RESOLUTION NO. 6626
A RESOLUTION OF THE CITY OF LAWRENCE, KANSAS, APPROVING SALE OF BOND-FINANCED PROJECT; AUTHORIZING EXECUTION OF ASSIGNMENT, ASSUMPTION AND RELEASE AGREEMENT; APPROVING REDEMPTION OF BONDS; AND AUTHORIZING TERMINATION AND RELEASE OF THE LEASE, TERMINATION AND RELEASE OF SUBLEASE AND ALL SUCH OTHER DOCUMENTS NECESSARY TO CONVEY TITLE TO SUCH FACILITY AND TO EFFECT REDEMPTION OF THE BONDS.
WHEREAS, pursuant to the provisions of K.S.A. 12-1740, et seq., as amended (the “Act”), the City of Lawrence, Kansas (the “City”), in order to stimulate and develop the general economic welfare and prosperity of the City and its environs, and thereby to further promote, stimulate and develop the general economic welfare and prosperity of the State of Kansas, previously issued its Housing Development Revenue Bonds (Section 8 Assisted – HUD-FHA Insured Mortgage Loan), Series May 1, 1979, for the purpose of providing funds to acquire, purchase, construct and install a certain residential development known as Vermont Towers and located at 1101 Vermont St. in Lawrence, Kansas (the "Project"); and
WHEREAS, pursuant to the Act, the Bonds were issued and secured pursuant to an Ordinance passed by the City on May 15, 1979 (the "Bond Ordinance"); and
WHEREAS, pursuant to the Act, the City leased the Project from Vermont Towers, Ltd., a Kansas limited partnership (the “Company”) pursuant to a certain Lease dated as of May 1, 1979 (the “Lease”); and
WHEREAS, pursuant to the Act, the City subleased the Project to the Company pursuant to a certain Sublease dated as of May 1, 1979 (the “Sublease”); and
WHEREAS, the Bonds are secured by a Mortgage from the Company to GMAC Commercial Mortgage (as successor mortgagee to Empire Bank and Trust) (the "Mortgagee") dated May 15, 1979 and filed of record on May 17, 1979 in Book 334 at page 1970 of the Real Estate Records of Douglas County, Kansas, which Mortgage is insured by the U.S. Department of Housing and Urban Development ("HUD"); and
WHEREAS, the Company wishes to sell the Project to Lawrence Senior Residences, L.P., a Kansas limited partnership (the "Purchaser"), and the Purchaser wishes to purchase the Project from the Seller; and
WHEREAS, in connection with such sale, the Company and the Purchaser have agreed that the Purchaser shall assume the obligations of the Company under the Lease and the Sublease, as well as under the Mortgage and certain documents related to the Mortgage (collectively, the "Transaction Documents"), and the Seller shall be released from its obligations under such Transaction Documents, all as set forth in a certain Assignment, Assumption and Release Agreement described herein; and
WHEREAS, the Purchaser has indicated its desire to redeem and pay the Bonds prior to maturity and the City wishes to expedite that process; and
WHEREAS, Bank of New York Trust Company, N.A., St. Louis Missouri (as successor to Empire Bank and Trust) (the "Fiscal Agent") serves as Fiscal Agent with respect to the Bonds pursuant to the Bond Ordinance[; and
WHEREAS, the Fiscal Agent and HUD have each consented to the sale of the Project to the Purchaser and to the Purchaser's assumption of the Company's obligations under the Transaction Documents].
NOW, THEREFORE, BE IT RESOLVED BY THE GOVERNING BODY OF THE CITY OF LAWRENCE, KANSAS:
Section 1. The City is hereby authorized to approve that certain Assignment, Assumption and Release Agreement by and among the Company, the Purchaser, the Mortgagee and the Fiscal Agent, whereby the Transaction Documents shall be assigned by the Company to the Purchaser, the Purchaser shall assume the obligations of the Company with respect to the Bonds and the Transaction Documents and the Seller shall be released from such obligations[, such approval of the City being subject to the receipt of the consent from the Fiscal Agent and HUD to the sale of the Project to the Purchaser, the assignment of the lease to the Purchaser and to the Purchaser's assumption of the Company's obligations under the Transaction Documents].
Section 2. The City is hereby authorized to terminate the Lease and the Sublease at such time as no Bonds remain Outstanding in accordance with Section 34 of the Bond Ordinance.
Section 3. The City hereby waives any notice of prepayment of subrentals rent under Article VIII of the Sublease.
Section 4. The Mayor or Vice Mayor and the City Clerk or any Deputy City Clerk are hereby authorized to execute all documents necessary to provide clear title to the Project in the name of the Company, including but not limited to the Assignment, Assumption and Release Agreement and all documents necessary to clear title to the Project in the name of the Purchaser at such time as no Bonds remain Outstanding, including but not limited to a Termination and Release of Lease and Termination and Release of Sublease.
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Section 5. The Mayor or City Clerk, or other appropriate staff of the City, are authorized
(i) to deliver the Assignment, Assumption and Release Agreement to Preferred Title of St. Joseph, L.L.C., St. Joseph, Missouri, or its successor, as escrow and title agent with respect to the sale of the Project, for recording on behalf of the City, and, (ii) at such time as the City shall have received evidence from the Fiscal Agent that all of the Bonds have been defeased under Section 34 of the Bond Ordinance, to deliver to the Purchaser (or at the direction of the Purchaser, to such escrow and title agent) the remaining documents referred to in Section 4 hereof. The Assumption Assignment and Release Agreement and the Termination and Release of Lease and the Termination and Release of Sublease shall be in substantially the forms presented to the City prior to the adoption of the Resolution, with such changes as shall be approved by the individual executing such documents on behalf of the City, such execution being conclusive evidence of the approval thereof.
Section 6. The Mayor or Vice Mayor and the City Clerk or any Deputy City Clerk, or other appropriate staff of the City, are hereby authorized and directed to take all such other actions not inconsistent herewith as may be appropriate or desirable to accomplish the purpose of this Resolution.
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ADOPTED AND APPROVED by the governing body of the City of Lawrence, Kansas this 24th day of January, 2006.
CITY OF LAWRENCE, KANSAS [Seal]
By: Dennis Highberger, Mayor
ATTEST:
Frank Reeb, City Clerk
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