110220 0
1 RESOLUTION NO. 11, 022
2
3 A RESOLUTION AUTHORIZING A MEMORANDUM OF INTENT
4 BY AND BETWEEN THE CITY OF LITTLE ROCK, ARKANSAS,
5 AND GSJ PROPERTIES, LLC AND EAST END PARTNERS, LLC AS
6 LESSEES AND UNITED SYSTEMS OF ARKANSAS, INC.; AS
7 SUBLESSEE, PERTAINING TO THE ISSUANCE OF INDUSTRIAL
8 DEVELOPMENT REVENUE BONDS FOR FINANCING THE COSTS
9 OF ACQUIRING, CONSTRUCTING AND EQUIPPING
10 INDUSTRIAL FACILITIES; AND PRESCRIBING OTHER MATTERS
11 RELATING THERETO.
12
13 NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS
14 OF THE CITY OF LITTLE ROCK, ARKANSAS:
15 Section 1. That there be, and there is hereby authorized, the execution and
16 delivery of a Memorandum of Intent by and between the City of Little Rock, Arkansas (the
17 "City"), and GSJ Properties, LLC and East End Partners, LLC, as Lessees and United
18 Systems of Arkansas, Inc., as Sublessee (collectively, the "Company "), in substantially the
19 form hereinafter set forth, and the Mayor and City Clerk be, and they are hereby authorized
20 to execute and deliver the Memorandum of Intent for and on behalf of the City. The Mayor
21 is hereby authorized to confer with the Company in order to complete the Memorandum of
22 Intent in substantially the form hereinafter set forth with such changes as shall be approved
23 by such persons executing the Memorandum of Intent, their execution thereof constitute
24 conclusive evidence of such approval.
25 Section 2. This Resolution and the Memorandum of Intent shall constitute
26 "some other similar official action" of the County within the meaning of Section 1.103-
27 8(a)(5) of the Federal Income Tax Regulations issued by the United States Treasury
28 Department. The form and content of the Memorandum of Intent, which are approved and
29 which are made a part hereof, shall be substantially as follows:
30
31
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1 MEMORANDUM OF INTENT
2
3 THIS MEMORANDUM OF INTENT is between the City of Little Rock, Arkansas
4 (hereinafter referred to as the "City"), and GSJ Properties, LLC and East End Partners,
5 LLC, as Lessees and United Systems of Arkansas, Inc., as Sublessee (herein referred to
6 collectively as the "Company ").
7 IN CONSIDERATION OF the undertakings of the parties set forth herein and the
8 benefits to be derived therefrom and of other good and valuable consideration, receipt of
9 which is hereby acknowledged by the parties, the City and the Company AGREE:
10 1. Preliminary Statement. (a) The City is a duly organized and existing
11 City of the first class county under the laws of the State of Arkansas and is authorized by the
12 laws of the State of Arkansas, particularly Arkansas Code of 1987 Annotated § §14164201
13 et sea., as amended, and Arkansas Code of 1987 Annotated § §19 -9 -601, et sea., as
14 amended, (hereinafter collectively called the "Act "), to issue revenue bonds for financing
15 the costs of acquiring, constructing and equipping industrial facilities (as defined and
16 authorized by the Act), and to lease and /or sell the same for such rentals and payments and
17 upon such terms and conditions as the City deems advisable.
18 (b) In order to secure and develop industry which will furnish substantial
19 employment and payrolls (in furtherance of the public purpose of the Act), it is
20 proposed that a certain industrial project (consisting of lands, buildings,
21 improvements, machinery, equipment and facilities) be acquired, constructed and
22 equipped (the "Project ").
23 (c) The Company has determined that it must obtain a commitment from
24 the City that it will issue revenue bonds under the Act as the Company and the City,
25 upon advice of counsel, shall deem appropriate and make the proceeds available for
26 the permanent financing of the costs and expenses incurred in acquiring,
27 constructing and equipping the Project.
28 (d) The City is willing to so commit and to proceed with the issuance of
29 such bonds as and when requested by the Company, in principal amounts necessary
30 to furnish such permanent financing, subject to compliance with all conditions set
31 forth in the Act.
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(e) The City considers that the acquiring, constructing and equipping of
the Project and the leasing or sale thereof to the Company will secure and develop
industry and thereby promote the general health and economic welfare of the
inhabitants of the City and adjacent areas.
2. Undertakings on the Part of the City. Subject to the conditions above stated,
the City agrees as follows:
(a) That when requested by the Company, it will authorize and take, or
cause to be taken, the necessary steps to issue bonds under the Act, in the aggregate
principal amount necessary to furnish the permanent financing or any part of the
cost of acquiring, constructing and equipping the Project. In this regard, it is
estimated at this time that the cost of the Project will be in an aggregate principal
amount not to exceed $2,000,000. Thus, industrial development revenue bonds will
be issued under the Act in such amount as shall be requested by the Company for
acquiring, constructing and equipping all or any part of the Project (the 'Bonds ").
(b) That it will, at the proper time and subject in all respects to the
recommendation and approval of the Company, adopt, or cause to be adopted, such
proceedings and authorize the execution of such documents as may be necessary and
advisable for the authorization, sale and issuance of the Bonds, the acquiring,
constructing and equipping of the Project, and for the leasing or sale thereof to the
Company, all in conformity with the Act and any other applicable federal and state
laws and upon terms and conditions mutually satisfactory to the City and the
Company.
(c) That the aggregate basic rents or payments (i.e., the rents or payments
to be used to pay the principal of, premium, if any, and interest on the Bonds)
payable under leases or sale agreements between the City and the Company shall be
sufficient to pay the principal of, premium, if any, and interest on the Bonds when
due. The leases or sale agreements shall contain such provisions as are necessary or
desirable, consistent with the authority conferred by the Act.
(d) That it will take or cause to be taken such other acts and adopt such
further proceedings as may be required to implement the aforesaid undertakings or
as it may deem appropriate in pursuance thereof.
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1 (e) That the Mayor and City Clerk be, and they are hereby authorized and
2 directed, for and on behalf of the City, to do all things, execute all instruments and
3 otherwise take all action necessary to the realization of the City's obligations under
4 the Memorandum of Intent.
5 3. Undertakings on the Part of the Compan y. Subject to the conditions stated
6 above, the Company agrees as follows:
7 (a) That it will obtain the services of a qualified underwriter or financial
8 advisor, if the Company in its judgment determines that the assistance of such an
9 underwriter or financial advisor will be necessary, who will assist with the
10 structuring of the bond issue and that it will cooperate with the City in the sale and
11 issuance of the Bonds to the end of achieving timely and favorable marketing
12 thereof.
13 (b) That it will enter into such leases, sale agreements or other appropriate
14 agreements with the City under which the Company will obligate itself to pay to the
15 City rents or payments sufficient to pay the principal of, premium, if any, and
16 interest on the Bonds when due and containing such other provisions as are
17 necessary or desirable consistent with the authority conferred by the Act.
18 (c) That it will take such further action and adopt such further
19 proceedings as may be required to implement its aforesaid undertakings or as it may
20 deem appropriate in pursuance thereof.
21 4. General Provisions. (a) This Memorandum of Intent shall continue in full
22 force and effect until the Project and its financing by Bonds, as herein specified, is
23 accomplished, and in this regard it is understood that the Bonds may be issued as a single
24 series or in multiple series. The City will take appropriate action by City Ordinance to sell
25 and authorize the Bonds and to authorize and execute such agreements and documents as
26 may be determined necessary or desirable by the City and the Company.
27 (b) The City and the Company agree that the law firm of Wright, Lindsey
28 & Jennings LLP, Little Rock, Arkansas, shall be appointed to serve as bond counsel
29 with respect to the issuance and sale of the Bonds.
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(c) The Company agrees that it will make payments in lieu of ad valorem
taxes in such amount as is mutually agreed and accepted by the City and the
Company.
(d) This Memorandum and the agreements contained herein, may be
assigned by the Company to any person or persons, company or companies for the
purposes of completing the industrial development financing contemplated hereby.
IN WITNESS WHEREOF, the parties hereto have entered into this Memorandum
by their officers thereunto duly authorized as of the _ day of 2001.
CITY OF LITTLE ROCK, ARKANSAS
ewd—OWN
Nancy Wood, City Clerk
(SEAL)
Lin
Jim Dailey, Mayor
GSJ PROPERTIES, LLC
By:
EAST END PARTNERS, LLC
0
UNITED SYSTEMS OF ARKANSAS, INC.
By:
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Section 3. That the Mayor and City Clerk be, and they are hereby authorized and
directed, for and on behalf of the City, to do all things, execute all instruments and
otherwise take all action necessary to the realization of the City's obligations under the
Memorandum of Intent.
Section 4. Severability. In the event any title, section, paragraph, item, sentence,
clause, phrase, or word of this ordinance is declared or adjudged to be invalid or
unconstitutional, such declaration or adjudication shall not affect the remaining portions of
the ordinance which shall remain in full force and effect as if the portion so declared or
adjudged invalid or unconstitutional was not originally a part of the ordinance.
Section 5. Repealer. All ordinances and resolutions are hereby repealed to the
extent of such inconsistency.
ADOPTED: March 20, 2001
ATTEST: APPROVED:
7,%nW CZ
Nan Woo , City Clerks
APPROVED AS TO LEGAL FORM:
Thomas M. Carpenter, Ci Attomey
[Page 6 of 61
Dailey, Mayor
TELEFACSIMILE TRANSMISSION
Office of the City Attorney
Little Rock, Arkansas
TO: Mayor Dailey and Members of the Board of Directors
FROM: Thomas M. Carpenter G =v�
City Attorney
Attached to this fax are six pages of a resolution that needs to be included on
tonight's agenda. It was always intended to be a part of the agenda, but there was some
confusion because of the IDB (industrial development bond) aspect of this issue.
United Systems of Arkansas, Inc., will be involved in the Advantage Arkansas
program. The resolution to permit this involvement is already before the Board. In
addition, the resolution to call a public hearing on the question of the issuance of the IDB is
before the Board. This preliminary agreement permits the IDB to go forward for
consideration.
Because this is essentially the first one of these that has been before the Board since
Ms. Hancock retired, it was not certain how to deal with the issue. The Clerk's office
believed that this office should prepare the preliminary agreement. However, counsel for
an IDB is typically selected by the company, and typically prepares all of the
documentation.
Therefore, this matter needs to be formally added to the agenda for 20 MAR 2001,
so this issue can move forward in the appropriate time frame.
Please let me know if you have any questions (371- 6875).
TMC:ct
Cy Carney, City Manager
-- Mike Dooley, Economic Development
Donald Yucuis, Director of Finance & Treasurer