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HomeMy WebLinkAbout83-12-2446.:• ORDINANCE NO. 83-12-2446 AN ORDINANCE OF THE CITY OF PADUCAH, KENTUCKY AUTHORIZING AND PROVIDING FOR THE ISSUANCE OF THE CITY OF PADUCAH INDUSTRIAL BUILDING REVENUE BOND (INGRAM MATERIALS COMPANY PROJECT), IN THE PRINCIPAL AMOUNT OF $1,000,000, AUTHORIZING (1) THE ACCEPTANCE OF A --DEED AND/OR BILL OF SALE CONVEYING THE PROJECT PROPERTY TO THE CITY, (2) THE EXECUTION OF A LEASE AGREEMENT, WHEREBY THE PROJECT WILL PRODUCE REVENUES AND RENTAL- INCOME.,"SUFFICIENT TO PAY THE INTEREST ON AND THE ,PRINCIPAL OF THE BOND AS SAME BECOME DUE; AND (3) THE EXECUTION OF A MORTGAGE DEED OF TRUST FOR THE PURPOSE OF SECURING,THE BOND BY A PLEDGE OF THE REVENUES OF THE PROJECT; -AND AUTHORIZING OTHER RELATED PRO- CEDURES,. WHEREAS,rthe City of Paducah, Kentucky (the "Issuer"), is authorized ..and empowered by the Industrial. -Buildings for Cities and..Counties Act -(Sections 103.200 -:to - 103.295, inclusive, of -the Kentucky Revised Statute.,,s-j ras amended; hereinafter referred,to as the'."Act"), to acquire -any building, structure or:related:improved area, and to: lease the same to a domestic or foreign corporation in order that the lCity might encourage the increase of industry -n. Kentucky, _:and ::increase employment therein;.) ,and WHEREAS, the City is authorized by the Act> -to issue bonds payable solely.out..of the revenues and other-proceeds..derived from the leasing.or.ownership of the industrial building project (the "Project.") t -a be acquired throughcthe :issuance of such bonds TTand is authorized to execute -,a mortgage deed of trust oto grant_a-f.orec.losable mortgage lien as additional security for the bonds, in accordance with KRS 103.251; and WHEREAS, Ingram Materials Company, a division of Ingram Industries, Inc., a Tennessee corporation (the "Company") has offere.d.to the City to operate the Project to be constructed on the Project Site described in the Mortgage Deed of Trust (the "Mortgage") (hereinafter identified), if the City will agree to issue an industrial building revenue bond (the "Bond"), in the principal amount of $1,000,000, pursuant to the Act, for the purpose of acquiring and constructing two warehouses and related facilities for bulk storage as part of the Company's operation of an existing port facility, which will result in the employment of a substantial number of workers; and WHEREAS, by Inducement through other actions taken, the Issuer has invited the Company to proceed with the proposed Project; and WHEREAS, the City and the Company have agreed that the Company, on behalf of the City, will construct the Project to be owned by the City on -the Project Site owned by the Paducah -McCracken County Riverport Authority (the "Authority") and currently leased by the -Authority to the Company, and the Company will lease the:Project from the City at a rental which will be sufficient in each year to pay the cost of the Project to the. City, through the retirement of the Bond issued by the City to finance said cost, all as set forth in the agreed Lease Agreement (the -"Lease") hereinafter -approved; and WHEREAS, under ;th.e:terms of the Lease, the,City will -.receive rentals and other payments from the Company, which shall be pledged as :security -,.for the payment of the •`1 principal of and interest on the Bond secured by the Mortgage, by and between the Issuer and Citizens Bank and .Trust Company, Paducah, Kentucky, as trustee (the "Trustee"); and WHEREAS, :the Issuer 'has found that the proposed Project will tend to relieve existing conditions of unemployment in the area and will otherwise promote =; the economic development and general welfare of the Issuer.''and all of its citizens and inhabitants; NOW, THEREFORE, BE IT ORDAINED BY THE CITY OF 'PADUCAH, COMMONWEALTH OF KENTUCKY, AS FOLLOWS`-'; SECTION 1':' AUTHORIZATION OF BOND: For the purpose of paying the costs of the Project, not otherwise pro- -� vided, the Issuer hereby authorizes and approves the issuance, execution and de- livery of the City ''of,Paducih; Kentucky, -Industrial -Building Revenue Bond (Ingram Materials Company Project). -Ii -to the purchaser thereof, inithe'-principal amount of One ?' Million Dollars ($1,000,000-)=1 initially issued-las='a= `single" fully registered''B'ond, -_' but which may be reissued as. more than one fully -registered: Bond, in any denomi:­ nation of at least $5,000, or any integral multiple thereof; as more -fully -provided for in said Mortgage and shal=l -be repaid as set forth in said Mortgage until final maturity, bearing interest at the rate of nine and one-quarter percent (9-1/4%) per annum. The interest .rate -has -been agreed upon by, the Issuer, the Company, and Citizens Bank and Trust Company, Paducah, Kentucky, as purchaser (the "Purchaser") pursuant to Section 103:'230''6f the Kentucky Revised Statutes, as amended. Pre- payment privileges and-bther''particulars regarding principal and interest require- ments of said Bond are specified in said Mortgage and approved hereby. SECTION 2. APPROVAL AND AUTHORIZATION OF EXECUTION OF VARIOUS DOCUMENTS; LEASE AGREEMENT; MORTGAGE DEED OF TRUST; BONDr,PURCHASE AGREEMENT; AND GUARANTY AGREEMENT. The following documents in the respective forms attached to this Ordinance in substantially the form -as submitted, are hereby approved, subject to such changes, insertions, or omissions as may be approved by the Mayor, such approval to be conclusively evidenced by his execution and delivery of said documents, in order to effectuate the purposVs,af--.this Ordinance, and the Mayor is hereby authorized to execute and acknowledge same for and on behalf of the Issuer; and the City Clerk is authorized to attest 'same and to affix thereto the corporate seal of the Issuer. Said documents are hereby ordered to be filed in the office of the City= C-1erk, labelled respectively, Exhibits A through D, as identified below, and each of said documents is ordered --to be recorded with-ths Ordinance 'in the official Ordinance.' Book of the Issuer:" (a) The Lease between the Issuer andd-the Company. (Exhibit A):.,: (b) The Mortgage between the Issuer and the Trustee. (Exhibit B). (c) Bond Purchase,Agreement (the "Agreement"); between the Issuer and the Purchaser, and also approved by the Company, providing 1 17 for the sale: -of the Bond to the Purchaser.r the price, at'the interest rate, and upon the respective terms and conditions set forth in said Agreement. The approval of said Agreement by the Company and a separate letter from the Company to the Issuer evidences the request of the Company that the Bond be sold at private sale upon a negotiated basis, as authorized by K.R.S. 103.230. (Exhibit C). (d) The Guaranty Agreement by and between the Trustee and the Company. -- SECTION 3. ACQUISITION OF PROJECT. In order to promote the general welfare of the Issuer and of its inhabitants, -by providing opportunities for permanent employment, the Issuer is hereby authorized to acquire ,,the, Project Property by.:accepting.the appropriate deed and/or bill of sale and to permit the Company to construct, renovate, and improve the Project pursuant. to --.the Lease and -the Mortgage. „ SECTION 4. COMPANY HAS-BEEN AND IS AUTHORIZED TO AND SHALL ARRANGE CONSTRUCTION; APPROVAL OF COMPANY CONTRACTS. (a) The Issuer specifically finds that (1) inasmuch as the Project will be undertaken, and the facilities will be constructed or installed, and in fact has been substantially or totally completed since passage of the inducement Resolution by the City on April 16, 1983, for the purpose of conforming to the requirements of the Company as Lessee, in order that the Company may afford employment to citizens and residents of the community, (2) the Company is better able than the Issuer to judge which facilities will be most suitable for its operation, and (3) since judgments must be made, in some cases, as con- struction progresses, the direct negotiation of construction contracts by the Company has been and will be necessary, and the reimbursement of the Company is authorized for ad- vancements made by the Company under such contracts and for other expenses related to the Project. The Issuer hereby ratifies and approves all action taken by the Company in initiating the Project, and authorizes the letting of'furthet contracts and the taking of other;actions necessary to complete the Project, so that same will'be suitable for use by the Company under the terms o -f 'the Lease. (b) Any contracts entered into by and between the contractors and the Company are hereby assumed by the Issuer to the extent that amounts payable thereunder shall be -payable from the proceeds of the sale of the Bond. Any amounts due to contractors shall be paid from the proceeds of the sale of the Bond, and shall not be payable from any other funds`of the Issuer, except that advancements may be made by the Company "for Project purposes which are reimbursable from the -proceeds of the Bond. SECTION 5. DISBURSEMENT OF -PROCEEDS OF BOND. - The Company and the Trustee are authorized -to carry out the procedures set -forth in the Mortgage for the construction and improvement of the Project and for the payment from time -to -,;time of the costs of such construction and improvement and related expenses, as the same;,progress. Such procedures..shall include reimbursement .to .the Company of all advances made by the Company toward the total cost of the Project in contemplation of the issuance of this Bond in reliance on the commitment of the Issuer in the Memorandum of Agreement ap- proved -,by Inducement Resolution adopted by the Board of Commissioners of the Issuer on April 26, ..1983_. SECTION 6. REVENUES OF THE PROJECT. The rental and other payments to be received by the Issuer for the use of the 691 692 1I Project under the terms ofathe Lease are determined to be sufficient to pay the principal of and interest on the Bond'as.the same become due and payable; and all of said rental payments and other payments received under the Lease and all other revenues arising out of or in connection with.the-ownership:of the Project, together with the Lease, are hereby pledged to secure such payments and revenues, and in addition, for such other purposes as are more fully specified in the Mortgage._ The City shall never be required to pay from its own funds any obligations deriving fromlthe issuance of the Bond, and the Bond is declared to be a special and limited obligation payable, -solely and only out of the receipts derived under the Lease, the Mortgage, and/or the Guaranty Agreement. SECTION 7. FORECLOSABLE MORTGAGE LIEN. The foreclosable mortgage lien upon the Project created and granted by the Mortgage pursuant to Section 103.251 of the Kentucky Revised Statutes is recognized, confirmed, and declared to be valid and binding upon the City and the Project, and shall take effect immedi- ately upon the issuance and delivery of the Bond. SECTION 8. DESIGNATION OF TRUSTEE. Citizens Bank and Trust Company, Paducah, Kentucky, is hereby designated as the corporate Trustee under the Mortgage and also as the paying agent and bond registrar for the Bond. SECTION 9. EXECUTION OF BOND. The Bond shall be executed in the manner provided in the Mortgage and shall be _o delivered to the Trustee for proper authentication and delivery by the Trustee to the Pur- chaser, with instructions to that effect, as provided in the Mortgage. SECTION 10. MAYOR AND OTHER CITY OFFICIALS TO TAKE ANY OTHER NECESSARY ACTION. Pursuant to the Constitution and laws of the Commonwealth of Kentucky, the Mayor, the City Clerk, the City Attorney, and all other appropriate officials of the Issuer are hereby authorized and directed to take any and all further action and to execute and deliver all other documents as may,be-necessary to effect the issuance and delivery'of the Bond, the acquisition by the City: of: the Project Property, and the leasing of the Project to the Company. SECTION.11. COMPLIANCE WITH FEDERAL ARBITRAGE REQUIREMENTS. The Issuer covenants that sums derived from the proceeds of the Bond shall not be invested in investments in a manner which would cause the Bond to be treated.as an "arbitrage bond" within-themeaning of Section 103 of the United States Internal Revenue Code of 1954, as amended, and the applicabl'eDRegulations thereunder (the."Code"). Prior to or at the time of delivery -of - the- Bond,- the Mayor and/or the City -Clerk, whoare jointly and'sever`ally charged with the responsibility for the issuance of the -Bond, are authorized to execute .the.appropriate certification with reference to the matters required and contemplated by the Code', setting out all known and --contemplated facts concerning the con- struction, expenditures, and investments, including the -execution of necessary and/or desir- able certifications contemplated by the Code in order to assure that interest on the Bond will be exempt from all federal income taxes and that the Bond will not be treated as an "arbitrage bond". Such officer(s):As LL(are) entitled to rely upon information furnished by the Company in making such certifications and representations unless they, or either of them, shall be aware of any fact or circumstances which would cause such certifications or representations to- be�iqu6stioned. _ SECTION 12. SEVERABILITY CLAUSE. If any section, paragraph, clause or provision of this Ordinance shall be ruled by any court of competent jurisdiction to. be invalid, the invalidity of such section, para- graph, clause, or provision -shall not affect any of.the .remaining .provisions hereof -.-- SECTION 13. CAPTIONS.OF-CLAUSES. The captions.of-this Ordinance are for convenience only and are not to be con- strued as.part of this Ordinance nor as defining or limiting -in any way the scope or intent of the°}provisions hereof. .:SECTION 14.. PROVISIONS IN CONFLICT REPEALED. All orders, ordinances, and resolutions, or parts thereof, in conflict with the provisions of this Ordinance, are, to the extent of such conflict, hereby repealed. SECTION 15. EFFECTIVE DATE OF ORDINANCE. This ordinance shall take effect from and after its adoption, approval and publi- cation of the Notice of Adoption and Summary hereof (including the title to this Ordinance), which.publication is hereby approved and ordered to be made by the -City Clerk, pursuant to Section 103.210 and Chapter 67 of the Kentucky Revised Statutes. Signed by the Mayor as evidence of his approval this 13th day of December, 1983. Joe Viterisi Mayor Protem ATTEST: Louise McKinney City Clerk (Seal of City) CERTIFICATE OF CITY CLERK I, Louise McKinney, hereby certify that I am the duly qualified and acting City Clerk of the City of Paducah, Kentucky, that the foregoing Ordinance having been introduced and given first reading on November 22, 1983, and being duly adopted by the Board of Commis- sioners of said City signed by the Mayor after proper publication, and attested under seal by me as City Clerk, at a properly convened term and session of said Board of Commissioners held on December 13, 1983, as shown by the official records in my custody and under my control, that Notice of Adoption and Summary of said Ordinance has been ordered to be published as required by law, that said Ordinance appears as a matter of public record in the City Ordinance Book No. 21, that attached hereto are true copies of the documents approved therein, and that copies of such documents have also been duly filed and recorded in the official records of the City. IN WITNESS WHEREOF, I have hereto set my hand as City Clerk and the Seal of the City this 13th day of December, 1983. Louise McKinney City Clerk (Seal of City) Published by The Paducah Sun, December 18, 1983 693