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HomeMy WebLinkAbout82590 RESOLUTION NO. 8,259 0 A_ RESOLUTION OF THE BOARD OF DIRECTORS OF THE CITY OF LITTLE ROCK, ARKANSAS, AUTHORIZING THE ENTRY INTO AN AGREEMENT TO ISSUE BONDS FOR THE PURPOSE OF ASSISTING IN THE FINANCING OF AN INDUSTRIAL FACILITY WITHIN THE CITY. WHEREAS, the City of Little Rock, Arkansas (the "City "), is authorized under the provisions of the Municipalities and Counties Industrial Development Revenue Bond Law, Arkansas Code Annotated Sections 14- 164 -201 to -224 (1987) (the "Act "), to acquire; construct, and equip facilities to secure and develop industry and to assist in the financing thereof by the issuance of bonds payable from the revenues derived from such facilities; and WHEREAS, Arkansas Modification Center, Inc., an Arkansas corporation (the "Company "), currently leases certain facilities located at the Little Rock Regional Airport where it is engaged in the business of completion of corporate jet aircraft; and WHEREAS, the Company has evidenced its interest in expanding it business of completion of corporate jet aircraft and in commencing a new business of maintenance and service of jet aircraft and, for this purpose, desires to acquire, construct, and equip a new industrial facility to be located at the Little Rock Regional Airport if the permanent financing can be provided through the issuance of bonds under the authority of the Act; and WHEREAS, the Company anticipates that upon completion of the project described above, which is scheduled for 1991, its employment will increase by approximately 300 to 400 persons; and WHEREAS, the transfer of the its existing location to the which are located at the Little result in the availability of occupied by the Company for lease and Dperations of the Company from proposed new location, both of Rock Regional Airport, will the facilities currently being to airport - related industry; WHEREAS, the Company has been in operation in the City of Little Rock since 1974 and has made and is expected to continue to make valuable contributions to the economic well -being of the City and its inhabitants; and WHEREAS, economic development is an important aspect of city government; and -1- 59 5853X RLF020190 .1 WHEREAS, the City Airport and airport -rela development —and growth 1990's and beyond; and recognizes the Little :ed industry as a key area in the City during the Rock Regional for economic decade of the WHEREAS, in order to enhance the attractiveness of the Little Rock Regional Airport for airport - related industry and to provide access to the entire souhern area of the Airport it is desirable that heavy jet rampways, to be owned by the City and available for public use, be constructed; and WHEREAS, the construction of heavy jet rampways and the issuance of bonds pursuant to the Act have been recommended to the City by the Little Rock Municipal Airport Commission; and WHEREAS, it is the intent of the City to commit $3,000,000 from its Economic Development Fund to the Little Rock Municipal Airport Commission for construction of the heavy jet rampways at the Little Rock Regional Airport sufficient to serve private and commercial aircraft; and WHEREAS, the City desires to assist the Company, in order to secure and develop industry within the City, and to aid in the financing thereof under the provisions of the Act; and WHEREAS, it is desirable that the City enter into an Agreement to Issue Bonds for such purpose; and NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE CITY OF LITTLE ROCK, ARKANSAS, that: 1. The Mayor of the City of Little Rock, Arkansas be authorized to enter into an Agreement to Issue Bonds in substantially the form and substance attached hereto. 2. This Resolution shall be in full force and effect from and after its adoption. ADOPTED this 6th day of February, 1990. q,"'9 'A - V ^ MAYO 0 G. VILLINES, AI ATTEST: C1'P(j:_CLERR -JANY CZECH J'S E A L) '. -2_ 5853 RLF020190 0 • AGREEMENT TO ISSUE BONDS THIS AGREEMENT is made as of February 6, 1990, by and between the - City of Little Rock, Arkansas, a municipal corporation under the laws of the State of Arkansas (the "City "), and Arkansas Modification Center, Inc., an Arkansas corporation (the "Company "), for the purpose of carrying out the purposes set forth in the Municipalities and Counties Industrial Development Revenue Bond Law, Arkansas Code Annotated Sections 14- 164 -201 to -224 (1987) (the "Act "). W I T N E S S E T H: WHEREAS, the City is construct, reconstruct, maintain, sell, lease, o in or dispose of any land, every nature whatsoever developing industry within authorized by the Act to own, acquire, extend, equip, improve, operate, r contract concerning or otherwise deal buildings, or facilities of any and that can be used in securing or or near the City; and WHEREAS, the City has determined that such purposes may be served by cooperation with the Company for the acquisition of a ground lease for real property owned by the Little Rock Municipal Airport Commission within the City, construction of buildings, including hangars, shops, and corporate offices, and purchasing furnishings, fixtures, and equipment to be used in the business of designing, manufacturing, and installing interiors of airplanes (the "Manufacturing Project ") and in the business of maintaining airplanes (the "Airport Project ") (collectively, the "Projects "); and WHEREAS, the City and the Company desire to cooperate in the acquisition of the Projects and to have the costs of acquiring, constructing, and equipping the Projects financed from the proceeds of revenue bonds of the City (the "Bonds ") to be issued pursuant to the Act in an aggregate principal amount now estimated not to exceed $13,000,000 with respect to the Manufacturing Project and not to exceed $5,000,000 with respect to the Airport Project (excluding any bonds issued to refund the Bonds); and WHEREAS, the City and the Company contemplate that the Projects will be leased to the Company, and the rental payments therefor together with other moneys available shall be sufficient to pay debt service on the Bonds and all related costs; 61 NOW, THEREFORE, in consideration of the premises and other good and valuable consideration under the mutual benefits, covenants, and agreements herein expressed, the City and the Company agree as follows: -1- 5853X RLF020190 -9 M M M M 1. Proceedings. All proceedings in connection with the issuance of the Bonds shall be consistent with the requirements of the Act, -- including notice to all state agencies, and the publication of notice as required by the Act. All references contained herein to the issuance of the Bonds shall be subject to compliance with the formalities of the Act when the facts required to do so are determined. 2. Acquisition. Construction, and Equipping. The City and the Company will cooperate in causing to be commenced and continued the required acquisition, construction, and equipping of the Projects, and the Company may provide, or cause to be provided, the necessary interim financing to permit such acquisition, construction, and equipping of the Projects to commence pending the issuance of interim and /or permanent bonds. Not later than the time of issuance of the Bonds for any portion of the Projects, the Company will convey and transfer or cause to be conveyed and transferred to the City, the Projects or portions thereof to be then financed, for an amount approximately equal to that then expended by the Company for the Projects or portions thereof which are financed by the Bonds then issued (including at the Company's option any costs of interim financing). There shall also be conveyed to the City any easements and rights -of -way necessary to permit acquisition and operation of the Projects or such portion. 3. Lease. The City the Company will lease thereof and will agree to the principal of and prei together with all charges the Bonds. shall enter into a lease under which from the City the Projects or portions make rental payments sufficient to pay nium, if any, and interest on the Bonds, of any Trustee and Paying Agent for 4. Sale of Bonds: Securitv. The City will take such steps as are necessary to issue, sell, and deliver, pursuant to the terms of the Act, the Bonds for the purposes of financing the costs of the Projects, in each case only upon receipt of the written designation by the Company of the underwriter thereof, such Bonds to be in such principal amount, to mature in such amount and times, to bear interest at such rate or rates, to be payable on such dates, and to have such optional and mandatory redemption features and prices as are determined by the Company. The City further agrees that it will enter into the lease and, if required, an indenture of trust with a bank or trust company, qualified to exercise trust powers where necessary, for the purpose of providing rental payments sufficient, with other amounts available from the Company or directly or indirectly from the proceeds of the Bonds, to pay the principal of and premium, if any, and interest on the Bonds as they become due together with the charges of any Trustee and any Paying Agent for the Bonds, and pledging or otherwise securing the payment of such rental payments for the benefit of -2- 5853X RLF020190 62 M = M the owners of the Bonds. The lease, the indenture, other related documents, and the Bonds shall contain such terms and conditions -as -are agreed upon by the City and the Company. The City will cooperate in consummating the transaction so contemplated and in attempting to realize the desire of the parties hereto that the interest on all Bonds issued to finance the Airport Project be excluded from gross income for purposes of federal income taxation. 5. Bonds to be Special Obligations. The City shall have no financial responsibility with respect to the Projects, the Bonds, or the costs associated with either, and the Bonds shall be special obligations of the City and shall never constitute a general obligation, indebtedness, or pledge of the credit of the City within the meaning of any constitutional or statutory provision and shall never be paid in whole or in part out of any funds raised or to be raised by taxation or any other revenues or other funds of the City except those (including unexpended Bond proceeds) derived from or in connection with the sale or lease of the Projects as provided for herein. 6. Conditions of Issuance. The Bonds may be issued either at one time or in several series or issues from time to time, in such aggregate principal amount or amounts as the Company shall request in writing; provided, however, that all conditions of the Act shall have been met. It is further agreed that the proceeds of the Bonds issued to finance the Airport Project shall not be invested so as to constitute any of such Bonds as arbitrage bonds within the meaning of Section 148 of the Internal Revenue Code of 1986, as amended, and applicable regulations promulgated or proposed pursuant thereto. 7. Costs to be Financed. The costs of the Projects may include any costs permissible under the Act, including but not limited to reasonable and necessary costs, expenses, and fees incurred by the City in connection with the issuance of the Bonds or in connection with the Projects, such as out -of- pocket expenses incurred by any employee of the City; fees and out -of- pocket expenses of counsel for the City, bond counsel, and any trustee; fees and expenses required in connection with the underwriting or placement of the Bonds; recording costs; and printing costs. The City will upon request provide or cause to be provided dny data or information which may be reasonably required to verify any of the costs, expenses, and fees enumerated above. 8. Termination. In the event that the Bonds shall not be sold within three years from the date hereof, this Agreement shall automatically terminate unless the parties hereto shall agree in writing to its extension for a further period of time specified in such writing. The Company may unilaterally terminate this Agreement without liability to the City (except -3- 5853% ALF020190 f,-, ft = = = = = = ft 0 • for any amounts due and owing by the Company to the City arising out of the transactions occurring on or before the time of such termination,--which shall be promptly paid by the Company to the City) by giving notice by ordinary mail, postage prepaid, to the City specifying therein the date of termination which may be the date of the notice. 9. Protection to the City. The Company shall pay all of the City's costs and expenses reasonably and necessarily incurred in connection with this Agreement or any other related document or instrument. The Company will at all times indemnify and hold harmless the City against any and all losses, costs, damages, expenses, and liabilities of whatsoever nature directly or indirectly resulting from, arising out of, or related to matters in connection with this Agreement. 10. Purpose and Effect. The Bonds are to be issued, sold, and delivered under the authority of the Act and all related actions and documents shall be in conformity therewith. The City intends this Agreement to be the expression of its present intent, pursuant to the terms hereof, to issue the Bonds up to $13,000,000 aggregate principal amount outstanding at any one time with respect to the Manufacturing Project and up to $5,000,000 aggregate principal amount outstanding at any one time with respect to the Airport Project, and to expend the Bond proceeds to defray the costs of the Projects. The City considers this Agreement to be an official action for all purposes of the Federal Income Tax Regulations. IN WITNESS WHEREOF, the acting pursuant to a resolution caused its name to be hereun caused its corporate name to be authorized officers, all as written. 5853X RLP020190 City of Little Rock, Arkansas, of its Board of Directors, has to subscribed, and the Company has subscribed hereto by its duly of the year and date first above CITY OF LITTLE ROCK, ARKANSAS By: F.G. "Buddy" Villines, Mayor ARKANSAS MODIFICATION CENTER, INC. By: Dennis D -4- Davis, President 64