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HomeMy WebLinkAbout204271 2 2011034786 Received: 6115/2011 9:54:45 AM Recorded: 06/15/2011 10:02:44 AM Filed & Recorded in Official Records of Larry Crane, PULASKI COUNTY CIRCUIT /COUNTY CLERK ORDINANCE NO. 20,427 Fees $35.00 3 AN ORDINANCE TO AUTHORIZE ISSUANCE OF TAXABLE INDUS - 4 TRIAL DEVELOPMENT REVENUE BONDS UNDER THE AUTHORITY 5 OF ACT NO. 9 OF 1960, AS AMENDED, TO SECURE AND DEVELOP 6 INDUSTRY WITHIN THE CITY; TO AUTHORIZE EXECUTION. AND 7 DELIVERY OF A BOND PURCHASE AGREEMENT PROVIDING FOR 8 THE SALE OF THE BONDS; TO AUTHORIZE EXECUTION AND DE- 9 LIVERY OF A TRUST INDENTURE SECURING THE BONDS; TO AU- 10 THORIZE EXECUTION AND DELIVERY OF A LEASE AGREEMENT 11 BETWEEN THE CITY, AS LESSOR, AND WINDSTREAM HOSTED SO- 12 LUTIONS, LLC, AS LESSEE; TO AUTHORIZE EXECUTION AND DE- 13 LIVERY OF AN AGREEMENT FOR PAYMENTS IN LIEU OF TAXES; 14 TO AUTHORIZE EXECUTION AND DELIVERY OF OTHER DOCU- 15 MENTS RELATING TO THE ISSUANCE OF THE BONDS AND TO 16 PRESCRIBE OTHER MATTERS IN RELATION; TO DECLARE AN 17 EMERGENCY; AND FOR OTHER PURPOSES. 18 19 WHEREAS, the City of Little Rock, Arkansas (the "City ") is authorized under the provisions of the 20 Municipalities and Counties Industrial Development Revenue Bond Law, Ark. Code Ann. § §14- 164 -201 21 to — (Repl. 2004 & Supp. 2011) (the "Act "), to own, acquire, construct, reconstruct, improve, equip and 22 lease facilities to secure and develop industry and to assist in the financing thereof by the issuance of 23 bonds payable from the revenues derived from such facilities; and 24 WHEREAS, the City, pursuant to Little Rock, AR, Resolution No. 13,303 (April 19, 2011) has pre - 25 viously expressed its intent to issue its industrial development revenue bonds under the authority of the 26 Act for the purposes hereinafter described for the benefit of Windstream Hosted Solutions, LLC, a Dela- 27 ware limited liability company (the "Company "), such bonds to be issued as described below; and 28 WHEREAS, the necessary arrangements have been made with the Company for the financing of a 29 31 substantial industrial project consisting of the retrofitting and equipping of a data center facility (the "Pro- ject") to be located at 15707 Chenal Parkway within the corporate boundaries of the City and tg,ba,utiii,,,, ized in the Company's telecommunications business; and �``��j►� ��C U�rC { [PAGE 1 OF 51 Ordiaamce to antbar ze Act 9 bonds for Windshwm I WHEREAS, permanent financing of the Project costs, necessary costs and expenditures incidental 2 thereto and the cost of the issuance of bonds is being furnished by the City pursuant to the Act through 3 the issuance of its Taxable Industrial Development Revenue Bonds ( Windstream Corporation Project), 4 Series 2011, in the principal amount of not to exceed Thirty Million Dollars ($30,000,000) (the "Bonds "); 5 and 6 WHEREAS, an open public hearing on the question of the issuance of the Bonds was held before the 7 City Board of Directors on May 3, 2011, following publication of notice in the Arkansas Democrat- 8 Gazette on April 23, 2011; and 9 WHEREAS, the Bonds will be issued pursuant to the terms and provisions of a Trust Indenture (the 10 "Indenture "), by and between the City and a trustee bank to be named (the "Trustee "); and 11 WHEREAS, the necessary arrangements have been made by the City to lease the Project to the Com- 12 pany pursuant to the terms of a Lease Agreement (the "Lease Agreement "); 13 NOW, THEREFORE, BE IT ORDAINED BY THE BOARD OF DIRECTORS OF THE CITY 14 OF LITTLE ROCK, ARKANSAS, THAT: 15 Section 1. The Board of Directors makes the following findings and determinations: 16 (a) Based on information compiled and released by the Arkansas Employment Security 17 Department, unemployment in the City of Little Rock during February of 2011 averaged is 7.3 %. Completion of the Project is expected to ensure continued employment and other 19 benefits to residents of the City. 20 (b) The Company currently intends to utilize the Project in its telecommunications business. 21 (c) The Company's continued presence within the City is expected to be an important factor in 22 the economic well being and employment base for the City and its inhabitants. 23 (d) The Bonds shall not constitute general obligations of the City within the meaning of any 24 constitutional or statutory limitation, but shall be special limited obligations of the City as 25 provided in the Act, the principal and interest on which shall be payable solely from the 26 revenues or other receipts, funds, monies and property pledged therefor under the Indenture. 27 Section 2. There is hereby authorized and directed the issuance from time to time of the Bonds and the 28 sale thereof to Windstream Supply, LLC, an Ohio limited liability company, or another affiliate of the 29 Company (the "Purchaser ") pursuant to the terms and provisions of a Bond Purchase Agreement to be dated 30 as of the date of delivery of the Bonds (the `Bond Purchase Agreement "), which Bond Purchase Agreement 31 is specifically approved in Section 3 hereof. The Bonds shall be sold at the purchase price of par plus accrued 32 interest, if any, and shall be issued and delivered according to the terms and provisions of the Bond Purchase 33 Agreement. The Bonds shall be issued in the original aggregate principal amount of not to exceed Thirty 34 Million Dollars ($30,000,000), shall be dated as of the date of their delivery, shall have a final maturity of (PAGE 2 OF 51 Ordinance to authorize Act 9 bonds for Windstream 1 December 1, 2026, shall bear interest at the rate of 5.75% per annum, shall be in the form, and shall be issued 2 upon the terms and conditions recommended by the Company, all as more particularly set forth in the 3 Indenture approved in Section 4 hereof. The Mayor is hereby authorized and directed to execute and deliver 4 the Bonds from time to time as requested by the Company, and the City Clerk is hereby authorized and 5 directed to execute and deliver the Bonds and to affix the seal of the City thereto, and the Mayor and City 6 Clerk are hereby authorized and directed to cause the Bonds to be authenticated by the Trustee. 7 Section 3. To prescribe the terms and conditions upon which the Bonds are to be sold to the Pur- s chaser, the Mayor is hereby authorized and directed to execute at the request of the Company the Bond 9 Purchase Agreement on behalf of the City, by and between the City and the Purchaser, and approved by 10 the Company. The Bond Purchase Agreement is hereby approved in substantially the form submitted to 11 this meeting, and the Mayor, with the counsel of the City Attorney, is hereby authorized to confer with 12 the Purchaser, the Company and Kutak Rock, LLP, Little Rock, Arkansas ( "Bond Counsel "), in order to 13 complete the Bond Purchase Agreement in substantially the form submitted to this meeting, with such 14 changes as shall be approved by such persons executing the document, their execution to constitute con - 15 clusive evidence of such approval. 16 (Advice is given that a copy of the Bond Purchase Agreement in substantially the form authorized to be 17 executed is on file with the City Clerk and is available for inspection by any interested person.) 18 Section 4. To prescribe the terms and conditions upon which the Bonds are to be secured, executed, 19 authenticated, issued, accepted and held, the Mayor and the City Clerk are hereby authorized and directed 20 to execute, acknowledge and deliver the Indenture, by and between the City and the Trustee, and the 21 Mayor and City Clerk are hereby authorized and directed to cause the Indenture to be accepted, executed 22 and acknowledged by the Trustee. The Indenture is hereby approved in substantially the form submitted 23 to this meeting, and the Mayor, with the counsel of the City Attorney, is hereby authorized to confer with 24 the Trustee, the Company, the Purchaser and Bond Counsel in order to complete the Indenture in substan- 25 tially the form submitted to this meeting, with such changes as shall be approved by such persons execut- 26 ing the document, their execution to constitute conclusive evidence of such approval. 27 (Advice is given that a copy of the Indenture in substantially the form authorized to be executed is on 28 file with the City Clerk and is available for inspection by any interested person.) 29 Section 5. There is hereby authorized and directed the execution and delivery of the Lease Agree - 30 ment by and between the City, as lessor, and the Company, as lessee, and the Mayor and the City Clerk 31 are hereby authorized to execute, acknowledge and deliver the Lease Agreement for and on behalf of the 32 City. The Lease Agreement is hereby approved in substantially the form submitted to this meeting, and 33 the Mayor, with the counsel of the City Attorney, is hereby authorized to confer with the Company, the 34 Trustee, the Purchaser and Bond Counsel in order to complete the Lease Agreement in substantially the [PAGE 3 OF 51 Ordisaam to amtrorize Act 9 bom& ror Whmhtmm 1 form submitted to this meeting, with such changes as shall be approved by such persons executing the 2 document, their execution to constitute conclusive evidence of such approval. 3 (Advice is given that a copy of the Lease Agreement in substantially the form authorized to be exe- 4 cuted is on file with the City Clerk and is available for inspection by any interested person.) 5 Section 6. The City and the Company recognize that under Article 16, Section 5, of the Constitution 6 of the State of Arkansas, as interpreted under past decisions of the Supreme Court of the State of Arkan- 7 sas applicable to facilities financed pursuant to the Act, including particularly the case of Wayland v. 8 Snapp, 232 Ark. 57, 334 S.W.2d 663 (1960), the Project will be exempt from ad valorem taxation. Al- 9 though the City makes no representation as to the continued precedential value of such past decisions, the 10 Company has agreed to enter into an Agreement for Payments in Lieu of Taxes to be dated as of the date 11 of its execution (the "PILOT Agreement ") requiring the Company to make certain payments in lieu of all 12 ad valorem taxes which would otherwise be levied on the Project real and personal property by local pub - 13 lic bodies with taxing power. In order to provide for such payments, there is hereby authorized and di- 14 rected the execution and delivery of the PILOT Agreement, and the Mayor is hereby authorized to exe- 15 cute and deliver the PILOT Agreement for and on behalf of the City. The PILOT Agreement is hereby 16 approved in substantially the form submitted to this meeting, and the Mayor, with the counsel of the City 17 Attorney, is hereby authorized to confer with the Company and Bond Counsel in order to complete the 18 PILOT Agreement in substantially the form submitted to this meeting, with such changes as shall be ap- 19 proved by such persons executing the document, their execution to constitute conclusive evidence of such 20 approval. 21 (Advice is given that a copy of the PILOT Agreement in substantially the form authorized to be exe- 22 cuted is on file with the City Clerk and is available for inspection by any interested person.) 23 Section 7. The Mayor and City Clerk, for and on behalf of the City, are hereby authorized and di- 24 rected to do any and all things necessary to effect the execution and delivery of the Bonds, the Bond Pur- 25 chase Agreement, the Indenture, the Lease Agreement and the PILOT Agreement, and to perform all of 26 the City's obligations under and pursuant thereto. The Mayor and the City Clerk are hereby further au- 27 thorized and directed, for and on behalf of the City, to execute all papers, documents, certificates and 28 other instruments approved by the City Attorney that may be required for the carrying out of such author - 29 ity or to evidence the exercise thereof. 30 Section 8. Because the City is here involved with the expansion, renovation and equipping of a 31 complex industrial project requiring highly specialized work and specialized types of machinery and 32 equipment, it has been and is hereby determined by the Board of Directors that competitive bidding be, 33 and the same is hereby, waived as to this particular industrial project. This action is taken by the City 34 pursuant to applicable laws of the State of Arkansas, including particularly the Act. [PAGE 4 OF 51 Ordinaue to authorize Act 9 bonds for Windsneam I Section 9. Kutak Rock, LLP, Little Rock, Arkansas, is hereby appointed as Bond Counsel with re- 2 spect to the issuance of the Bonds, the fees and expenses of which firm shall be costs of the Project and 3 paid from the proceeds of the Bonds or by the Company. 4 Section 10. Severability. In the event any section, subsection, subdivision, paragraph, subparagraph, 5 item, sentence, clause, phrase, or word of this ordinance is declared or adjudged to be invalid or unconsti- 6 tutional, such declaration or adjudication shall not affect the remaining provisions of this ordinance, as if 7 such invalid or unconstitutional provision were not originally a part of this ordinance. 8 Section 11. Repealer. All ordinances, resolutions, bylaws, and other matters inconsistent with this or- 9 dinance are hereby repealed to the extent of such inconsistency. 10 Section 12. Emergency Clause. There is hereby found and declared to be an immediate need for the 11 securing and developing of substantial industrial operations in order to provide additional employment, 12 retain existing employment, alleviate unemployment, and otherwise benefit the public health, safety and 13 welfare of the City and the inhabitants thereof, and the issuance of the Bonds authorized hereby and the 14 taking of the other actions authorized herein are immediately necessary in connection with the securing 15 and developing of substantial industrial operations and deriving the public benefits referred to above; 16 therefore, an emergency is declared to exist and this Ordinance being necessary for the immediate preser- 17 vation of the public health, safety and welfare shall be in force and take effect immediately upon and after 18 its passage. 19 PASSED: May 3, 2011 2o ATTES APPROVED: i 21 22 23 usa le City Clerk Mark Stodola, Mayor 24 25 APPROVED AS TO LEGAL FORM: 26 1t,` __ -- 27 �1�'LA-^V 28 Thomas M. Carpenter, CitVui6rney 29 H 30 H 31 H 32 H 33 H 34 H (PAGE 5 OF 51 Ordinance to authorize Act 9 bonds for Windstream