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HomeMy WebLinkAbout$8,000,000 Economic Development Revenue Bonds Brethren Care of South BendPassed by the Common Council of the City of South Bend, Indiana October 9 zg 78 Attest: ' • `�'� O`�J City Clerk IRENE K. GAMMON of Common Council Presented by me to the Mayor of the City of South Bend, Indiana October 10 19_28 IRENE K. GAMMON Approved and signed by me / 0 . 19—Q Clerk ORDINANCE NO. (o AN ORDINANCE AUTHORIZING THE ISSUANCE AND SALE OF $8,000,000 ECONOMIC DEVELOPMENT REVENUE BONDS OF THE CITY OF SOUTH BEND, INDIANA, FOR THE PURPOSE OF MAKING A LOAN TO BRETHREN CARE OF SOUTH BEND, INC. IN ORDER TO FINANCE THE 'ACQUISITION-AND CONSTRUCTION OF CERTAIN ECONOMIC DEVELOPMENT FACILITIES; AUTHORIZING EXECUTION OF A LOAN AGREEMENT; PROVIDING FOR THE DELIVERY OF A NOTE AND THE ASSIGNMENT THEREOF AS SECURITY FOR SAID BONDS; AND AUTHORIZING AN INDENTURE OF TRUST. BE IT ORDAINED BY THE COMMON COUNCIL OF THE CITY OF SOUTH BEND, INDIANA, AS FOLLOWS: Section 1. Preliminary Statement. The following recitals establish the background for the financing authorized hereby: (a) The City of South Bend, Indiana (hereinafter called the "City "), by virtue of Indiana Code 18- 6 -4.5, as amended (herein - after called the "Act "), is authorized and empowered to make direct loans to users for the acquisition and construction of economic deyelopment facilities as defined in the Act to overcome insufficient employment opportunities and insufficient diversification of business, commerce and industry in and near the City and to promote the general economic welfare of the area in and near the City and to issue its economic development revenue bonds to obtain funds to make such loan and to secure said bonds pursuant to a trust indenture by the pledge of one or more notes of the user. (b) Brethren Care of South Bend, Inc. (the "Company "), a nonprofit corporation organized and existing under and by virtue of the laws of Indiana, has agreed to acquire and construct a residential retirement community (the "Project ") which is a health facility licensed and regulated by the Indiana Health Facilities Council under Indiana Code 16 -10 -2 and by virtue thereof an "economic development facility" as defined in the Act. (c) The Project is located in St. Joseph County with a portion thereof in the City and will create new employment opportunities and provide expansion and diversification of business, commerce and industry in and near the City. (d) The City proposes to loan to the Company the proceeds of sale of the revenue bonds hereinafter authorized, and the Company has agreed to make payments on its note or notes evidencing its loan obligation in an amount sufficient to pay the principal of and interest and premium, if any, on such revenue bonds. (e) The South Bend Economic Development Commission (the "Commission "), which is functioning and operating under the Act, (1) has found by written resolution that because of existing in- sufficient employment opportunities and insufficient diversification of business, commerce and industry, the economic welfare of the City would be benefited by financing a portion of the costs of payroll on account of the acquisition and construction of the Project and the cost thereof, (3) has submitted such report to the plan 'co'nmission(s) and school corporation(s) having jurisdiction over such facilities, and (4) has, after giving notice in acbordanee with the Act, held a public hearing on the proposed financing and adopted a resolution finding the proposed financing benefits the economic welfare of the City and complies with the purposes and provisions of the Act and approving the financing and the proposed form and terms of such revenue bonds, loan agreement and indenture of trust, which resolution and other instruments and information pertaining to the proposed financing have been transmitted to the Common Council of the City by the Secretary of the Commission. Section 2. Public Benefits and Findings. The Common Council of the City hereby finds and determines that the Project as described in Exhibit A to the Loan Agreement dated as of October 1, 1978 between the City and the Company (t,he "Loan Agreement ") to be acquired and constructed in part with the proceeds of $8,000,000 principal amount Economic Development Revenue Bonds, Series A (Brethren Care of Sbuth Bend, Inc. Project) (the "Series A Bonds ") herein authorized are "economic development facilities" as that phrase is used in the Act; that acquisition and construction of the Project will increase employment opportunities and increase diversification of business, commerce and industry in and near the City, will improve and promote the economic stability, development and welfare of the area in and near the City and will encourage and promote the expansion of industry, trade and commerce in the area in and near the City and the location of other new commercial and business facilities in such area; and that this ordinance (the "Bond Ordinance ") complies with the purposes and provisions of the Act and is of public benefit to the economic welfare of the City by tending to overcome the deficiencies previously found to exist, to wit: insufficient employment opportunities and insufficient diversification of business, commerce and industry, and that such_ benefit is greater than the cost of public facilities (as that phrase is defined in the Act) which will be required by the Project. Section 3. Authorization of Series A Bonds. In order to pay a portion of the cost of acquiring and constructing the Project, including interest on the Series A Bonds during the period of construction, there are hereby authorized to be issued, sold and delivered $8,000,000 aggregate principal amount of the Series A Bonds. Pursuant to the terms of the Loan Agreement the balance of the cost of the Project will be paid for by the Company unless paid for out of the proceeds of additional parity bonds (the "Additional Bonds ") as identified in the Indenture of Trust dated as of October 1, 1978 (the "Indenture ") between the City and the National Bank & Trust Company of South Bend, South Bend , Indiana, as Trustee t?.,e "Trustee"). Section 4. Terms for the Series A Bonds. The Series A Bonds shall be dated October 1, 1978, shall bear interest at a rate or rates per annum set forth in the Bond Purchase Agreement identified in Section 9 hereof payable on April 1 and October 1 of each year and shall mature on October 1 of each of the years set forth in and in the principal amount set opposite each year, as follows: Year Amount Year Amount 1981 S.20.000 1 9RR S inn_nnn The Series A Bonds shall be in such form, shall be in such denominations, shall be payable in such medium of payment and at such place or places, shall be subject to redemption at the times and in the manner, and shall contain such other provisions as are pro- vided in the Indenture. The Series A Bonds shall be executed on behalf of the City with the official manual or facsimile signature of the Mayor and attested with the official manual or facsimile signature of the City Clerk and the corporate seal of the City or a facsimile thereof shall be impressed or imprinted thereon, and any coupons attached to the Series A Bonds shall be executed by the facsimile signature of such officials. The Series A Bonds are limited obligations of the City payable solely from payments of principal, premium, if any, and interest made by the Company on the Series A Note in the form attached to the Loan Agreement as Exhibit B, except to the extent that the principal of, premium, if any, and interest on the Series A Bonds may be paid out of money attributable to Series A Bond proceeds or from temporary investments, or from other moneys, if any, accruing to the Trustee for the benefit of the bondholders. The Series A Bonds do not and shall never constitute an indebtedness of, or a charge against the general credit or taxing power of the City. By the Indenture, the City will assign or pledge to the Trustee the City's rights under the Loan Agreement, including the right of the City to receive payments under the Series A Note, all as security for the payment of the Series A Bonds. Section 5. Additional Bonds. The City reserves the right to authorize the issuance of Additional Bonds upon the terms and conditions provided in the Indenture and Loan Agreement; provided that prior to the issuance, sale or delivery of any such series of Additional Bonds, the Common Council shall adopt and approve an appropriate resolution or ordinance authorizing execution and delivery of a supplement to the Loan Agreement and a supplement to the Indenture and authorizing issuance of such series of Additional Bonds. Section 6. Indenture. In order to secure the payment of the principal of and interest on the Series A Bonds, the Mayor and City Clerk shall execute, acknowledge and deliver in the name and on behalf of the City, an Indenture of Trust, herein identified as and called the Indenture, in substantially the form submitted to the Common Council and before the mee -ting at which this Bond Ordinance is adopted, which is hereby approved in all respects. Section 7. Loan Agreement. In order to provide for the loan of the proceeds of sale of the Series A Bonds to the Company and to provide for the payment by the Company of an amount sufficient to pay the principal of and premium, if any, and interest on the Series A Bonds, the Mayor and City Clerk shall execute, acknowledge and deliver in the name and on behalf of the City a Loan Agreement, herein identified as and called the Loan Agreement, in substantially the form submitted to this Common Council and before the meeting at which this Bond Ordinance is adopted, which is hereby approved in all respects. Section 8. Acceptance of Series A Note. In connection with the Series A Bonds, the City accepts as security for such Series A Bonds the Series A Note of the Company. The Series A Note shall be in substantially the form attached as Exhibit B to the Loan Agreement and shall be secured by a mortgage on the Project from the Company to the Trustee in substantially the form attached as Exhibit C to the Loan Agreement. Section 9. The Series A Bonds shall be sold to Stix & Co. Inc., St. Louis, Missouri, pursuant to a Bond Purchase Agreement in the form before the meeting of the Common Council at which this Bond Ordinance is adopted at a rate or-rates of interest not to exceed _2,�L__% per annum and at a price of not less than 96% of the principal amount thereof, the exact rate or rates and price to be set forth in the Bond Purchase Agreement and approved by Stix & Co. Inc. and the Company. The Mayor and City Clerk are authorized to execute and deliver such Bond Purchase Agreement in substantially the form before the meeting at which this Bond Ordinance is adopted. Section 10. The distribution of a Preliminary Official Statement in the form presented to the meeting at which this Bond Ordinance is adopted and the distribution of a final Official Statement in substantially the form of the Preliminary Official Statement, with such changes and modifications therein, as shall be'approved by the Mayor, with an appendix containing information furnished by the Company, is hereby approved, and the Mayor is hereby authorized to execute such final Official Statement. Section 11. General. The Mayor, City Clerk, City Controller and City Treasurer be and they are each hereby authorized and directed, in the name of and on behalf of the City, to execute any and all instruments, perform any and all acts, approve any and all matters, and do any and all things deemed by them, or any of them, to be necessary or desirable in order to carry out the purposes of this Bond Ordinance. Section 12. Effective Date. This Bond Ordinance shall be in full force and effect from and after passage and approval as provided by law. i // p cer of the Common Counc ATTEST: v FILED IN CLERK'S OFFICE City Clerk 1978' AUG �. 8 1978 Presented to the Mayor by me this day of , y Irene Gamrw,o CITY CLERK, SOUTH BEND, IND. City Clerk Approved by me this day of 1st READINd -gs- • i 8' PUBLIC HEARING $P—//. C 1978.