ORDINANCE NO. 2214

AN ORDINANCE AUTHORIZING THE ISSUANCE AND SALE OF $3,500,000 AGGREGATE PRINCIPAL AMOUNT OF CITY OF GRAND JUNCTION, COLORADO, INDUSTRIAL DEVELOPMENT REVENUE BONDS (WESTERN STATES MOTEL OPERATIONS, INC.)--1984--TO FINANCE PROPERTY SUITABLE FOR COMMERCIAL OR BUSINESS ENTERPRISES; RATIFYING CERTAIN ACTIONS HERETOFORE TAKEN; AUTHORIZING THE EXECUTION AND DELIVERY BY THE CITY OF SAID BONDS, A LOAN AGREEMENT WITH MORTGAGE, AND CLOSING DOCUMENTS IN CONNECTION THEREWITH; AND REPEALING ACTION HERETOFORE TAKEN IN CONFLICT THEREWITH.

WHEREAS, the City of Grand Junction, Colorado ("the Issuer") is a legally and regularly created, established municipal corporation organized and existing under the provisions of the Constitution and laws of the State of Colorado ("the State"), and

WHEREAS, the legislature of the State of Colorado, in the County and Municipal Development Bond Act, Title 29, Article 3, Colorado Revised Statutes 1973, as amended ("the Act"), has found and declared it to be a public purpose for municipalities to promote industry and develop trade or other economic activity by, among other things, inducing profit or nonprofit corporations and commercial or business enterprises to locate, expand, or remain in the State, mitigate the serious threat of extensive unemployment in parts of the State, secure and maintain a balanced and stable economy in all parts of the State; and

WHEREAS, in furtherance of the foregoing purposes, the legislature of the State has authorized municipalities such as the Issuer to issue revenue bonds under the Acts for the purposes of defraying the costs of financing, acquiring, improving, and equipping any "project," including any land, building, or other improvement in all real or personal properties, whether or not in existence, suitable, or used for or in connection with commercial enterprises and other purposes set forth in the Act; and

WHEREAS, Western States Motel Operations, Inc., a corporation duly organized and existing under the laws of the State (the "Borrower"), proposes to expand, operate and maintain its motel and hotel facility (the "Project") which will consist of acquiring, constructing, improving and equipping a "project" within the meaning of and as defined in the Act; and

WHEREAS, the Borrower desires to expand and improve the Project, which is to be constructed within the boundaries of the Issuer, in order to provide lodging, tourist, and dining services to the area of the Issuer; and

WHEREAS, the Borrower has presented to the Issuer a proposal whereby the Issuer will, pursuant to the Act, issue the revenue bonds hereinafter described and loan the proceeds therefrom to the Borrower in order to allow the Borrower to finance the expansion and improvement of the Project; and

WHEREAS, the City Council of the Issuer has heretofore acted to declare its intention, on December 15, 1982, and November 2, 1983, to cause such revenue bonds to be issued for such purposes on or prior to December 12, 1984, and in an amount not in excess of $3,500,000; and

WHEREAS, the "City of Grand Junction, Colorado, Industrial Development Revenue Bonds Western States Motel Operations, Inc.,--1984--," in the aggregate principal amount of $3,500,000 (the "Bonds"), will be issued, sold and delivered by the Issuer to Mesa United Bank of Grand Junction, National Association, of Grand Junction, Colorado (the "Original Purchaser") pursuant to the Loan Agreement with Mortgage herein authorized and approved, to provide funds in the amount of $3,500,000 to be used by the Borrower for the purpose of financing the Project; and

WHEREAS, there have been or will be presented for approval by the City Council of the Issuer prior to the final adoption of this Ordinance: (a) A Loan Agreement with Mortgage, setting forth the form of the Bonds; (b) a Delivery Certificate and Receipt between the Issuer and the Original Purchaser; and (c) various Issuer Certificates regarding Documents, Arbitrage, and Signature.

NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF GRAND JUNCTION, COLORADO, THAT:

Section 1. All action (not inconsistent with the provisions of this Ordinance) heretofore taken by the City Council and the efforts of the Issuer directed toward financing the Project through the issuance and sale of the Bonds therefor are ratified, approved and confirmed.

Section 2. The Issuer shall finance the Project by lending the process of the Bonds to the Borrower as set forth in the Loan Agreement with Mortgage.

Section 3. To defray the cost of financing the Project, there is hereby authorized and created an issue of revenue bonds designed as the "City of Grand Junction, Colorado, Industrial Development Revenue Bonds Western States Motel Operations, Inc.--1984--," in the aggregate principal amount of $3,500,000, to be dated as of November 30, 1984. The Bonds shall be 20-year amortized bonds, payable monthly, and bear interest from the date of delivery. While interest received by the bondholders is exempt from Federal income taxation, the interest rate will be adjusted annually to be 75% of the weighted average prime rate of United Bank of Denver over the previous year, up to a maximum rate of 15% per annum, all as more fully set forth in the Loan Agreement with Mortgage. As set forth more fully in the Loan Agreement with Mortgage the Bonds may be prepaid at any time without penalty and are subject to call at the end of ten (10) years. Should interest on the Bonds become taxable, the interest rate will be adjusted annually to be 0.5% over the weighted average prime rate of Mesa United Bank of Grand Junction over the previous year, up to a maximum of 25%, all as more fully set forth in the Loan Agreement with Mortgage.

The Bonds shall be issued solely as fully registered bonds, all in accordance with the provisions of the Loan Agreement with Mortgage.

The Bonds shall be in the form provided for in the Loan Agreement with Mortgage. The Bonds shall be sold to the Original Purchaser at a private sale for a purchase price equal to 100% of the principal amount of the Bonds dated as of the date of delivery, all in accordance with the Loan Agreement with Mortgage. The costs and expenses incurred in connection with the issuance of the Bonds, including compensation to the Original Purchaser, shall be paid by the Borrower.

Section 4. The following determinations and findings are hereby made in accordance with the Act:

(a) The Issuer is authorized by the Act to issue the Bonds, and to enter into the Loan Agreement with Mortgage for the public purposes expressed in the Act, and to assign its interest therein to the Original Purchaser.

(b) The Issuer has made the necessary arrangements with the Borrower for the establishment within the Issuer's boundaries of the Project, consisting of certain property more fully described in, and which will accomplish certain public purposes contemplated by, the Act;

(c) The Bonds and the interest accruing thereon shall never constitute the debt or indebtedness of the Issuer within the meaning of any provision or limitation of the Constitution or statutes of the State, and shall not constitute nor give rise to a pecuniary liability of the Issuer or a charge against its general credit or taxing powers; and

(d) The maximum amount necessary in each year to pay the principal of and the interest on the Bonds is as set forth in Exhibit A attached hereto and incorporated herein by reference, and the Loan Agreement with Mortgage requires such payments to be made by the Borrower; and since the Loan Agreement with Mortgage provides that the Borrower shall maintain the Project and carry certain insurance with respect thereto, no determination of the estimated cost of maintaining the Project need be made.

Section 5. The forms, terms and provisions of the Bonds, the various Issuer's Certificates, the Loan Agreement with Mortgage as finally approved by bond counsel and counsel for Issuer be and they hereby are, approved. The Issuer shall enter into the Loan Agreement with Mortgage, issue the Bonds and execute such certificates substantially in the forms of each of such documents presented at the meeting at which this Ordinance is finally adopted, but with such minor changes therein as are inconsistent herewith and as the officers of the Issuer executing such documents shall approve, their execution thereof being deemed conclusive of their approval of any such changes; and the Mayor of the Issuer is hereby authorized and directed to execute and deliver such documents and the City Clerk is hereby authorized and directed to affix the seal of the Issuer to, and to attest, such documents in substantially the forms of each of such documents presented at the meeting at which this Ordinance is finally adopted.

Section 6. The form, terms and provisions of the Bonds, in substantially the form contained in the Loan Agreement with Mortgage, be, and they hereby are, approved; and the President of the City Council is hereby authorized and directed to cause his facsimile signature to be affixed to the Bonds; the City Clerk is hereby authorized and directed to attest the Bonds with her manual signature, and each is authorized to deliver the Bonds in the form contained in the Loan Agreement with Mortgage but with such minor changes therein as are consistent with the Loan Agreement with Mortgage and this Ordinance and as the officers of the Issuer executing the Bonds shall approve, their execution thereof being deemed conclusive of their approval of any such changes. The seal of the Issuer is hereby authorized and directed to be affixed to or imprinted on the Bonds.

Section 7. The officers of the Issuer shall take all action which they deem necessary or reasonably required in conformity with the Act in order to finance the construction and improvement of the Project which is hereby authorized, and for carrying out, giving effect to and consummating the transactions contemplated by this Ordinance, and the Loan Agreement with Mortgage, including without limitation the execution and delivery any closing documents to be delivered in connection with the sale and delivery of the Bonds.

Section 8. The cost of financing the Project, including the paying of incidental issuance expenses, will be paid out of the proceeds of the Bonds. The Bonds together with interest payable thereon are special, limited obligations of the Issuer payable solely as provided in the Loan Agreement with Mortgage. The Bonds or interest payable thereon shall never constitute the debt or indebtedness of the Issuer, the State or any political subdivision thereof within the meaning of any provision or limitation of the Constitution or statutes of the State, nor shall anything contained in this Ordinance or in the Inducement Ordinance, the Bonds, the Loan Agreement with Mortgage or any other instrument constitute or give rise to a pecuniary liability of, or a charge against the general credit or taxing power of, the Issuer, nor shall the breach of any agreement contained in this Ordinance, or any of the above-mentioned documents or instruments, impose any pecuniary liability upon the Issuer, the Issuer having no power to pay out of its general fund or otherwise contribute any part of the costs of financing the Project, nor shall the Issuer condemn any land or other property for the Project nor contribute any land or other property to the Project.

Section 9. After any of the Bonds are issued, this Ordinance shall be and remain irrepealable until all Bonds and interest thereon shall have been fully paid, cancelled and discharged.

Section 10. If any section, paragraph, clause or provision of this Ordinance shall for any reason be held to be invalid or unenforceable, the invalidity or unenforceability of such section, paragraph, clause or provision shall not affect any of the remaining provisions of this Ordinance.

Section 11. All bylaws, orders, resolutions and ordinances, or parts thereof, inconsistent herewith and with the documents hereby approved are hereby repealed to the extent only of such inconsistency. This repealer shall not be construed as reviving any bylaw, order, resolution or ordinance, or part thereof.

Section 12. A public hearing on this Ordinance shall be held at the City Hall in Grand Junction, Colorado, on November 27, 1984, at which time all interested parties may express their views on this Ordinance. Copies of all the documents and instruments referred to herein shall be placed on file in the offices of the City Clerk and of Younge & Hockensmith, P.C., Attorneys at law, and shall be available for inspection by the general public.

Section 13. This Ordinance shall be effective 30 days after the final publication hereof as required by law.

PASSED and ADOPTED this 27th day of November, 1984.

CITY OF GRAND JUNCTION, COLORADO

By

____________________

President of the Council

Attest:

(SEAL)

Neva B. Lockhart, CMC

____________________

City Clerk

AMORTIZATION SCHEDULE

10/17/84

Prepared for Holiday Inn

Grand Junction, CO.

Loan Amount $3,500,000.00

Interest Rate 25.0000%

First Payment Due 1/01/85

Calculated Payment $73,436.20

I HEREBY CERTIFY that the foregoing ordinance, being Ordinance No. 2214, was introduced, read, and ordered published by the City Council of the City of Grand Junction, Colorado, at a regular meeting of said body held on the 17th day of October, 1984, and that the same was published in The Daily Sentinel, a newspaper published and in general circulation in said City, at least ten days before its final passage.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of said City this 27th day of November, 1984.

Neva B. Lockhart

____________________

Neva B. Lockhart, CMC

City Clerk

Published: November 29, 1984