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HomeMy WebLinkAbout70-79 RESOLUTION• • • A RESOLUTION 70-'7 • 1 AUTHORIZING THE EXECUTION AND DELIVERY OF AN INDUCEMENT AGREEMENT BY AND AMONG CITY OF FAYETTEVILLE, ARKANSAS (THE "IS- SUER"), THE STANDARD REGISTER COMPANY AND J. C. BRADFORD & CO.'PROVIDING FOR THE ISSUANCE BY THE ISSUER OF APPROXIMATE- LY $5,000,000 PRINCIPAL AMOUNT OF INDUSTRIAL DEVELOPMENT REVENUE BONDS. • WHEREAS the Issuer is a municipality created and existing under the Constitution and laws of the State of Arkansas, and is authorized and empoweredby the provisions of Arkansas Statutes Annotated, Sections 13-1601 et seq. (the "Act"), to acquire, own, lease and dispose of industrial projects through which the indus- trial development of the City and the surrounding area will be promoted by inducing manufacturing and industrial enterprises to locate in the City and thus to relieve conditions of unemployment; and WHEREAS the Issuer, in order to implement the public pur- poses enumerated in the Act and in furtherance thereof to assist The Standard Register Company (the "Corporation"), to expand and modernize certain existing manufacturing facilities located in Fayetteville, Arkansas, including the acquisition and installa- tion of certain manufacturing machinery and equipment and certain renovation in connection therewith (the "Project"), has offered to issue its revenue bonds under and pursuant to the provisions of the Act and to apply the proceeds therefrom to the payment of the cost of acquiring and installing the Project; and WHEREAS the Corporation has determined to locate the Project within the boundaries of Fayetteville, Arkansas and has request- ed that the Issuer finance the costs of the acquisition and in- • stallation of the Project through the issuance of revenue bonds under the provisions of the Act; and MiCROF our A 1979 DATE REEL • • • WHEREAS it is now deemed advisable to authorize the execu- tion and delivery by the Issuer of an Inducement Agreement ex- pressing formally and in writing the understanding intended by the Issuer and the Corporation: NOW, THEREFORE, Be It Resolved by the governing body of City of Fayetteville, Arkansas, as follows: Section 1. The Mayor is hereby authorized and directed to execute an Inducement Agreement by and among the Issuer, the Corporation and J. C. Bradford & Co., said. Inducement Agreement, which is hereby approved and incorporated by reference and made a part of this authorizing resolution, to be in substantially the form attached hereto as Exhibit A. Section 2. All resolutions and orders, or parts thereof, in conflict with the provisions of this resolution, are, to the extent of such conflict, hereby repealed and this resolution shall be in immediate effect from and after its adoption. PASSED: August;, 1979. APPROVED: ATTEST: -2- & Mayor e- Pie __ S s ++NIr 1— `^ is Clerk EXHIBIT A INDUCEMENT AGREEMENT This Agreement made and entered into by and among the City of Fayetteville, Arkansas, a municipality created and existing under the laws of the State of Arkansas (the "Issuer"), The Standard Register Company, a corporation duly qualified to conduct business in the State of Arkansas (the "Corporation"), and J. C. Bradford & Co., Nashville, Tennessee. WITNESSETH: ARTICLE I RECITATION OF FACTS Section 1.01. As a means of setting forth the matters of mutual induce- ment which have resulted in the making and entering into of this Agreement, the following statements of fact are herewith recited: 1. The Issuer is a municipality created and existing under the Constitution and laws of the State of Arkansas, and is auth- orized and empowered by the provisions of Arkansas Statutes Anno- tated, Sections 13-1601 et seq. (the "Act"), to acquire, own, lease and dispose of industrial projects through which the indus- trial development of the City and the surrounding promoted by inducing manufacturing and industrial locate in the City and thus to relieve conditions area will be enterprises to of unemployment. 2. The Corporation has requested that the Issuer finance the cost of the expansion and modernization of certain existing manufacturing facilities located in Fayetteville, Arkansas, includ- ing the acquisition and installation of certain new manufacturing machinery and equipment and certain renovation in connection there- with (the "Project"). The cost of the new manufacturing facilities, machinery and equipment including necessary renovation in connection therewith is estimated to be approximately $5,000,000. When com- pleted and in full operation, the Project will provide employment for five to ten additional persons the first year and fifteen to twenty additional persons by the second year. 3. The Issuer has given due consideration to all of the proposals and requests of the Corporation and has agreed subject to the requirements of law and in all respects to the provisions and limitations in the Act to endeavor to effect the issuance of the Bonds at the time and on the terms and conditions here- after set forth. ARTICLE II • UNDERTAKINGS ON THE PART OF THE ISSUER The Issuer agrees subject to the limitations and require- ments of the Act as follows: Section 2.01. That it will authorize the issuance under the Act of Indus- trial Development Revenue Bonds, Series A (The Standard Register Company Project) in an amount sufficient to finance the cost of the Project, presently estimated to be approximately $5,000,000. The Bonds shall be payable solely from the revenues and receipts derived by the Issuer from the Project as required by the Act. Section 2.02. That it will permit the Corporation to select J. C. Bradford & Co., as Underwriter to market the Bonds for the Issuer, and it will adopt such proceedings as are necessary for the entering into of the Lease or Sale Agreement referred to in Section 2.05 and the issuance and securing of the Bonds. Section 2.03. The Issuer agrees that the Corporation may proceed with plans for the Project, enter into contracts for acquisition and installation of the Project, and take such other steps as it may deem appropriate in connection therewith, provided that nothing herein shall be deemed to authorize the Corporation to obligate the Issuer in any manner to the payment of any moneys or the per- -2- • • • 9 • formance of any acts in connection with the Project, except as otherwise set forth herein. The Issuer agrees that the Corpora- tion may be reimbursed from the proceeds of. the Bonds for all costs so incurred by it. Section 2.04. That prior to the issuance of the Bonds it will enter into an Indenture with a bank, as Trustee, to be selected by the Cor- poration, to secure the Bonds to be issued to finance the Project. Such Indenture shall be in the form substantially used in connec- tion with the issuance of industrial development revenue bonds in Arkansas. Section 2.05. That simultaneously with the issuance of the Bonds, it will either (a) lease the Project to the Corporation for a term commen- surate with the life of the Bonds at a rental which will provide the Issuer with sums sufficient to pay the principal of and inter- est on the Bonds, as and when the same become due and payable, and with options in favor of the Corporation when the Bonds have been paid to purchase the Project for $10.00, or (b) enter into a Sale Agreement with the Corporation with respect to the Project pursuant to which the Corporation will be obligated to make pay- dents sufficient to pay the principal of and interest on the Bonds, as and when the same become due and payable. Section 2.06. That it will perform such other acts and adopt such further proceedings as may be required to faithfully implement its under- takings. ARTICLE III UNDERTAKINGS ON THE PART OF THE CORPORATION Section 3.01. The Corporation has obtained the services of Marvin W. -3- • • • • • Leiter, Esq., Bond Counsel of Chicago, Illinois to prepare the necessary proceedings for the authorization, issuance and sale of the Bonds. Section 3.02. If the plan proceeds as contemplated, the Corporation fur- ther agrees as follows: (a) To enter into a Lease or Sale Agreement with the Issuer, under the terms of which it will obligate itself to pay to the Issuer sums sufficient to pay the principal of and interest on the Bonds, as and when the same become due and payable, said Lease or Sale Agreement to be in form and contain such provisions as shall be satisfactory to the Issuer and the Corporation. (b) To hold the Issuer harmless from all pecuniary liability and to reimburse it for all expenses to which it might be put in the fulfillment of its obligations under this Agreement and in the implementation of its terms and provisions. (c) That it will perform such further acts and adopt such further proceedings as may be required to faithfully implement its undertakings. (d) That it will make payments in lieu of ad valorem taxes for distribution to the ad valorem taxing authorities on all facilities financed by the Bonds in the same amount as it would have paid in ad valorem taxes had it owned such facilities and assessed and paid ad valorem taxes thereon along with the other properties in the Project. ARTICLE IV GENERAL PROVISIONS Section 4.01. All commitments of the Issuer under Article II hereof are subject to the condition that no holder of any Bonds issued under and pursuant to this Agreement shall have the right to compel any exercise of taxing power of the Issuer to pay the Bonds or the interest thereon, and the Bonds shall not constitute an indebtedness of the Issuer or a loan of credit thereof within the meaning of any constitutional or statutory provision. It shall be plainly stated on the face of each Bond that it does not constitute an indebtedness of the Issuer of a loan of credit thereof within the meaning of any constitutional or statutory provision. -4- • • Section 4.02. All commitments of the Issuer and the Corporation hereunder are subject to the condition that the Issuer and the Corporation do agree on mutually acceptable terms and conditions of all documents whose execution and delivery are contemplated by the provisions hereof. IN WITNESS WHEREOF, the parties hereto, each after due authori- zation, have executed this Agreement on the dates indicated. CITY OF FAYETTEVILLE, ARKANSAt. S `•'- Dated: By _..rw :ifes._ THE STANDARD REGISTER C01dANY ''t MR ;":41S Dated: By Vice President J. C. BRADFORD & CO. Dated: By -5-