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HomeMy WebLinkAboutRevenue Bond Financing for Koch Label Co.+468 RESOLUTION/MUNICIPAL ORDER NO. 609 A RESOLUTION/MUNICIPAL ORDER OF THE BOARD OF COMMISSIONERS OF THE CITY OF PADUCAH, KENTUCKY, GIVING PRELIMINARY APPROVAL TO INDUSTRIAL BUILDING REVENUE BOND FINANCING FOR KOCH LABEL CO., INC.; AUTHORIZING INITIATION OF ACQUISITION AND CONSTRUCTION OF SUCH ,;: INDUSTRIAL BUILDING PROJECT; AGREEING TO UNDERTAKE THE ISSUANCE OF INDUSTRIAL BUILDING REVENUE BONDS AT THE APPROPRIATE TIME; AND TAKING OTHER PRELIMINARY ACTION. WHEREAS, it has been determined that the City of Paducah, Kentucky (the "Issuer"), may assist Koch Label Co., Inc., presently of Evansville, Indiana, or an affiliated entity (the "Company"), by causing the acquisition and construction of an industrial building project as described in Exhibit A attached hereto (the "Project") and by entering into at the appropriate time a lease or loan agreement with the Company pertaining to the Project, all pursuant to authority of Sections 103.200 to 103.287, inclusive, of the Kentucky Revised Statutes, as amended (the "Act"), and in furtherance of the purposes of the Act and the ensuing public benefit to the residents of the Issuer and its environs, such lease or loan agreement to be upon such terms and conditions as the Act may require and the Issuer may deem advisable; and WHEREAS, the Issuer is authorized by the Act to issue its revenue bonds for the purpose of defraying the costs of acquiring and constructing the Project; discussions have occurred between the Company and the Issuer incident to the issuance of such revenue bonds by the Issuer; it is the intention of the Issuer, and the ,r~,_, Issuer has agreed and hereby agrees with the Company, to issue such i bonds upon compliance by the Company with such reasonable conditions `_,..~' and obligations as the Issuer may require and subject to the approval by the Issuer of the terms of all agreements, ordinances and other documents incident to such bond issue; and the Issuer has authorized the Company to proceed with initiation of the Project, subject to reimbursement of the initial costs of the Project from the proceeds of such bonds, as, if and when issued; and WHEREAS, based upon the Company's estimate of the aggregate costs of the Project, the Issuer proposes to issue its industrial building revenue bonds (the "Bonds") in an aggregate amount up to $10,000,000 to pay the costs of the Project, including costs incident to the authorization, sale and issuance of the Bonds and other financing costs, but with such other financing and contributions from the Company as may be necessary; and the Bonds will be payable solely from payments to be made by the Company under the contemplated lease or loan agreement and will not be payable from any funds or assets of the Issuer whatsoever; and WHEREAS, the Issuer proposes to enter into at the appropriate time a lease or loan agreement with the Company with respect to the Project whereby the Company will covenant and agree to pay amounts sufficient to provide for the payment of principal of and premium, if any, and interest on the Bonds together with all trustee's and paying agent's fees in connection with the Bonds and any other related charges as the same come due and payable; ~~..,Y NOW, THEREFORE, THE BOARD OF COMMISSIONERS OF THE CITY OF PADUCAH, KENTUCKY, DOES HEREBY ORDER AS FOLLOWS: Section 1. It is hereby found, determined and declared that (i) the recitals set forth in the preambles to this Resolution/Municipal Order, which are hereby incorporated in this Section by reference, are true and correct; (ii) the total amount of .. i ~ m~r7~,r~an. ~...,rr'- -P ~. r ~ -,;_ .. - ~ .. -i p.ra ~ r-' ~-rv -r -i-c- 469 money necessary to be provided by the Issuer through the issuance of the Bonds for the acquisition and construction of the Project will not exceed $10,000,000; (iii) the Company has represented it will have sufficient financial resources to acquire and construct the Project and to place it in operation and to continue to operate, maintain, and insure the Project throughout the term of the Bond issue, meeting when due the obligations of the proposed lease or loan agreement; and (iv) sufficient safeguards will be provided by the lease or loan agreement to insure that all money provided by the ``~"' Issuer from the proceeds of the sale of the Bonds will be expended, by way of direct expenditure or reimbursement, solely and only for the purposes of the Project. Section 2. It is hereby found, determined and declared that the costs of acquiring and constructing the Project will be paid out of the proceeds of the Bonds, such proceeds to be supplemented by contributions of the Company as may be necessary to complete the Project as the Project is described in the lease or loan agreement to be executed by and between the Issuer and the Company at the appropriate time pursuant to the Act; that none of the Bonds will be general obligations of the Issuer; that neither the Bonds nor the interest thereon shall constitute or give rise to any pecuniary liability whatsoever of the Issuer or any charge against its general credit or taxing power; that the Bonds and the payment of interest thereon shall be secured and payable solely and only by a pledge of amounts to be paid by the Company or otherwise to be available under such lease or loan agreement; and that no part of said costs will be payable out of any general funds, assets, properties or other contributions of the Issuer. It is acknowledged and intended that interest on the Bonds will be excluded from gross income for federal and Kentucky income tax purposes, subject to certain conditions. ,, ,... Section 3. Because the Project will be acquired and constructed to conform to the requirements of the Company, it is hereby found, determined and declared that acquisition and construction of the Project should be undertaken or caused to be undertaken by the Company forthwith, and accordingly, the Company is hereby authorized to formulate and develop plans and specifications for the Project and to enter into such contracts and undertakings as may be required for the acquisition and construction of the Project. Payments or reimbursements to or on behalf of the Company after the receipt of the proceeds of the sale of the proposed Bonds by the Issuer shall be made as set out in the lease or loan agreement to be entered into by the Issuer and the Company at the appropriate time pursuant to the Act. Section 4. The Company is authorized and directed to take any other legal action necessary and customary in order to satisfy any prerequisites to the issuance of the Bonds. Counsel for the Issuer and its officers are authorized and requested to assist the Company in any appropriate manner. Section 5. No funds of the Issuer shall be expended on the Project, except such as are derived from Bond proceeds. Section 6. All resolutions/municipal orders of the Issuer ,. ~r. or parts thereof in conflict herewith are, to the extent of such ~,,,~ conflict, hereby rescinded. Section 7. This Resolution/Municipal Order shall be in full force and effect from and after its adoption. ADOPTED by the Board of Commissioners of the City of Paducah, Kentucky, at a meeting held on October 8, 1991, signed by 470 the Mayor as evidence of his approval, attested by the City Clerk, and declared to be in full force and effect. GERRY B . P~IONTGOMERY Mayor ~, Attest: Lenita Smith City Clerk CERTIFICATION "Issuer"), and as such I further certify that the foregoing is a true, correct and complete copy of a Resolution/Municipal Order duly adopted by the Board of Commissioners of the Issuer at a meeting properly held on October 8, 1991, signed by the Mayor and now in full force and effect, all as appears from the official records of the Issuer in my possession and under my control. I, the undersigned, do hereby certify that I am the duly qualified and acting Clerk of the City of Paducah, Kentucky (the IN WITNESS WHEREOF, I have hereunto set my hand this 8th day of October, 1991. (SEAL) Lenita Smith City Clerk Exhibit A Project Description The Project, which consists of a new manufacturing plant for use by the Company in the production and processing of printed labels for commercial products and other printed materials, comprises an industrial building encompassing approximately 100,000 square feet, as substantially improved, appurtenances thereto and site improvements on a 14-acre tract at Coleman Road and Ky. Hwy. 305 in Coleman Industrial Park in the City of Paducah, Kentucky, together with major new manufacturing machinery and equipment including without limitation two new printing presses and related equipment. Preliminary cost estimates are as follows: Land, building and improvements $ 3,800,000 Equipment 6,200,000 Estimated Total $10,000,000 ~.~~nm~~r-~vnq.,r.,. .emu ~,~, .~..,i7.. ~ ,,., .._ , ~-nr-,.. ,~-.. :~rtavrrr~~~i~~. r, r-ir- ~- _,-.,- ~-. n-- .. . _TT,-...,. ..,~~n, are ....._ .....--~-r-~a~-~. .. .~ ~~(