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Home My WebLink AboutRESOLUTION NO. 6-4-91 1 RESOLUTION. NO. Approving and authorizing a Loan Agreement and providing,,_ for the issuanceand securing the payment of- a General Obligation Library Improvement ,Note, in an amount ,not to exceed $85,0.00 WHEREAS, pursuant to the provisions of Section 34 . 241 of the Code of Iowa, the City. of Fairfax, Iowa (the "City") , has heretofore proposed. to contract indebtedness and enter into a loan agreement in the principal amount not to exceed $85, aoo (the "Loan Agreement"Y to provide funds to pay .the cost, to that. extent, of acquiring, constructing and equipping a new library for the City (the "Library Project") , and has published notice of the proposed action and has held .a `hearin thereon; WHEREAS, it: is : nece'ssary -at this time to authorize a.nd approvethe Loan Agreement and to:.make provision for the issuance of . a General. Obligation .Library :Improvement Nate in the maxim-um principal amount of $85,000 (the "Note") in evidence of the obligation of the City under the Loan.`Agreement; NOW, THEREFORE,. Be It Resolved by the City Council of tt.t.r C'.ity of Fairfax, Iowa, as follows: Section 1.. The City shall enter into the Loan Agreement with Fairfax State Savings Sank, Fairfax, Iowa, as lender (the Lender") , in substantially, the form attached hereto providing � for a loan to the City in the maximum principal amount lof $85, 000, for the purposes set forth in the preamble hereof. The Mayor and City Clerk are hereby authorized and directed to sign the Loan Agreement on behalf of the City, and the Loan Agreement is hereby approved. Section 2. The Note is hereby authorized to be issued in evidence of the obligation of the City under the Loan A.greemeit, in the maximum principal amount of $85, 000, to be dated as of the date of its delivery to the Lender. The Mai or and City Clea: are re hereby authorized to request advances on the Note in such amounts and at such times as are needed to pay costs of the Library Project, and the date and amount of each advance shall be entered by the Lender on Schedule I to the Note, and each advance shall bear interest from the date of such entry. Principal of the Note shall bear interest from the date of each advance or from the last date on which interest has 1:,v--n paid at the rate of Six Percent . (0) per annum. Both .1, of and interest on the Note shall be payable in equal annual installments in the amount of $19,000 each, due on June 1 in !g ch of the years 1992 through 1995, inclusive, with onp final installment of all remaining principal and interest due thereon being payable at maturity on June 1, 1996. All payments shall b -2- . DORSEY&WHITNEY, ATTORNEYS, DES MOINES, IOWA I applied f irst to the payment of interest due and next to the reduction of principal. Paying 1i The City Clerk is '•hereby designated as the Registrar and. the "Registrar" or the oPaying Agentn e• hereinafter referred to as "nRAgent gistrarn � The City reserveas the right to prepay principal of the Note in whole or in part at any time prior .a '.to nd in inverse order of maturity upon terms o f par and accrued interest to the date of prepayment. All principal �so prepaid ` shall cease to bear interest on the prepayment date. Payment of both principal of and interest on the Note shall be made` to the registered owner appearing on the registration books of the City at 'the close of business on the fifteenth day of the month next preceding the payment date and shall be paid by check or `draft mailed to the registered owner at the address shown on such registration ` books; provided, however, that the final installment of principal and interest shall be payable only upon presentation and surrender of the Note to the Paying Agents The Council hereby covenants to appropriate to the General Fund of the City's annual budget in each year as Long as the Shote is outstanding sufficient 'funds to pay interest of and principal on the Note as such payments become due. The .City hereby pledges the General Fund of the City and the faith, credit, revenues and resources and all of `the real and personal property of the City for the full and prompt payment of the principal of and interest on the Note. The Note shall be executed on behalf of the City with the- official manual signature of the Mayor and attested with the official manual signature of the City Clerk and shall have the City's seal impressed thereon, and shall be a fully registered Note without interest ° coupons. In case any officer whose signature appears on the , Note shall cease to be such officer before the delivery, of the Note, 'such signatur,.:2 shall nevertheless be valid 'and'' suff',icient for all purposes, the same as if such officer 'had remained in office until delivery. The Note shall he fully. registered as to principal and interest in the name of the owner on the registration books of the City kept by the Registrar, and after such registration, payment of the principal thereof and interest thereon shall. be made only to the registered owner or. its legal representatives or assigns. The Note shall' be transferable without cost to the registered owner thereof only upon the registration books of the City upon presentation to the Registrar, together with either a written instrument of transfer satisfactory to the Registrar or the assignment form thereon completed and duly executed by the registered owner or the duly authorized attorney for such registered owner. -3- DORSEY 'WHnNEY, ATTORNEYS, DES MOINES, IOWA i i I The record and identity of the owner of the Note shall be kept confidential as provided by Section 22 , 7 of the code of Iowa. r Section 3. The eNote shall be in substantially the form set forth .as Exhibit A to. the Loan Agreement 'attached hereto, and shall be executed as. herein provided . as ..soon after the adoption of this resolution as maybe possible, and thereupon it shall be delivered. to the Registrar -for registration, authentication and delivery to the Lender, and all action heretofore taken in connection with the Loan Agreement is hereby ratified and confirmed in all respects.. Section 4.. It isthe .intention of the. city that interest on the Note be and remain excluded from gross income for federal. income tax purposes pursuant to the a6ppropriate provisions of the Internal Revenue Code of:.. 1986, as amended, and the rreasury Regulations ,in effect with respect thereto (all of the foregoing herein referred to . as the "Internal Revenue code" ) . In furtherance thereof, the City covenants to comply with the provisions of the Internal 'Revenue Code as they may from tine tai time be in effect or amended and further covenants to comply with the applicable future laws, regulations, published rulings and court 'decisions as may be necessary to insure that the interest on the Note will remain excluded. from gross income for federal income tax purposes. Any and all of the officers of the city are hereby authorized and directed to take. any and all actions as may be necessary to comply with the covenants herein contained. The City hereby designates the Note as a "Qualified {.fax Exempt Obligation" as that term is used in Section 265 (b) (3) (B) of the Internal Revenue* Code. Section 5. All resolutions or parts thereof in conflict herewith be and the same are 'hereby repealed to the extent of such conflict. Section 6. This resolution shall be in full force and effect immediately upon its adoption and approval as provided by law. Passed and approved June 4 *ao Atte t: City Perk -4- DORSEY&WHUNEY, ATTORNEYS, DES MOINES, IOWA