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HomeMy WebLinkAbout9722-06 Authorizing the sale of an Aggregate Principal amount not to exceed $8,500,000ORDINANCE No. s~~=os Passed by the Common Council of the Ciry of South Bend, Indiana November 27, 20 06 Attest: JOHN OR ~. Attest: Presented by me to the Mayor of the Ciry of Soutli Bend, Indiana November 28, 2~ 06 City Clerk President of Common Council Approved and signed by me November 29 2006 Ciry Clerk ~/~~~~r~ ~~`` `~`n Mme. ORDINANCE NO. ~ ~ ZZ-~~ AN ORDINANCE AUTHORIZING THE ISSUANCE AND SALE OF AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED EIGHT MILLION FIVE HUNDRED THOUSAND DOLLARS ($8,500,000) OF THE CITY OF SOUTH BEND, INDIANA VARIABLE RATE ECONOMIC DEVELOPMENT REVENUE BONDS, SERIES 2007 (PEI/GENESIS PROJECT); DESIGNATING THE BONDS AS LIMITED OBLIGATIONS OF THE CITY; APPROVING THE FORM OF, AND AUTHORIZING THE EXECUTION AND DELIVERY OF, THE TRUST INDENTURE, LOAN AGREEMENT AND OTHER DOCUMENTS RELATED TO THE ISSUANCE AND SALE OF THE BONDS; AND AUTHORIZING PROPER OFFICERS TO DO ALL OTHER THINGS DEEMED NECESSARY OR ADVISABLE IN CONNECTION THEREWITH AND APPROVING AND AUTHORIZING OTHER ACTIONS IN RESPECT THERETO. STATEMENT OF PURPOSE AND INTENT The City of South Bend, Indiana (the "C~") is a political subdivision of the State of Indiana, and by virtue of Title 36, Article 7, Chapters 11.9 and 12, of the Indiana Code, as amended (the "Act"), is authorized and empowered to adopt this Ordinance and to carry out its provisions. The South Bend Economic Development Commission (the "Commission") has rendered its report concerning the proposed financing and refinancing of economic development facilities for PEUGenesis, Inc., a Pennsylvania corporation ("PEl') and Tuliptree Associates, LLC, a Pennsylvania limited liability company ("Tuliptree") (PEI and Tuliptree, collectively, the "Borrower"). The Commission, after a public hearing held on November 17, 2006, has adopted a Resolution, which has been transmitted to this Council, (i) finding that the acquisition, construction and equipping by the Borrower of the proposed economic development facilities to be f nanced and the economic development facilities to be refinanced (collectively, the "Pr ,iect") will not have an adverse competitive effect on any similar facilities already constructed or operating in or about the City, (ii) further finding that the proposed financing and refinancing of the Project will be of benefit to the health and general welfare of the City and its citizens, (iii) further finding that the proposed financing and refinancing of the Project complies with the purposes and provisions of the Act, (iv) approving the financing and refinancing of the Project, including the form and terms of the Loan Agreement, the Bonds from the City to the bondholders and the Trust Indenture, more fully described below, and this Ordinance, presented to the Commission, and (v) recommending that this Council find that the proposed financing and refinancing of the Project will be of benefit to the health and general welfare of the City and its citizens, and complies with the purposes and provisions of the Act, and that this Council adopt an ordinance approving such financing. This Council believes it is in the best interests of the City and its citizens to provide a program for financing and refinancing economic development facilities for developers or users thereof through the issuance of taxable or tax-exempt bonds. The City, as requested by the Borrower, has determined to issue, sell and deliver the City of South Bend, Indiana Variable Rate Economic Development Revenue Bonds, Series 2007 (PEUGenesis Project) in an aggregate principal amount not to exceed $8,500,000 to make funds available for the Project (the "Bonds"). The City desires to sell the Bonds through an underwritten offering pursuant to a Bond Purchase Agreement (the Bond Purchase Agreement"), among the City, the Borrower and NatCity Investments, Inc. (the "Underwriter"). There have been submitted to this Common Council (the "CounciP') proposed forms of: (i) the Trust Indenture (the "Indenture") between the City and U.S. Bank National Association, as trustee (the "Trustee"), pursuant to which the Bonds will be issued; (ii) the Loan Agreement (the "Loan A,Qreement") between the City and the Borrower; and (iii) the Bond Purchase Agreement pursuant to which the Bonds will be sold. NOW, THEREFORE, BE IT ORDAINED BY THE COMMON COUNCIL OF THE CITY OF SOUTH BEND, INDIANA AS FOLLOWS: SECTION 1. Incorporation of Recitals. The recitals contained in this Ordinance are true and correct and are incorporated in this Ordinance by this reference. SECTION 2. Findings; Public Benefits. This Council finds that the facilities that constitute the Project to be financed and refinanced as described in said Loan Agreement are "economic development facilities" within the meaning of the Act and that such facilities will not have an adverse competitive effect on any similar facilities already constructed or operating in or about the City. This Council further finds that the proposed financing and refinancing of the Project will be of benefit to the health and general welfare of the City and its citizens. This Council further finds that the proposed financing and refinancing of the Project complies with the purposes and provisions of the Act. SECTION 3. Issuance of the Bonds. The Council hereby authorizes, as part of a program for financing and refinancing the aforementioned economic development facilities, the issuance of an aggregate principal amount not to exceed $8,500,000 of the Bonds by the City, for the purpose of procuring funds to loan to the Borrower in order to finance and refinance the 2 Project, costs of issuance of the Bonds, and expenses related thereto. The Bonds shall be dated the date set forth in the Indenture, and shall be fully registered without coupons. The Bonds shall be payable in the medium and at the place or places, shall bear interest, shall have maturities not exceeding twenty-five (25) years from the date of issuance and shall have redemption terms as set forth in the Indenture approved by the Mayor (the "Executive") and the City Clerk (the "Cler1~'). The Bonds shall be executed on behalf of the City by, and bear the manual or facsimile signature of, the Executive and Clerk, and the seal of the City shall be thereunto affixed (or imprinted or engraved if in facsimile). The Bonds shall be in the form set forth in the final form of the Indenture. The City hereby elects to apply the provisions of Section 144(a)(4) of the Internal Revenue Code of 1986, as amended, to the Bonds, to increase the amount of qualified small issue bonds which it may issue for the Project from One Million Dollars ($1,000,000) to Ten Million Dollars ($10,000,000). SECTION 4. Limited Obli ag_tion. THE BONDS AND THE INTEREST THEREON DO NOT AND SHALL NEVER CONSTITUTE AN IlVDEBTEDNESS OF, OR A CHARGE AGAINST THE GENERAL CREDIT OR TAXING POWER OF, THE CITY, BUT ARE LIMITED OBLIGATIONS OF THE CITY PAYABLE SOLELY FROM REVENUES AND OTHER AMOUNTS DERIVED FROM THE LOAN AGREEMENT. SECTION 5. Approval of Financing~Documents. The Indenture, the Loan Agreement and the Bond Purchase Agreement are hereby approved in the forms submitted to this meeting, and a copy of each such document shall be kept on file by the Clerk. The Executive and the Clerk are hereby authorized and directed to execute and deliver such documents without further approval of the Council in substantially the forms herein approved with such additions, deletions and modifications thereto as may be approved under the Act, the execution thereof being conclusive evidence of such approval and of the approval of the Council; and the Clerk, or any authorized representative of the City, is hereby authorized and directed to affix the seal of the City to such documents and to attest the same. Two copies of the Indenture, the Loan Agreement and the Bond Purchase Agreement, hereby incorporated into this Ordinance, were duly filed in the Office of the Clerk and are available for public inspection in accordance with Section 36-1-5-4 of the Indiana Code. SECTION 6. Trustee. U.S. Bank National Association is hereby appointed as the initial Trustee under the Indenture. The Indenture may provide that the Trustee hereunder, or another corporate entity, shall act as the bond registrar and authenticating agent, and may provide for a co-trustee. SECTION 7. Delivery of Bonds. After execution on behalf of the Executive and the Clerk, the Bonds shall be delivered to the Trustee, which is hereby authorized and requested to authenticate and deliver the Bonds to or upon the order of the Underwriter, or to any depository, in accordance with and upon compliance with the provisions of the Indenture. The Council hereby authorizes the sale of the Bonds pursuant to the Bond Purchase Agreement. 3 SECTION 8. State Securities Law Actions. The Executive and the Clerk are hereby authorized in the name and on behalf of the City to take any and all action which the Executive and the Clerk may deem necessary or advisable with the advice of counsel for the City in order to effect the registration or qualification (or exemption therefrom) of the Bonds for issue, offer, sale or trade under the Blue Sky or securities laws of any of the states of the United States of America and in connection therewith, to execute, acknowledge, verify, deliver, file or cause to be published any applications, reports, consents to service of process and other papers and instruments which may be required under such laws, and to take any and all further action which such official of the City may deem necessary or advisable in order to maintain any such registration or qualification for as long as the Executive and the Clerk deem necessary or as required by law, provided, however, the Executive and the Clerk need not consent to service of process in any jurisdiction other than the State of Indiana. SECTION 9. Other Action. The Executive and the Clerk are hereby authorized and directed to execute and deliver, in the name and on behalf of the City, any and all additional documents and instruments necessary or proper and to do and cause to be done any and all acts and things necessary or proper for carrying out the transactions contemplated by this Ordinance (including the recitals hereto and the documents mentioned herein) and the issuance and sale of the Bonds. The Executive and Clerk may, by their execution of the documents requiring their signatures or imprinting of their facsimile signatures thereon, approve changes therein and also in those documents which do not require the signature of the Executive and/or Clerk without further approval of this Council if such changes do not affect terms set forth in Indiana Code Title 36, Article 7, Chapter 12, Section 27(a)(1) through (a)(10). SECTION 10. No Personal Liability. No stipulation, obligation or agreement herein contained or contained in the Indenture, the Loan Agreement, the Bond Purchase Agreement, the Bonds or in any other agreement or document executed on behalf of the City shall be deemed to be a stipulation, obligation or agreement of any member of the Council, or any officer, agent or employee of the City in his or her individual capacity, and no such member of the Council, officer, agent or employee shall be personally liable on the Bonds or be subject to personal liability or accountability by reason of the issuance thereof. SECTION 11. Action Approved and Confirmed. All acts of the officers of the City which aze in conformity with the purpose and intent of this Ordinance and in the furtherance of the issuance of the Bonds and the execution, delivery and performance of the documents and agreements authorized hereby are in all respects ratified, approved and confirmed. SECTION 12. Severability. If any provision of this Ordinance shall be held or deemed to be illegal, inoperative or unenforceable, the same shall not affect any other provision or cause any other provision to be invalid, inoperative or unenforceable to any extent whatsoever. SECTION 13. No Conflict. Any ordinances, resolutions or orders or parts thereof in conflict with this Ordinance are to the extent of such conflict hereby repealed. 4 SECTION 14. Effective Date. This Ordinance shall be in full force and effect from and after its passage and compliance with Indiana law. PASSED AND ADOPTED by the Common Council of the City of South Bend, Indiana, this Z~ day of d~ ¢;w,1~/ , 2006. COMMON COUNCIL OF THE CITY OF SOUTH BEND, INDIANA By: Member of the C mon Council Attes ' CI rk Presented by me to the Mayor of the City of South Bend, Indiana on the 'L~~. day of ~ o~z.,~,,,,,4~ , 2~, at 3'-a~ o'clock ~. m. ,___ c ~, City Clerk ~ ''II Approved and signed by me on the o'~9 day of ~~'v' , 2so,~ , at %30 o'clock ~-- . m. ~ ~~ Mayor, City of uth Bend, Indiana 1st READING I ~ .,13 ,fib PUSLIC HEARING ~ ~ -L~ ~~~'' Ord READING (t_L~-a~ NOT APPROVED REFERRED PASSED l ~ - 2.7 -a ~ Fiied in Cierk's Office NOV $ 200u JOHN VOORDE _CITYCLERK, S0. BENB, IN. TO THE COMMON COUNCIL OF THE CITY OF SOUTH BEND: Your Committee of the Whole, to whom was referred: BILL NO. 81-06 A BILL AUTHORIZING THE ISSUANCE AND SALE OF AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED EIGHT MILLION FIVE HUNDRED THOUSAND DOLLARS ($8,500,000) OF THE CITY OF SOUTH BEND, INDIANA VARIABLE RATE ECONOMIC DEVELOPMENT REVENUE BONDS, SERIES 2007 (PEI/GENESIS PROJECT); DESIGNATING THE BONDS AS LIMITED OBLIGATIONS OF THE CITY; APPROVING THE FORM OF, AND AUTHORIZING THE EXECUTION AND DELIVERY OF, THE TRUST INDENTURE, LOAN AGREEMENT AND OTHER DOCUMENTS RELATED TO THE ISSUANCE AND SALE OF THE BONDS; AND AUTHORIZING PROPER OFFICERS TO DO ALL OTHER THINGS DEEMED NECESSARY OR ADVISABLE IN CONNECTION THEREWITH AND APPROVING AND AUTHORIZING OTHER ACTIONS IN RESPECT THERETO Respectfully report that they have examined the matter and that in their opinion, this bill is being recommended to the full Council with a favorable recommendation. Karen L. White Chairperson BARNES &THORNBURG LLP Philip J. Faccenda, Jr. (574)237-1148 Email: philip.faccenda®btlaw.com HAND-DELIVERED Mr. John Voorde Clerk of the City of South Bend 455 County-City Building 227 West Jefferson Boulevard South Bend, Indiana 46601 100 North Michigan 600 1st Source Bank Center South Bend, IN 46601-1632 U.S.A. (574)233-1171 Fax (574)237-1125 www.btlaw.com November 8, 2006 Re: City of South Bend, Indiana Variable Rate Demand Economic Development Revenue Bonds, Series 2007 (PEUGenesis Project) Dear John: As you know, we are serving as bond counsel with respect to the issuance of the above- referencedbonds (the "Bonds"), and in such capacity we are hereby delivering to the Clerk of the City of South Bend the enclosed copies of the proposed Bond Ordinance (the "Bond Ordinance") pertaining to the Bonds, together with two copies of substantially final forms of each of the following documents (the "Bond Documents"), which are incorporated by reference into such Bond Ordinance: (i) the Indenture (as defined in the Bond Ordinance); (ii) the Loan Agreement (as defined in the Bond Ordinance); and (iii) the Bond Purchase Agreement (as defined in the Bond Ordinance). We hereby request that such Bond Ordinance be scheduled for first reading before the South Bend Common Council on November 13, 2006 and that the Bond Ordinance and the Bond Documents be made available for public inspection, in accordance with Section 36-1-5-4 of the Indiana Code. If you have any questions, please feel free to call us. Sincerely, BARNES & THORNBURG LLP '~~~'`! Philip J. Faccenda, Jr. , PJF:mdm Enclosures P~OV - 8 2000 cc: The Working Group ~l J~1lN 1I~~N~E SBDS02 PFACCENDA 346589v1 Cii'1 [ C[.E9!C,~"~. 0+~-I'l'J~ 1N. Chicago Elkhart Fort Wayne Grand Rapids Indianapolis South Bend Washington, D,Cr --~ ,, . ~~r