Loading...
HomeMy WebLinkAbout99180 Resolution No. 9 91 A RESOLUTION AUTHORIZING THE EXECUTION AND DELIVERY OF AGROUND LEASE AGREEMENT BETWEEN THE CITY OF LITTLE ROCK, ARKANSAS, AS LESSOR, AND THE CITY OF LITTLE ROCK, ARKANSAS RESIDENTIAL HOUSING AND PUBLIC FACILITIES BOARD, AS LESSEE; PRESCRIBING CERTAIN MATTERS RELATING THERETO; AND DECLARING AN EMERGENCY 94 WHEREAS, the City of Little Rock, Arkansas Residential Housing and Public Facilities Board (the "Facilities Board "), a duly organized and existing public body, politic and corporate, created under the laws of the State of Arkansas, particularly the Public Facilities Board Act, codified as Arkansas Code Annotated, Sections 14- 137 -101 to 123, inclusive (1987; Suppl. 1995), as amended (the "Act "), and duly enacted ordinances of the City of Little Rock, Arkansas (the "City"), has expressed its intention to undertake to construct an auditorium (including, without limitation, related facilities and equipment) (the "Project ") for the use and benefit of the Central Arkansas Library System ( "CALS ") adjacent to the main library facility of CALS now under construction at East Second and Cumberland Streets in the City; and WHEREAS, the proposed site of the Project is owned by the City, and the City desires to assist the Facilities Board and CALS in accomplishing the Project; and WHEREAS, in order to finance the Project, the Facilities Board has determined to issue, sell, and deliver its $800,000 Capital Improvement Revenue Bonds (Central Arkansas Library System Project), Series 1997 (the "Bonds "); and WHEREAS, it is desirable that the City enter into a Ground Lease Agreement with the Facilities Board, pursuant to which the Facilities Board will acquire the right to the possession and use of the site for the Project, which rights will in turn be assigned to a bank or trust company, as trustee (the "Trustee "), acting for and on behalf of the owners of the Bonds in order to provide for the security for the Bonds; and WHEREAS, upon the payment in full of the Bonds, the site of the Project and the improvements constructed thereon, the Ground Lease will site terminate and will then be held and used for the benefit of CALS; NOW THEREFORE, BE IT RESOLVED BYTHE BOARD OF DIRECTORS OF THE CITY OF LITTLE ROCK, ARKANSAS, THAT: Section 1. There is hereby authorized the execution and delivery of a Ground Lease Agreement, dated as of March 1, 1997, by and between the City, as Lessor, and the Facilities Board, as Lessee (the "Ground Lease "), and the Mayor and City Clerk be, and they are hereby authorized to execute, acknowledge, and deliver the Ground Lease for and on behalf of the City, which Ground Lease shall provide for an initial term of twenty years and one day, with an option for renewal for one ten -year period under certain conditions to provide security for the Bonds, and for which the rental shall be $1.00 for such initial term and the optional renewal period. The Ground Lease is hereby approved substantially in the form submitted to this meeting, and the Mayor is hereby authorized to confer with such bank or trust company as the Facilities Board has selected to be trustee for the Bonds, and the initial purchaser of the Bonds, in order to complete Ground Lease in substantially the form submitted to this meeting with such changes as shall be approved by such persons executing the document, their actions to constitute conclusive evidence of such approval. 95 (Advice is given that a copy of the Ground Lease in substantially the form authorized to be executed is on file with the City Clerk of the City and is available for inspection by any interested person.) Section 2. The Mayor and the City Clerk be, and they are hereby, further authorized and directed, for and on behalf of the City, to execute all papers, documents, certificates, or other instruments that may be required for the carrying out of such authority or to evidence the exercise thereof. Section 3. The provisions of this Resolution are hereby declared to be severable, 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, or provisions. Section 4. It is hereby ascertained and declared that, due to the inadequacy of initial funding to complete the planned auditorium adjacent to the central library facility, the issuance of the Bonds must be accomplished as soon as possible in order to allow the auditorium construction to be completed in a timely manner along with the scheduled completion of the central library facility, to effectuate savings to the City in the form of avoided construction costs, and to alleviate immediate hazards to the health, safety, and welfare of the City of Little Rock, its inhabitants, and their property, and that this can be accomplished only by the issuance of the Bonds. It is, therefore, declared that an emergency exists, and this Resolution, being necessary for the immediate preservation of the public peace, health, and safety, shall take effect and be in force from and after its passage. ADOPTED: February 18, 1997. Attest: Robbie Hancock, City Clerk (S E A L) Approved as to form: Thomas M. Carpenter, Ciry ttorney da Approved: /V IA,Gff� Michael Keck, Vice Mayor w 95 Ground Lease Agreement THIS GROUND LEASEAGREEMENT (the "Ground Lease ") is entered into as of March 1, 1997, by and between the City of Little Rock, Arkansas (the "City"), as lessor, and the City of Little Rock, Arkansas Residential Housing and Public Facilities Board (the "Board "), as lessee. WITNESSETH: WHEREAS, the City is a city of first class, duly organized and existing under the laws of the Sate of Arkansas (the "State "); and WHEREAS, the Board is a duly organized and existing public body politic and corporate, created and existing under the laws of the State, particularly the Public Facilities Boards Act, codified as Arkansas Code Annotated Sections 14- 137 -101 to 123, inclusive (1987; Suppl. 1995), as amended (the "Act "), and duly enacted ordinances of the City; and WHEREAS, the Act authorizes the Board: (a) to own, acquire, construct, equip, operate, maintain, sell, lease, and contract concerning capital improvement facilities, including without limitation, libraries and auditoriums; (b) to issue its revenue bonds for the purpose of financing such capital improvements, to establish necessary reserve funds, and to pay administrative costs and other costs incurred in connection with the issuance of such bonds; and (c) to pledge all or any part of the revenues, and receipts to be received by the Board from or in connection with such facilities, and to mortgage, pledge, or grant security interests in, such facilities in order to secure the payment of the principal or redemption price of and interest on such bonds; and WHEREAS, the Central Arkansas Library System ( "CALS ") is a legal entity created pursuant to an interlocal cooperation agreement duly entered into between the City and Pulaski County, Arkansas, pursuant to the Interlocal Cooperation Act of the State, codified as Arkansas Code Annotated % 25 -20- 101 et seq. (1996 Repl.), for the purpose of providing library services to the public; and WHEREAS, the Central Arkansas Library System ( "GALS ") and the Board have entered into a Lease Agreement dated as of March 1, 1997 (the "Lease "), pursuant to which the Board has undertaken to construct an auditorium, including, without limitation, related facilities and equipment (the "Project "), adjacent to the main library facility of CALS now under construction at East Second and Cumberland Streets in the City, which Project will be constructed on the Leased Premises (hereinafter defined) and leased to CALS for such rentals as will be sufficient to pay the principal of and interest on the Bonds (hereinafter defined) when due; and WHEREAS, the Board has determined to issue, sell and deliver its $800,000 Capital Improvement Revenue Bonds (Central Arkansas Library System Project), Series 1997 (the "Bonds "), to fund the cost of the Project and to pay the expenses of the issuance of the Bonds; and WHEREAS, pursuant to a Trust Indenture, dated as of March 1, 1997 (the "Indenture "), between the Board and , [a bank] [a trust company] organized and existing under the laws of the [United States of America] [State] and having its principal corporate trust office in Little Rock, Arkansas, as Trustee (the "Trustee "), the Board will to convey to the Trustee its interest in this Ground Lease, together with the Board's interest in the Lease, as security for the Bonds; w 9 r Now, THEREFORE, in consideration of the respective representations and agreements hereinafter contained, the City and the Board agree as follows; provided, however, that in the performance of the agreements of the Board herein contained, any obligation it may thereby incur for the payment of money shall not be a general debt on its part, but shall be payable solely out of the proceeds derived from the Lease, the sale of the Bonds, and the insurance and condemnation awards as provided therein: Section 1. Purpose; Principles of Construction. The purpose of this Ground Lease is to create in the Board a leasehold interest in the Leased Premises (hereinafter defined), which it may assign, mortgage, and set over to the Trustee to provide a portion of the security for the payment of the Bonds. To that end, the City and the Board covenant and agree, for the benefit of the Trustee and the owners of the Bonds, as follows: (a) The entry by the Board into the Lease with CATS shall not operate as a merger of tide, notwithstanding that the Board is, in certain respects, subject to the dominion and control of the City, and that CALS was created with the consent of the City and exists as a separate entity to perform certain governmental operations of the City. (b) It is the intention of the Board to enter into the Indenture and to mortgage its leasehold interest created by the Ground Lease to the Trustee as security for the payment of the Bonds, and the City will undertake no action to alter or amend the existence or powers of the Board which would adversely affect the security for the Bonds while the Bonds are "Outstanding," as defined in the Indenture. (c) The City will undertake no action to terminate the interlocal agreement establishing CALS as it relates to the City, unless adequate provision has been made concerning the operation of the City's library system to assure payment in full of the Bonds, and such arrangements have been consented to by the Trustee, such consent to be in the Trustee's sole discretion. Section 2. Lease of Premises. For and in consideration of the rent reserved and the covenants herein, and subject to the conditions set forth herein, the City leases to the Board and the Board leases from the City the premises described in Appendix A attached hereto, which premises, together with any improvements now existing or hereafter constructed thereon, are herein collectively referred to as the "Leased Premises." Section 3. Use of Premises. The parties acknowledge that the Board and CALS intend to use the Leased Premises for the construction and operation of a public auditorium, which will be leased by the Board to CALS for use in conjunction with its public library system, and that the Leased Premises shall be used for no other purpose without the prior written consent of the City, which shall not be unreasonably withheld; provided, however, if CALS shall be in default under the Lease, no consent by the City shall be required to permit the Trustee to exercise all rights and remedies available to it herein, under the Lease, under the Indenture, or otherwise at law or in equity. Section 4. Term. The term of this Lease is for twenty (20) years and one (1) day beginning at 12:01 A.M. on 1997, and ending at 12:00 midnight on , 2017, subject to the provisions of Section 6 hereof with respect to the option to renew granted to the Board; provided, however, that, if the Bonds shall be paid in full pursuant to the Indenture and there shall be no continuing default by CALS under the Lease, the term of this Ground Lease shall terminate at midnight on the later of the date on which (1) the Bonds have been, or are deemed to have been, paid in full under the Indenture, or (2) all moneys due to the Board and the Trustee under the Indenture and the Lease have been paid in full. -2- Section 5. Rent. For the leasehold estate granted hereunder, the Board shall pay to the City a rental 9 for the entire term hereof and the renewal option granted in Section 6 hereof of One Dollar ($1.00), receipt of which is hereby acknowledged by the City. Section 6. Option to Renew Term. If CALS shall be in default under the Lease and the Bonds (including any bonds issued to refund the Bonds) shall be unpaid, the Board is granted an irrevocable option to renew this Ground Lease for the additional period of ten (10) years from , 2017, provided that such renewal term shall expire upon the payment of the Bonds and any amounts due the Board or the Trustee in the manner specified in Section 4 hereof with respect to the early termination of the original term hereof. The option may be exercised at any time prior to , 2017, by written notice from the Board or the Trustee to the City of the exercise thereof. Section 7. Utilities. In the Lease, CALS has agreed to pay all charges for gas, electricity, light, heat, power, water, sewer, and telephone and other utility services supplied to, or used in connection with, the Leased Premises; and neither the Board nor the Trustee shall be obligated to pay for such services. Section 8. Repairs. In the Lease, CALS has agreed to make all repairs necessary to maintain the Leased Premises in good condition and to make all other repairs and do all other things to maintain all improvements hereafter placed on the Leased Premises in good condition; and neither the Board nor the Trustee shall be obligated to repair or maintain the Leased Premises. Section 9. Mechanic's Liens. In the Lease, CALS has agreed not to permit mechanic's or materialmen's liens or similar liens to be imposed on the Leased Premises, and neither the board nor the trustee shall be liable in any regard as to such claims. The parties acknowledge that the purchase of all construction, labor, and materials for the construction of the auditorium on the Leased Premises will be exclusively under the control of CALS, that compliance with applicable laws of the State regarding public construction and the providing of payment and performance bonds thereunder shall be the sole responsibility of CALS, and that compliance by CALS with the laws of the State shall be deemed in compliance with this Section 9, norwithstanding any claim that may be made by laborers or materialmen. Section 10. Alterations. The City acknowledges that all alterations, additions, or improvements made pursuant to the provisions of the Lease at the request or direction of CALS shall be deemed made with the City's consent, and neither the Board nor the Trustee shall be obligated to obtain the consent of the City with respect thereto. Section 11. Insurance. CALS has agreed in the Lease, at its expense, to maintain, or cause to be maintained, in full force and effect insurance against loss or damage by fire and extended coverage (including sprinkler leakage, vandalism, and malicious mischief) covering the buildings and improvements currently existing or hereafter placed upon the Leased Premises, in an amount at least equal to full replacement cost. Whether or not CALS shall be in compliance with such provision of the Lease, neither the Board nor the Trustee shall be obligated to provide insurance with respect to the Leased premises, including, without limitation, the buildings, equipment, furnishings, or other personal property placed thereon or therein. Section 12. Fire and Other Damage. In the Lease, CALS has agreed that, if any portion of any building, structure, or improvements constructed on the Leased Premises is damaged or destroyed by fire or other casualty, CALS shall forthwith give notice thereof to the City, the Board, and the Trustee; and CALS shall use its best efforts to repair, restore, or replace the damaged or destroyed improvements -3- and complete the same as soon as reasonably possible to the condition they were in prior to such damage or destruction, except for such changes in design or materials as may then be required by law; provided, however, that CALS shall be not obligated to expend any moneys for such purposes in excess of the available proceeds of insurance. Unless CALS shall be in default under the Lease, the provisions of the Lease shall control the use, custody, and application of the proceeds of insurance. Section 13. Compliance With Law. The Board shall comply with all laws, orders, and regulations of governmental authorities and with any direction of any public officer, pursuant to law, which shall impose any duty upon the City or the Board with respect to the Leased Premises; provided, however, that the compliance by CALS with the provisions of the Lease with respect to the duties imposed by this Section 13 shall be deemed compliance by the Board. Section 14. Right of Entry. The City may enter the Leased Premises, during normal business hours, for the purpose of inspecting same and performing any work which the City elects to undertake made necessary by reason of CALS's default under the terms of the Lease. Section 15. Assignment and Subletting. Provided CALS is not in default under the Lease, this Ground Lease shall not be assigned (except to the Trustee pursuant to the Indenture) nor the Leased Premises sublet (other than to CALS pursuant to the Lease) without the prior written consent of the City, which shall not be unreasonably withheld. Such assignment or subletting shall not affect or alter the Board's obligations hereunder. If CALS shall be in default under the Lease, the Board, or the Trustee acting pursuant to the Indenture, shall have the right to further assign this Ground Lease and let the Leased Premises to any other person for any lawful purpose without the City's prior written consent. Section 16. Condemnation. In the event of the taking of all or a part of the Leased Premises by the exercise of eminent domain, the respective rights of the City and the Board to compensation for the taking shall be those provided by law at the time of the taking. If, as a result of the taking, the Leased Premises are no longer suitable for use by the Board for the purposes leased, this Ground Lease shall terminate and the Board's obligation hereunder shall terminate as of the date of taking. If the taking is partial, and, if in the Board's sole determination such taking does not render the Leased Premises unsuitable for use by the Board for the purpose leased, this Ground Lease shall continue in full force and effect, without any adjustment in rent. The City hereby covenants not to condemn the leasehold estate created hereby in the Leased Premises. Section 17. Subordination. The City hereby subordinates this Ground Lease to the Indenture, the Lease, and to any other indenture, mortgage, or encumbrance which the Board may have placed, or may hereafter place, upon the Leased Premises specifically including but not limited to, the lien created under the Indenture and any subsequent indenture to secure refunding bonds of the Board. The City shall execute any instrument which the Board deems necessary to further render any such indenture, mortgage, or encumbrance, whenever made, filed, or recorded, superior and prior to this Ground Lease. Section 18. Surrender of Premises. On termination of this Ground Lease in due course (including any renewal thereof), the Board shall surrender the Leased Premises in as good condition as they were in at the beginning of the term hereof, reasonable wear and tear excepted. All additions, fixtures and improvements shall become the property of the City. Any personal property of the Board, CALS, or any sublessee of CALS, including but not limited to machinery and equipment, shall remain the property of the Board, CALS, or such sublessee, as applicable. The owner thereof shall repair any damage to the Leased Premises caused by the removal of any of its property and shall replace any portion of the Leased Premises altered by the removal. F M = M = M 0 0 Section 19. Default by Board. Upon the Board's failure to observe or perform any of the other 1 0 conditions, agreements or provisions hereof after the City shall have given the Board notice in writing of such failure on the part of the Board and the Board shall not have remedied such failure within thirty (30) days after giving of such notice, City may pursue any remedy at law or in equity for payment or performance due but shall have no right to possession of the Leased Premises or to the rents payable by CALS under the Lease while the Bonds (including any refunding bonds) are outstanding and unpaid. Section 20. City's Right to Perform. If the Board shall be in default hereunder, the City may cure such default on behalf of the Board, in which event the Board shall reimburse the City for all sums paid to effect such cure. to: Section 21. Notices. Notices hereunder shall be given in writing, first class mail, postage prepaid, If to the City: City of Little Rock, Arkansas 500 West Markham Street Little Rock, Arkansas 72201 Attention: Director of Finance and Treasurer If to the Board: City of Little Rock, Arkansas Residential Housing and Public Facilities Board c/o George E. Campbell 120 East Fourth Street Little Rock, Arkansas 72201 If to the Trustee: Attention: A duplicate copy of each notice given hereunder by the Board or the City shall also be given to the Trustee. The Board, the City, and the Trustee may designate any further or difference addresses to which subsequent notices or other communications can be sent. Section 22. Performance by Parties. Time is of the essence as to each of the terms and conditions herein to be performed by either parry hereto. The failure to insist upon performance in any one or more instances shall not be a waiver of the right thereafter to insist upon full performance. The failure of either parry to exercise any rights hereunder shall not be deemed a waiver of such rights. Section 23. Amendment. This Ground Lease may not be effectively amended, changed, modified, altered, or terminated without the concurring written consent of Trustee given in the manner and subject to any approval by the owners of the Bonds a provided in Article[ ] of the Indenture while the -5- 101. Bonds shall be "outstanding" within the meaning of the Indenture. This Ground Lease may be amended at any time after the payment in full of Bonds, unless terminated as provided herein, with the mutual consent of both the City and the Board. Section 24. Severability. In the event any provision of this Ground Lease shall be held invalid or unenforceable by any court of competent jurisdiction, such holding shall not invalidate or render unenforceable any other provision hereof. Section 25. Binding Effect. This Ground Lease shall be binding upon and inure to the benefit of the successors and assigns of the parties hereto. Section 26. Counterparts. This Ground Lease may be simultaneously executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. Section 27. Applicable Provisions of Law. This Ground Lease shall be governed by and construed in accordance with the laws of the State. IN WITNESS WHEREOF, the Board has caused these presents to be executed in its corporate name by its duly authorized Chairman, whose execution hereof has been duly attested by the Secretary of the Board; and the City has caused these presents to be executed in its name by its duly authorized Mayor, whose execution hereof has been duly attested by the City Clerk, all as of the date first above written. Attest: City Clerk Attest: Secretary City of Little Rock, Arkansas By: Mayor City of Little Rock, Arkansas Residential Housing and Public Facilities Board W Chairman