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HomeMy Public PortalAbout025-1998 - Authorizes EC Revenue Bonds - Stagood Co. for Lease to NorthlandORDINANCE NO. 25-1998 AN ORDINANCE AUTHORIZING THE ISSUANCE OF NOT TO EXCEED $1,355,000 AGGREGATE PRINCIPAL AMOUNT OF ECONOMIC DEVELOPMENT REVENUE BONDS, SERIES 1998 (NORTHLAND CORPORATION PROJECT) OF THE CITY OF RICHMOND, INDIANA, THE PROCEEDS OF WHICH SHALL BE LOANED TO STAGOOD COMPANY TO (A) FINANCE THE ACQUISITION, CONSTRUCTION, INSTALLATION AND EQUIPPING OF AN ECONOMIC DEVELOPMENT FACILITY FOR LEASE TO NORTHLAND CORPORATION, D/B/A/ MARVEL INDUSTRIES AND (B) REFUND AN ISSUE OF ECONOMIC DEVELOPMENT REVENUE BONDS PREVIOUSLY ISSSUED BY THE CITY OF RICHMOND TO FINANCE ECONOMIC DEVELOPMENT FACILITIES, PROVIDING FOR THE PLEDGE AND ASSIGNMENT OF REVENUES FOR THE PAYMENT OF SAID BONDS, AUTHORIZING A BOND PURCHASE AND LOAN AGREEMENT WITH RESPECT TO THE BONDS AND LEASE AGREEMENT WITH RESPECT TO THE PROJECT, AND AUTHORIZING OTHER ACTIONS IN CONNECTION WITH THE ISSUANCE OF SUCH BONDS. WHEREAS, the City of Richmond, Indiana (the “Issuer”), is a municipal corporation and political subdivision of the State of Indiana, and by virtue of the constitution and laws of the State, including Indiana Code, Title 36, Article 7, Chapters 11.9 and 12, as supplemented and amended and Title 5, Article 1, Chapter 5, as supplemented and amended (collectively, the “Act”), is authorized and empowered, among other things, to (a) provide funds for the acquisition, construction, installation and equipping of economic development facilities, (b) issue its revenue bonds for the purpose set forth herein; (c) secure such revenue bonds by a pledge and assignment of revenues and other documents as provided for herein; and (d) enact this Ordinance (the “Bond Ordinance”), execute the Loan Agreement (hereinafter identified) and all other documents to be executed by it, upon the terms and conditions provided therein; and WHEREAS, the City Council of the Issuer (the “City Council”) has found and determined, and does hereby confirm, that the economic development facilities to be acquired or refinanced with the proceeds of the Bonds herein authorized will increase business opportunities within the City of Richmond, Indiana, and will be to the benefit of the health and general welfare of the citizens of Richmond, Indiana, and that the Issuer, by assisting with the financing of such economic development facilities through the issuance of revenue bonds in the aggregate principal amount not to exceed $1,450,000, will be acting in a manner consistent with and in furtherance of the provisions of the Act; and WHEREAS, pursuant to a Bond Purchase and Loan Agreement (the “Loan Agreement”), dated the date of issuance of the Bonds, among the Issuer, Stagood Company, a Michigan Co-Partnership (the ”Borrower”), and Peoples Loan and Trust Bank, an Indiana banking corporation (the ”Original Purchaser”), the Issuer proposes to issue an amount not to exceed $1,450,000 of its Economic Development Revenue Bonds, Series 1998 (Northland Corporation Project) to provide funds for the (a) acquisition, construction, installation and equipping of an approximate 47,200 square foot addition to an existing manufacturing facility and an approximate 5,000 square foot office addition, together with the purchase of machinery and equipment to be utilized therein, to be located on the Borrower’s existing facility at 233 Industrial Parkway, Richmond, Indiana 47374 (the ”Project”) and (b) the refunding of the outstanding principal balance of the Issuer’s $900,000 Economic Development First Mortgage Revenue Bonds, Series 1974 (Elder/Wilbert Corp.) (the “Prior Bonds”), which Prior Bonds were assumed by the Borrower, by lending such funds to the Borrower Pursuant to the Loan Agreement which prescribes the terms and conditions under which the Borrower shall repay such loan and pursuant to which the Borrower will execute and deliver to the Issuer its promissory note (the ”Project Note”) in the principal amount equal to the aggregate principal amount of the Bonds; and WHEREAS, the Borrower will lease the real and personal property constituting the Project to Northland Corporation d/b/a Marvel Industries (the “Lessee”) pursuant to a written lease agreement Northland Corporation, d/b/a Marvel Industries, a Michigan Corporation, an economic development facility within the meaning of the Act, and WHEREAS, it is determined by the Issuer that the amount necessary to (a) finance the costs of or related to the acquisition, construction, installation and equipping of the Project and (b) refund the Prior Bonds, will require the issuance, sale and delivery of not to exceed $1,450,000 $1,450,000 aggregate principal amount of Economic Development Revenue Bonds, Series 1998 (Northland Corporation Project) (the ”Bonds”); NOW, THEREFORE, BE IT ORDAINED BY THE COMMONCOUNCIL that: Section 1. Definitions. In addition to the words and terms defined in this Bond Ordinance, the words and terms used in this Bond Ordinance shall have the meanings set forth in the Loan Agreement, the Project Note and in the form of the Bonds unless the context or use indicates another or different meaning or intent, which forms are before this meeting, are hereby incorporated by reference in this Bond Ordinance and the Clerk of the Issuer is hereby directed to insert them into the minutes of the Issuer and to keep them on file as specified in Section 12 hereof. Any reference herein to the Issuer, or to any officers thereof, shall include those which succeed to their functions, duties or responsibilities pursuant to or by operation of law or who are lawfully performing their functions. Unless the context shall otherwise indicate, words importing the singular number shall include the plural number and vice versa, and the terms “hereby”, “hereto”, “hereunder”, and similar terms, mean this Bond Ordinance. Section 2. Determination of Issuer. At a meeting open to the public held on February 2, 1998 by the Richmond Economic Development Commission (the “Commission”), the Commission adopted a Report and Findings of Fact, finding, among other things, that the proposed financing will be of benefit to the health and general welfare of the citizens of Richmond, Indiana and complies with the provisions of the Act. The City Council hereby acknowledges the Commission’s Report and Findings of Fact. At a meeting open to the public held on March 2, 1998 by the Commission, the Commission adopted a Resolution (the ”Approving Resolution”) and the Issuer has received from the Commission such Approving Resolution wherein the Commission finds that the proposed financing will be of benefit to the health and general welfare of the citizens of Richmond, Indiana and that the proposed financing complies with the provisions of the Act, and further recommending this form of Bond Ordinance for approval by this City Council. Based upon the Report, Findings of Fact and Approving Resolution of the Commission, the Issuer hereby finds and determines that the financing approved by the Commission in such Approving Resolution will be of benefit to the health and general welfare of the citizens of Richmond, Indiana and complies with the provisions of the Act. Pursuant to the provisions of Indiana Code 36-7-12-24(a) and Section 147(f) of the Internal Revenue Code of 1986, as amended (the “Code”), the Commission held a public hearing at 5:00 p.m. on Monday, March 2, 1998 regarding the Project wherein in any persons desiring to speak for or against the Project were given a reasonable opportunity to express their views, both orally and in writing. Section 3. Authorization of the Bonds. It is hereby determined to be necessary to, and the Issuer shall, issue, sell and deliver, as provided and authorized herein and pursuant to the authority of the Act, Bonds in the maximum aggregate principal amount of not to exceed $1,450,000, designated as “City of Richmond, Indiana Economic Development Revenue Bonds, Series 1998 (Northland Corporation Project), “the pr9ceeds of which will be held by the Original Purchaser under the Loan Agreement and used to make a loan to the Borrower to (a) pay the cost of the acquisition, construction, installation and equipping of the Project, which Project will be leased to the Lessee for use as an economic development facility within the meaning of the Act and (b) refund the Prior Bonds. Section 4. Terms and Execution of the Bonds. The Bonds shall be issued as fully registered Bonds, without coupons, in the denominations set forth in the Loan Agreement, numbered consecutively as set forth in the Loan Agreement, and shall be payable at the office of the Original Purchaser and mature as provided in the Loan Agreement. The Bonds shall have such terms, bear such interest rates (but in no event in excess of 15% per annum), and be subject to mandatory and optional redemption as provided in the Lon Agreement heretofore presented to the Issuer. The Bonds shall be executed on behalf of the Issuer by the manual or facsimile signatures of the Mayor of the Issuer and the Clerk of the Issuer, and the seal of the Issuer shall be impressed thereon or a facsimile of such seal placed therein. In case any officer whose signature or a facsimile thereof shall appear on the Bonds shall cease to be such officer before the issuance or delivery of the Bonds, such signature or facsimile thereof shall nevertheless be valid and sufficient for all purposes, the same as if he had remained in office until after that time. The form of the Bonds submitted to this meeting, subject to appropriate insertions and revisions in order to comply with the provisions of the Loan Agreement, be and the same is hereby approved, and when the same shall be executed on behalf of the Issuer by the appropriate officers thereof in the manner contemplated by the Loan Agreement in an aggregate principal amount not to exceed $1,450,000 shall represent the approved form of Bonds of the Issuer. The Bonds are special, limited obligations of the Issuer payable solely from payments of principal of, premium if any, and interest on the Bonds made by the Borrower under the Project Note and the Loan Agreement except to the extent that the principal of premium, if any, and interest on the Bonds may be paid out of money attributable to Bond proceeds or from temporary investments thereof. Section 5. Arbitrage Provisions. Subject to the obligations of the Borrower and the Lessee set forth in the Loan Agreement, the Tax Compliance Certificate and the Principal User’s Tax Compliance Certificate, the Issuer will use its best efforts to restrict the use of the proceeds of the Bonds in such a manner and to expectations at the time the Bonds are delivered to the purchasers thereof, so that they will not constitute arbitrage bonds under Section 148 of the Code and the regulations prescribed under that Section. The Mayor of the Issuer and the Clerk of the Issuer, or any other officer having responsibility with respect to the issuance of the Bonds, are authorized and directed, alone or in conjunction with any of the foregoing, or with any other officer, employee, consultant or agent of the Issuer, to deliver a certificate for inclusion in the transcript of proceedings for the Bonds, setting forth the facts, estimates and circumstances and reasonable expectations pertaining to said Section 148 and regulations thereunder. The Clerk, or other appropriate officer of the Issuer, shall furnish to the Original Purchaser a true transcript of proceedings, certified by said officer, of all proceedings had with reference to the issuance of the Bonds, along with such information for the records as is necessary to determine the regularity and validity of the issuance of the Bonds. Section 6. Loan Agreement, Project Note, Lease Agreement and all other Documents to be Executed or Accepted by the Issuer. In order to better secure the payment of the principal of, premium, if any, and interest on the Bonds as the same shall become due and payable, the Mayor of the Issuer and the Clerk of the Issuer are authorized and directed to execute, acknowledge and deliver, in the name and on behalf of the Issuer, the Loan Agreement and the Project Note, and all other material documents and assignments to be executed or accepted by it in substantially the forms submitted to the City Council, which are hereby approved, with such changes therein not inconsistent with this Bond Ordinance and not substantially adverse to the Issuer as may be permitted by the Act and approved by the officers executing the same on behalf of the Issuer without further approval of the City Council or of the Commission if such changes do not affect terms set forth in I. C. 36-7-12-27(a)(1)through(a)(10). The approval of such changes by such officers to the extent such are not substantially adverse to the Issuer, shall be conclusively evidenced by the execution or acceptance of receipt of any of the foregoing document by such officers. The Issuer hereby approves the Lease Agreement in substantially the form submitted to the Issuer, in connection with the issuance, sale and delivery of the Bonds. Section 7. Covenants of the Issuer. In addition to other covenants of the Issuer in this Bond Ordinance, the Issuer further covenants and agrees as follows: (a) Payment of Principal, Premium and Interest. The Issuer will, solely from the sources herein provided, pay or cause to be paid the principal of, premium, if any, and interest on each and all Bonds on the Dates, at the Places and in the manner provided herein and in the Bonds, and in all other documents referred to herein. (b) Performance of Covenants, Authority and Actions. The Issuer will at all times faithfully observe and perform all agreements, covenants, undertakings, stipulations and provisions contained in the Loan Agreement executed and delivered, or received, under this Bond Ordinance, and in all other proceedings of the Issuer pertaining to the Loan Agreement. The Issuer warrants and covenants that it is, and upon delivery of the Bonds will be, duly authorized by the laws of the State of Indiana, including particularly and without limitation, the Act, to issue the Bonds and to execute the Loan Agreement, and all other documents to be executed or received by it, to provide the security for payment of the principal of, premium, if nay, and interest on the Bonds in the manner and to the extent herein set forth, that all actions on its part for the issuance of the Bonds and execution or acceptance and delivery of the Loan Agreement and all other documents to be executed or accepted by it have been or will be duly and effectively taken; and that the Bonds will be valid and enforceable special, limited obligations of the Issuer according to the terms thereof. Each provision of this Bond Ordinance, each Bond and all other documents to be executed by the Issuer is binding upon such officer of the Issuer as may from time to time have the authority under law to take such actions as may be necessary to perform all or any part of the duty required by such provision, and each duty of the Issuer and of its officers and employees undertaken pursuant to such proceedings for the Bonds and all other documents to be executed by the Issuer is established as a duty of the Issuer and of each such officer and employee having authority to perform such duty. Section 8. No Personal Liability. No Recourse under or upon any obligation, covenant, acceptance or agreement contained in this Bond Ordinance, or in the Bonds, the Loan Agreement, or under any judgment obtained against the Issuer or by the enforcement of any assessment or by any legal or equitable proceeding by virtue of any constitution or statute or otherwise, or under any circumstances, under or independent of the Loan Agreement, shall be had against any member, director, or officer or attorney, as such, past, present, or future, of the Issuer, either directly or through the Issuer, or otherwise, for the payment for or to the Issuer or any receiver thereof, or for or to any holder of the Bonds secured thereby, or otherwise, of any sum that may be due and unpaid by the Issuer upon any of such Bonds. Any and all personal liability of every nature, whether at common law or in equity, or by statute or by constitution or otherwise, of any such member, director, or officer, or attorney, as such, to respond by reason of any act or omission on his or her part, or otherwise, of any sum that may remain due and unpaid upon the Bonds hereby secured or any of them, shall be expressly waived and released as a condition of and consideration for the execution and delivery of the Loan Agreement and the issuance of the Bonds. Section 9. No Debt or Tax Pledge. The Bonds shall not constitute a debt or pledge of the faith and credit of the State or any political subdivision thereof, and the holders or owners thereof shall have no right to have taxes levied by the State or taxing authority of any political subdivision for the payment of the principal thereof or interest thereon. Moneys raised by taxation shall not be obligated or pledged for the payment of principal of or interest on the Bonds, and the Bonds shall be payable solely from the revenues and security interests pledged for their payment as authorized by the Loan Agreement. Section 10. Severability. If any section, paragraph or provision of this Bond Ordinance shall be held to be invalid or unenforceable for any reason, the invalidity or unenforceability of such section, paragraph or provision shall not affect any of the remaining provisions of this Bond Ordinance. Section 11. Repeal of Conflicting Ordinances and Resolution. All ordinances, resolutions and orders, or parts, thereof, in conflict with the provisions of this Bond Ordinance are, to the extent of such conflict, hereby repealed. Section 12. Public Inspection. A copy of the Loan Agreement and the form of the City of Richmond, Indiana Economic Development Revenue Bonds, Series 1998 (Northland Corporation Project) are on file in the office of the Clerk of the Issuer for public inspection. Section 13. Compliance with Open Door Law. It is hereby determined that all formal actions of the City Council relating to the adoption of this Bond Ordinance were taken in an open meeting of the City Council, that all deliberations of the City Council and of its committees, if any, which resulted in formal action, were in meetings open to the public, and that all such meetings were convened, held and conducted in compliance with applicable legal requirements, including Indiana Code 5-14-1.5, et seq., as supplemented and amended. Section 15. Effective Date. This Bond Ordinance shall be in full force and effect upon compliance with Indiana Code 36-4-6 et seq. The foregoing was passed by the City Council this 2nd day of March. 1998. s/s Bruce Wissel, President (Bruce Wissel) ATTEST: s/s Norma Schroeder, City Clerk (Norma Schroeder) PRESENTED to the Mayor of the City of Richmond, Indiana, this 3rd day of March, 1998, at 9:00 a.m. s/s Norma Schroeder, City Clerk (Norma Schroeder) APPROVED by me, Dennis Andrews, Mayor of the City of Richmond, Indiana, this 3rd day of March, 1998, at 9:05 a.m. s/s Dennis Andrews, Mayor (Dennis Andrews) ATTEST: s/s Norma Schroeder, City Clerk (Norma Schroeder)