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HomeMy WebLinkAboutResolutions - RS-98-07 - 06/04/1998 - Issuance of Bonds for Kingsbury Ltd partnershipRESOLUTION NO. RS-98- 07 A RESOLUTION PROVIDING FOR THE FINANCING BY THE CITY OF MCHENRY, ILLINOIS OF AN INDUSTRIAL PROJECT CONSISTING OF THE ACQUISITION AND CONSTRUCTION OF AN INDUSTRIAL FACILITY AND ACQUISITION OF EQUIPMENT AND RELATED PROPERTY BY KINGSBURY LIMITED PARTNERSHIP (THE "BORROWER"): AUTHORIZING THE ISSUANCE OF ITS NOT TO EXCEED $5,600,000 INDUSTRIAL PROJECT REVENUE BONDS, SERIES 1998 (KINGSBURY LIMITED PARTNERSHIP PROJECT) IN CONNECTION THEREWITH: AUTHORIZING THE EXECUTION AND DELIVERY OF A LOAN AGREEMENT BETWEEN THE CITY OF MCHENRY, ILLINOIS AND THE BORROWER, AUTHORIZING THE EXECUTION AND DELIVERY OF A TRUST INDENTURE SECURING SAID BONDS; AND RELATED MATTERS. WHEREAS, the City of McHenry, Illinois, a unit of local government existing under the Constitution and the laws of the State of Illinois (the "issuer") is authorized and empowered by the provisions of the Industrial Project Revenue Bond Act, 65 ILCS 5/11-74-1 et seq., as from time to time supplemented and amended (the "Act") to issue its revenue bonds to finance the costs of any industrial project to the end that the Issuer may be able to relive conditions of unemployment, to maintain existing levels of employment and to encourage the increase of industry and commerce within the Issuer, thereby reducing the evils attendant upon unemployment and provide for the public safety, benefit and welfare of the residents of the Issuer; and WHEREAS, as a result of negotiations between the Issuer and Kingsbury Limited Partnership, an Illinois limited partnership (the "Borrower"), the Borrower has provided for financing of the cost of acquiring and constructing an approximately 60,000 square foot manufacturing facility to be located at lots 14 through 20 in the Inland Business park in McHenry, Illinois, and acquiring various equipment for use therein (the "Project"), which, based upon representations made to the Issuer by the Borrower, constitutes an industrial project under the Act and the Issuer is willing to issue its revenue bonds to finance the cost of the Project and to enter into a loan agreement with the Borrower upon terms which will produce revenues and receipts sufficient to provide for the prompt payment at maturity of the principal and interest on such revenue bonds, all as set forth in the details and provisions of the Loan Agreement as hereinafter identified; and WHEREAS, it is necessary and proper for the Issuer for the benefit of the inhabitants within the City of McHenry to authorize the financing of the Project and the issuance of the Issuer's Industrial Project Revenue Bonds, Series 1998 (Kingsbury Limited Partnership Project) in the aggregate principal amount of not to exceed $5,600,000 (the "Bonds"); and WHEREAS, The Northern Trust Company (the "Placement Agent") has indicated its willingness to use its best efforts to place the Bonds with sophisticated investors; and WHEREAS, it is necessary to authorize the execution of a Loan Agreement between the Issuer and the Borrower under the terms of which the Issuer will lend the proceeds of the sale of the Bonds to the Borrower to reimburse the Borrower for the financing of the costs of the Project, the payments to be paid by the Borrower to the Issuer in repayment of the loan to be sufficient to pay at maturity the principal of, premium, if any, and interest on the Bonds; and WHEREAS, it is necessary for the Issuer to execute and deliver a Trust Indenture to be entered into between the Issuer and the trustee to be named therein (the "Trustee") for the holders from time to time of the Bonds pursuant to which the Bonds will be issued; and WHEREAS, The Northern Trust Company (the "Bank") will issue an Irrevocable Transferable Letter of Credit to the Trustee (the "Letter of Credit"); and WHEREAS, a Preliminary Private Placement Memorandum (the "Placement Memorandum") has been prepared and presented to this meeting; and - 2 - WHEREAS, the Issuer has been asked to consent to the appointment of the Placement Agent and Remarketing Agent by executing the Placement and Remarketing Agreement for the sole purpose of evidencing such consent; and WHEREAS, there have been prepared and presented to this meeting the following documents, which the Issuer proposes to enter into: I . The Loan Agreement dated as of March 1,1998, between the Issuer and the Borrower (the "Loan Agreement'); 2. The Trust Indenture dated as of March 1, 1998 (the "Indenture"), between the Issuer and the Trustee, setting forth terms, conditions and security requirements for the proposed bond issue to finance the Project and containing the form of the Bonds; and 3. The Placement and Remarketing Agreement (the "Placement and Remarketing Agreement") between the Borrower and the Placement Agent for the sole purpose of having the Issuer consent to the appointment of the Placement Agent and the Remarketing Agent; WHEREAS, the Issuer held a Public Hearing pursuant to Section 147(f) of the Internal Revenue Code of 1986, as amended, on March 4,1998; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF MCHENRY, MCHENRY COUNTY, ILLINOIS, AS FOLLOWS: Section 1. That the form, terms and provisions of the proposed Loan Agreement and Indenture be, and they hereby are, in all respects approved, and that the Mayor and the City Clerk of the Issuer be, and they are hereby authorized, empowered and directed, subject to the terms and conditions of the Loan Agreement and the Indenture, to execute and deliver such instruments in the name and on behalf of the Issuer, to cause the Loan Agreement to be delivered to the Borrower and - 3 - to cause the Indenture to be delivered to the Trustee; that the Indenture shall constitute a lien for the security of the Bonds and upon all right, title and interest of the Issuer in and to the Loan Agreement (except for the Unassigned Rights of the Issuer, as defined in the Indenture) and in and to the payments, revenues and receipts payable to the Issuer pursuant to the Loan Agreement (except for payments, revenues and receipts of the Issuer derived pursuant to its Unassigned Rights), and said revenues are hereby and in the Indenture pledged for such purpose; that the Loan Agreement and the Indenture are to be in substantially the form presented at this meeting and are hereby approved, with such changes therein as shall be required or approved by counsel to the Issuer and approved by the officials of the Issuer executing the same, their execution thereof to constitute conclusive evidence of their approval of any and all changes or revisions therein from the forms of the Loan Agreement and the Indenture presented at this meeting and hereby approved; that the Loan Agreement shall be entered into with the Borrower and the Indenture shall be entered into with the Trustee; and that from and after the execution and delivery of such instruments, the officials, agents and employees of the Issuer are hereby authorized, empowered and directed to do all such acts and things and to execute all such documents as may be necessary to cant' out and comply with the provisions of such instruments as executed. Section .Z. That the Mayor is hereby authorized to evidence the consent of the Issuer to the appointment of the Placement Agent and the Remarketing Agent by executing the Placement and Remarketing Agreement for the sole purpose of evidencing such consent; that the Placement and Remarketing Agreement is to be in substantially the form presented at this meeting and hereby approved, with such chanscs therein as shall be required or approved by counsel to the Issuer and approved by the Mayor of the Issuer executing the same, his execution thereof to constitute - 4 - conclusive evidence of the Issuer's approval of any and all changes or revisions therein from the form of such instrument hereby approved. Swim 2. That, subject to the terms and conditions of the Loan Agreement, the issuance of the Bonds in the aggregate principal amount of not to exceed $5,600,000 to mature and with the interest rates to be calculated in accordance with the Weekly Mode, the Flexible Mode, the Medium Term Mode or the Fixed Rate Mode, as determined from time to time in accordance with the Indenture, is hereby approved and the Mayor and the City Clerk of the Issuer be and are hereby authorized, empowered and directed to cause to be prepared the Bonds in the form and having the other terms and provisions specified in the Indenture (as executed and delivered); that the Bonds shall be executed in the name of the Issuer with the manual or facsimile signature of its Mayor and the manual or facsimile signature of its City Clerk and the seal of the Issuer shall be impressed or reproduced thereon, and that the Mayor or any other officer of the Issuer shall cause the Bonds, as so executed and attested, to be delivered to the Trustee for authentication and the Trustee is hereby requested to authenticate the not to exceed $5,600,000 aggregate principal amount of Bonds; and the forms of the Bonds attached to the Indenture, subject to appropriate insertions in order to comply with the provisions of said Indenture be, and the same hereby is, approved, and when the same shall be executed on behalf of the Issuer in the manner contemplated by the Indenture and this Resolution in the aggregate principal amount of not to exceed $5,600,000, it shall represent the approved form of the Bonds of the Issuer. Section 4. That the distribution and use of the Placement Memorandum presented at this meeting (with such changes therein as shall be required or approved by counsel to the Issuer) by the Placement Agent is hereby approved, and the distribution and use of a Final Placement - 5 - Memorandum (in substantially the form of the Placement Memorandum but with appropriate variations to reflect the final terms of the Loan Agreement, the Indenture, the Bonds, the Placement and Remarketing Agreement and the Letter of Credit) is hereby authorized; provided, however, that the distribution and use of the Placement Memorandum and the Final Placement Memorandum, and the Issuer's authorization of same, does not constitute a representation or approval by the Issuer of the accuracy or sufficiency of any information contained in the Placement Memorandum or the Final Placement Memorandum except to the extent of the information contained under the heading "THE ISSUER" and "LITIGATION" (but only pertaining to the information under this heading relating to the Issuer). Section J. That the We of the Bonds, upon the terms and conditions set out in the Placement Memorandum, the Loan Agreement and the Indenture, be, and is, in all respects authorized and approved. Section �. That from and after the execution and delivery of the Loan Agreement, the Indenture and the Placement and Remarketing Agreement, the proper officials, agents and employees of the Issuer are hereby authorized, empowered and directed to do all such acts and things and to execute all such documents as may be necessary to carry out and comply with the provisions of said documents as executed and to further the purposes and intent of this Resolution, including the preamble hereto. Section Z. That all acts and doings of the officials of the Issuer which are in conformity with the purposes and intent of this Resolution and in furtherance of the issuance and We of the Bonds in the aggregate principal amount of not to exceed $5,600,000 and the financing of the Project to that amount be, and the same hereby are, in all respects, approved and confirmed. - 6 - Section $. No pledge, agreement covenant, representation, obligation or undertaking by the Issuer contained in this Resolution and no other pledge, agreement, covenant, representation, obligation or undertaking by the Issuer contained in any document executed by the Issuer in connection with the project or the Bonds shall give rise to any pecuniary liability of the Issuer or charge against its general credit, or shall obligate the Issuer financially in any way except out of payments to be made by the Borrower under the Loan Agreement other than payments to be made by the Borrower pursuant to the Issuer's Unassigned Rights (as defined in the Indenture), No failure of the Issuer to comply with any term, condition, covenant, obligation or agreement herein shall subject the Issuer to liability for any claim for damages, costs or other financial or pecuniary charge except to the extent the same is paid by the Borrower; and no execution of any claim, demand, cause of action or judgment shall be levied upon or collected from the general credit, general funds or other property of the Issuer. The principal of, premium, if any, and the interest on the Bonds are special limited obligations of the Issuer. No owner of the Bonds has the right to compel any exercise of the taxing power of the Issuer, the State of Illinois or any political subdivision thereof to pay the Bonds or the interest or the premium, if any, thereon. The Bonds do not and shall never constitute or give rise to any pecuniary liability of the Issuer or a charge against its general credit or taxing powers, The Bonds do not and shall never constitute or evidence an indebtedness of the Issuer, the State of Illinois or any political subdivision thereof or a loan of credit thereof within the meaning of any constitutional or statutory provision. - 7 - Section 2. That a public hearing pursuant to Section 147(f) of the Code relating to the issuance of the Bonds was held on March 4, 1998 and, subject to the terms and conditions of the Loan Agreement and the Indenture, the issuance of the Bonds is hereby approved. Section 1Q. That the Issuer hereby elects to have the provisions of Seotion 144(a)(4)(A) of the Internal Revenue Code of 1986, as amended, apply to the hereinabove described bond issue and hereby affirmatively notes said election in this Resolution. Section 11. That the Bonds shall be issued in compliance with and under the authority of the provisions of the Act, this Resolution and the Indenture. Seclioll ,Z. The obligation of the Issuer to issue and deliver the Bonds is subject to the availability for such purpose of a necessary and sufficient cap allocation under Section 146 of the Internal Revenue Code of 1986, as amended. Semen 11. That the provisions of this Resolution 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 or provisions; provided, however, that no holding of invalidity shall require the Issuer to make any payments from revenues other than the proceeds derived from the sale of the Bonds issued under the Indenture and the proceeds derived from the Loan Agreement (except such proceeds as may be derived by the Issuer pursuant to its Unassigned Rights, as defined in the Loan Agreement) or impose any personal liability on any director, member, elected or appointed officer, official, employee, attorney or agent of the Issuer. Section IA. This Resolution shall be in full force and effect from and after its passage and approval as provided by law. - 8 - AYES: Bolger, Glab, McClatche urgatrovd. Baird_ NAYS: None. None. ABSENT: PASSED this 4th day of March, 1999. APPROVED this 4th day of March,1998. (SEAL) ATTEST: City Clerk 2651.2 Mayor 9 -