HomeMy Public PortalAbout032-1985- AUTHORIZING AND PROVIDING FOR THE ISSUANCE OF FLOATING RATE DEMAND ECONOMIC DEVELOPMENT REVENUE REFUNDING BONDSORDINANCE NO. 32-1985
ORDINANCE' OF THE CITY OF RIC:HMOND, INDIANA AUTHORIZING AND
PROVIDING FOR THE ISSUANCE OF FLOATING RATE DEMAND ECONOMIC
DEVELOPMENT REVENUE REFUNDING BONDS (BEVERLY
ENTERPRISES-INDIANA, INC_ PROJECT) SERIES 1985 IN A PRINICIPAL
AMOUNT of ,$1.,450,008, TO FINANCE THE REFUNDING OF $1,4501.0Q0
CITY OF RICHMOND, INDIANA ECONOMIC DEVELOPMENT REVENUE BONUS
(BEVERLY ENTERPRISES-INDIANA, INC. PROJECT) 1983 SERIES A,
AUTHORIZING THE EXECUTION OF A LOAN AGREEMENT PROVIDING FOR THE
PAYMENT OF AMOUNTS SUFFICIENT TO PAY THE PRINCIPAL OF, PREMIUM,
IF ANY, AND INTEREST ON SAID BONDS AND PROVIDING FOR THE SALE
LOAN OF. THE PROCEEDS OF THE BONDS TO BEVERLY
ENTERPRISES-INDIANA,INC.; AUTHORIZING THE EXECUTION OF AN
INDENTURE OF TRUST; SETTING FORTH THE TERMS AND CONDITIONS UPON
WHICH SUCH BONDS ARE TO BE ISSUED; AND PROVIDING FOR OTHER
DIATTERS IN CONNECTION WITH THE ISSUANCE, SALE AND DELIVERY OF
THE BONDS.
WHEREAS, the City of Richmond, Indiana (the "Issuer") is a
municipal corporation of the State of Indiana (the "State");
WHEREAS, the Issuer has full power and is duly authorized
by law to issue and sell its obligations :for the purposes
contemplated herein, pursuant to the provisions of the Indiana
Code, §35-7--1-1 et sec o, as amended (the "Act");
WHEREAS, the Issuer issued, sold and delivered $1,450,000
in aggregate principal amount of its Economic Development:
Revenue Bonds (Beverly Enterprises -Indiana, Inc. Project) 198?
Series A (the "Series 1983 Bonds") 'to enable the- Company- to
finance the cost of acquis.ition-, construction and equipping of_ -
nursing home facilities (the "Project") Located ir.-i. f�Tayne
County, Indiana;
WHEREAS; the Issuer now intends to issug-s sell and deliver
its Floating Rate Demand Economic Development Revenue Refunding
Bonds (Beverly Enterprises -Indiana, Inc. Project) Series 1985
(the "Bonds"), to pay the cost of refunding the Series 1.98E
Bonds, including necessary expenses incidental thereto and to
loan such proceeds to the Company by causing such proceeds to
be deposited in an escrow fund created in the hereafter -defined
Indenture to provide funds for the refunding of the Series. 1.983
Bonds;
WHEREAS, the terms and provisions of. said Bonds have now
been substantially deterrained and resolved and. said Bonds
be issued substantially in the form and with the terms and
provisions set forth herein and in the, hereinafter-defi;ied
Indenture;
WHEREAS, the Issuer proposes to execute and deliver a Loan
Agreement dated as of April 1, 1985 (the "Agreement") between
the -.Issuer and Beverly Enterprises --Indiana, Inc. (.the
"Company") pursuant to which Agreement the Issuer will loan the
proceeds from the sale of the Bonds to the: Company;
WHEREAS, the Issuer has determined that the payments
required from the Company under the Agreement will be
sufficient to pay the principal of, premium, if any, and
interest on the Bonds;
- WHEREAS, the Issuer, as security for the Bonds, will
execute the Indenture of Trust dated as of April 1, 1985 (the
"Indenture') between the Issuer and Merchants NE)tional Bank &
Trust Company, Indianapolis, Indiana, as ' trustee (the
"Trustee"), pursuant to which the Issuer will pledge the income
and revenues received under the Agreement as security for the
Bonds, -
WHEREAS, as further security for the Bonds, Beverly
Enterprises (the "Parent") will execute a Guaranty Agreement
dated as of April 1, 1985 (the "Guaranty"), in favor of. the
Trustee, pursuant to which Parent unconditionally guarantees
payment of the principal of, premium, if any, and interest on
the Bonds and the Company's payment obligations under -the
Agreement;
WHEREAS, the Company has advised the Issuer that it will
request that the Issuer sell the Bonds on a negotiated basis to
Stephens Inc. (the "Underwriter") pursuant to a Contract of
Purchase substantially in the form attached hereto; -
WHEREAS, the Underwriter will reoffer the Bands to certain
institutions pursuant to an Official Statement (the "Official
Statement");
WHEREAS, the Act authorizes the issuance of obligations
such as the Bonds for the purpose of purchase, redemption or
payment of outstanding bonds such as the Series 1983 Bends;
WHEREAS, the Issuer desires to authorize the refunding of
the Series 1983 Bonds through the issuance of the Bonds;
WHEREAS, it is necessary that the Issuer designate
Merchants National Bank & Trust ;_ompany, as Trustee under the.
Indenture;
WHEREAS, copies of the forms of the following docume:Its
relating to the transactions described above have been filed
with the Issuer:
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A. The Agreement;
B. The Indenture;
C. The Contract of Purchase;
D. The Guaranty, and
E. The Official Statement.
WHEREAS, on the basis of the foregoing and in connection
with the issuance of the Series 1983 Bonds, the Issuer has
determined that the Project will promote the industrial
development and economy of Wayne County, Indiana (the "County")
and will be of benefit to the inhabitants of the County and the
State and will increase their commerce and promote their
safety, health, welfare, convenience or prosperity, and that
the Issuer, in assisting with the financing of the acquisition,
construction, equipping and installing of the Project and the
refunding of the Series 1983 Bonds, will be acting in
furtherance of the public. purposes of the Act; and
WHEREAS, the Issuer. has determined that it is appropriate
for the Issuer to issue the Bonds and use the proceeds thereof
for the purposes set forth herein.
NOW, THEREFORE, BE IT RESOLVED by the Issuer as follows:
1. It is hereby ascertained, determined and declared as
follows:
A. The Issuer is authorized and empowered by the
.Act to loan the proceeds of the Bends to the Company to
acquires construct, reconstruct, improve, rehabilitate and
equip projects, as described in the Act, including nu):sing
home facilities, including land, rights in land, buildings
and other structures, machinery, equipment, appurtenances
and facilities incidental thereto, and. other improvements.
necessary or convenient therefor, all to improve the
prosperity and welfare of the State and its inhabitants,
to improve living conditions in the State, and to improve
purchasing power and opportunities for gainful employment,
and is further enpowered to issue its revenue refunding
bonds to redeem bonds issued for such purposes.
B. The Project constitutes and will .constitute a
project within the meaning of the Act.
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C. The Project is desirable and will further the
public purposes of the Act, in that it will improve the
health and welfare of the County and the State and their
inhabitants, improve living conditions in the County and
the State, and improve purchasing power and opportunities
for gainful employment, for the Issuer to issue and sell
the Bonds for the purpose of providing funds to refund the
Series 1983 Bonds, as provided herein.
D. The Project is appropriate to the needs and
circumstances of, and shall make a significant
Contribution to the ,growth of the County and the State,
shall provide or preserve gainful employment, and shall
serve. a public purpose by advancing the economic
prosperity and the general welfare of the State and its
people as set forth in the Act.
E. Based upon the Financial information about the
Company and the Parent filed with the Issuer, the Company
and the Parent are financially responsible and fully
capable and willing -to fulfill their obligations under the
Agreement and the Guaranty, including the obligation to
make payments in the amounts and at the times required, to
operate, maintain and repair the Project at their own
expense and to carry out the other responsibilities to be
imposed under the Agreement, due consideration having been
given to the Company's and the Parent's ratio of current
assets to current liabilities, nef.worth, earning trends,
coverage of all fixed charges, the nature of the nursing
home industry, its inherent stability, and other factors
determinative of the capability of the Company and the
Parent, financially and otherwise, to fulfill their
obligations consistently with the purposes of the tact.
F. Adequate provision is made under the Agreement
for the operation, repair and maintenance of the Project
at the expense of the Company and for- the payment of the
principal of, premium, if any, and interest on the Bonds -
when and as the same become due and payable, and for the
payment by the Company of all other costs incurred in
connection with the financing, construction and
administration of the Project and the refunding of the
Series 1983 Bonds which are not paid out of the proceeds
from the sale of the Bonds or otherwise.
G. The costs to be paid from the proceeds of the
Bonds shall be costs of a project within the meaning of
the Act.
H. A negotiated sale of the Bonds is required and
necessary, and is in the best interest of the Issuer, For
the following reasons: the Bonds will be special and
limited obligations of the Issuer payable solely out of
revenues and proceeds derived by the Issuer from the
Project, and the Company will be obligated for the payment
of all costs in connection with the financing,
construction and administration of the Project which are
not paid out of the Bond proceeds or otherwise and for
operation and maintenance of the Project; the cost of
issuance of the Bonds, which will be borne directly or
indirectly by the Company, would be greater if the Bonds
are sold at public sale by competitive bids than if the
Bonds - are sold at negotiated sale, and a public sale by
competitive bids would cause undue delay refunding the
Series 1983 Bonds; revenue bonds having the
characteristics of the Bonds are typically and usually
sold at negotiated sale; the Company has indicated that it
may be unwilling to proceed with - the Project unless a
negotiated sale of the Bonds is authorized by the Issuer;
and authorization pf a negotiated sale of the Bonds is
necessary in order to serve the purposes of the Act.
I. The purposes of the
served by the acquisition,
installing of the Project by
the Agreement.
Act will be most effectively
construction, equipping and
the Company, as provided in
2. The refunding of the Series 1983 Bonds as provided in
the Agreement and the Indenture is hereby authorized.
3. For the purpose of paying- the cost, in whole or in
part, of refunding the Series 1983 Bonds, the issuance of
revenue bonds of the Issuer to be known as City of Richmond,
Indiana Floating Rate Demand Economic Development Revenue
Refunding Bonds (Beverly Enterprises -Indiana. Inca Project)
Series 1985, is hereby authorized. The Company has agreed that
if Bond proceeds are not- sufficient to pay all of the costs of
refunding the Series 1983 Bonds,. including payment of principal
of, accrued interest on and costs of issuance, the Company will
pay all such excess costs in order to complete the refunding of
the Series 1983 Bonds. Any such payments made by the Company
shall. in no manner affect or reduce the payments required by
the Agreement.
9. The Bonds will be dated their date of authentication,
except as provided in the Indenture, and shall mature on
September 1, 2008. Prior to the Conversion Date (as defined in
the Indenture), the Bonds shall bear interest at a floating
rate not to exceed fifteen percent (15a) per annum, and from
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and after the Conversion. Date,
a fixed rate calculated as set
provided in the Indenture.
the Bands will bear interest at
forth in the Indenture, all as
The Bonds are issued pursuant to the provisions of the Act
and are not'in any respect a general obligation of the City ❑f
Richmond, Indiana, the State, or any political subdivision
thereof, nor are they payable in any manner from revenues
raised by taxation, but such Bonds shall be payable solely from
the revenues and moneys pledged therefor.
The form of the Bonds and the provisions for signatures,
authentication, payment, registration and redemption- shall be
substantially as set forth in the Indenture hereinafter
authorized. -
The Bonds shall be issued in a principal amount ❑f
$1,450,000.
5. The payments to be made by the Company under the
Agreement (other than payments of certain expenses of Issuer
relating to the Project and the Bonds) are sufficient to pay
the principal of, premium, if any, and interest on the Bonds as
the same become due and payable, and said payments shall be
pledged for that purpose pursuant to the Indenture.
5. The execution, delivery and performance of the
Agreement and the Indenture are hereby authorized. The
Agreement and the Indenture shall be in substantially the forms
submitted at this meeting, with such changes, insertions or
omissions as may be approved by the Mayor of the Issuer, whose
approval thereof shall be conclusively evidenced by his
execution of each such instrument,
7. The execution and delivery of the Bonds to the Agent
for authentication and the authentication and redelivery of the
authenticated Bonds to or upon the order of the 'original,
purchaser thereof ❑r its duly authorized attorney--in-fact
against receipt by the Agent of the purchase price for the
Bonds, are hereby authorized.
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8. The Clerk or deputy Clerk of the Issuer is hereby
authorized to attest and affix the seal of the Issuer to the
Bonds, the Indenture. the Agreement, and any other document
executed by the Mayor of the Issuer pursuant to this Ordinance.
9. Merchants National Bank & Trust Company,
Indianapolis, Indiana is hereby designated Trustee under the
Indenture, and The Barak of New York is appointed Agent and bond
registrar for the Bonds.
10_ The preparation and use of the Official Statement by
the Underwriter in connection with the sale of the Bonds is
hereby ratified, confirmed and approved.
11. The acceptance, execution, delivery and performance
of the Contract of Purchase is hereby authorized. Such.
document shall be in substantially the form submitted to this
meeting, with such changes, insertions or omissions as may be
approved by the Mayor of the Issuer whose approval thereof
shall be conclusively evidenced by his execution of such
instruments. The Mayor ..of the Issuer is hereby authorized to
execute the Contract of Purchase and the official Statement.
12. The use of the proceeds from the sale of the Bonds to
refund by redemption the Series 1983 Bonds is hereby
authorized. Merchants National Bank & Trust Company as trustee
under the Indenture of Trust pursuant to which the Series 1983
Bonds were issued is authorized to give the notice of
redemption required thereunder at such time as directed by the
Company or the Parent, provided that such redemption of the
Series 1983 Bonds shall be completed within 180 days from the
date of issuance of the Bonds.
13. The Mayor of the Issuer and Cleric or Deputy Clerk of
the Issuer are hereby authorized to do and perform all s�:_ch
things and acts as' each shall deem necessary or appropriate in
furtherance of the issuance of the Bonds and the carrying out
of the transactions authorized by this Ordinance or
contemplated by the instruments referred to in this Ordinance.
14_ The Mayor of the Issuer- is authorized to Amake an
election pursuant to Section 103(b)(6)(D) of the Internal
Revenue Code of 1954, as amended, and to sign and file or cause
to be filed all documents necessary to accomplish and perfect
such election and such election and all actions heretofore made
and taken or caused to be taken are in all respects approved.,
ratified and confirmed.
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15. The Indenture, the Agreement, the Contract of
Purchase and the Guaranty are incorporated herein by reference
hereto.
16. The mayor of the Issuer and the Clerk or Deputy Clerk
are hereby authorized to approve any changes in any of the
documents lasted in paragraph 15 above without any further
action of the Issuer if such changes do not in the opinion of
counsel to the Issuer materially adversely affect. the rights
and obligations of the Issuer under the aforesaid documents_
17. vo covenant, obligation or agreement herein contained
or contained in the Indenture or the Agreement shall be deemed
to be a covenant, obligation or agreement of any officer,
member, agent or employee of the Issuer in his individual
capacity, and no such officer, member, agent or employee of the
issuer shall be personally liable on the Bonds or be subject to
personal liability or accountability by reason of the issuance
thereof.
18. The actions pf the Issuer herein described are
undertaken only upon the condition that the company and the
Parent, agree by its acknowledgment and acceptance hereof as
shown below, to indemnify, defend and hold the Issuer and - its
officers, members, agents, or employees harmless from and
against any pecuniary liability, loss or damage, including
claims, allegations, actions, suits or proceedings, and
specifically including but not limited -`to any thereof arising
out of or in connection with, arising out of or predicated upon
the authorization, offering, underwriting, sale or issuance of
the Bonds or the acquisition, construction,- equipping,
ownership, operation, or maintenance of the Project, and to
reimburse or otherwise pay on behalf of the Issuer ayj.Y and 8.11
expenses incurred by the Issuer its officers, members, agents
or employees, including but not :limited to attorneys fees and
costs of legal or administrative proceedings f in, cannecti.oz7
with any of the foregoing. This indemnity shall be superseded
by a similar indemnity from the Company contained in the
Agreement executed in connection with the issuance of the
Bonds, and if the Bonds are. not issued and delivered, this
indemnity shall survive the termination or revocation of this
Ordinance.
19. if any section, paragraph, clause or provision of
this Ordinance shall be held invalid, the invalidity thereof
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shall not affect the remaining provisions..
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20. The dates of any of the documents referred to herein
may be changed without any further action by the Issuer, and
the eiecution of the same by the Mayor of the Issuer shall be
sufficient in all respects to evidence the approval of said
change by the Issuer.
. 21. All motions, orders, resolutions, and parts thereof,
in -conflict herewith, are hereby repealed, and this Ordinance
shall take effect and be in force immediately after its passage
and approval.
Adopted this lst day of April, 1985.
ATTEST :
(SEAL)
Clerk
CITY OF RICHMOND, INDIANA
f
By
�?�/e iding Off:Lce'�of �the
Common Council
Presented by me to the Mayor of
the City of Richmond, Indiana on the
day of , 1985, at the
hour of /a: ao o`clock ra .m.
Clerk
ay
�=day
d and signed by me on
of 4, 1985,
at the hour of oico o clock Iq .m.
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