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HomeMy WebLinkAboutAuthorizing issuance of revenue bonds to evidence a loan from the industrial revolving fund relating to BoschORDINANCE No. 9266-01 Passed by the Common Council of the Ciry of South Bend, Indiana September 24, Attest: Attest: 01 20 Presented by me to the Mayor of the City of South Bend, Indiana SPntPmhPr ~5, 20 01 Ciry Clerk President of Common Council Ciry Clerk Approved and signed by me September 26, 20 01 Mayor ORDINANCE NO. ~ Zoo `~ ^ ~ AN ORDINANCE OF THE COMMON COUNCIL OF THE CITY OF SOUTH BEND, INDIANA, AUTHORIZING THE ISSUANCE OF REVENUE BONDS TO EVIDENCE A LOAN FROM THE INDUSTRIAL REVOLVING FUND OF SOUTH BEND, INDIANA, RELATING TO THE ROBERT BOSCH CORPORATION RETENTION PROJECT (CITY OF SOUTH BEND, INDIANA, REVENUE BONDS, SERIES 2001D) STATEMENT OF PURPOSE AND INTENT: The City of South Bend, Indiana (the "City") has previously determined to offer certain assistance to Robert Bosch Corporation ("Bosch") in order to induce Bosch to retain and expand its facility in the City. Accordingly, the City and Bosch have agreed to undertake certain activities in connection with the acquisition, demolition, construction, rehabilitation, and environmental remediation of certain property (the "Property") which Bosch formerly leased from Honeywell (formerly known as Allied Signal), including infrastructure and other site improvements (the "Project") and have memorialized their intentions in an Agreement for the Use and Rehabilitation of Real Property (the "Agreement")and Real Property Lease Agreement (the "Lease") (the "Agreement" and the "Lease" sometimes collectively referred to herein as the "Project Documents"). The Agreement provides that the City and Bosch will undertake the Project in return for Bosch's commitment to meet certain levels of employment. In addition, the City has acquired the Property and the City and Bosch have entered into the Lease pursuant to which Bosch will lease the Property from the City. ::ODMA\MI-IODMA\SBIMAN1;103388;3 In order to reimburse itself for a portion of the purchase price paid for the Property, the City proposes to borrow the aggregate principal amount not to exceed Five Hundred Ten Thousand Dollars ($510,000) (the "Loan") from the Industrial Revolving Fund of South Bend, Indiana, 15` Source Bank, South Bend, Indiana, trustee, (the "IRF") and issue revenue bonds (the "Bonds") of the City to evidence the Loan. Pursuant to the terms of the agreement which shall evidence the Loan (the "Loan Agreement"), the IRF requires that the City execute and deliver a mortgage granting to the IRF a security interest in the Property (the "Mortgage") and a collateral assignment of the City's interest in the Agreement and the Lease (the "Collateral Assignment"). To repay the Loan, the City will use certain sums payable by Bosch to the City pursuant to the terms of the Agreement (the "Bosch Funds"). In addition, the Redevelopment Commission (the "Commission") has adopted a resolution agreeing to consider the use of available tax increment revenues from the Airport Economic Development Area (the "TIF Revenues") to repay the Loan in the event that the Bosch Funds are insufficient for such purpose. It is intended that the City shall have no other obligation with respect to the payment of principal of or interest on the Loan other than (i) the Bosch Funds or (ii) if Bosch fails to make such payments or if such funds are insufficient to repay the Bonds, from the TIF Revenues. The Bonds which shall evidence the Loan shall constitute a limited obligation of the City payable solely from the Bosch Funds. Neither the full faith and credit nor the taxing power of the City is pledged to the payment of the principal of and the interest on the Bonds. NOW, THEREFORE, BE IT ORDAINED BY THE COMMON COUNCIL OF THE CITY OF SOUTH BEND AS FOLLOWS: ::ODMA~MI-IODMA~SBIMAN1;103388;3 '2' Section 1. The Common Council of the City (the "Common Council") hereby determines to issue the Bonds to evidence the Loan pursuant to I.C. 36-4-6-19 (the "Act") for the purpose of reimbursing the City for a portion of the purchase price paid for the Property. The Common Council hereby approves of and ratifies the execution and filing by the City of an application with the IRF for the purpose of requesting that the IRF make the Loan. The City shall use the proceeds of the Loan solely for the purpose of reimbursing a portion of the purchase price for the Property as set forth above. Section 2. The Common Council hereby authorizes the issuance of the Bonds in the form of the Loan in an aggregate principal amount not to exceed Five Hundred Ten Thousand Dollars ($510,000). The Bonds shall be designated as the "City of South Bend, Indiana, Revenue Bonds, Series 2001 D (Robert Bosch Corporation Project)." The Bonds shall be issued in fully registered form in the denomination of $1.00 or integral multiples thereof not exceeding the aggregate principal amount of the Bonds to be issued. Principal of and interest on the Bonds shall be paid pursuant to the schedule set forth as an exhibit to the Bonds. Interest shall be calculated on the basis of a 360-day year. The Bonds shall be sold by private, negotiated sale at a price of par to the IRF pursuant to the Loan Agreement. The Bonds shall be dated and have an original issuance date as of the date of the Loan. The Bonds shall mature on a date not later than twenty (20) years from the date of original issuance thereof and shall bear interest at a rate not to exceed four percent (4.0%) per annum. The Bonds may be redeemed by the City in whole and not in part on any date at par plus accrued interest to the redemption date. The Bonds shall be issued on parity with the City's Revenue Bonds, Series 2001 C (Robert Bosch Corporation Project) (the "Parity Bonds") and Senior to the City's Revenue Bonds, Series 2001E (the "Junior Bonds") to be issued on even date ::ODMA\MI-IODMA\SBIMAN1;103388;3 -3 - with the Bonds with respect to the pledge of the Bosch Funds and the Mortgage and Collateral Assignment (as set forth herein). The Clerk of the City is hereby appointed as registrar (the "Registrar") for the Bonds and is hereby charged with the responsibility of authenticating the Bonds. The Registrar shall keep and maintain at its principal office books for the registration of the Bonds. The Bonds shall be transferrable or exchangeable only upon the bond register by the registered owner thereof in person, or by his attorney duly authorized in writing, upon surrender of such Bond together with a written statement of transfer or exchange satisfactory to the Registrar duly executed by the registered owner, or his attorney duly authorized in writing, and thereupon a new fully registered Bond in the same aggregate principal amount and of the same maturity shall be executed and delivered in the name of the transferee or transferees or the registered owner, as the case may be, and in exchange therefor. Section 3. The Bonds to be issued by the City to evidence the Loan shall be secured by the Mortgage and the Collateral Assignment. The City hereby pledges the Mortgage and the Collateral Assignment to secure the payment of the principal of and interest on the Bonds. Such pledge is on a parity with the pledge made of the Mortgage and Collateral Assignment with respect to the Parity Bonds and senior to the pledge made with respect to the Junior Bonds. The City further pledges the Bosch Funds, which pledge is on a parity with the pledge of the Bosch funds for the Parity Bonds and senior to the pledge of the Bosch Funds for the Junior Bonds for the purpose of paying the principal of and interest on the Bonds. Section 4. The Mayor and the Clerk of the City are hereby authorized and directed to execute, attest, and deliver and the Clerk is hereby authorized to affix the seal on, when and if appropriate, the Loan Agreement, the Mortgage, and the Collateral Assignment together with ::ODMA\MF IODMA\SBIMAN1;103388;3 '4'- any documents, instruments, or certificates they deem necessary or appropriate upon the advice of counsel to complete the transactions contemplated herein. The Bonds shall be executed in the name of the City by the manual or facsimile signature of the Mayor of the City, and attested by the manual or facsimile signature of the Clerk of the City, who shall cause the official seal of the City to be impressed or a facsimile thereof to be printed on the Bonds. Subject to the provisions for registration, the Bonds shall be negotiable under the laws of the State of Indiana. Section 5. This Ordinance shall be in full force and effect from and after its passage by the Common Council and approval by the Mayor and shall not be repealed or amended in any manner which would serve to adversely affect the Loan or the funds identified herein which shall serve to repay the Loan. 1 st READING ~ -~ ~~~ 1 CAS .S (xY~S~'~7~•~L~ a s 1 ub.~~ ~ -e.~, COMMON COUNCIL OF THE CITY OF SOUTH BEND, INDIANA By: ~ ~'Q..J . Member of the Common Co cil PUBLIC HEARING Q-2~'©~ 3 rd READING 9-L`~-0~ NOT APPROVED REFERRED PASSEfl ~-L`~-0\ QS ::ODMA~MIIODMA~SBIMAN1;103388;3 "$" Fi(~c~ ~~ ~1erF~'~ Cuff ~~ LOSI,ETTA J. [JtiC& CITY CLERIC, ~s3. BEH:~, B'3. COMMITTEE REPORT TO THE COMMON COUNCIL OF THE CITY OF SOUTH BEND: Your Committee of the Whole, to whom was referred: BILL NO. 88-01 A BILL OF THE COMMON COUNCIL OF THE CITY OF SOUTH BEND, INDIANA, AUTHORIZING THE ISSUANCE OF REVENUE BONDS TO EVIDENCE A LOAN FROM THE INDUSTRIAL REVOLVING FUND OF SOUTH BEND, INDIANA, RELATING TO THE ROBERT BOSCH CORPORATION RETENTION PROJECT, CITY OF SOUTH BEND, INDIANA, REVENUE BONDS, SERIES 2001D 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 as substituted. Andrew Udj ak Chairman