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HomeMy WebLinkAbout20807 2013076221 Received: 10/2112013 9:54:35 AN Recorded: 10/21/2013 10:02:30 AM Filed& Recorded in Of:ciai Records of Larry :.rane, PULASKI COUNTY CIRCUIT/COUNTY CLERK 1 ORDINANCE NO. 20,807 Fees;40.00 2 3 AN ORDINANCE TO AUTHORIZE ISSUANCE OF TAXABLE 4 INDUSTRIAL DEVELOPENT REVENUE BONDS UNDER THE 5 AUTHORITY OF ACT NO. 9 OF 1960, AS AMENDED, AND THE 6 MUNICIPALITIES AND COUNTIES INDUSTRIAL DEVELOPMENT 7 REVENUE BOND LAW, AS AMENDED, TO SECURE AND DEVELOP 8 INDUSTRY WITHIN THE CITY; TO AUTHORIZE EXECUTION AND 9 DELIVERY OF A BOND PURCHASE AGREEMENT PROVIDING FOR 10 THE SALE OF THE BONDS; TO AUTHORIZE EXECUTION AND 11 DELIVERY OF A MORTGAGE, SECURITY AGREEMENT AND 12 FIXTURE FILING SECURING THE BONDS; TO AUTHORIZE 13 EXECUTION AND DELIVERY OF A LEASE AGREEMENT BETWEEN 14 THE CITY, AS LESSOR, AND CAMERON INTERNATIONAL 15 CORPORATION, AS LESSEE; TO AUTHORIZE EXECUTION AND 16 DELIVERY OF AN AGREEMENT FOR PAYMENTS IN LIEU OF TAXES; i:1ll..lf II1i' IM 17 TO AUTHORIZE EXECUTION AND DELIVERY OF OTHER °` C!Rcc" 18 DOCUMENTS RELATING TO THE ISSUANCE OF THE BONDS AND TO vQ w 'a,'•y G 19 PRESCRIBE OTHER MATTERS IN RELATION THERETO; TQ �+ f' Y •`a -7244 3 20 DECLARE AN EMERGENCY; AND FOR OTHER PURPOSES. �; ' �,�� 21 j'%,,O UNTY,,`P�.��`. 22 WHEREAS,the City of Little Rock, Arkansas (the "City") is authorized under the provisions of 23 Act 9 of the First Extraordinary Session of the Sixty-Second General Assembly of the State of Arkansas, 24 Ark. Code Ann. § 14-164-201 to 224 (Repl. 2004 and Supp. 2011), as amended, the Municipalities and 25 Counties Industrial Development Revenue Bond Law, Ark. Code Ann. §§14-164-501 to 526 (Repl. 2004 26 & Supp. 2011) (collectively, the "Act"),to own, acquire, construct, reconstruct, improve, equip and lease 27 facilities to secure and develop industry and to assist in the financing thereof by the issuance of bonds 28 payable from the revenues derived from such facilities; and 29 WHEREAS, the City, pursuant to Resolution No. 13,404 (approved November 15, 2011) has 30 previously expressed its intent to issue its industrial development revenue bonds under the authority of the 31 Act for the purposes hereinafter described for the benefit of Cameron International Corporation,a Delaware 32 corporation(the"Company"), such bonds to be issued as described below; and Page 1 of 61 1 WHEREAS,the necessary arrangements have been made with the Company for the financing of 2 a substantial industrial project consisting of 1)actuator component and stem machines;2)body and bonnet 3 machines; 3)seat/plug/core machines; 4)assembly,paint and testing machines; and 5)other machines and 4 equipment related to the Company's business of designing and manufacturing valves in Little Rock, 5 Arkansas(the"Project")located at 7200 Interstate 30 within the corporate boundaries of the City and to be 6 utilized in the Company's manufacturing business; and 7 WHEREAS,permanent financing of the Project costs,necessary costs and expenditures incidental 8 thereto and the cost of the issuance of bonds is being furnished by the City pursuant to the Acts through the 9 issuance of its Taxable Industrial Development Revenue Bonds(Cameron International Project),from time- 10 to-time in one or more series in the principal amount of not to exceed Twenty-Five Million Dollars 11 ($25,000,000)(the"Bonds"); and 12 WHEREAS, the Company has requested that the City approve an initial series of bonds in the 13 aggregate principal amount of not to exceed Seven Million Dollars ($7,000,000) to be identified as the 14 "Series 2013 Bonds"; and 15 WHEREAS,an open public hearing on the question of the issuance of the Bonds was held before 16 the Board of Directors on October 15, 2013, following publication of notice in the Arkansas Democrat- 17 Gazette on October 2, 2013; and 18 WHEREAS,the Bonds will be issued pursuant to the terms and provisions of a Mortgage,Security 19 Agreement and Fixture Filing (the "Mortgage"), granted by the City and the Company in favor of the 20 purchaser of the Series 2013 Bonds; and 21 WHEREAS, the necessary arrangements have been made by the City to lease the Project to the 22 Company pursuant to the terms of a Lease Agreement(the"Lease Agreement"); 23 NOW, THEREFORE, BE IT ORDAINED BY THE BOARD OF DIRECTORS OF THE 24 CITY OF LITTLE ROCK,ARKANSAS,THAT: 25 Section 1. The Board of Directors makes the following findings and determinations: 26 (a) Based on information compiled and released by the Arkansas Employment Security 27 Department, unemployment in the City during July 2013 averaged 7.2%. Completion of 28 the Project is expected to ensure continued employment and other benefits to residents of 29 the City. 30 (b) The Company currently intends to utilize the Project in its valve manufacturing business. 31 (c) The Company's continued presence within the City is expected to be an important factor 32 in the economic well-being and employment base for the City and its inhabitants. 33 (d) The Bonds shall not constitute general obligations of the City within the meaning of any 34 constitutional or statutory limitation, but shall be special limited obligations of the City as [Page 2 of 6] 1 provided in the Acts, the principal and interest on which shall be payable solely from the 2 revenues or other receipts, funds, monies and property pledged therefor under the 3 Mortgage. 4 Section 2. There is hereby authorized and directed the issuance from time to time of the Bonds 5 and the sale thereof to Cameron V&M Financing, LLC, a Delaware limited liability company, or another 6 affiliate of the Company (the "Purchaser") pursuant to the terms and provisions of a Bond Purchase 7 Agreement to be dated as of the date of delivery of the Bonds (the "Bond Purchase Agreement"), which 8 Bond Purchase Agreement is specifically approved in Section 3 hereof. The Bonds shall be sold at the 9 purchase price of par plus accrued interest, if any, and shall be issued and delivered according to the terms 10 and provisions of the Bond Purchase Agreement. The Series 2013 Bonds shall be issued in the original 11 aggregated principal amount of not to exceed Seven Million Dollars($7,000,000), shall be dated as of the 12 date of their delivery, shall have a maturity as stated in the Series 2013 Bonds which shall be no more than 13 twenty(20)years from the date of issuance of the Series 2013 Bonds,shall bear interest at the rate of 4.20% 14 per annum, shall be in the form, and shall be issued upon the terms and conditions recommended by the 15 Company, all as more particularly set forth in the Mortgage approved in Section 4 hereof. The Mayor is 16 hereby authorized and directed to execute and deliver the Series 2013 Bonds as requested by the Company, 17 and the City Clerk is hereby authorized and directed to execute and deliver the Series 2013 Bonds and to 18 affix the seal of the City thereto,and the Mayor and City Clerk are hereby authorized and directed to cause 19 the Series 2013 Bonds to be authenticated by the Trustee. 20 Section 3. To prescribe the terms and conditions upon which the Bonds are to be sold to the 21 Purchaser,the Mayor is hereby authorized and directed to execute at the request of the Company the Bond 22 Purchase Agreement on behalf of the City,by and between the City and the Purchaser,and approved by the 23 Company. The Bond Purchase Agreement is hereby approved in substantially the from submitted to this 24 meeting and the Mayor, with the counsel of the City Attorney, is hereby authorized to confer with the 25 Purchaser, the Company and Wright, Lindsey & Jennings LLP, Little Rock, Arkansas("Bond Counsel"), 26 in order to complete the Bond Purchase Agreement in substantially the form submitted to this meeting,with 27 such changes as shall be approved by such persons executing the document, their execution to constitute 28 conclusive evidence of such approval. A copy of the Bond Purchase Agreement in substantially the form 29 authorized to be executed is on file with the City Clerk and is available for inspection by any interested 30 person. 31 Section 4. To prescribe the terms and conditions upon which the Series 2013 Bonds are to be 32 secured, executed, authenticated, issued, accepted and held, the Mayor and the City Clerk are hereby 33 authorized and directed to execute, acknowledge and deliver the Mortgage, by and between the City and 34 the Purchaser, and the Mayor and City Clerk are hereby authorized and directed to cause the Mortgage to [Page 3 of 6] 1 be accepted, executed and acknowledged by the Purchaser. The Mortgage is hereby approved in 2 substantially the form submitted to this meeting, and the Mayor, with the counsel of the City Attorney, is 3 hereby authorized to confer with the Company, the Purchaser and Bond Counsel in order to complete the 4 Mortgage in substantially the form submitted to this meeting, with such changes as shall be approved by 5 such persons executing the document, their execution to constitute conclusive evidence of such approval. 6 A copy of the Mortgage in substantially the form authorized to be executed is on file with the City Clerk 7 and is available for inspection by any interested person. 8 Section 5. There is hereby authorized and directed the execution and delivery of the Lease 9 Agreement by and between the City, as lessor, and the Company, as lessee, and the Mayor and the City 10 Clerk are hereby authorized to execute,acknowledge and deliver the Lease Agreement for and on behalf of 11 the City. The Lease Agreement is hereby approved in substantially the form submitted to this meeting,and 12 the Mayor, with the counsel of the City Attorney, is hereby authorized to confer with the Company, the 13 Purchaser and Bond Counsel in order to complete the Lease Agreement in substantially the form submitted 14 to this meeting, with such changes as shall be approved by such persons executing the document, their 15 execution to constitute conclusive evidence of such approval. A copy of the Lease Agreement in 16 substantially the form authorized to be executed is on file with the City Clerk and is available for inspection 17 by any interested person. 18 Section 6. The City and the Company recognize that under Article 16,Section 5 of the Constitution 19 of the State of Arkansas,as interpreted under past decisions of the Supreme Court of the State of Arkansas 20 applicable to facilities financed pursuant to the Acts, including particularly the case of Wayland v. Snapp, 21 232 Ark. 57, 334 S.W.2d 663 (1960), the Project will be exempt from ad valorem taxation. Although the 22 City makes no representation as to the continued precedential value of such past decisions, the Company 23 has agreed to enter into an Agreement for Payments in Lieu of Taxes to be dated as of the date of its 24 execution and as supplemented from time to time in accordance with the provisions thereof(collectively, 25 the"PILOT Agreement")requiring the Company to make certain payments in lieu of all ad valorem taxes 26 which would otherwise be levied on the Project real and personal property by local public bodies with 27 taxing power. In order to provide for such payments,there is hereby authorized and directed the execution 28 and delivery of the PILOT Agreement,and the Mayor is hereby authorized to execute and deliver the PILOT 29 Agreement for and on behalf of the City. The PILOT Agreement is hereby approved in substantially the 30 form submitted to this meeting, and the Mayor,with the counsel of the City Attorney, is hereby authorized 31 to confer with the Company and Bond Counsel in order to complete the PILOT Agreement in substantially 32 the form submitted to this meeting, with such changes as shall be approved by such persons executing the 33 document, their execution to constitute conclusive evidence of such approval. A copy of the PILOT [Page 4 of 61 1 Agreement in substantially the form authorized to be executed is on file with the City Clerk and is available 2 for inspection by any interested person. 3 Section 7. The Mayor and City Clerk, for and on behalf of the City, are hereby authorized and 4 directed to do any and all things necessary to effect the execution and delivery of the Series 2013 Bonds, 5 the Bond Purchase Agreement, the Mortgage, the Lease Agreement and the PILOT Agreement, and to 6 perform all of the City's obligations under and pursuant thereto. The Mayor and the City Clerk are hereby 7 further authorized and directed,for and on behalf of the City,to execute all papers, documents,certificates 8 and other instruments approved by the City Attorney that may be required for the carrying out of such 9 authority or to evidence the exercise thereof. 10 Section 8. Because the City is here involved with the expansion, renovation and equipping of a 11 complex industrial project requiring highly specialized work and specialized types of machinery and 12 equipment,it has been and is hereby determined by the Board of Directors that competitive bidding be,and 13 the same is hereby,waived as to this particular industrial project. This action is taken by the City pursuant 14 to applicable laws of the State of Arkansas, including particularly the Act. 15 Section 9. That the Mayor is hereby authorized to pay (if not otherwise paid) the necessary 16 expenses incidental to the issuance of the Series 2013 Bonds including, but not limited to,fees and costs of 17 Bond Counsel, Issuer's Counsel, permitting costs, publication costs and filing fees, but solely from the 18 proceeds of the Series 2013 Bonds available for payment of the costs of issuance. 19 Section 10. Wright, Lindsey&Jennings LLP,Little Rock,Arkansas, is hereby appointed as Bond 20 Counsel with respect to issuance of the Bonds, the fees and expenses of which firm shall be costs of the 21 Project and paid from the proceeds of the Series 2013 Bonds or by the Company. 22 Section 11. Severability. In the event any section, subsection, subdivision, paragraph, 23 subparagraph,item,sentence,clause,phrase,or work of this ordinance is declared or adjudged to be invalid 24 or unconstitutional, such declaration or adjudication shall not affect the remaining provisions of this 25 ordinance, as if such invalid or unconstitutional provision were not originally a part of this ordinance. 26 Section 11. Repealer. All ordinances,resolutions,bylaws,and other matters inconsistent with this 27 ordinance are hereby repealed to the extent of such inconsistency. 28 Section 12. Emergency Clause. There is hereby found and declared to be an immediate need for 29 the securing and developing of substantial industrial operations in order to provide additional employment, 30 retain existing employment, alleviate unemployment, and otherwise benefit the public health, safety and 31 welfare of the City and the inhabitants thereof,and the issuance of the Series 2013 Bonds authorized hereby 32 and the taking of the other actions authorized herein are immediately necessary on connection with the 33 securing and developing of substantial industrial operations and deriving the public benefits referred to 34 above; therefore, an emergency is declared to exist and this ordinance being necessary for the immediate [Page 5 of 61 1 preservation of the public health, safety and welfare shall be in force and effect immediately upon and after 2 its passage. 3 PASSED: October 15,2013 4 ATTEST: APPROVE . 5 // 7 san a City Clerk Mark Stodola,Mayor 8 APPRO E TO LEGAL FORM: 9 10 14-4 11 Thomas M.Carpenter,City Attorkey 12 // 13 // 14 // 15 // 16 // 17 // 18 // 19 // 20 // 21 // 22 // 23 // 24 // 25 // 26 // 27 // 28 // 29 // 30 // 31 // 32 // 33 // 34 // 35 II ]Page 6 of 6]