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HomeMy WebLinkAboutAM Installment Sale RequirementsTOWN OF WESTLAKE AGENDA MEMO TO: Honorable Mayor and Members of the Board of Aldermen FROM: Trent Petty, Town Manager SUBJECT: Installment Sale Requirements DATE: September 20, 2002 WESTLAKE ACADEMY INSTALLMENT SALE Because of the Attorney General decision concerning the use of bond proceeds to build the Charter School, the Town has had to jump through multiple hoops and red tape to complete the Charter School funding. The mechanism we had to use to build the Charter- - -- School section of the project is to be accomplished through an installment sale agreement, which we have previously discussed. While preparing that sale, the attorneys have run across a requirement that will require additional actions by the Council. Because of a unique quirk in the law identified while assembling the installment sale, it was learned that the Town of Westlake was unable to simply convey the land recently purchased from Hillwood to the Westlake Academy Corporation without having to go through some bureaucratic yet necessary steps. We will have to go through a public bid process to sell the land. Bidders will be limited (among other things) to bidders holding a Charter in Westlake, Texas granted by TEA for a school to be opened in the Fall of 2003. The newly created corporation, detailed below, will purchase the land from the town and then we will set up a contractual arrangement between this entity and the previously created Academy Corporation for management, etc. The documents in your agenda packet dealing with this subject will accomplish the following beginning with the September 23rd meeting and extending into October meetings. On Sept 23rd, we will: 1. Authorize the Town Manager to advertise for the sale of public property to qualified bidders. That means the Town intends to accept bids to sell the 24.59 acre tract to a qualified bidder. Narrowly restricted to ensure that a qualified bidder will meet the requirements of the Town. 2. Adopt a Resolution authorizing creation of the Westlake Academy Finance Corporation, establish bylaws, etc. This entity will become the "interim owner" of the property and ultimately "buy" it from the Town. 3. Adopt a Resolution authorizing creating the Westlake Academy Management Corporation. Stan will draft newspaper notice and it will go out the next day. On October 14th before the regular Board of Aldermen meeting, we will convene the WRFC: 1. Perform organization steps 2. Authorize the bid on the property 3. Authorize the Installment Sale Agreement. On October 10h regular Board of Aldermen meeting, we will: 1. Receive and award a bid on the sale of the land 2. Approve the installment sale agreement. 3. Authorize closing to a qualified investor At closing (asap thereafter): 1. Town will convey the land 2. WFAC executes installment sale agreement and simultaneously conveys the land back to the Town. 3. WFAC will assign its interest in the ISA to the investor who then wires the money AUTHORIZING (1) THE ACQUISITION OF CERTAIN LAND AND THE CONSTRUCTION OF CERTAIN IMPROVEMENTS, LOCATED WESTLAKE, TEXAS, (2) THE EXECUTION AND DELIVERY OF DOCUMENTS APPROPRIATE TO EFFECT THE ACQUISITION OF THE LAND AND CONSTRUCTION OF THE IMPROVEMENTS,D RESOLVING1 MATTERS WHEREAS, the Town of Westlake, Texas (the "Town") is a Type -A city and is empowered under Section 51.015(a) of the Local Government Code (1) to acquire the certain land and improvements, which land is more particularly described on Exhibit A attached hereto (the "Land") (collectively, the Land and improvements shall be referred to as the "Property") pursuant to an Installment Sale Agreement (the "Installment Agreement"), dated as of October 1, 2002, between the Town and the Westlake Academy Finance Corporation, and (2) to lease a portion of the Property to Westlake Academy Management Corporation ("WAMC"), _ a_ _ nonprofit_ _corporation created _ as an instrumentality of the Town , on terms deemed appropriate by the Town, to house an open enrollment charter school (the charter school shall be referred to as the "Westlake Academy"), which charter has been obtained by the Town pursuant to Section 12.101 of the Education Code; WHEREAS, the Board of Aldermen (the "Board") of the Town hereby finds that it is in the interest of the Town to acquire the Property pursuant to the Installment Agreement and to lease a portion of the Property to WAMC to operate the Westlake Academy in that such action will make substantial contribution to the economic, educational, cultural, social, and civic development of the community and promote the general welfare of the community; WHEREAS, the Board understands that the Property shall be acquired pursuant to the Installment Agreement and all documents contemplated thereby, such documents shall be referred to as the "Transaction Documents," copies of which Transaction Documents have been presented to the members of the Board; WHEREAS, the Board has determined to enter into the Transaction Documents in order to enable the Town to acquire the Property and lease a portion of the Property to the WAMC by authorizing the execution and delivery of the Transaction Documents and taking such other actions as may be necessary and convenient to effect the transactions contemplated by the Transaction Documents and this resolution (the "Resolution"); WHEREAS, the meeting at which this Resolution has been considered has been called and held, and public notice of the meeting has been given, in accordance with applicable law; BE , RESOLVED 1 :B is ' .D OF ALDERMEN OF O WESTLAKE, TEXAS: SECTION 1. Preamble. The preamble of this Resolution and the findings contained therein are hereby adopted by reference and made part of this Resolution. SECTION 2. Authorization of the Acquisition and Leasing of the Property Pursuant to the Transaction Documents. The Board hereby authorizes and approves the acquisition of the Property pursuant to, and the performance of its duties under, the Transaction Documents, with such changes in the forms thereof as may be approved by the Mayor as provided below. The Board also authorizes the Town to lease a portion of the Property to WAMC to house Westlake Academy on such terms and conditions as may hereafter be approved by the Board. SECTION 3. Certain Terms of the Agreement. The Town hereby authorizes with respect to its payment obligations under the Transaction Documents, in connection with the acquisition of the Property, a net effective interest rate not to exceed 7.50 percent and a final maturity of the payment of principal no later than October 1, 2037. SECTION 4. Terms of Acquisition of Project. The Town hereby authorizes the acquisition, construction, and equipping of the Property for a purchase price not to exceed $6,000,000, on the terms and conditions as contained in the Transaction Documents, with the final terms subject to the approval of the Mayor. SECTION 5. Conditions to Entering into the Transaction Documents. The Finance Counsel, Thomas Allen Moon, and the Special Finance Counsel, Jenkens & Gilchrist, a Professional Corporation, shall have delivered an opinion to the Board to the effect that the Board has taken all appropriate action to authorize the execution and delivery of the Transaction Documents, and the Transaction Documents, subject to customary creditor rights exceptions, are enforceable and binding obligations of the Town. SECTION 6. Execution and Delivery of Transaction Documents. Following the approval of the final terms of the Transaction Documents and the satisfaction of all requirements contained therein and in this Resolution, the Mayor, Town Manager and the Secretary are each hereby directed and authorized to execute, attest and affix the Town's seal to the Agreement, and the Mayor or the Town Manager is hereby directed and authorized to execute the Transaction Documents, and to deliver the Transaction Documents to the appropriate persons., all of such actions being taken for, on behalf and in the name of the Town. SECTION 7. Authorized Officers. The Mayor, each of the members of the Board, the Town Manager, and the Town Secretary (each as an authorized officer), Larry Williamson, as the Financial Advisor, Thomas Allen Moon, as the Finance Counsel, and Jenkens & Gilchrist, a Professional Corporation, as the Special Finance Counsel, are each hereby authorized to execute and deliver certifications as to facts, estimates, and circumstances as are necessary to accomplish the purposes of this Resolution and, on the Town's behalf, to: (1) do all things necessary or convenient to effect the acquisition and leasing of the Property and to carry out the terms and purposes of this Resolution, including (without limitation) the execution and delivery of all agreements and other documents and papers, whether or not mentioned herein, contemplated to be delivered in connection therewith; (2) perform all duties and functions of the Town under the Transaction Documents and this Resolution in order to accomplish the purposes thereof; and (3) certify as to the accuracy of any information about the Town that is contained in the Transaction Documents. SECTION 8. Limited Obligations. The obligations of the Town to pay the Purchase Price of the Property shall be limited obligations of the Town payable solely from the revenues, funds, and assets payable under the Transaction Documents to secure payment thereof, and under no circumstances shall the be payable from any other revenues, funds, assets, or income of the Town. SECTION 9. Obligations of Town Only. The obligations of the Town under the Transaction Documents shall not constitute an indebtedness, liability, general, special, or moral obligation or a pledge or loan of the faith and credit or taxing power, within the meaning of any constitutional or statutory provision whatsoever, of the United States of America or any agency or instrumentality thereof, the State of Texas, or any other political subdivision or governmental unit. SECTION 10. Power to Revise Form of Transaction Documents. Notwithstanding any other provision of this Resolution, the Mayor or Town Manager of the Town is authorized to make or approve such revisions in the form of the Transaction Documents as, in the opinion of the Finance Counsel, may be necessary or convenient to carry out the purposes of this Resolution; and the approval of such changes shall be conclusively established by the Mayor's or Town Manager's execution of the documents. SECTION 11. Effective Date of Resolution. This Resolution shall take effect immediately upon its adoption. Scott Bradley, Mayor Wit"Vim Ginger Crosswy, Town Secretary Trent O. Petty, Town Manager FOR 9 0 aftyj Z I L. Stanton Lowry, Town Attorney Exhibit A (Description of the Land) BEING a 24.59 acre tract of land situated in the Jesse Gibson Survey, Abstract No. 592, the Richard Eads Survey, Abstract No. 492, and the Jesse Sutton Survey, Abstract No. 1451, Tarrant County, Texas, Town of Westlake, being a portion of a tract of land conveyed by deed to AIL Investments, L.P., as recorded in Volume 13275, Page 542, Deed Records, Tarrant County, Texas, and subsequently conveyed to the Town of Westlake, Texas. A metes and bounds description may be obtained at the Town Hall. 6 DALLAS2 929372v2 22174-00002 MINUTES AND CERTIFICATION On October 14, 2002, the Board of Aldermen (the "Board") of the Town of Westlake, Texas (the "Town") convened in a public meeting at the designated meeting place in Westlake, Texas. The roll of duly constituted officers and members of the Board was called and are as follows: Name Title Absent Scott Bradley Mayor Fred Held Alderman Don Redding Alderman Larry Sparrow Alderman Bill Frey Alderman Buddy Brown Alderman all of whom were present except those indicated above as being absent, thus constituting a quorum. Among other things, the Board considered the written resolution as follows: A Resolution Authorizing (1) the Acquisition of Certain Land and the Construction of Certain Improvements, Located in Westlake, Texas, (2) the Execution and Delivery of the Documents Appropriate To Effect the Acquisition of the Land and Construction of the Improvements, and (3) Resolving Related Matters The Resolution was read by the Board. After due consideration, it was duly moved and seconded that the Resolution be adopted. The Presiding Officer put the motion to a vote of the Board, and the Resolution was adopted by the following vote: AYES: NOES: ABSTENTIONS: The Presiding Officer then declared the Resolution adopted. The persons named herein are the duly chosen, qualified, and acting officers and members of the Board as indicated herein. Each of the officers and members of the Board was duly and sufficiently notified officially and personally, in advance, of the time, place, and purpose of the aforesaid meeting and that the resolution would be introduced and considered for adoption at the meeting. The meeting was open to the public, and public notice of the time, place, and purpose of the meeting was given all as required by Chapter 551 of the Texas Government Code. DALLAS2 929678v2 22174-00002 MINUTES APPROVED AND CERTIFIED TO BE CORRECT and to correctly reflect the duly constituted members of the Board of the Town, and the attached copy of the Resolution is hereby certified to be a correct copy of an official copy thereof on file among the official records of the Town and such resolution has not been amended and is in full force and effect on this October 14, 2002. [SEAL] 2- TOWN AUTHORIZING RESOLUTION DALLAS2 929678v2 22174-00002 By: Name: Ginger Crosswy Title: Secretary RESOLUTION AUTHORIZING (1) THE ACQUISITION OF CERTAIN LAND AND THE CONSTRUCTION OF CERTAIN IMPROVEMENTS, LOCATED IN WESTLAKE, TEXAS, (2) THE EXECUTION AND DELIVERY OF THE DOCUMENTS APPROPRIATE TO EFFECT THE ACQUISITION OF THE LAND AND CONSTRUCTION OF THE IMPROVEMENTS, AND (3) RESOLVING RELATED MATTERS WHEREAS, the Town of Westlake, Texas (the "Town") is a Type -A city and is empowered under Section 51.015(a) of the Local Government Code (1) to acquire the certain land and improvements, which land is more particularly described on Exhibit A attached hereto (the "Land") (collectively, the Land and improvements shall be referred to as the "Property") pursuant to an Installment Sale Agreement (the "Installment Agreement"), dated as of October 1, 2002, between the Town and the Westlake Academy Finance Corporation, and (2) to lease a portion of the Property to Westlake Academy Management Corporation ("WAMC"), a nonprofit corporation created as an instrumentality of the Town , on terms deemed appropriate by the Town, to house an open enrollment charter school (the. charter school shall be referred to as the "Westlake Academy"), which charter has been obtained by the Town pursuant to Section 12.101 of the Education Code; WHEREAS, the Board of Aldermen (the "Board") of the Town hereby finds that it is in the interest of the Town to acquire the Property pursuant to the Installment Agreement and to lease a portion of the Property to WAMC to operate the Westlake Academy in that such action will make substantial contribution to the economic, educational, cultural, social, and civic development of the community and promote the general welfare of the community; WHEREAS, the Board understands that the Property shall be acquired pursuant to the Installment Agreement and all documents contemplated thereby, such documents shall be referred to as the "Transaction Documents," copies of which Transaction Documents have been presented to the members of the Board; WHEREAS, the Board has determined to enter into the Transaction Documents in order to enable the Town to acquire the Property and lease a portion of the Property to the WAMC by authorizing the execution and delivery of the Transaction Documents and taking such other actions as may be necessary and convenient to effect the transactions contemplated by the Transaction Documents and this resolution (the "Resolution"); WHEREAS, the meeting at which this Resolution has been considered has been called and held, and public notice of the meeting has been given, in accordance with applicable law; THEREFORE, BE IT RESOLVED BY THE BOARD OF ALDERMEN OF THE TOWN: SECTION 1. Preamble. The preamble of this Resolution and the findings contained therein are hereby adopted by reference and made part of this Resolution. SECTION 2. Authorization of the Acquisition and Leasing of the Pro eegy Pursuant to the Transaction Documents. The Board hereby authorizes and approves the acquisition of the Property pursuant to, and the performance of its duties under, the Transaction Documents, with such changes in the forms thereof as may be approved by the Mayor as provided below. The Board also authorizes the Town to lease a portion of the Property to WAMC to house Westlake Academy on such terms and conditions as may hereafter be approved by the Board. 3 - TOWN AUTHORIZING RESOLUTION DALLAS2 929678v2 22174-00002 SECTION 3. Certain Terms of the Agreement. The Town hereby authorizes with respect to its payment obligations under the Transaction Documents, in connection with the acquisition of the Property, a net effective interest rate not to exceed 7.50 percent and a final maturity of the payment of principal no later than October 1, 2037. SECTION 4. Terms of Acquisition of Project. The Town hereby authorizes the acquisition, construction, and equipping of the Property for a purchase price not to exceed $6,000,000, on the terms and conditions as contained in the Transaction Documents, with the final terms subject to the approval of the Mayor. SECTION 5. Conditions to Entering into the Transaction Documents. The Finance Counsel, Thomas Allen Moon, and the Special Finance Counsel, Jenkens & Gilchrist, a Professional Corporation, shall have delivered an opinion to the Board to the effect that the Board has taken all appropriate action to authorize the execution and delivery of the Transaction Documents, and the Transaction Documents, subject to customary creditor rights exceptions, are enforceable and binding obligations of the Town. SECTION 6. Execution and Delivery of Transaction Documents. Following the approval of the final terms of the Transaction Documents and the satisfaction of all requirements contained therein and in this Resolution, the Mayor, Town Manager and the Secretary are each hereby directed and authorized to execute, attest and affix the Town's seal to the Agreement, and the Mayor or the Town Manager is hereby directed and authorized to execute the Transaction Documents, and to deliver the Transaction Documents to the appropriate persons., all of such actions being taken for, on behalf and in the name of the Town. SECTION 7. Authorized Officers. The Mayor, each of the members of the Board, the Town Manager, and the Town Secretary (each as an authorized officer), Larry Williamson, as the Financial Advisor, Thomas Allen Moon, as the Finance Counsel, and Jenkens & Gilchrist, a Professional Corporation, as the Special Finance Counsel, are each hereby authorized to execute and deliver certifications as to facts, estimates, and circumstances as are necessary to accomplish the purposes of this Resolution and, on the Town's behalf, to: (1) do all things necessary or convenient to effect the acquisition and leasing of the Property and to carry out the terms and purposes of this Resolution, including (without limitation) the execution and delivery of all agreements and other documents and papers, whether or not mentioned herein, contemplated to be delivered in connection therewith; (2) perform all duties and functions ofthe Town under the Transaction Documents and this Resolution in order to accomplish the purposes thereof; and (3) certify as to the accuracy of any information about the Town that is contained in the Transaction Documents. 4- TOWN AUTHORIZING RESOLUTION DALLAS2 929678v2 22174-00002 SECTION 8. Limited Obligations. The obligations of the Town to pay the Purchase Price of the Property shall be limited obligations of the Town payable solely from the revenues, funds, and assets payable under the Transaction Documents to secure payment thereof, and under no circumstances shall the be payable from any other revenues, funds, assets, or income of the Town. SECTION 9. Obligations of Town Only. The obligations of the Town under the Transaction Documents shall not constitute an indebtedness, liability, general, special, or moral obligation or a pledge or loan of the faith and credit or taxing power, within the meaning of any constitutional or statutory provision whatsoever, of the United States of America or any agency or instrumentality thereof, the State of Texas, or any other political subdivision or governmental unit. SECTION 10. Power to Revise Form of Transaction Documents. Notwithstanding any other provision of this Resolution, the Mayor or Town Manager of the Town is authorized to make or approve such revisions in the form of the Transaction Documents as, in the opinion of the Finance Counsel, may be necessary or convenient to carry out the purposes of this Resolution; and the approval of such changes shall be conclusively established by the Mayor's or Town Manager's execution of the documents. SECTION 11. Effective Date of Resolution. This Resolution shall take effect immediately upon its adoption. I04X41111 I ElizaJ�Ti Cl �7111C�lf�l 5 TOWN AUTHORIZING RESOLUTION DALLAS2 929678v2 22174-00002 PASSED AND APPROVED BY TOWN OF WESTLAKE, TEXAS, this October 14, 2002. [SEAL] n TOWN AUTHORIZING RESOLUTION DALLAS2 929678v2 22174-00002 By: Name: Title: Scott Bradley Mayor