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HomeMy WebLinkAbout2007-OR-44 ORDINANCE NO. 2007- OR - 44 AN ORDINANCE AUTHORIZING ~HE ENTRY INTO A LEASE-SUBLEASE PURCHASE AGREEMENT IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $5,500,000 WITH CHASE EQUIPMENT LEASING INC. AND MKM MACHINE TOOL CO, INC.; TO FINANCE THE EQUIPPING OF AN ECONOMIC DEVELOPMEN1 FACILITY LOCATED WITHIN THE CITY OF JEFFERSONVILLE, INDIANA; AUTHORIZING A LEASE- SUBLEASE PURCHASE AGREEMENT AND TAX EXEMPTION I CERTIFICATE AND TAX REGULATORY AGREEMENT; AND AUTHORIZING OTHER ACTIONS IN CONNECTION WITH THE TRANSACTION. WHEREAS, the City of Jeffersonville, Indiana (hereinafter called the "Issuer"), is a municipal corporation and political subdivision of the State of Indiana, and by virtue of the Constitution and laws of the State, including Indiana Code, Title 18, Article 6, Chapter 45, as recodified and amended at I.C. 9 36-7-12 (the "Act"), is authorized and empowered, among other things: (a) to provide funds for the acquisition of privately owned economic development facilities; (b) to assist in the financing and acquisition of the Project (as hereinafter defined), (c) to enter into a lease and a sublease for the purpose of providing such assistance, and (d) to enact this Bond Legislation and execute the Lease-~ublease Purchase Agreement (the "Lease-Purchase Agreement") among the Issuer, Chase Equipment Leasing Inc. (the "Purchaser") and MKM Machine Tool Co., Inc. (the "Borrower"), and all other documents to be executed by it, upon the terms and conditions provided therein; and WHEREAS, the City Council has heretofore found and determined, and does hereby confirm, that the financing and refinancing of the acquisition, installation and equipping of certain economic development facilities to be located within the City (the "Project"), as set forth in the Lease-Purchase Agreement, will promote the welfare of the people of the Issuer, create or preserve jobs and employment opportunities, and assist in the development of economic activities to the benefit of the people of the Issuer, and that the Issuer, by assisting with the financing of the Project through the entry into the Lease-Purchase Agreement in the maximum aggregate principal amount of not to exceed $5,500,000, will be acting in a manner consistent with and in furtherance of the provisions of the Act; and WHEREAS, it is determined by the Issuer that the amount necessary to finance the costs of or related to the Project, will require the el)try into the Lease-Purchase Agreement. NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF JEFFERSONVILLE, INDIANA, that: Section 1. Definitions. All de:6.ned terms used herein and those not otherwise defined herein shall have the respective. meanings given to them in the Lease-Purchase Agreement. 90164 1 Any reference herein to the Issuer, or to any officers thereof, shall include those which succeed to their functions, duties or responsibilities pursuant to or by operation of law or who are lawfully performing their functions. Unless the context shall otherwise iI).dicate, words importing the singular number shall include the plural numbef,'al1d vice versa, and the terms "hereof', "thereby", "hereto", "hereunder" and similar terms, mean this Bond Legislation. Section 2. Determination of Issu~r. Pursuant to the Act, the Issuer hereby finds and determines that the Project constitutes an "economic development facility" as defined in the Act, and that all actions required under the Act to be taken by the Issuer prior to the entry into the Lease-Purchase Agreement have been duly authorized and completed. The Issuer hereby further declares its intention to comply fully with the requirements of Section 103 of the Internal Revenue Code of 1986, as amended (the "Code"), which applies to the lease obligations and the applicable regulations prescribed under that Section. At a public hearing held by the. City of Jeffersonville Economic Development Commission (the "EDC"), the EDC considered whether the economic development facilities would have an adverse competitive effect on any similar facilities located in or near Jeffersonville, Indiana, and found that the. facilities would not have an adverse competitive effect. This City Council hereby confirms tlie EDC's findings, and concludes that the economic development facilities will not have an adverse competitive effect on any other similar facilities in Jeffersonville, Indiana, and the facilities 'will be of benefit to the health and welfare of the citizens of Jeffersonville, Indiana. Section 3. Authorization Of the Lease-Purchase Agreement. It is hereby determined to be necessary to, and the Issuer shall, enter into the Lease-Purchase Agreement pursuant to the authority of the Act, in the maximum aggregate principal amount of not to exceed $5,500,000 aggregate principal amount, the proceeds o{which to be used as follows: The proceeds will be dis bursed for the purpose of equipping the Ptoj ect and paying a portion of the costs of issuance. Section 4. Terms and Execution of Lease-Purchase Agreement. The Agreement shall have such terms, bear such interest rates, and be subject to mandatory and optional prepayment as provided therein. The Lease-Purchase Agreement shall be executed on behalf of the Issuer by the Mayor ofthe Issuer and the Clerk ofthe ~ssuer. Section 5. Arbitrage Provisions. The Issuer will use its best efforts to restrict the use of the revenue obligations in such manner ~d to expectations at the time the Lease-Purchase Agreement is entered into, so that they will 'not constitute arbitrage bonds under Section 148 of the Code and the regulations prescribed under that Section. The Mayor of the Issuer and the Clerk of the Issuer, or any other officer having responsibility with respect to the entry into the Lease-Purchase Agreement, are authorized a.nd directed, alone or in conjunction with any of the foregoing or with any other officer, employee, consultant or agent of the Issuer, to deliver a certificate for inclusion in the transcript of proceedings for the financing, setting forth the facts, estimates and circumstances and reasonabl~ expectations pertaining to said Section 148 and regulations thereunder. The Clerk, or other appropriate officer of the Issuer shall furnish to the 90164 2 Purchaser a true transcript of proceedings, certified by said officer, of all proceedings had with reference to the entry into the Lease-Purcha~e Agreement along with such information for the records as is necessary to determine the regularity and validity of the entry into the Lease- Purchase Agreement. I Section 6. Lease-Purchase Agreement, Tax Exemption Certificate and Tax I Regulatory Agreement, and all Other Documents to be Executed or Accepted by the Issuer. In order to better secure the payment of amounts due under the Lease-Purchase Agreement as the same shall become due and payable, the Mayor of the Issuer and the Clerk of the Issuer are authorized and directed to execute, acknowledge and deliver, in the name and on behalf of the Issuer, the Lease-Purchase Agreement, Tax Exemption Certificate and Tax Regulatory Agreement and all other material documents ~nd assignments to be executed or accepted by it in substantially the forms submitted to this City Council, which are hereby approved, with such changes therein not inconsistent with this Bqnd Legislation and not substantially adverse to the Issuer as may be permitted by the Act and approved by the officers executing the same on behalf of the Issuer without further approval of t4is City Council or of the City of Jeffersonville Economic Development Commission if such changes do not affect terms set forth in I.C. 99 36- 7-12-27(a)(1) through (a)(ll). The approval of such changes by such officers, and that such are not substantially adverse to the Issuer, shall be conclusively evidenced by the execution of said Lease-Purchase Agreement and Tax Exemption Certificate and Tax Regulatory Agreement by such officers. The Mayor of the Issuer an~ the Clerk are further authorized to execute and deliver on behalf of the Issuer, any other certificates, documents and instruments in connection with the entry into the Lease-Purchase Agreement including, without limitation, any insurance commitment or other documents related to C(redit support for the lease obligations, and escrow agreement related to the refunding and any documents which are necessary or appropriate in order to ensure compliance of the lease pbligations with the Internal Revenue Code and including conveyances of title to real and personal property, terminations of financing statements and other releases of security interests in property and cancellations of leases. Section 7. No Personal Liability. No recourse under or upon any obligation, covenant, acceptance or agreement contained in this Bqnd Legislation, or in the Lease-Purchase Agreement or in the Tax Exemption Certificate and 1;ax Regulatory Agreement or under any judgment obtained against the Issuer, or by the enforce,ment of any assessment, or by any legal or equitable proceeding by virtue of any constitution 01' statute or otherwise, or under any circumstances, under or independent of the Lease-Purcha~e Agreement, shall be had against any member, director, or officer or attorney, as such, past, present, or future, of the Issuer, either directly or through the Issuer, or otherwise, for the payment for or to the Issuer or any receiver thereof, or otherwise, of any sum that may be due and unpaid by the Issuer upon any of such revenue obligations. Any and all personal liability of every nature, whether at common law or in equity, or by statute or by constitution or otherwise, of any such member, director, or officer or attorney, as such, to respond by reason of any act or omission on his or her part, or otherwise, for, directly or indirectly, the payment for or to the Issuer or any receiver thereof of any sum that may remain due and unpaid upon the revenue obligations hereby secured or any of them, shall be expressly waived and released as a condition of and. consideration for the execution and delivery of the Lease-Purchase Agreement and Tax Exemption Certificate. 90164 3 Section 8. No Debt or Tax Pledge. The revenue obligations shall not constitute a debt or pledge of the faith and credit of the State or ~ny political subdivision thereof, and the holders or owners thereof shall have no right to have taxes levied by the State or taxing authority of any political subdivision for the payment of the ptincipal thereof or interest thereon. Moneys raised by taxation shall not be obligated or pledged for the payments due under the Lease-Purchase Agreement, and the amounts due under the +-ease-Purchase Agreement shall be payable solely from the revenues and security interests pledged for their payment as authorized by the Lease- Purchase Agreement. . Section 9. Severability. If any section, paragraph or provision of this Bond Legislation shall be held to be invalid or unenforceable ~or any reason, the invalidity or unenforceability of such section, paragraph or provision shall not affect any of the remaining provisions of this Bond Legislation. , Section 10. Repeal of Conflicting Ordinances and Resolutions. All ordinances, resolutions and orders, or parts thereof, in conflict with the provisions of this Bond Legislation are, to the extent of such conflict, hereby repealed. Section 11. Approval by Governmental Unit. This Bond Legislation is intended to satisfy the public approval requirements of Section 147(f) of the Code with respect to approval by the applicable elected representative of the governmental unit. In particular, the City Council as the "applicable elected representative" of the Issuer for the purposes of Section 147(f) of the Code, hereby approves of the revenue obligations in the aggregate face amount of not to exceed $5,500,000, the proceeds of which will be u~ed to finance the Project as set forth herein and in the Lease-Purchase Agreement and, the initia.l owner, operator or manager of the Project will be the Borrower. Section 12. Compliance with Open Door Law. It is hereby determined that all formal actions of this City Council relating to the adoption of this Bond Legislation were taken in an open meeting of this City Council, that all deliberations of this City Council and of its committees, if any, which resulted in formal ~ction, were in meetings open to the public, and that all such meetings were convened, held and conducted in compliance with applicable legal requirements, including the Indiana Code, Title 5, Article 14, Chapter 1.5, as amended. Section 13. Effective Date. This 130nd Legislation shall be in full force and effect immediately upon its passage. 90164 4 I p.m. The foregoing was passed by the City Council this 6th day of August, 2007 at -8.J'/ p.}..J... , And presented by me to the Presiding Officer of the City Council of Jeffersonville, Indiana this 6th day of August, 2007 at Jeffersonville, Indiana. Passed and adopted this ~ day of 2007. ~ST .' 11 .~ Pe gy W~ Clerk and Treasurer Presented by me as Clerk -Treasurer to the Mayor of said City of Jeffersonville this ~ day of PtJ~ LD\- , 2007 at ~. ;\ I m. 9Q~U ~ peggy W Clerk and Treasurer This Ordinance approved and signed by me 8' ,'/5 JLm. f~2007at 90164 5 -~I STATE OF INDIANA ) ) SS: COUNTY OF CLARK ) I, , Clerk of Jeffersonville, Indiana, do hereby certify the above and foregoing is a full, true, and complete copy of Ordinance No. passed by the City Council on the 6th day of August, 2007, which was signed by the Presiding Officer of the City Council on the 6th day of August, 2007, and now remains on file and on record in my office. WITNESS my hand and the official seal of Jeffersonville, Indiana, this _ day of ,2007. Clerk, Jeffersonville, Indiana The foregoing Ordinance prepared by: Sujyot S. Patel, Esq. Peck, Shaffer & Williams LLP 118 West Fifth Street Covington, KY 41017 90164 6