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HomeMy WebLinkAboutIssue Industrial Development Bonds 1981140 ,. ,, f_ A RESOLUTION OF THE BOARD OF COMMISSIONERS OF THE CITY OF PADUCAH, f 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 - -,. 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; and ~ - - .. 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 ,. _ ~ - 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 142 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. 143 Section 11. In order to ensure the acquisition, improvement, installation and construction of the Project in the City with resultant public benefits which will - _ _v _. - - 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, . ___.. 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. ,:. Section 15~.'~~-Thi.s `resolution shall take effect upon' its adoption. The City .. r ,. .. 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. _ - ,. - .. - - Mayor Introduced by Board of Commissioners on July 28, 1981 F... - . _ ,. _. . - - - ,_ , 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 _ -.. - r.