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HomeMy WebLinkAboutAuthorizing Economic Development Revenue Bonds Steel Warehouse Co Inc ProjectORDINANCE No 7285 -83 Passed by the Common Council of the City of South Bend, Indiana December 30 rq 83 !� -�� Attest: -� P; IRENE K. GAMMON Presented by me to the Mayor of the City of South Bend, Indiana Approved and signed by me� December 30 �9 83 Clerk of Common Council IRENE K. GAMMON Clerk ORDINANCE NO. ,7ge -wk3 ORDINANCE AUTHORIZING THE CITY OF SOUTH BEND TO ISSUE ITS "ECONOMIC DEVELOPMENT REVENUE BONDS, SERIES 1983 (STEEL WAREHOUSE CO., INC. PROJECT)" AND APPROVING OTHER ACTIONS IN RESPECT THERETO WHEREAS, the South Bend Economic Development Commission has rendered its Project Report for the Steel Warehouse Co., Inc. Project regarding the financing of proposed economic development facilities for Steel Warehouse Co., Inc., and the Area Plan Commission has commented favorably thereon; and WHEREAS, the South Bend Common Council conducted a public hearing on December 30, 1983, after publishing reasonable notice thereof as required by law and on December 30, 1983, gave approval for the Project; and WHEREAS, the South Bend Economic Development Commission con- ducted a public hearing on December 29, 1983, and also adopted a resolution on December 29, 1983, which Resolution has been transmitted hereto, finding that the financing of certain economic development facilities of Steel Warehouse Co., Inc. complies with the purposes and provisions of I.C. 36 -7 -12 and that such financing will be of benefit to the health and welfare of the City of South Bend and its citizens; and WHEREAS, the South Bend Economic Development Commission has heretofore approved and recommended the adoption of this form of Ordinance by this Common Council, has considered the issue of adverse competitive impact and has approved the forms of and has transmitted for approval by the Common Council the Equipment Loan Agreement, Note and Security Agreement and Indenture of Trust, now therefore, BE IT ORDAINED BY THE COMMON COUNCIL OF THE CITY OF SOUTH BEND, INDIANA THAT: Section 1. It is hereby found that the financing of the economic development facilities referred to in the Equipment Loan Agreement and Security Agreement and Indenture of Trust approved by the South Bend Economic Development Commission and presented to this Common Council, the issuance and sale of revenue bonds in the aggregate principal amount of $1,750,000, the loan of the proceeds of the revenue bonds to Steel Warehouse Co., Inc. for the construc- tion of a 10,400 square foot building addition to the Company's present operation located at 2722 Tucker Drive, in the City of South Bend (the "Project "), together with the acquisition and installation of a temper mill and related machinery and equipment to be installed at said location, the payment of the revenue bonds by the note payments of Steel Warehouse Co., Inc. under the Equipment Loan Agreement and Note, and the securing of said bonds by a security instrument to the Trustee under the Security Agreement and Indenture of Trust complies with the purposes and provisions of I.C. 36 -7 -12 and will be of benefit to the health and welfare of the City of South Bend and its citizens. Section 2. The facilities will consist of the construction of a 10,400 square foot building addition to the Company's present operation located at 2722 Tucker Drive, in the City of South Bend -2- (the "Project "), together with the acquisition and installation of a temper mill and related machinery and equipment to be installed at said location. Section 3. It is hereby found that the above - described Project of Steel Warehouse Co., Inc. will not have an adverse competitive impact on other facilities of the same kind already operating in the same market area for the following reasons: (a) After published notice of a public hearing to be held before the Commission, no competitors made them- selves known or spoke against the proposed Project on any basis. (b) There are no facilities of the same kind as the Project in existence or under construction in South Bend or in St. Joseph County, Indiana, and, therefore, will have no adverse competitive impact on any other facility. (c) In the absence of any evidence of any adverse competitive impact, the benefits to the public from the new jobs and payroll to be generated by the Project clearly indicate that the Project should be supported by the issuance of economic development revenue bonds. Section 4. The substantially final forms of the Equipment Loan Agreement, Note and Security Agreement and Indenture of Trust approved by the South Bend Economic Development Commission are hereby approved (herein collectively referred to as the "Financing Agree- ment" referred to in I.C. 36- 7 -12), and all such documents shall be -3- incorporated herein by reference and shall be inserted in the minutes of the Common Council and kept on file by the Clerk. In accordance with the provisions of I.C. 36- 1 -5 -4, two (2) copies of all such documents are on file in the office of the Clerk for public inspection. Section 5. The City of South Bend shall issue its Economic Development Revenue Bonds, Series 1983 (Steel Warehouse Co., Inc. Project), in the total principal amount of approximately One Million Seven Hundred Fifty Thousand Dollars ($1,750,000) and maturing over a period of not more than nine (9) years from the date of the first payment of principal for the purpose of procuring funds to lend to Steel Warehouse Co., Inc. to pay the costs of the construction of a 10,400 square foot building addition to the Company's present operation located at 2722 Tucker Drive, in the City of South Bend (the "Project "), together with the acquisition and installation of a temper mill and related machinery and equipment to be installed at said location, as more particularly set out in the Equipment Loan Agreement and Security Agreement and Indenture of Trust incorporated herein by reference, which bonds will be payable as to principal, premium, if any, and interest from the note payments made by Steel Warehouse Co., Inc. under the Equipment Loan Agreement and Note or as otherwise provided in the above described Security Agreement and Indenture of Trust. The bond shall be issued in fully registered form in the denominations of $1,750,000 or integral multiples -4- thereof and shall be redeemed as provided in the Security Agree- ment and Indenture of Trust. Payments of principal and interest are payable in lawful money of the United States of America at the principal office of the Trustee or its successor in trust or by check or draft mailed or delivered to the registered owner as provided in the Security Agreement and Indenture of Trust. The bonds shall never constitute a general obligation of, an indebtedness of, or a charge against the general credit of the City of South Bend or the State of Indiana nor are the bonds payable in any manner from revenues raised by taxation. Section 6. The Mayor and Clerk are authorized and directed to sell such bonds to the purchasers thereof at the rate of interest on the bonds equal to 75% of the prime commercial lending rate ( "Prime Rate ") announced by Citibank, of New York, New York, at its principal office on December 1, 1983, such rate to be adjusted from time to time contemporaneously with each change in said Citibank's Prime Rate; provided, however, that in the event interest on the bonds becomes taxable, the interest rate shall increase to the Prime Rate of said Citibank, as adjusted from time to time contemporaneously with each change of said Bank's Prime Rate, plus 1 The bonds shall be sold at a price not less than 100% of the principal amount thereof. Section 7. The Mayor and Clerk are authorized and directed to execute, attest, affix or imprint by any means the City seal to the -5- documents constituting the Financing Agreement approved herein on behalf of the City and any other document which may be necessary or desirable to consummate the transaction, including the bonds authorized herein. The Mayor and Clerk are hereby expressly authorized to approve any modifications or additions to the documents constituting the Financing Agreement which take place after the date of this Ordinance with the review and advice of the City Attorney; it being the express understanding of this Common Council that said Financing Agreement is in substantially final form as of the date of this Ordinance. The approval of said modifications or additions shall be conclusively evidenced by the execution and attestation thereof and the affixing of the seal thereto or the imprinting of the seal thereon; provided, however, that no such modification or addition shall change the maximum principal amount of, interest rate on or term of the bonds as approved by the Common Council by this Ordinance without further consideration by the Common Council. The signatures of the Mayor and Clerk on the bonds may be either manual or facsimile signatures. The Clerk is authorized to arrange for delivery of such bonds to the Trustee named in the Security Agreement and Indenture of Trust and after such payment the bonds will be delivered by the Trustee to the purchasers thereof. The Mayor and Clerk shall execute and the Clerk shall deliver the bonds to the Trustee within ninety days of the adoption of this Ordinance. The bonds shall be dated as of December 1, 1983 but shall bear interest only from the date of delivery. Q� Section 8. The provisions of this Ordinance and the Security Agreement and Indenture of Trust securing the bonds shall consti- tute a contract binding between the City of South Bend and the holder of the Economic Development Revenue Bonds, Series 1983 (Steel Warehouse Co., Inc. Project), and after the issuance of said bonds, this Ordinance shall not be repealed or amended in any respect which would adversely affect the rights of such holders so long as any of said bonds or the interest thereon remains unpaid. Section 9. This Ordinance shall be in full force and effect from and after its passage and signing by the Mayor. Attest: Clerk FILED M CLF e�'S OFFICE Irene Gammon CITY CLERK, SOUTH BEND, IND. 2nd Rf.Af 1,,1G p 3 NOT ARRRoVED' REFERRED —7— PASSED + ` � - � � _ r�,� 3i.�.ys ✓�.,,.. i�'��`,�,�.,R, i Economic Development Commission Jerry Hammes, President Walter Szymkowiak, Vice President Walter A. Mucha, Secretary Kenneth P. Fedder, Counsel Alice Neddo, Asst. Sec. CITY of SOUTH BEND ROGER 0. PARENT, Mayor Members of the South Bend Common Council County -City Building South Bend, IN 46601 December 28, 1983 Re: Steel Warehouse Co., Inc. - Proposed Ordinance Dear Councilmen: Alice Neddo Staff Administrator 230 W. Jefferson Boulevard P.O. Box 1677 South Bend, Indiana 46634 -1677 (219) 234.0051 The South Bend Economic Development Commission on December 29, 1983, approved a resolution for the issuance of $1,750,000 of revenue bonds to finance the construction of a 10,400 square foot addition to the existing Corporate facilities at 2722 Tucker Drive, South Bend, and to purchase and install additional machinery and equipment. Steel Warehouse Co., Inc. is engaged in the sale of steel to various users and /or manufacturers. This is to request that the Common Council suspend its rules at the Council Meeting scheduled for December 30, 1983, at 9:00 a.m., to allow the first reading and public hearing on the Ordinance approving the financing documents for this project and the issuance of the bonds. This request is being made in order to permit the bonds to be issued during this calendar year. With the new construction and increased production, it is anticipated that approximately 6 -12 new jobs, with an estimated payroll of $88,000- $176,000 will be created. Thi /;!s an expansion of a long -time South Bend business operation. tfully ENNET P. FEDDER to ey for the South Bend omic Development Commission KPF:ram FILED iD ULLNE S OFFICE Irene Gammon CITY CLERK, SOUTH BEND, IND.