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HomeMy WebLinkAboutAuthorizing $3,200,000 Economic Development Revenue Bonds - Crowe, Chizek & Company ProjectORDINANCE NO. 6552 -79 Passed by the Common Council of the City of South Bend, Indiana February 12 rq 79 IRENE K. GAMMON Attest: Presented by me to the Mayor of the City of South Bend, Ind'ana February 13 zq 79 Clerk Of Common Council City Clerk IRENE K. GAMMON Approved and signed by me e, n ORDINANCE NO. (,,SS2-79 ORDINANCE AUTHORIZING THE ISSUANCE OF $3,200,000 AGGREGATE PRINCIPAL AMOUNT OF ECONOMIC DEVELOPMENT REVENUE BONDS, SERIES 1979 (CROWE, CHIZEK AND COMPANY PROJECT) (THE "BONDS "), TO FINANCE THE COST OF THE ACQUISITION, CONSTRUCTION, EQUIPPING AND INSTALLATION OF LAND, A BUILDING AND RELATED FACILITIES CONSTITUTING AN OFFICE BUILDING AND CONFIRMING THE SALE OF THE BONDS TO THE PURCHASERS THEREOF, AND CERTAIN OTHER RELATED MATTERS. WHEREAS, the Issuer (as hereinafter defined) is authorized by the Act (as hereinafter defined) to, among other things, finance the cost of commercial projects in the City of South Bend, Indiana, so that economic development facilities may be diversified, and employment opportunities and the tax base in and near the City of South Bend be made sufficient; and WHEREAS, the Issuer is further authorized by the Act to issue economic development revenue bonds secured by a mortgage on the land and /or facilities so acquired, constructed and equipped through the issuance of such revenue bonds payable from the revenues and receipts derived from the repayment of a loan made with respect to such facilities; and WHEREAS, the Commission (as hereinafter defined) has rendered its Report Making Certain Estimates economic development facilities for defined), and the St. Joseph County South Bend Community School Corpora thereon; and WHEREAS, the Commission, after on the financing of proposed the Company (as hereinafter Area Plan Commission and tion have commented favorably public hearing held on February 2, 1979, adopted a resolution on the same date, which resolution has been previously transmitted hereto, finding that the financing of certain economic development facilities for the Company complies with the purposes and provisions of the Act and that such financing will be of benefit to the health and welfare of the Issuer and its citizens; and WHEREAS, the Commission has heretofore recommended the action to be taken through adoption of this ordinance by the Issuer; and WHEREAS, the issuance by the Issuer of the Bonds, as herein- after authorized, will in all respects conform to the provisions and requirements of the Act; and WHEREAS, it has now been determined that the estimated amount necessary to finance the cost of acquiring, constructing and equipping the Project (as hereinafter defined), including necessary expenses incidental thereto, requires that the Bonds of the Issuer be authorized as hereinafter provided; and WHEREAS, the Issuer has made the necessary arrangements for the issuance and sale of the Bonds; and WHEREAS, the officers of the Issuer have caused to be prepared and presented to this meeting proposed forms of the following instruments (hereinafter collectively called the "Instru- ments"): (a) a form of Loan Agreement, including the form of Mortgage attached thereto; (b) a form of Indenture; and (c) a form of Bond Purchase Agreement ; and WHEREAS, it appears that each of the Instruments which are now before this meeting, is in appropriate form and is an appro- priate instrument to be executed and delivered or accepted, as the case may be, by the Mayor and City Clerk of the Issuer for the purposes intended; and WHEREAS, pursuant to and in accordance with provisions of the Act, the Issuer is now prepared to sell its Bonds and the Issuer is willing to lend the proceeds from the sale of the Bonds to the Company, such loan of proceeds to be repaid by the Company in periodic installments sufficient to pay the principal of, premium, if any, and interest on the Bonds, together with related expenses, all as set forth in the Loan Agreement; and WHEREAS, it is necessary to authorize the sale of said Bonds to the Bond Purchasers (as hereinafter defined) and to authorize certain other matters in connection therewith; - 2 - NOW, THEREFORE, BE IT ORDAINED by the Common Council of the City of South Bend, Indiana: Section 1. Definitions. For the purpose of this ordinance, unless the context otherwise requires, the following words and phrases shall have the following meanings: "Act" means Indiana Code, Title 18, Article 6, Chapter 4.5, as from time to time supplemented and amended. "Bond Purchase Agreement" means that agreement providing for the sale of the Bonds by the Issuer to the Bond Purchasers (as hereinafter defined). "Bond Purchasers" means Harris Trust and Savings Bank, Chicago, Illinois, and The First National Bank of Mishawaka, Mishawaka, Indiana. "Bonds" means the $3,200,000 aggregate principal amount of Economic Development Revenue Bonds, Series 1979 (Crowe, Chizek and Company Project) of the Issuer, issued for the purpose of financing the acquisition, construction and equipping of the Project. "Commission" means the South Bend Economic Development Commission. "Company" means Crowe, Chizek and Company, an Indiana general partnership, having its principal office at South Bend, Indiana. "Indenture" means that certain Trust Indenture dated as of January 1, 1979, from the Issuer to the Trustee, pursuant to which the Bonds will be issued and secured. "Issuer" means the City of South Bend, Indiana, a munici- pal corporation and governmental unit organized and existing under the laws of the State of Indiana. "Loan Agreement" means that certain Loan Agreement dated as of January 1, 1979, between the Issuer and the Company. "Mortgage "means that certain Mortgage by the Company and St. Joseph River Bend Development Corporation, as Mortgagors, to the Trustee (as hereinafter defined), as Mortgagee. - 3 - "Project" means the real property, building and any related facilities, to be located in South Bend., Indiana, constituting a commercial office building to be acquired, constructed and equipped by the Company as contemplated by the Loan Agreement. "Trustee" means First Bank and Trust Company of South Bend, South Bend, Indiana, as Trustee under the Indenture. Section 2. Initial Resolution. The initial resolution adopted by the Issuer on October 23, 1978, and the Memorandum of Agreement executed by the Issuer and the Company pursuant thereto, are hereby found to be in the best interest of the Issuer and are in all respects approved, ratified, confirmed, readopted and declared to be and remain in full force and effect. Section 3. Findings and Determinations. It is hereby found that the financing of the Project, previously approved by the Commission and recommended to this Common Council, the issuance and sale of the Bonds, the use of the net proceeds thereof to make a loan to the Company for the acquisition and construction of the Project, the payment of the Bonds by the payments of the Company under the Loan Agreement, and the securing of the Bonds by the mortgaging of the Project to the Trustee under the Mort- gage will be of benefit to the health and welfare of the City of South Bend, and its citizens in furtherance of the purposes of the Act. It is further found that the Project will not have an adverse competitive effect on similar facilities already constructed and operating in the City of South Bend, Indiana. Section 4. Cost of Project. Based upon representations made by the Company to the Issuer, the Issuer hereby determines that the aggregate cost of the Project will be not less than $3,200,000. Section 5. Authorization of the Bonds. For the purpose of financing the cost of the acquisition, construction and equip- ping of the Project, including necessary expenses incidental thereto, there is hereby authorized to be issued the revenue bonds of the Issuer in compliance with and under authority of the provi- - 4 - sions of the Act, this ordinance and the Indenture in the principal amount of $3,200,000, which bonds shall be designated "Economic Development Revenue Bonds, Series 1979 (Crowe, Chizek and Company Project) ", and shall be payable as to principal, interest and premium, if any, in lawful money of the United States of America at the principal office of the Trustee, or its successors in trust, under the provisions of the Indenture. The Bonds shall be issuable as coupon Bonds, registrable as to principal only, or as to both principal and interest, in the denomination of $5,000, and as fully registered Bonds without coupons in the denomination of $5,000 and any integral multiple thereof. The Bonds shall be issued initially as fully registered Bonds. The fully registered Bonds shall be lettered R and shall be numbered separately from 1 upward, and the coupon Bonds shall be numbered separately from 1 upward. The coupon Bonds shall be dated January 1, 1979, and shall bear interest from such date payable semiannually on January 1 and July 1 of each year with the first interest payment to be made on July 1, 1979. Fully registered Bonds shall bear interest payable semiannually as aforesaid and shall be dated as of the date of issue and delivery. Bond number R -1 shall be in the denomination of $2,500,000 and shall bear interest at the rate of six and three - quarters percent ( 6 3/40 ) per annum; Bond number R -2 shall be in the denomination of $700,000 and shall bear interest at the rate of seven and sixty- hundredths percent ( 7.600 ) per annum. The Bonds shall mature and be payable in periodic installments as set forth on Exhibit B to the Indenture. The Bonds shall be subject to redemption at the times, under the circumstances, in the manner, at the prices and with the effect as more fully prescribed in Article III of the Indenture, which terms are, by this reference, incorporated herein. Section 6. City of South Bend, Indiana, Not Liable on Bonds. The Bonds shall be limited obligations of the Issuer and, except - 5 - to the extent payable from the Bond proceeds or the investment thereof, shall be payable solely from the sources specified in, and be secured as provided by, the Indenture. The Bonds and the interest thereon shall not be deemed to evidence a debt of the Issuer or a loan of credit extended by it within the meaning of any constitutional or statutory provi- sion. Further, the Bonds and the interest thereon shall not be deemed to constitute a debt or liability of the Issuer or the State of Indiana or of any political subdivision thereof within the meaning of any constitutional or statutory provision of the State of Indiana, and their issuance shall not, directly or indirectly or contingently, obligate the State of Indiana or any political subdivision thereof to levy any form of taxation there- for or to make any appropriation for their payment. Nothing in the Bonds or in the Indenture or the proceedings of the Issuer authorizing the issuance of the Bonds or in the Act shall be construed to authorize the Issuer to create a debt or liability of the State of Indiana or any political subdivision thereof within the meaning of any constitutional or statutory provision of the State of Indiana. The nature of the obligation represented by the Bonds is as more fully set forth in the Indenture. Nothing in this ordinance, the Loan Agreement or the Indenture, shall be construed as an obligation or commitment by the Issuer to expend any of its funds other than (i) the proceeds of the sale of the Bonds, (ii) certain of the revenues and receipts to be received from the Project as provided in the Indenture, (iii) any proceeds accruing to the Issuer of insurance on the Project, (iv) any moneys accruing to the Issuer on account of any taking or condemnation of title to the whole or any part of the Project, (v) any other moneys derived from or accruing to the Issuer from the Project, and (vi) any moneys arising out of the investment or reinvestment of said proceeds, revenues or moneys. Section 7. Execution of the Bonds. Each of the Bonds shall be executed and delivered in the name and on behalf of the Issuer by the manual or facsimile official signature of the Mayor and attested by the manual signature of the City Clerk and the coupons appertaining to the coupon Bonds shall be executed in the name and on behalf of the Issuer by the facsimile signatures of said Mayor and said City Clerk, the Bonds shall have the corporate seal of the Issuer impressed or reproduced thereon and shall be authenticated by the endorsement of the Trustee, all as more fully provided in the Indenture. If any of the officers who shall have signed or sealed said Bonds shall cease to be such officers of the Issuer before the Bonds so signed and sealed shall have been actually authenticated by the Trustee or delivered by the Issuer, the Bonds nevertheless may be authenticated, issued and delivered with the same force and effect as though the person or persons who signed or sealed such Bonds had not ceased to be such officer or officers of the Issuer; and also any such Bonds may be signed and sealed on behalf of the Issuer by those persons who, at the actual date of the execution of such Bonds, shall be the proper officers of the Issuer, although at the nominal date of such Bonds any such person shall not have been such officer of the Issuer. Section 8. Form of the Bonds. The Bonds and the Trustee's endorsement to appear on each of the Bonds shall be in substan- tially the form set forth in the Indenture, with such appropriate variations, omissions, insertions and provisions as are permitted or required by the Indenture, the omissions to be appropriately completed when the Bonds are prepared, and the execution of the Bonds by the City Clerk shall be conclusive evidence of such approval. Section 9. Compliance with the Act. The Bonds shall be issued in compliance with and under authority of the provisions of the Act, this ordinance and the Indenture. �m Section 10. Additional Bonds. While any of the Bonds shall remain outstanding and unpaid, the Issuer hereby convenants and agrees with the holders from time to time of such Bonds that it will not issue any additional bonds or incur any obligations of any sort secured by a lien prior to or on a parity with the lien of the Bonds except for any Additional Bonds which may be issued pursuant to Section 210 of the Indenture. Section 11. Maintenance and Repair Costs. The maintenance and repair costs of the Project, all taxes in connection therewith and other charges, all as specified in the Loan Agreement, will be assumed and paid by the Company under the Loan Agreement, and accor- dingly, the Issuer has no obligation with respect thereto and all such costs, expenses, taxes, fees and charges shall be paid by the Company, as provided in the Loan Agreement. Section 12. Additional Findinas and Determinations. It is hereby found, determined and declared by the Issuer that the amounts of the installments payable under the Loan Agreement are the amounts necessary in each year to pay the principal of and interest on the Bonds and that the installment payments and other monetary obligations undertaken by the Company in the Loan Agreement are sufficient to satisfy the Loan Agreement and other monetary obligations required by the Act to be undertaken by the user of a project. The Loan Agreement provides that the Company shall operate and maintain the Project and carry all proper insur- ance with respect thereto. Section 13. Approval of the Loan Agreement, Mortgage and Indenture. The form, terms and provisions of the Loan Agreement, the Mortgage and the Indenture are hereby approved and the Mayor and the City Clerk are hereby authorized and directed to execute and deliver the Loan Agreement and the Indenture in the name and behalf of the Issuer, each to be in substantially the form now before this meeting and hereby approved or with such changes therein as shall be approved by the officers of the Issuer executing the same, their execution thereof to constitute conclusive evidence of their approval of any and all changes or revisions from the form of Loan Agreement or Indenture, as the case may be, now before this meeting and the City Clerk is hereby authorized and directed to affix to the Loan Agreement and the Indenture the corporate seal of the Issuer. Section 14. Approval of the Bond Purchase Agreement and the Sale of the Bonds. The form, terms and provisions of the Bond Purchase Agreement are hereby approved and the Mayor and the City Clerk are hereby authorized and directed to execute and deliver the Bond Purchase Agreement in substantially the form now before this meeting and hereby approved. The sale of the Bonds pursuant to the Bond Purchase Agreement, at the price of one hundred percent (100 %) of the principal amount of the Bonds to the Bond Purchasers is hereby approved, ratified and confirmed. Section 15. Authorization to Effect Execution and Delivery of Documents. The Mayor and the City Clerk for and on behalf of the Issuer, shall be and they are hereby authorized and directed to do any and all things necessary to effect the execu- tion and delivery of the Indenture and the Loan Agreement, to do any and all things necessary to effect the performance of all obligations of the Issuer under and pursuant to the Loan Agree- ment and the Indenture, the execution and delivery of the Bonds, and the performance of all other acts of whatever nature necessary to effect and carry out the authority conferred by this ordinance and by the Loan Agreement and the Indenture. The Mayor and the City Clerk shall be, and they are hereby further authorized and directed for and on behalf of the Issuer, to execute all papers, documents, certificates, financing statements and other instruments that may be required for the carrying out of the authority con- ferred by this ordinance and by the Loan Agreement and the Inden- ture, or to evidence the said authority and its exercise. The Trustee is hereby authorized to receive and receipt for the proceeds of the Bonds on behalf of the Issuer and to hold, 9 - invest and disburse said proceeds in accordance with the provi- sions of the Indenture. All provisions of the Indenture, includ- ing those with respect to the acquisition, construction and equipping of the Project, the issuance and delivery of the Bonds and the receipt, custody, investment and application of the proceeds of the Bonds and the loan payments and other revenues to be derived from the Project, are hereby in all respects adopted, ratified and confirmed for and on behalf of the Issuer. Section 16. Section 103(b) (6) (D) Election. The Issuer hereby elects to have the provisions as to the limit in Section 103(b) (6) (D) of the Internal Revenue Code of 1954, as amended, applied to the Bonds; and the Mayor and the City Clerk of the Issuer be and they are hereby authorized, empowered and directed to take any and all further action which may be required to implement and effectuate such election, including without limita- tion the preparation and filing of such statement or statements or other document or documents as may be deemed by them to be necessary or advisable in order to comply with the procedure set forth in Section 1.103 -10(b) (2) (vi) of the Income Tax Regulations (26 CFR Part 1) under Section 103 of the Internal Revenue Code of 1954, as amended, and all acts heretofore taken by them in this connection are hereby ratified and confirmed. Section 17. Preparation of Bonds. The Mayor and the City Clerk of the Issuer are hereby authorized and directed to cause to be prepared an issue of $3,200,000 principal amount of the Bonds in the form, bearing interest at the rates, and having the other terms and provisions specified in the Indenture. Section 18. Designation of Trustee. First Bank and Trust Company of South Bend, South Bend, Indiana, is hereby designated Trustee under the Indenture. The Issuer hereby recognizes, agrees to and approves the deposit of the proceeds of the Bonds with the Trustee under the Indenture which amount shall be held and applied by said Trustee in accordance with the provisions of the Indenture. - 10 - The Mayor and the City Clerk of the Issuer are hereby authorized to direct the Trustee to authenticate and deliver the Bonds. Section 19. Covenants and Stipulations of the Issuer. All covenants, stipulations, obligations and agreements of the Issuer contained in this ordinance and in the Indenture and the Loan Agreement (herein collectively referred to as the "Instruments ") shall be deemed to be the covenants, stipulations, obligations and agreements of the Issuer to the full extent authorized or per- mitted by law, and all such covenants, stipulations, obligations and agreements shall be binding upon the Issuer and its successors from time to time and upon any board or body to which any powers or duties affecting such covenants, stipulations, obligations and agreements shall be transferred by or in accordance with law, and except as otherwise provided in this ordinance or in the Instruments or other instruments contemplated hereby to which the Issuer is or is to be a party, all rights, powers and privileges conferred and duties and liabilities imposed upon the Issuer or the members of the Common Council thereof by the provisions of this ordinance or the Instruments shall be exercised or performed by the Issuer or by such members, officers, board or body as may be required by law to exercise such powers and to perform such duties. No covenant,stipulation, obligation or agreement herein con- tained or contained in the Instruments shall be deemed to be a covenant, stipulation, obligation or agreement of any member of the Common Council, officer, agent or employee of the Issuer in his individual capacity and neither the members of the Common Council of the Issuer nor any officer executing the Bonds shall be liable personally on the Bonds or be subject to any personal liability or accountability by reason of the issuance thereof. Section 20. Execution of Certifications and Other Instru- ments. The Mayor and the City Clerk, as appropriate, are hereby authorized and directed to execute such certifications, financing statements, assignments, documents and other instruments as are, - 11 - in the opinion of counsel to the Issuer and nationally recognized bond counsel, necessary to perfect the pledges set forth in the Indenture and the Loan Agreement and any such other documents and instruments as may be required to effectuate any portion of the financing transaction. Section 21. Separable Provisions. The provisions of this ordinance are hereby declared to be separable and if any section, phrase or provision shall for any reason be declared to be invalid, such declaration shall not affect the validity of the remainder of the sections, phrases and provisions hereof. Section 22. Resolutions and Ordinances in Conflict Repealed. Except for the Initial Resolution of the Issuer relating to the Bonds, adopted on October 23, 1978, all resolutions and ordinances and parts thereof in conflict herewith are hereby repealed to the extent of such conflict. Section 23. Ordinance Effective Immediately. This ordinance shall take effect immediately upon its adoption. �Councy- ember Fa kt READING °z' � � � � � r E b �' 1979 r -JB? IC HEARING PEADING •�� / o? - a 7 - 12 - Irene Gamnion NOT APPROVED. CITY CLERKa SOUTH BE(Vp, tND, REFERRED PASSED • /,'f ..7e3 � � /� -AA /f - 1