Minutes 11/08/1994 - Laserfiche WebLink

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TUESDAY, NOVEMBER 8. 1994 MARTINSVILLE, VIRGINI~: The following plan for financing of the Project as described in the preambles above is hereby approved. The Authority will be requested to issue its lease revenue note in the maximum amount of 85,000,000, which will be payable as to interest only until the maturity date of the Note (the "Note") and to use the proceeds therefrom to finance the Project. The Authority will groundlease from the School Board, and acquire, renovate, expand, improve and equip the Project and lease the Project to the City pursuant to the Lease Agreement between the Authority and the City. The Authority will also enter into the Note Purchase Agreement pursuant to which the Note will be issued. The Authority will also enter into the Assignment Agreement between the Bondholder and the Authority whereby the Authority's rights under the Ground Lease and the Lease Agreement will be assigned to the Bondholder, which is to be acknowledged and consented to by the City and the School Board. The Authority will be requested to lease the Project to the City under a "triple net lease" for the term of the Note at a rent sufficient to pay interest and principal due on the Note all pursuant to the Lease Agreement. The obligation of the Authority to pay principal and interest on the Note will be limited to rent payments received from the City. The obligation of the City to pay rent will be subject to the City Council making annual appropriations for such purpose. It is intended that the principal of the Note will be paid from proceeds available from a subsidized loan from the State Literary Fund. The Note will be secured by an assignment of rents to the Bondholder as holder of the Note. If the City Council exercises its right not to appropriate money for rent payments, the Bondholder may terminate the Lease Agreement or otherwise exclude the City (and the School System) from possession of the Project. The Mayor or Vice-Mayor, either of whom may act, is hereby authorized and directed to execute and deliver the Lease Agreement, the Ground Lease, the Note Purchase Agreement and the Assignment Agreement. The City Manager is hereby authorized to cause any of such Documents to be recorded in the Clerk's Office of the Circuit Court. The Documents shall be in substantially the forms submitted to this meeting, which are hereby approved, with such completions, omissions, insertions and changes as may be approved by the officer executing them, his execution to constitute conclusive evidence of his approval of any such completions, omissions, insertions and changes. The Project is hereby declared to be essential to the efficient operation of the City and its provision of essential services to citizens of the City's School System, and the City Council anticipates that the Project will continue to be essential to the operation of the City's School System during the term of the Lease Agreement. The City Council, while recognizing that it is not empowered to make any binding commitment to make appropriations beyond the current fiscal year, hereby states its intent to make annual appropriations in future fiscal years in amounts sufficient to make all payments under the Lease Agreement and hereby recommends that future City Councils do likewise during the term