regulations. "Construction Fund" means the Construction Fund created by Section 6 hereof. "Eligible Investments" means, to the extent permitted by law and in accordance with the provisions of the Bond Legislation (i) obligations issued or guaranteed by the United States of America; (ii) obligations issued or guaranteed by any person controlled or -4- supervised by and acting as an instrumentality of the United States of America pursuant to authority granted by the Congress of the United States of America; (iii ) obligations issued or guaranteed by any state of the United States of America, or the District of Columbia, or any political subdivision of any state or district; ( iv) prime commercial paper ; (v) prime finance company paper ; (vi ) bankers acceptances drawn on and accepted by banks organized under the laws of any state or of the United States of America which have a combined capital and surplus and undivided profits and reserves of at least $1,000,000; (vii ) repurchase agreements fully secured by obligations issued or guaranteed by the United States of America or by any person controlled or supervised by and acting as an instrumentality of the United States of America pursuant to authority granted by the Congress of the United States of America; and (viii) certificates of deposit or savings accounts issued by banks organized under the laws of any state or of the United States of America, including the Holder, which have a combined capital and surplus and undivided profits and reserves of at - least $1 ,000,000; provided that any such investment or deposit is not prohibited by applicable law. "Executive" means the Mayor of the Issuer. "Financial Institution" means any life or casualty insurance company or any state or federally chartered commercial bank, savings and loan association or mutual savings association insured by either the Federal Deposit Insurance Corporation or the Federal Savings and Loan Insurance Corporation. "Fiscal Officer" means the City Clerk of the Issuer. "Holder" means the Original Purchaser as the initial holder of the Project Bond and the Mortgage and its lawful successors, or, in the event of transfer and assignment permitted by the terms of the Project Bond, the Financial Institution at the time holding the Project Bond and the Mortgage. "Issuer" means the City of Waterloo of the State. "Legal Officer" means the of the Issuer. "Legislative Authority" means the Council of the Issuer. "Loan" means the loan by the Issuer to the Borrower of the proceeds from the sale of the Project Bond. -5- "Loan Payments" means the amount required to be paid by the Borrower in repayment of the Loan pursuant to the provisions of Section 4.1 of the Agreement. "Mortgage" means the Open-End Mortgage and Security Agreement, dated as of even date with the Agreement, executed and delivered by the Borrower to the Issuer and assigned by the Issuer to the Holder, as the same may be amended from time to time in accordance with the applicable provisions thereof. "Original Purchaser" means The National Bank of Waterloo "Person" means a natural person, firm, association, corporation or a public body. "Project" means (a) the real estate at the time comprising the "Project Site" , as defined in the Agreement and (b) the real and - personal property at the time comprising the "Project Facilities" as defined in the Agreement together constituting a "project" as defined in the Act. "Project Bond" means the industrial development revenue bond authorized in Section 3 hereof. "Project Purpose" means acquiring, constructing, equipping, improving and installing a project comprising purchasing land and building , remodeling and equipping the building and improving the land to be used for a professional office complex. This is a commercial project in the Downtown Urban Renewal Area and for such related operations, or as may otherwise be permitted by the Agreement. "Revenues" means (a) the Loan Payments, (b) all other moneys received by the Issuer, or the Holder for the account of the Issuer, in respect of repayment of the Loan, (c) unexpended proceeds derived from the sale of the Project Bond in the Construction Fund, and (d) all income and profit from the investment of the Loan Payments and such other moneys by or on behalf of the Issuer. "State" means the State of Iowa. "Urban Renewal/Revitalization Plan" means the Downtown Urban Renewal Area , for an area located within the corporate limits of the Issuer, approved by the Issuer pursuant to Chapter 403/404, Code of Iowa, as amended. Any reference herein to the Issuer or to any member or officers thereof or to the Legislative Authority, or to any member or officers thereof, shall include those which succeed to their functions , duties -6- or responsibilities pursuant to or by operation of law or who are lawfully performing their functions. Any reference to a section or provision of the Constitution of the State or to a section, provision or chapter of the Code of Iowa shall include such section or provision or chapter as from time to time amended, modified, revised, supplemented and superseded, provided that no such change in the Constitution or laws shall be deemed applicable by reason of this provision if such change in any way constitutes an impairment of the rights or obligations of the Issuer or the Company under this Bond Legislation, the Agreement, the Assignment, the Mortgage, or any other document executed in connection with any of the foregoing, including, without limitation, any alteration of the obligation to pay the Bond service charges in the amount and manner, at the times, and from the sources provided in the Bond Legislations, the Agreement and the Mortgage, except as otherwise herein permitted. Words of the masculine gender shall be deemed and construed to include correlative words of the feminine and neuter genders. Unless the context shall otherwise indicate, words importing the singular number shall include the plural number, and vice versa, and the terms "hereof" , "hereby" , "herein" , "hereto" , "hereunder" and similar terms mean this Bond Legislation. Section 2. Determinations of Legislative Authority. It is hereby determined that (a) the Project is a project as defined in the Act and is consistent with the purposes of the Act; (b) the utilization of the Project is in furtherance of the purposes of the Act and will benefit the people of the Issuer and of th State by maintaining and enhancing employment opportunities, enhancing the tax base of the Issuer and overlapping taxing jurisdictions, providing and inducing other public benefits flowing from conducting the Project and improving the economic welfare of the people of the Issuer and of the State; and (c) the provision of loan assistance in the financing of costs of acquiring, constructing, equipping, improving and installing the Project, including the financing thereof, will require the issuance, sale and delivery of the Project Bond, which shall be payable and secured as provided herein and in the Agreement and the Mortgage. Section 3. Authorization and Terms of Project Bond. It is hereby determined to be necessary to, and the Issuer shall , issue sell and deliver, as provided and authorized herein and pursuant to the authority of the Act, the Project Bond in the principal amount of -7- $177 ,000.00 for the purpose of making a loan to assist the Borrower in the financing of costs of acquiring , constructing , equipping , improving and installing the Project for the Project Purpose. The Project Bond shall be designated "Industrial Development Revenue Bond (Depot Restoration Corporation Project)". The Project Bond shall be issued in the single denomination of $177 ,000.00 , substantially in the fully registered form attached hereto as Exhibit "A" (which is incorporated herein by reference and made a part hereof fully as if set forth in full herein) , and shall be subject to prepayment, as set forth herein and in that Exhibit "A" , at the place set forth therein. The Project Bond shall be dated as of the date of delivery to the Original Purchaser, at the rate of 9 1/2% for first five years. Beginning July 1 , 1991 , the interest rate will be adjusted to 1 point in excess of the June, 1991 rates of the Twenty Municipal Bond Buyer - Index. (subject to adjustment as therein provided) , and shalt be payable as to interest on the first day of month and as to principal and interest on the first day of month in the amounts and for such period of time as set forth in Exhibit "A". Interest from the date of delivery to the last day of the calendar month of such delivery shall be paid in advance to the Original Purchaser upon the delivery of the Project Bond. In the event of any final determination with respect to the tax liability of the holder of the Project Bond that the interest on the Project Bond is wholly or partially includable for federal income tax purposes in the gross income of such Holder (other than because the Holder is a "substantial user" of the Project or a "related person" as those terms are used in Section 103 of the Code) , the Project bond shall from the date on which such interest becomes taxable and until all the installments due on the Project Bond shal have been paid bear interest at a rate equal to the rate thereon plus an additional amount equalt to the interest on the outstanding principal amount of the Project Bond on the date of the final determination for the period which has elapsed between that date and the date the Project Bond is redeemed or paid in full , whichever is earlier. As used herein, "final determination" shall be deemed to have occurred upon receipt by the Holder of a ruling or technical advice by the Internal Revenue Service in which the Borrower has participated or a written opinion of an attorney or firm of attorneys of recognized standing on the subject of municipal bonds selected by the Holder and approved by the Borrower, which approval should not be unreasonably withheld, or upon the enactment of legislation by the Congress of the United States of America amending Section 103 of the Code. -8- The Project Bond is also subject to loss of tax exemption prepayment upon a final determination that interest on the Project Bond is wholly or partially includable for federal income tax purposes in the gross income of such Holder (other than because the Holder is a "substantial user" of the Project or a "related person" as those terms are used in Section 103 of the Code) . As used herein, a "final determination" shall be deemed to have occurred upon the receipt by the Holder of a ruling or technical advice by the Internal Revenue Service in which the Borrower has participated or a written opinion by an attorney or firm of attorneys of recognized standing on the subject of municipal bonds selected by the Holder and approved by the Borrower, which approval should not be unreasonably withheld, or upon the enactment of legislation by the Congress of the United States of America amending Section 103 of the Code. Following a final determination, the Project Bond shall/may be redeemed by the Issuer from the proceeds of the Borrower paying advance Loan Payments pursuant to Sections 4.1 and 6.3 of the Agreement at a prepayment price equal to % of the principal amount of the Project Bond outstanding at the time oof prepayment, plus accrued interest to the redemption date and an amount equal to any penalties or interest paid by the Holder resulting from the failure to include interest on the Project Bond in the gross income of the Holder, at the earliest practicable date selected by the Holder, after consultation with the Borrower. The Project Bond shall be payable as to principal and interest in lawful money of the United States of America, shall be a negotiable instrument subject to the provisions therein restricting transfer and shall express on its face the purpose for which it is issued and such other statements or legends as may be required by law. The Project Bond shall not be transferred by any Holder to other than a Financial Institution and in accordance with its terms and any purported transfer to other than a Financial Institution shall be void and of no effect. Bond service charges on the Project Bond shall be payable at the principal office of the Holder. The Project Bond shall be executed on behalf of the Issuer by the manual signature of its Executive and attested by the manual signature of its Fiscal Officer and shall bear the corporate seal of the Issuer or a facsimile thereof. Section 4. Payment of and Security for the Project Bond. The Project Bond shall be (i ) payable solely from the Revenues and (ii ) secured by an assignment of and grant of a security interest in the Revenues and an assignment of the Agreement and the Mortgage -9- (except the Unassigned Issuer' s Rights, as defined in the Agreement) . Anything in this Bond Legislation or the Project Bond to the contrary notwithstanding, neither the Bond Legislation, the Project Bond, nor the Agreement shall constitute an indebtedness of the Issuer, within the meaning of any State constitutional provision or statutory limitation, and shall not constitute nor give rise to pecuniary liability of the Issuer or a charge against its general credit or taxing powers, and the Project bond shall contain on the face thereof a clear statement to that effect and that such Bond is payable solely from the Revenues; provided, that nothing herein shall be deemed to prohibit the Issuer, of its own violation, from using to the extent lawfully authorized to do so any other resources for the fulfillment or any of the terms, conditions or obligations of the Bond Legislation or of the Project Bond. Section 5. Sale of Project Bond. The Project Bond is hereby sold and rewarded to the Original Purchaser in accordance with its written offer therefor, at a purchase price equal to the par value thereof. The Executive and the Fiscal Officer are authorized and directed to make the necessary arrangement with the Original Purchaser to establish the date, location, procedure and conditions for the delivery of the Project Bond to the Original Purchaser, and to take all steps necessary to effect due execution and delivery to the Original Purchaser of the Project Bond under the terms of this Bond Legislation to the extent not provided for in the written offer. It is hereby determined that the price for and the terms of the Project Bond, and sale thereof, all as provided in this Bond Legislation, are in the best interest of the Issuer and in compliance with all legal requirements. Section 6. Allocation of Proceeds of Project Bond - Construction Fund. The proceeds from the sale of the Project Bond shall be deposited and credited to the Construction Fund. There is hereby created by the Issuer and ordered maintained as a separate deposit account (except when invested as hereinafter provided) in the custody of the Holder a fund in the name of the Issuer to be designated "Depot Restoration Corporation Project Construction Fund" (the "Construction Fund") . Moneys in the Construction Fund may be invested as provided in Section 9 hereof and shall be held and disbursed in accordance with the provisions of the Assignment and the Agreement. The Holder is authorized and directed to make any such disbursements from the Construction Fund in accordance with the provisions of the Agreement and the Assignment. The moneys to the credit of the Construction Fund shall , pending disbursement as above set forth, be subject to a lien and charge in favor of the Holder. -10- Section 7. Source of Payment of Project Bond. As provided in the Agreement, Loan Payments, sufficient in time and amount to pay the Bond service charges as they come due, are to be paid by the Borrower directly to the Holder for the account of the Issuer. The Issuer hereby covenants and agrees that, until the entire principal of and premium, if any, and interest on the Project Bond shall have been paid, (i ) it will pay, or cause to be paid, to the Holder, Revenues sufficient in time and amount to pay the Bond service charges as the same become due and payable, (ii ) it will diligently and promptly proceed in good faith and use its best efforts to enforce the Agreement, and (iii ) should there be an event of default under the Agreement, the Issuer shall cooperate fully with the Holder to protect fully the rights and security of the Holder hereunder; provided that nothing herein shall be construed as requiring the Issuer to use or aply to the payment of Bond service charges any funds or revenues from any source other than Revenues. Nothing in this Bond Legislation is intended to prevent the Borrower from delivering moneys to the Holder pursuant to Article VI of the Agreement to be used to prepay unpaid principal installments on the Project Bond in accordance with those Sections and the applicable provisions of the Project Bond, and the Holder shall promptly apply such moneys to the prepayment of such installments in accordance with the Borrower's instructions. Section 8. Convenants of Issuer. In addition to other covenants of the Issuesr in this Bond Legislation contained, the Issuer further convenants and agrees as follows: (a) Payment of Bond Service Charges. The Issuer will , solely from the sources herein provided, pay or cause to be paid the Bond service charges on the Project bond on the dates , at the places and in the manner provided herein and in the Project Bond. (b) Performance of Convenants , Authority and Actions. The Issuer will at all times faithfully observe and perform all agreements, covenants , undertakings , stipulations and provisions contained in the Agreement, the Assignment, this Bond Legislation and the Project Bond and all proceedings of its Legislative Authority pertaining thereto , or its part to be performed or observed. The Issuer convenants that it is, and upon delivery of the Project Bond will be, duly authorized by the Constitution and laws of the State, including particularly and without limitation the Act, to issue the Project Bond, to execute the Agreement and the Assignment and to provide the security for payment of the Bond service charges in the manner and to the extent herein and in -11- the Project Bond set forth; that all actions on its part for the issuance of the Project Bond and execution and delivery of the Agreement and the Assignment have been or will be duly and effectively taken; and that the Project Bond in the hands of the Holder will be a valid and enforceable special obligation of the Issuer according to the terms thereof. (c) Revenues. Except as otherwise provided in this Bond Legislation, the Agreement, the Assignment or the Mortgage, the Issuer will not assign or grant a security interest in the Revenues or create or suffer to be created any debt, lien or charge thereon other than the assignment and grant thereof under this Bond Legislation and the Assignment. (d) Recordings and Filings. The Issuer will , at the expense of the Borrower, cause the Agreement, the Mortgage and the Assignment, and any amendments or supplements to any, and all necessary financing - statements, amendments thereto, continuation statements and instruments of similar character relating to the assignment and grants made by it to secure the Project Bond, to be recorded and filed in such manner and in such places as may be required by law in order to preserve and protect fully the security of the Holder. Prior to the last day of the month succeeding the month in which falls any anniversary of the date of th Mortgage, the Issuer will in the Mortgage and, at the request of the Holder and at the expense of the Borrower, require the Borrower to deliver to the Holder, an opinion of Independent Counsel (as defined in the Mortgage) , who may be Counsel for the Issuer or for the Borrower, addressed to the Holder specifying any filing, registration or recording and re-filing, re-registration or re-recording, of any such instrument since the date of the Assignment or the date of the most recent opinion of Independent Counsel pursuant to this Section 8(d) , or stating that no such filing, registration, recording, re-filing, re-registration or re-recording is necessary, or if necessary, setting forth the requirements in respect thereto. Promptly after any filing, recording, re-filing or re-recording of any financing statement or amendment thereto or continuation statement or instrument of similar character relating to any of the pledges made in the Bond Legislation, the Mortgage or the Assignment, or any filing, registration, recording, re-filing, re-registration or re-recording of the Agreement, the Mortgage or the Assignment, or any amendment or supplement thereto, the Issuer will in the Mortgage require the Borrower to deliver, or cause to be delivered, to the Holder an opinion of the counsel , who may be counsel for the Issuer or for the Borrower, to the effect that such filing, registration, recording, re-filing, re-registration or re-recording has been duly accomplished and setting forth the particulars thereof. -12- (e) Inspection of Project Books. All books and documents in the Issuer' s possession relating to the Project and the Revenues shall at all times during the Issuer' s regular business hours be open to inspection by such accountants or other agents of the Holder as the Holder may from time to time designate. (f) Rights under Agreement. The Holder, in its name or in the name of the Issuer, may enforce all rights of the Issuer except for Unassigned Issuer's Rights as defined in the Agreement and all obligations of the Borrower under and pursuant to the Agreement, whether or not the Issuer is in default of the pursuit or enforcement of such rights and obligations. (g) Enforcement of Agreement. The Issuer shall do all things and take all actions on its part necessary to comply with the obligations , duties and responsibilities on its part under the Agreement, and will take all actions within its authority to keep the Agreement in effect in accordance with the terms thereof and to enforce and protect the rights of the Issuer thereunder, including actions at law and in equity, as may be appropriate. (h) Arbitrage Provisions. The Issuer will restrict the use of the proceeds of the Project Bond in such manner and to such extent, if any, as may be necessary, after taking into account reasonable expectations at the time of the delivery of and payment for such Project Bond, so that the Project Bond will not constitute arbitrage bonds under Section 103(c) of the Code and the applicable regulations under that Section. The Fiscal Officer or any other officer having responsibility for issuing the Project Bond is authorized and directed, alone or in conjunction with any of the foregoing or with any other officer, employee, consultant or agent of the Issuer, or with the or any employee, consultant or agent of the Borrower, to give an appropriate certificate of the Issuer, for inclusion in the transcript of proceedings for the Project Bond, setting forth the reasonable expectations of the Issuer regarding the amount and use of the proceeds of the Project Bond and the facts , estimates and circumstances on which they are based, such certificate to be premised on the reasonable expectations and the facts, estimates and circumstances on which they are based as provided by the Borrower, all as of the date of delivery of and payment for such Project Bond. The Fiscal Officer, or other appropriate officer of the Issuer, shall furnish to the Holder a true transcript of proceedings, certified by said Fiscal Officer or officer, of all proceedings had with reference to the issuance of the Project bond along with such information from the records as is necessary to determine the regularity and validity of the issuance of the Project Bond. -13- (i ) Additional Financing. At the request of the Borrower, provided that the Borrower is not in default under the Agreement and to the extent then permitted by law, including the Act, and upon obtaining the written approval of the Holder, the Issuer shall use its best efforts to provide for the issuance of revenue obligations in addition to the Project Bond for the purpose of (i ) completing the Project, (ii ) acquiring, constructing, equipping or improving additional property for use in connection with the Projector (iii) with the consent of the Holder refunding the Project Bond or any other such revenue obligations previously issued. (j) Federal Tax Election. If and to the extent applicable, this Legislative Authority hereby elects to have the limitation on capital expenditures specified in Section 103(b)(6)(D) of the Code applied to the Project Bond, and the execution and filing with the Internal Revenue Service of a statement regarding such election, as provided by the rules and regulations of the Internal Revenue Service, by the - Executive or the Fiscal Officer is hereby authorized, approved, ratified, and affirmed. Section 9. Investments and Records of Construction Fund. Moneys in the Construction Fund shall be invested and reinvested by the Holder in any Eligible Investments at the oral or written request of the Authorized Borrower Representative in accordance with Section 3.7 of the Agreement. Subject to any such written request with respect thereto, the Holder may from time to time sell such investments and reinvest the proceeds therefrom in Eligible Investments maturing or redeemable as aforesaid. Any such investments may be purchased from the Holder. An investment made from money credited to the Construction Fund shall constitute part of that Fund and such Fund shall be credited with all proceeds of sale and income from such investment. For purposes of this Bond Legislation, such investments shall be valued at face amount or market value, whichever is less. Section 10. Agreement and Assignment. In order to secure the payment of the Bond service charges as the same shall become due and payable, the Executive and the Fiscal officer are hereby authorized and directed (i ) to execute, acknowledge and deliver, in the name and on behalf of the Issuer, the Agreement and the Assignment, in substantially the forms submitted to this Legislative Authority, which instruments are hereby approved, with such changes therein not inconsistent with this Bond Legislation and not substantially adverse to the Issuer as may be permitted by the Act and approved by the officers executing the same on behalf of the Issuer and (ii ) to execute such other certificates, financing statements and other instruments as may be necessary or desirable in order to consummate the transactions contemplated by this Bond Legislation. The approval of such changes by those officers, and that such are not substantially adverse to the Issuer, shall be conclusively evidenced by the execution of such instruments. -14- Section 11. Other Documents. The Executive and the Fiscal Officer, as appropriate , are hereby further authorized and directed to execute such certifications, financing statements, assignments and instruments as are in the opinion of the Bond Counsel necessary or appropriate to perfect the assignments and grants set forth herein in the Assignment and to consummate the transactions provided for in the Agreement and the Assignment. Section 12. Delivery of the Project Bond. Before the Project Bond is delivered there shall be delivered to the Holder: (a) A copy, duly certified by the Fiscal Officer of this Bond Legislation; and (b) An original executed counterpart of the Agreement, the Mortgage and the Assignment; (c) Written title evidence that the Borrower has a good and marketable title in fee simple to the Project Site as defined in the Agreement and that the Holder has a valid first mortgage on the Project Site subject only to (i ) taxes and assessments not delinquent, (ii) liens and encumbrances permitted by the terms and provisions of the Mortgage, and (iii ) the Mortgage. Section 13. Payment and Discharge. If the Issuer shall pay or cause to be paid and discharged the Project Bond, the convenants , agreements and other obligations of the Issuer hereunder and in the Project Bond, the Agreement, the Mortgage and the Assignment shall be discharged and satisfied, except for the obligation to make any payment required under loss of tax exemption redemption provisions in Section 3 hereof. Section 14. Compliance with Open Meeting Requirements. It is hereby found and determined that all formal actions of this Legislative Authority concerning and relating to the adoption of this Bond Legislation were adopted in an open meeting of this Legislative Authority, and that all deliberations of this Legislative Authority and of any of its committees that resulted in such formal action, were in meetings open to the public, in compliance with all legal requirements, including Chapter 28A of the Code of Iowa. -15- Section 15. Payments Due on Sundays and Holidays. If any case where the date of maturity of or due date of interest on or principal of the Project Bond shall be a Sunday or a day on which the Holder is required, or authorized or not prohibited, by law (including executive orders) to close or is closed, then payment of such interest or principal need not be made on such date but may be made on the next succeeding business day on which the Holder is open for business with the same force and effect as if made on the date of maturity or such due date and no interest shall accrue for the period after such date. Section 16. Effective Date. This Bond Legislation shall take effect and be in force immediately upon its adoption. PASSED AND ADOPTED this 9th day of June , 1986. -1,e7_,44,7(e/-71/0 11V// Bernard L. McKinley, Mayor ATTEST: Larry P Burger, Ci Clerk/Auditor -16- CLERK'S CERTIFICATE I, Larry P. Burger , being first duly sworn do hereby depose and certify that I am the duly appointed, qualified, and acting City Clerk of the City of Waterloo , in the County of Black Hawk, State of Iowa (the "Issuer") ; that as such I have in my possession, or have access to, the complete corporate records of the Issuer and of its Council and officers; that I have carefully compared the transcript hereto attached with the aforesaid corporate records; and that the transcript hereto attached is a true, correct and complete copy of all the corporate records showing the action taken by the Council of the Issuer at a meeting open to the public on June 9 , 1986, for the purpose of considering a Resolution authorizing the issuance of a $177,000.00 Industrial Development Revenue Bond (Depot Restoration Corporporation Project) of the Issuer, the execution and delivery of a Loan Agreement between the Issuer and Depot Restoration Corporation , the acceptance of an Open-End Mortgage and Security Agreement from Depot Restoration Corporation , the Assignment by the Issuer of the rights and interest of the Issuer in and to the Mortgage, Loan Agreement and Pledged Receipts, the sale of the Bond and related matters; that the proceedings remain in full force and effect and have not been amended or rescinded in any way; that the meeting and all action thereat was duly and publicly held, with members of the public in attendance, in accordance with a notice of meeting and tentative agenda, a copy of which was timely served on each member of the Council and posted on a bulletin board or other prominent place easily accessible to the public and clearly designated for that purpose at the principal office of the Council (a copy of the face sheet of the agenda being attached hereto) pursuant to the local rules of the Council and the provisions of Chapter 21, Iowa Code, and upon reasonable advance notice to the public and media at least twenty-four hours prior to the commencement of the meeting as required by the applicable law. Witness my hand and the Corporate Seal of the Issuer hereto affixed this llth day of June , 1986. /t1/l./ At_�ef . (Seal ) .rry P. Burge _,,. , ity C erk State of Iowa ) SS. : County of Black Hawk ) Subscribed and sworn to before me this day, the date last above written. (iCet /e . /6/-4---te (Seal ) , Notary Public -17- (This Notice to be Posted) NOTICE AND CALL OF COUNCIL MEETING Governmental Body: The City Council of Waterloo , Iowa Date of Meeting: June 9, 1986 Time of Meeting: 7 :00 P.M. P1 ace of Meeting: Council Chambers City Hall Waterloo , Iowa PUBLIC NOTICE IS HEREBY GIVEN that the above-mentioned governmental body will meet at the date, time and place above set out. The tentative agenda for the meeting is as follows: 1. Resolution Authorizing the Issuance of $177,000.00 Industrial Development Revenue Bond (Depot Restoration Corporation Project) of the City of Waterloo , Iowa for the Purpose of Making a Loan to Assist Depot Restoration Corporation in the Financing of Costs of a "Project" Within the Meaning of Chapter 419, Code of Iowa; Providing For the Assignment of Grant of a Security Interest in Revenues for the Payment of the Bond to Further Secure the Payment of the Bond; Authorizing the Execution and Delivery of a Loan Agreement Pertaining to the Project; and Authorizing the Acceptance of a Mortgage and Security Agreement and an Assignment Thereof and the Loan Agreement for Securing Further the Payment of The Bond. 2. Such additional matters as are set forth on the additional page(s) attached hereto (attach copy of agenda) . This notice is given at the direction of the Mayor, pursuant to Chapter 21, Iowa Code, as amended, and the local rules of said governmental body. y P. Burge , Clerk of the i of Wat oo , Iowa -18- iv STATE OF IOWA CITY OF WATERLOO INDUSTRIAL DEVELOPMENT REVENUE BONDS DEPOT RESTORATION CORPORATION PROJECT) The City of Waterloo , a municipal corporation organized and existing as a city under and by virtue of the Constitution and laws of the State of Iowa (the "Issuer") , for value received, promises to pay from the source and as hereinafter provided, to Depot Restoration Corporation , or registered assigns , (together with any permitted assigns, the "Holder") the principal sum of One Hundred Seventy Seven Thousand DOLLARS ($177 ,000.00 ). Said principal sum and interest thereon shall be payable in installments as follows: (a) July 1 , , 1986, and the first day of each month thereafter through and including July 1 , , 1991 , there shall be due a sum equal to the interest, at the rate of nine & one-halfpercentper annum, accrued on (9 1/2 %) the principal amount of this Bond: (b) On July 1, , 1991. the interest rate on the Bond will be adjusted to be that rate which is equal to one percent in excess of the average of the May rates on the Twenty Municipal Bond Buyer Index. The monthly payments due thereafter will be adjusted to cause a complete amortization of the remaining unpaid principal balance by July 1 ,19 86. (c) Except as provisions hereinafter set forth with respect to prepayment prior to maturity may become applicable, principal of this Bond shall be payable in one hundred twenty (120) monthly installments commencing July 1, ,1986 and payable on the first day of each month thereafter, including a final payment on or before July 1, , 1991 , when all principal then outstanding and accrued interest due thereon shall be payable, such monthly installments being equal to the amount set forth as principal amounts opposite the payment dates in the amortization schedule attached to this Bond as Exhibit "A" and by this reference incorporated herein (said principal payments have been determined in accordance with an assumed interest rate of nine & one-half percent (9 1/2%) per annum and shall be adjusted at the time of any adjustment in the Interest Rate) . -1- i F/uyiC li 1, l,U L.ltC I IUIUCI Jul .)uCllll, W JCuulull Y.0 UI )U U rty1 CCWC IIL. Principal of and interest on this Bond are payable in lawful money of the United States of America, without deduction for the service of the Holder as the paying agent, upon presentation of this Bond for proper endorsement on Schedule B attached hereto of principal and interest paid and its presentation and surrender upon the final payment of principal and interest at the principal office of the Holder. This Bond represents the duly authorized Industrial Development Revenue Bond (Depot Restoration Corporation Project) (the "Bond") , in the principal amount of S177 ,000.00 , authorized by resolution duly adopted by the Legislative Authority of the Issuer on Jun 9, , 1986 (the "Bond Legislation") . Reference is hereby made to the Bond Legislation for a more complete description of the terms and conditions upon which this Bond is issued and the rights , duties and obligations of the Issuer and the Holder thereunder. This Bond is issued for the purpose of making a loan (the "Loan") to assist Depot Restoration Corporation (the "Borrower") in the financing of costs of the acquisition, construction, improving and equipping of a - project comprising purchasing land and building , remodeling and equippping the building and improving the land to be used for a professional office complex. This is a commercial project in the Downtown Urban Renewal Area within the boundaries of the Issuer, together with re[ated and incidental uses (the "Project") pursuant to a Loan Agreement, dated as of July 1 1986 (hereinafter, as the same may be amended according to its terms, caTTed the "Agreement") between the Issuer and the Borrower. This Bond is issued pursuant to and in full compliance with the Constitution and laws of the State of Iowa, particularly the Act for Municipal Support of Industrial Projects, Chapter 419 of the Code of Iowa, as amended, and pursuant to the Bond Legislation. THE BOND SHALL BE A LIMITED OBLIGATION OF THE ISSUER. THE PRINCIPAL OF, PREMIUM, IF ANY, AND INTEREST ON THE BOND (HEREINAFTER COLLECTIVELY CALLED "BOND SERVICE CHARGES") SHALL BE PAYABLE SOLELY OUT OF THE REVENUES DERIVED FROM THE AGREEMENT PURSUANT TO WHICH THE PROJECT IS TO BE FINANCED. THE BOND AND THE INTEREST THEREON SHALL NEVER CONSTITUTE AN INDEBTEDNESS OF THE ISSUER WITHIN THE MEANING OF ANY STATE CONSTITUTIONAL PROVISION OR STATUTORY LIMITATION, AND SHALL NOT CONSTITUTE NOR GIVE RISE TO A PECUNIARY LIABILITY OF THE ISSUER OR A CHARGE AGAINST ITS GENERAL CREDIT OR TAXING POWERS. Pursuant to the Agreement, the Borrower is required to make payments in the amounts and at the times necessary for the prompt payment when due of the Bond service charges on this Bond. Such payments are to be made by the Borrower directly to the Holder for the account of the Issuer and have been duly pledged for that purpose. -2- The Company's obligations under the Agreement are secured by an Open-End Mortgage and Security Agreement dated as of even date with the Agreement (hereinafter, as the same may be amended in accordance with its terms , called the "Mortgage" ) , between the Borrower and the Issuer. The Mortgage and, except as reserved in the Assignment hereinafter defined, the Issuer' s rights under the Agreement and the Issuer' s interest in the Revenues (as defined in the Bond Legislation) have been assigned to the Holder under the Assignment dated as of even date with the Agreement (the "Assignment") , from the Issuer to the Holder. This Bond is issued as a single fully registered bond to The National Bank of Waterloo or permitted registered assigns, as the registered holder, and is transferable by said holder or by its attorney, with written notice of such transfer given to the Issuer and the Borrower which shall specify therein the address of the principal office of the transferee, and upon the concurrent assignment of the rights and interests of the Holder under the Assignment to the transferee of this Bond; provided, however, that each Holder by its acceptance hereof agrees that it shall not transfer this Bond except in compliance with all applicable federal and state securities laws and to other than a financial institution and shall be void and of not effect. As used herein "financial institution" means any life or casualty insurance company or any state or federally chartered commercial bank, savings and loan association or mutual savings association insured by either the Federal Deposit Insurance Corporation or the Federal Savings and Loan Insurance Corporation. In the event of any final determination, as defined in the Bond Legislation, with respect to the tax liability of the Holder of this Bond that the interest on this Bond is wholly or partially includable for federal income tax purposes in the gross income of such Holder (other than the event that the Holder is a "substantial user" of the Project or a "related person" as those terms are used in Section 103(b) (13) of the Internal Revenue Code of 1954, as amended) , this Bond shall from the date on which such interest becomes taxable and until all of this Bond shall have been paid bear interest at a rate equal to the rate thereon plus an additional amount equal to the interest on the outstanding principal amount of the Bond on the date of the final determination for the period which has elapsed between that date and the date the Bond is redeemed or paid in full , whichever is earlier. -3- The unpaid principal balance of this Bond is also subject to prepayment prior to stated maturity in the event of the exercise by the Company of its option to direct such prepayment upon the occurrence of any of the events specified in Section 6.2 of the Agreement. If called for prepayment upon the occurrence of any such events, the unpaid principal balance of this Bond shall be subject to prepayment by the Issuer in whole. The unpaid principal balance of this Bond is subject to prepayment at par prior to the stated maturity thereof, in whole at any time or in part at any time/on any installment payment date and from time to time, plus accrued interest to the date of prepayment. In the case of a partial prepayment of this Bond each payment of principal shall be applied (to the extent thereof) to reduce in the inverse order of their due dates the installments of principal required to be paid on this Bond. This Bond is also subject to loss of tax exemption redemption upon a final determination that interest on this Bond is wholly or partially includable for Federal income tax purposes in the gross income of the holders of this Bond (other than because a holder is a "substantial user" of the Project or a "related person" thereof, as those terms are used in Section 103(b) (16) of the Internal Revenue Code of 1954, as amended) . As used herein, a "final determination" shall be deemed to -4- have occurred upon the receipt by the Holder of a ruling or technical advice by the Internal Revenue Service in which the Borrower has participated or a written opinion by an attorney or firm of attorneys of recognized standing on the subject of municipal bonds selected by the Holder or upon the enactment of legislation by the United States Congress amending Section 103 of the Internal Revenue Code of 1954, as amended. Following a final determination and at the option of the Holder, this Bond shall be redeemed in whole by the Issuer at a redemption price of 0 % of the principal amount thereof, plus accrued interest to the redemption date, at the earliest practicable date selected by the Holder, after consultation with the Borrower, but in no event later than 90 days following the Holder' s notification of such final determination. Rights of prepayment shall be exercised upon at least thirty (30) full business days' prior written notice by the Issuer, or the Borrower acting on behalf of the Issuer (unless such notice is waived by the Holder). Such notice shall specify the portion of the principal sum to be prepaid and the date fixed for prepayment, and shall be mailed to the Holder, at the address of its principal office. If the entire unpaid principal balance of this Bond or any portion thereof is duly called for prepayment and if on such prepayment date moneys for the prepayment thereof, together with premium, if any, and interest thereon to the prepayment date shall be held by the Holder so as to be available therefor, then from and after such prepayment date the entire unpaid principal balance of this Bond or, in the event of a partial prepayment, the portion thereof being prepaid shall cease to bear interest and shall not be deemed to be outstanding under the Bond Legislation or otherwise. The amount of any partial prepayment shall be endorsed by the Holder on Schedule B attached hereto. In the event of (i) any failure in the payment of any interest on or the principal of this Bond when and as the same shall become due and payable and continuing for more than five (5) business days thereafter or (ii ) the occurrence of an "event of default" as defined in Section 7.1 of the Agreement the entire unpaid balance of the principal sum of this Bond, together with interest accrued thereon, may be declared due and payable by the Holder and, upon such declaration, such principal and interest shall become and be immediately due and payable. The Holder may, in its discretion, rescind any declaration and, upon such rescission, the Issuer, the Holder and the Borrower shall be restored to their respective positions hereunder. No such rescission shall extend to any subsequent or other default hereunder or impair any right consequent thereon. -5- This Bond shall not constitute the personal obligation, either jointly or severally, of the members of the Legislative Authority of the Issuer, or any other officer of the Issuer. IT IS HEREBY CERTIFIED AND RECITED that all acts, conditions and things necessary to be done or performed by the Issuer or to have happened precedent to and in the issuing of this Bond in order to make it a legal , valid and binding special obligation of the Issuer in accordance with its terms, and precedent to and in the execution and delivery of the Agreement and the Assignment have been done and performed and have happened in regular and due form as required by law: that payment in full for this Bond has been received; and that this Bond does not exceed or violate any constitutional or statutory - limitation. IN WITNESS WHEREOF, the Issuer has caused this Bond to be executed in the name of the Issuer by the manual signature of its Mayor and the corporate seal of the Issuer to be affixed hereon, and duly attested by the manual signature of its Mayor, all as of June 9 , 1986. City of Waterloo (Seal ) By e Bernard L. McKinley, Mayor Attest: /r'..✓ k / "r`_ L.rry Purger / , City Clerk/Auditor i -6- F'dC) F40 'dF4 OZrr1h1ZCDhd ;dZ tT1 HH ;d > c)o xtr1O co co rt-. CD rt co co L-1 rtm1-4T1c CO C) HOC C7CDZ t=i 'dH Hidr, H xC� HbdZPdGO xH Pd PdZOCO O yH0 HHC) Zr'] c0 otiHZ HH dEnHhiyFrj O �CFCH d Cn dZ � O 'dH9CnH tr1 O I1 ›. OZ Hx < • Po Po hi r, HH Hr=irrixHFt pd C70x �o xt=1 OxOO td -i -dOOo dpim ,dL, rtH tea\ rt pd t4 hd r-C rt ZONhdHCD0 ZNw H 1-3 C-1 H O H H w t=i Z t' _ h4 Z CO t4 CD. 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