20034ORDINANCE NO. 20,034
AN ORDINANCE AUTHORIZING THE ISSUANCE OF
INDUSTRIAL DEVELOPMENT REVENUE BONDS TO
FINANCE CERTAIN INDUSTRIAL FACILITIES; AUTHORIZING
THE LEASING OF SUCH FACILITIES TO SAGE V FOODS, LLC;
AUTHORIZING A TRUST INDENTURE SECURING THE
BONDS; AUTHORIZING THE SALE OF THE BONDS;
AUTHORIZING AND PRESCRIBING OTHER MATTERS
PERTAINING THERETO; AND DECLARING AN EMERGENCY.
WHEREAS, the City of Little Rock, Arkansas (the "City "), is authorized and empowered
under the provisions of Title 14, Chapter 164, Subchapter 2 of the Arkansas Code of 1987 Annotated
(the "Act "), to issue revenue bonds and to expend the proceeds thereof to finance land, buildings or
facilities which can be used in securing or developing industry; and
WHEREAS, it is proposed that the City issue its revenue bonds under the Act for the purpose
of financing certain industrial facilities in the Little Rock Port Industrial Park (the "Project "),
generally consisting of a rice production facility, together with related land and machinery,
equipment and other tangible personal property, for use by Sage V Foods, LLC, a California limited
liability company (the "Company "), and paying the bond guaranty fees and expenses of issuing the
bonds; and
WHEREAS, the Project will be owned by the City and leased to the Company pursuant to the
provisions of a Lease Agreement (the "Lease Agreement ") between the City and the Company; and
WHEREAS, after due consideration, the City has determined to proceed with financing the
Project and to issue and sell its revenue bonds in the aggregate principal amount of $11,000,000 (the
"Bonds "), and in connection therewith to enter into a Trust Indenture (the "Indenture ") between the
City and Regions Bank, Little Rock, Arkansas, as Trustee (the "Trustee "), to secure the Bonds; and
WHEREAS, the Bonds will be sold to Morgan Keegan & Company, Inc. (the "Underwriter ")
pursuant to a Bond Purchase Agreement (the "Purchase Agreement ") among the City, the Company,
and the Underwriter; and
WHEREAS, in contemplation of the issuance of the Bonds the Arkansas Development
Finance Authority and the Arkansas Economic Development Commission made an interim loan to
the Company in the maximum principal amount of $11,000,000 for the purpose of financing the
Project (the "Interim Loan "), and a portion of the proceeds of the Bonds will be used to repay such
Interim Loan; and
WHEREAS, forms of the Purchase Agreement, Indenture, and Lease Agreement have been
presented to and are before this meeting;
NOW, THEREFORE, BE IT ORDAINED by the Board of Directors of the City of Little
Rock, Arkansas:
Section 1. The Board of Directors hereby finds that the accomplishment of the Project,
and the issuance of the Bonds to finance the same, will provide substantial employment and payrolls
and will thereby secure and develop industry within and near the City.
Section 2. The issuance of the Bonds in the aggregate principal amount of $11,000,000 is
hereby authorized. The Bonds shall be issued in two series designated: (a) City of Little Rock,
Arkansas Taxable Industrial Development Revenue Bonds (Sage V Foods, LLC Project), 2008
Series A, in the principal amount of $6,000,000, and (b) City of Little Rock, Arkansas Taxable
Industrial Development Revenue Bonds (Sage V Foods, LLC Project), 2008 Series B, in the
principal amount of $5,000,000. The Bonds shall bear interest at the rate or rates per annum as shall
be recommended by the Company and set forth in the Indenture, so long as no rate exceeds the
maximum permitted by Amendment No. 60 to the Arkansas Constitution or other applicable law and
the true interest cost on the Bonds does not exceed 7 1/4% (after taking into account underwriter's
discount and original issue premium or original issue discount, if any). The Bonds shall mature (or
be subject to mandatory sinking fund redemption) on the date or dates and in the principal amount or
amounts as shall be recommended by the Company and set forth in the Indenture, so long as the final
maturity of the Bonds is not greater than 15 years from their date of issuance and the weighted
average maturity of the Bonds is not greater than I I years. The Bonds shall be issued in the forms
and denominations, shall be dated, shall be numbered, and shall be subject to redemption prior to
maturity all upon the terms and conditions recommended by the Company and set forth in the
Indenture.
Section 3. The Bonds shall be sold to the Underwriter for the purchase price of 99.33%
of the aggregate principal amount thereof, plus original issue premium or minus original issue
discount, if any, and plus accrued interest, if any, from the date of the Bonds to the date of delivery,
which price is recommended by the Company, and upon the terms and conditions set forth in the
Purchase Agreement. The Purchase Agreement is hereby approved in substantially the form
submitted to this meeting, and the Mayor is hereby authorized to confer with the Company, the
Underwriter and others in order to complete the Purchase Agreement and to execute and deliver the
same on behalf of the City in substantially the form presented to this meeting with such changes as
shall be approved by him, his execution to constitute conclusive evidence of such approval.
Section 4. To prescribe the terms and conditions upon which the Bonds are to be
executed, authenticated, issued, accepted, held and secured, the Mayor and City Clerk are hereby
authorized and directed to execute and acknowledge the Indenture for and on behalf of the City. The
Indenture is hereby approved in substantially the form submitted to this meeting, and the Mayor is
hereby authorized to confer with the Trustee and others in order to complete the Indenture in
substantially the form submitted to this meeting with such changes as shall be approved by him, his
execution to constitute conclusive evidence of such approval.
Section 5. There is hereby authorized the execution and delivery of the Lease Agreement,
and the Mayor and City Clerk are hereby authorized to execute, acknowledge and deliver the Lease
Agreement for and on behalf of the City. The Lease Agreement is hereby approved in substantially
the form submitted to this meeting, and the Mayor is hereby authorized to confer with the Company
and others in order to complete the Lease Agreement in substantially the form submitted to this
meeting with such changes as shall be approved by him, his execution to constitute conclusive
evidence of such approval.
Section 6. There is hereby authorized the preparation and distribution to various
prospective and actual purchasers of the Bonds of an Official Statement (and Preliminary Official
Statement) describing the Bonds and their security and setting forth such other information as may be
determined to be necessary or desirable. The Mayor is hereby authorized to execute such Official
Statement on behalf of the City.
Section 7. The acquiring, constructing and equipping of the Project, and the issuance and
sale of the Bonds, are exceptional situations in which the City has no responsibility for payment of
the costs and expenses thereof, all of which are payable by the Company, and the Company's
recommendations with respect thereto are acceptable to the City. In particular the Board of Directors
finds that (i) the Project consists of industrial facilities within the meaning of the Act, and (ii) the
Company's selection of Bond Counsel is a nationally recognized firm in the field of municipal bonds,
familiar with the Company, the Act, and the policies of the City with respect to the issuance of bonds
of the type now being issued. Therefore, pursuant to applicable laws of the State of Arkansas,
including the Act and Section 14 -47 -138 of the Arkansas Code of 1987 Annotated, competitive
bidding is hereby waived.
Section 8. The repayment of the Interim Loan, and the use of the proceeds of the Bonds
for such purpose, is hereby authorized.
Section 9. The Mayor and City Clerk, for and on behalf of the City, are hereby authorized
and directed to do any and all things necessary to effect the execution and delivery of the documents
herein authorized and the performance of all obligations of the City thereunder, the issuance,
execution, sale and delivery of the Bonds, and the performance of all acts of whatever nature
necessary to effect and carry out the authority conferred by this Ordinance. The Mayor and City
Clerk are hereby further authorized and directed, for and on behalf of the City, to execute all papers,
documents, certificates and other instruments that may be required for the carrying out of such
authority or to evidence the exercise thereof.
Section 10. The City Clerk is hereby authorized and directed to file in the office of the
City Clerk, as a part of the minutes of the meeting at which this Ordinance is adopted, for inspection
by any interested person copies of the Purchase Agreement, the Indenture, and the Lease Agreement,
and such documents shall be on file for inspection by any interested person.
Section 11. The provisions of this Ordinance are hereby declared to be separable, and if
any section, phrase or provision shall for any reason be declared to be invalid, such declaration shall
not affect the validity of the remainder of the sections, phrases and provisions.
Section 12. All ordinances, resolutions and parts thereof in conflict herewith are hereby
repealed to the extent of such conflict.
Section 13. There is hereby found and declared to be an immediate need for the securing
and developing of industry in order to provide substantial employment and payrolls, thereby
alleviating unemployment and otherwise benefitting the public health, safety and welfare of the City
and the inhabitants thereof, and the issuance of the Bonds authorized hereby and the taking of the
other action authorized hereby are immediately necessary for the accomplishing of these public
benefits and purposes. It is, therefore, declared that an emergency exists and this Ordinance being
necessary for the preservation of the public peace, health and safety shall be in force and effect
immediately upon and after its passage.
PASSED: October 14, 2008.
ATTEST:
(SEAL)
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Mayor
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Mayor
CERTIFICATE
The undersigned, City Clerk of the City of Little Rock, Arkansas, hereby certifies that the
foregoing pages are a true and perfect copy of Ordinance No. , adopted at an adjourned
session of the City Council of the City of Little Rock, Arkansas, held at the regular meeting place of
the City at 4:00 o'clock p.m., on the 14th day of October, 2008, and that the Ordinance is of record in
Ordinance Record Book No. , at page , now in my possession.
GIVEN under my hand and seal on this day of October, 2008.
City Clerk
(SEAL)