|
WHEREAS, as pursuant to the terms of the Housing Program Act, on June 25, 1998, the
<br />Issuer issued its $26,545,000 Senior Housing Revenue Refunding Bonds (College Properties,
<br />Inc. Project) Series 1998 (the "1998 Bonds") and loaned the proceeds to College Properties, Inc.,
<br />a Minnesota nonprofit corporation ("College Properties") to refund and refinance certain tax
<br />exempt debt of the Issuer which had been loaned to College Properties and to finance the
<br />acquisition and construction of a 36-unit memory care facility connected to College Properties'
<br />existing independent and assisted living facility in the City pursuant to a loan agreement dated as
<br />of June 1, 1998. The assets of College Properties were acquired by PHS/EagleCrest, Inc.,
<br />formerly known as PHM/EagleCrest, Inc., a Minnesota nonprofit corporation ("PHS") on
<br />September 24, 1999 and on Apri125, 2007 PHS formed EagleCrest Senior Housing, LLC, a
<br />Minnesota limited liability company, of which PHS is the sole member (the "Borrower"). On
<br />July 1, 2007 the Issuer issued its $23,720,000 Senior Housing Refunding Revenue Bonds
<br />(EagleCrest Project), Series 2007 (the "Prior Bonds") pursuant to an Indenture of Trust, dated as
<br />of July 1, 2007, between the Issuer and U.S. Bank National Association, in St. Paul, Minnesota,
<br />as trustee. The proceeds derived from the sale of the Prior Bonds were loaned to the Borrower.
<br />The proceeds of the Prior Bonds were applied by the Borrower to refinance the acquisition,
<br />construction and equipping of a multifamily rental housing facility known as EagleCrest,
<br />consisting of 127 units of independent living apartments, 91 units of assisted living and 36 units
<br />for memory care located at 2925-45 Lincoln Drive North in the City (the "Project"); and
<br />WHEREAS, the Borrower's affiliate, Presbyterian Homes of Arden Hills, Minnesota (the
<br />"Affiliate") currently has an outstanding taxable obligation payable to U.S. Bank National
<br />Association consisting of a construction and term loan in the original principal amount of $4.2
<br />million, of which approximately $4.1 million remains outstanding (the "Prior Taxable Debt")
<br />which was used to finance improvements to the common areas, hallways and room conversions
<br />to the McKnight Care Center, located at 3220 Lake Johanna Boulevard in the City of Arden
<br />Hills, Minnesota.
<br />WHEREAS, the Borrower has requested the Issuer to issue senior housing revenue
<br />refunding bonds in the maximum aggregate principal amount of $23,390,000 in accordance with
<br />the provisions of the Act and to loan the proceeds thereof to the Borrower to provide for the (i)
<br />refinancing of the Project by redemption of the Prior Bonds; (ii) financing certain capital
<br />improvements to the Project; (iii) payment in full of the outstanding Prior Taxable Debt; and (iv)
<br />payment of certain costs of issuance of the Bonds; and
<br />WHEREAS, the Bonds will be issued under an Indenture of Trust, to be dated on or after
<br />June 1, 2009 (the "Indenture"), between the City and U.S. Bank National Association (the
<br />"Trustee"), and the Bonds and the interest on the Bonds: (i) shall be payable solely from the
<br />revenues pledged therefor; (ii) shall not constitute a debt of the City within the meaning of any
<br />constitutional or statutory limitation; (iii) shall not constitute nor give rise to a pecuniary liability
<br />of the City or a charge against its general credit or taxing powers; and (iv) shall not constitute a
<br />charge, lien, or encumbrance, legal or equitable, upon any property of the City other than the
<br />City's interest in the Project and in the Amended and Restated Financing Agreement dated on or
<br />after June 1, 2009 (the "Financing Agreement"), among the City, the Borrower and the Trustee.
<br />WHEREAS, pursuant to the terms of the Financing Agreement, the City will use the
<br />proceeds of the sale of Bonds to acquire from the Trustee and amend and restate a loan of the
<br />2363919v1 2
<br />
|