HomeMy WebLinkAboutIssue Industrial Development Bonds 1981140
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A RESOLUTION OF THE BOARD OF COMMISSIONERS OF THE CITY OF PADUCAH,
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KENTUCKY, PROVIDING FOR THE ISSUANCE OF CITY OF PADUCAH, KENTUCKY, INDUSTP.IAL
DEVELOPMENT BONDS, 1981 SERIES B, SOUTHERN ILL.INO.IS__STEEL PRODUCT-CORPORATION
PROJECT, AND AUTHORIZING THE EXECUTION OF A MEMORANDUM OF AGREEMENT BY AND BETWEEN
THE CITY AND SOUTHERN ILLINOIS STEEL PRODUCTS CORPORATION, RELATING TO THE BOND
ISSUE. ~ _..__ ..
WHEREAS, pursuant to and in accordance with the provisions of KRS 103.200
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to 103.285, as amended (the "Act"), the City of Paducah, Kentucky (-the "City")
proposes to undertake to cause the acquisition, construction and financing of-the
Project referr-ed to below so as to promote-ahe economic•develop~ent of-the
Commonwealth, to-.relieve conditions of .unemployment, and to .,encourage_the,inc~ease of
industry in this state by providing an inducement to manufacturers to construct and,`
expand industrial facilities in the City of Paducah, Kentucky; and
WHEREAS, the City is authorized by the Act to acquire, construct and
improve, or cause to be acquired, constructed and improved, industrial facilities;
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WHEREAS, the City is authorized by the Act to issue revenue bonds (the.....
"Bonds") payable solely from-the revenues and receipt-s derived from the loan of the
bond proceeds or-sale or~leasing of the~_facilities;:acquired-`and constructed through
the issuance of such revenue bonds; and _.. - -
WHEREAS, Southern Illinois Steel Products Corporation, (the "Company"), a
corporation duly organized under the laws of the State of ILlinois, proposes to build
a new industrial building, as~de-fined in the Act, in the City of Paducah, if the
bonds are issued to finance the construction, equipment and expansion of such plant
(the "Project"); and
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WHEREAS; the Board of Commissioners of the City of `Paducah, Kentucky, finds
that:
A. The project wiJa retain.l4_jobs and provide 20 to -25 new jobs--and has
has the potential of providing 40 to 50 new jobs in five years.
B. The project will significantly increase the revenue received from the
property by the City, County and State through real estate, payroll and
sales taxes.
C. The project will improve economic conditions throughout the community
by having a substantial indirect impact on many other aspects of the area's
economy.
D. The project is recommended by Paducah McCracken County Growth, Inc. by
resolution dated July 20, 1981.
WHEREAS, the bonds shall not be payable from the revenues of the City other
than those derived from the Company pursuant to a financing agreement (the
"Agreement") and related financing documents and shall never constitute an
indebtedness of the City;
WHEREAS, the City proposes to enter into a Financing Agreement with respect
to the Project with the Company, whereby the Company will covenant and agree to pay
principal, premium, if any, and interest on the bonds, together with all trustee's
and paying agent's fees in connection with such bonds as the same come,.~due and
payable; and
WHEREAS, it is deemed necessary and advisable that a Memorandum of
Agreement between the City and the Company"be executed setting forth the agreements
of the parties with respect to the acquisition and construction of the Project -and
the issuance of the bonds to defray the costs thereof;
NOW, THEREFORE," BE IT RESOLVED BY THE BOARD OF COMMISSIONERS OF THE CITY OF
PADUCAH as follows: _
Section 1." That the Project; an industrial steel and alloy fabrication
facility of approximately twelve thousand (12;000) square feel, constitutes an
"industrial building" under the Act.
SectYOn 2. That the~:acquistion, construction and improvement of the
Project by the Company be', and`the same are hereby authorized: Inasmuch as the
Project will be undertaken, and the facilities will be acquired; constructed and
installed, for the purpose of"conforming to-the requirements of the Company, as
lessee or owner, in order that the Company may give employment to citizens and
residents of the community, and inasmuch as the Comp-any requires for its operations
the installation of certain equipment and devices which it is peculiarly equipped to
install, and inasmixcli as the"Company is better able to judge its requirements as the
work progresses than the City can reasonably be expected to"do, and the Company
possesses more expertise in such matters, it is hereby found, determined and declared
that construction of the proposed facilities should be undertaken by the Company.
Accordingly, the Company is hereby empowered and authorized"-to formulate and develop
plans and designs for the Project, and to enter into such contracts and undertakings
as may be required for the complete construction and installation of the"Project.
Section 3. -For the purpose of paying the cost of the Project; the City
will issue City of Paducah Industrial Development Bonds, 1981 Series, -Southern
Illinois Steel Products Corporation Project) (the "Bonds") now in an amount estimated
not to exceed six hundred thousand ($600,000.00) dollars. The bonds shall bear
interest at t:he rates:, shall be nti"ally issued in coupon form, shall be in such
denominations, shall be numbered, shall"be dated, shall mature; shall b"e subject to
redemption prior to maturity, shall have such provisions with-respect"to
registration, shall be in such form and shall have such other details `and provisions
as shall be .prescribed by an indenture of Trust (the "Indenture") to be entered into
by the City and a-bank acting as Trustee. -
Section 4. The bonds shall be limited obligations payable solely by'
Southern Illinois Steel Products Corporation and shall not be considered general
obligations of the-City, or the Commonwealth of Kentucky. The holders of the bonds
shall not have the right to demand payment from moneys derived by taxation or any
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other revenues of the City, except those revenues pledged to the payment of the bonds
in the manner provided in the Indenture.
Section 5. Prior to or contemporaneously with the delivery of any bonds,
the Company will enter into a financing agreement with the City under the terms of
which the Company will obligate itself to complete the acquisition and construction
of the Project,,and to pay to the City sums sufficient in the aggregate to pay the
principal~of, inter-est on, and premium, if any, on the proposed-bonds; as and when
said bonds shall become due and payable, such financing agreement to contain such-
other provisions as shall be mutually acceptable to the City and the Company, which
may include a covenant on behalf of the Company to pay each year to all taxing
authorities~an amount equal-to_the ad valorem-taxes which would have been-:due had the
property remained-ion the -tax rolls; ~f for any reason thE_:property is-removed from
the tax rolls, less the amount of the leasehold tax-under KRS 132.020 if applicable.
It is agreed that.. the Company, or~a-related company, will. enter into a guaranty
agreement with the Trustee appointed by the Gity in which it will guarantee the.
payment of-all principal and interest on the bonds. - _
Sect~on.6. Vo covenant, stipulation, obligation or agreement herein
contained shall be deemed to-be a covenant, stipulation, obligation or agreement of
any member of the Board-of Commissioners of the City o-r of any officer; agent or
employee of the City in-his; individual. capacity -and- the members of: the Board of
Commissioners- of -the.Ci.ty shall not be subject to any personal liability"or
accountability by-reason-of the adoption hereof. -
Section ~7. Any action heretofore taken by the. Company in initiating the
acquisition and construction of the Project is hereby ratified, confirmed and
approved., and the Company is hereby authorized-to commence such acquisition and
construction.
.Section 8. Pursuant to KRS 102.230, the Company has requested that sale of
the bonds be made. .privately, if possible, upon a negotiated basis. ,The :Company is
authorized to-s-elect proposed purchasers-to prepare and submit to the City proposals
for the purchase...of the bonds: The identity of any of~the purchasers of the. bonds
and the terms of.s ale of the bonds w-ill be subject to the approval of the City.
Section 9. The City af:Paducah shall receive from the s:aie of the bonds.,
as a service fee,; a sum o:f-money equivalent to one-half _of one percent'of the bond
amount; however., the. service fee-shahl not be less than $1,000 nor more than $50,000,
to be p.ai.d at the .time of sale.. -
Section 10. -A: law firm mutually acceptable to the Company and-the. City
shall act as Bond Counsel and Special Counsel for, the City and shall b.e .authorized
and directed to-file any suit and-take any other legal: action necessary and customary
in the establishment of prerequisites to the issuance of the bonds.. The firm-of-
Whitlow., Roberts,-.Houston, and Russell, Paducah, Kentucky, is designated as Special
Counsel for the•.Gity and said Special Counsel and the Corporation Counsel are each
authorized and directed to assist Bond Counsel in any appropriate manner.
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Section 11. In order to ensure the acquisition, improvement, installation
and construction of the Project in the City with resultant public benefits which will
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flow therefrom, it-is deemed necessary aril advisable that the-Memorandum of Agreement
hereinafter referred to be approved:.'.arid, executed+: for and -ori behalf of the~`City
Accordingly, the Memorandum of Agreement by and-:between-the Company and City, - -
substantially in~the form ,and__.wi,th the contents. set.fo.rth_in_Exhibit A.are..attached _.
hereto and incorporated herein by reference, is hereby approved and the Mayor is
hereby authorized and directed to execute and deliver said Memorandum of Agreement,
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and the Clerk of the City to attest his signature thereto.
n connection with the issuance of the
1 Section 12. `The expenses and fees'i
bonds shall b'e borne completely by the Company or be-paid out of the proceeds of the `
bonds . ~ .. _ ~ .... _ .. - -
Section 13~. The~~Gi-ty Cl_exk xs h~e-reby authorized and di.recte.d to :distribute
copies o€, this resolution _tq. the .Company .and, _to,_do~,_s-uch furthex. ths~gs. -.ox~ pexform , ~ -,
y y ,._ ^_ _'^ ~„ p _ he provisions of_ this ~ _
such acts as ma be necessar or convenient.,to.im_lenient t _ __
resolution and take other actions to induce the Company to construct the Project.
Section 14. This resolution shall constitute such "official action" on the
part of the City and Board of Commissioners toward the issuance of the proposed
revenue bonds, within the meaning of the Federal Income Tax Regulations.
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Section 15~.'~~-Thi.s `resolution shall take effect upon' its adoption. The City
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shall cause--to-be publ'sled ri "the newspaper`official"adv'ertisements of 'the City'the
title of this resolution, together with>;a stat:ement psi>gned by the Clay Cae.rk; "'sett.ing
forth the..estimated,amount of the: bond, issue ;.the-name of th.e--Company which will
lease the industrial building or be loaned the.pro.ceeds for. construction and _
installation of the industrial building, and the fact that the revenue, bonds are to
be retired from the proceeds of the lease payments or loan payments as set forth in
KRS 103.200 to 103.285, inclusive. The form of such publication, attached hereto as
Exhibit B and made a part hereof, is hereby approved for the purposes of such
publication.
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Introduced by Board of Commissioners on July 28, 1981
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Notice of Public Hearing in Paducah Sun August 2, 1981
Public Hearing and Final Approval August 11, 1981
Recorded by Louise McKinney, City Clerk, August 11, 1981
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