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HomeMy WebLinkAbout2003-03-11 CC Meeting Packet Enclosure-ENCLOSUM Oak Park Hei Re for Council Action Meetin Date March 11 ,..200 A Item Title Receiv ive Bri - - sa Mor Corr ondence Re and Council for Refinancin of VSSA McKean S LLC Housin Revenue Bonds A Placement Ori Department/ Re Administration --- Judv Hoist Re Si Action Re Receive ondence from Bri Mor Back (Please indicate an previous action, financial implications includin bud information and recommendations). See attached correspondence from Bri and Morgan. O PROFESSIONAL ASSOCIATION 2400 IDS CENTER 80 SOUTH EIGHTH STREET NEAPOLIS, MINNESOTA 55402 �? TELEPHONE (612) 334 -8400 FACSIMILE (612) 334 -8650 WRITER'S DIRECT DIAL WRITER'S E -MAIL February 28, 2003 Ms. Judy Holst Oak Park Heights City Hall P.O. Box 2007 Oak Park Heights, MN 55082 -2007 Mr. Mark Meyer Presbyterian Homes of Minnesota 2485 Hamline Avenue North, Suite 200 Roseville, MN 55113 Mr. Bradley D. Wirt U.S. Bancorp Piper Jaffray Inc. 800 Nicollet Mail J1012019 Minneapolis, MN 55402-7020 Re: City of oak Park Heights, Minnesota $19,985,000 Tax Loan Participations, Series 2003A and 2003B (Boutwells Landing /McKean Square Project) Ladies and Gentlemen: We have been asked to serve as Bond Counsel for a proposed issue of housing revenue bonds in the form of loan participations (the "Bonds ") of the City of oak Park Heights (the "Issuer ") to be privately placed with financial institutions by US Bancorp Piper Jaffray, Inc. (the "Placement Agent "). The proceeds of the Bonds will be loaned by the Issuer to VSSA McKean Square, LLC (the "Company ") and used to refund certain tax - exempt debt issued by the Issuer in 2002 to finance a portion of the costs of the construction and equipping of a 1,50 -unit elderly rental housing development located adjacent to the Company's existing Iacility' at 5 600 Norwich Parkway in oak Park Heights and known as McKean Square (the "Project "). In performing our services as Bond Counsel, our client will be the Issuer. our principal responsibility as Bond Counsel is to provide the Issuer, the Company and the Placement Agent an expert opinion (the "Bond opinion "), upon which each of them and the holders of the Bonds may rely, as to (1) the validity and enforceability of the Bonds and the Issuer's obligations under the financing documents, and (ii) exemption of interest on the Bonds from federal and Minnesota income taxes. We will also assume principal responsibility for drafting the financing documents and any security documents agreed to by the parties. As Bond Counsel, we do not expect to give any opinion with respect to the Company's participation in the financing or the status of title or the priority of any mortgage lien or security 15053 I9v 1 SAINT PAUL OFFICE a FIRST NATIONAL BAND BUILDING u UTWWBRIGGS.COM MEMBER ---- LEh MUNDI, A GLOBAL ASSOCIATION OF INDEPENDENT LAW FIRMS Ms. Judith Hoist Mr. Mark Meyer Mr. Bradley D. Wirt February 28, 2003 Page 2 interest securing the Bonds. As to these and other matters the parties will be relying upon the opinion to be given by counsel for the Company or upon a policy of title insurance. The Bond Counsel opinion will be executed and delivered by us in written form on the date the Bonds are delivered to the Placement Agent and will be based on facts and law existing as of that date. Upon delivery of the Bond opinion, our responsibilities as Bond Counsel will be concluded with respect to this financing. In rendering the Bond opinion, we will rely upon representations of the Issuer, the Company and the Placement Agent set forth in the financing documents, the certified proceedings, and other certifications of public officials, officials of the Company and other persons (including certifications as to the use of Bond proceeds and various tax matters) without undertaking to verify the same by independent investigation. As Bond Counsel, we do not review the financial condition of the Company or the financial feasibility of the financing, and we will express no opinion relating to the foregoing. We wish to point out to the parties that while the Placement Agent has engaged separate counsel for this transaction, we have represented the Placement Agent from time to time in the past on legal matters unrelated to the present financing and may do so in the future. While these unrelated representations may be "adverse" under applicable ethics rules, this letter will confirm our understanding that the parties are agreeable to our acting as Bond Counsel in this proposed financing notwithstanding our representation of the Placement Agent on unrelated matters. If our understanding is not correct, please contact us. We understand that the Company will be responsible for payment of our fees and disbursements as Bond Counsel. Based upon: (i) our current understanding of the terms, structure, size and schedule of the financing represented by the Bonds; (ii) the time we anticipate de Y oting to the finaplcinor, we estimate that our fee as Bond Counsel for this transaction will be in � b the range of $40,000 including disbursements. Such fee may vary; (i) if the principal amount of Bonds actually issued differs significantly from the amount stated above, (ii) if the manner in which the Bonds are marketed changes, (iii) if material changes in the structure of the financing occur, or (iv) if unusual or unforeseen circumstances arise which require a significant increase in our time or responsibility. If Bonds are in fact issued we will submit our statements for services and disbursements to the Company at or promptly after the closing. If the transaction is cancelled before closing for whatever reason, we would then submit our bill to the Company for the time expended and disbursements made by us to the date of termination at our standard hourly rates. I505319vl Ms. Judith Holst Mr. Mark Meyer Mr. Bradley D. Wirt February 28, 2003 Page 3 If the foregoing omits or misstates any item, please contact me. otherwise, we will assume our participation as Bond Counsel and the scope of our engagement as Bond Counsel are acceptable to you. we are pleased to be working on this matter and look forward to bringing it to a successful conclusion.. Very truly yours, Professional Association 1 5053190