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HomeMy WebLinkAboutO-698ORDINANCE NO. 0' AN ORDINANCE AUTHORIZING THE ISSUANCE OF $1,000,000 PRINCIPAL AMOUNT OF GENERAL OBLIGATION WARRANTS, SERIES 1982, DATED JUNE 1, 1982, AND MAKING PROVISION FOR THE PAYMENT THEREOF BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FAIRHOPE, ALABAMA, as follows: Section 1. Definitions and Use of Phrases. The fol- lowing words and phrases and others ev ent y intended as the equivalent thereof shall, in the absence of clear implication herein otherwise, be given the following respective interpretations herein: "Depository to means (i) the bank designated as the depository for the Warrant Fund and the place of payment of the Warrants and coupons appertaining thereto and (ii) any successor bank designated by the Municipality pursuant to the provisions of Section 11 hereof. "Eli ible Certificates" means (i) interest bearing certi icates ot deposit issued by any bank organized under the laws of the United States of America or any state thereof having a combined capital, surplus and undivided profits of not less than $10,000,000, or (ii) interest bearing certificates of deposit issued by any bank organized under the laws of the United States of America or any state thereof that are secured by the issuing bank by depositing and pledging with a Federal Reserve Bank Government Obligations having a market value (exclusive of accrued interest) not less than the face amount of such certificates. "Government Obligations" means direct general obliga- tions o t e United States of America or any securities on which the payment of the principal and interest are uncon- ditionally guaranteed by the United States of America. "Municipality" means the City of Fairhope, Alabama, a municipa corporation under the laws of the State of Alabama, and any successor to its functions. "Temporary Note" means the Municipality's General Obligation Note dated June 4, 1981, issued pursuant to Resolution No. 5-81 adopted March 27, 1981, and now outstanding in the principal amount of $400,000. "Warrants" means the Municipality's General Obligation Warrants, Series 1982, authorized to be issued by this ordinance. "Warrant Fund" means the Series 1982 General Obliga- tion Warrants Fund established pursuant to Section 8 here- of. The definitions set forth in this section shall be deemed applicable whether the words defined are used here- in in the singular or the plural. Wherever used herein, any pronoun or pronouns shall be deemed to include both singular and plural and to cover all genders. Section 2. Findings and Representations. The Munici- pality, by and through its City Council, does hereby find, determine, represent, and warrant as follows: (a) It is necessary and in the public interest for the Municipality to (a) retire the Temporary Note, and (b) acquire and construct a civic center in the corporate limits of the Municipality, and for such purposes to issue the Warrants herein authorized. (b) The Municipality has heretofore issued its Tem- porary Note for the purpose of acquiring Del -Fair shopping center for use as a municipal civic center complex. The principal of and interest on the Temporary Note will be due and payable on June 4, 1982. The Municipality does not and will not have sufficient funds on hand on the maturity date of the Temporary Note to pay the principal and interest maturing on such date, and it is necessary to refund the Temporary Note, thereby permitting the retirement of the indebtedness evidenced thereby in installments payable from anticipated revenues, taxes and other income of the Municipality. (c) The assessed valuation of the taxable property in the Municipality for the preceding fiscal year (ending September 30, 1981) is not less than $13,545,820, and the total indebtedness of the Municipality (including the War- rants) chargeable against the debt limitation for the Municipality prescribed by the Constitution of the State of Alabama will not be more than twenty percent of said assessed valuation. Section 3. Authorization and Description of War- rants. Pursuant to the authority to do so contained in the applicable provisions of the laws of Alabama, includ- ing particularly Section 11-47-2 of the CODE OF ALABAMA 1975, there is hereby authorized to be issued a series of -2- r warrants designated "General Obligation Warrants, Series 1982" in the aggregate principal amount of $1,000,000. The Warrants shall be dated June 1, 1982, shall be payable to Roger C. Clayton or his assignees, shall be in the denomination of $5,000 each, and shall be numbered conse- cutively from 1 to 200, inclusive. The Warrants shall mature, subject to prior redemption as hereinafter pro- vided, on June 1, 1987 and shall bear interest at the rate of 10-3/4% per annum. Interest on the Warrants shall be evidenced by coupons payable to bearer and shall be pay- able semiannually on June 1 and December 1 in each year, first interest payable December 1, 1982. The principal of and interest on the Warrants shall be payable at par and without discount, exchange, deduction or charge therefor, at the principal office of the Depository in the City of Fairhope, Alabama. Section 4. Redemption of Warrants. The Warrants shall be redeemable, in whole or in part, at the option of the Municipality on June 1, 1983, or any interest payment date thereafter, at the applicable redemption price, (expressed as a percentage of principal amount) set forth in the table below, plus accrued interest thereon to the date fixed for redemption: Redemption Date Redemption Price June 1, 1983 or December 1, 1983 102% June 1, 1984 or December 1, 1984 101-1/2% June 1, 1985 or December 1, 1985 101% June 1, 1986 or December 1, 1986 100-1/2% If less than all of the Warrants at the time outstanding are redeemed, any redemption shall be in the inverse order of identification numbers, highest numbers first. Notice of any intended redemption shall be given by publication not less than thirty (30) days prior to the proposed redemption date at least once in a financial journal or financial newspaper published in the City of New York, New York. If any of the Warrants so redeemable shall have been called for redemption, interest thereon shall cease to accrue from and after the date fixed for redemption unless default shall be made in the -payment of the redemp- tion price thereof. Section 5. Form of Warrants and Coupons. The War- rants and coupons thereunto appertaining s all be in sub- stantially the following form: ,z -3- (Form of Warrant) UNITED STATES OF AMERICA STATE OF ALABAMA CITY OF FAIRHOPE GENERAL OBLIGATION WARRANT SERIES 1982 No. $5,000 The CITY OF FAIRHOPE, a municipal corporation organized and existing under and by virtue of the laws of the State of Alabama (herein called the "Municipality"), for value received, hereby acknowledges itself indebted to Roger C. Clayton or his assignees in the principal sum of FIVE THOUSAND DOLLARS ($5,000) and hereby orders and directs the Treasurer of the Munici- pality to pay to said payee or his assignees from the Fund hereinafter designated said sum on June 1, 1987, and to pay from said Fund interest on said sum at the rate of 10-3/4% per annum, payable semiannually on June 1 and December 1 in each year, first interest payable December 1, 1982, until maturity upon presentation and surrender of the interest coupons therefor hereto attached as they respectively become due. Both principal of and interest on this warrant are payable in -lawful money of the United States of America, at par and without deduction for exchange or costs of collection, at the principal office of Central Bank, N.A. in the City of Fairhope, Alabama. This warrant is one of a duly authorized issue of General Obligation Warrants, Series 1982, of the Munici- pality (herein called the "Warrants") limited to an aggre- gate principal amount of $1,000,000 issued pursuant to the Constitution and laws of the State of Alabama, including the provisions of Section 11-47-2 of the CODE OF ALABAMA 1975, and an ordinance and proceedings of the Municipality duly held, passed and conducted. The indebtedness evi- denced by the Warrants is a general obligation of the Municipality, and the full faith and credit of the Munici- pality are hereby sacredly and irrevocably pledged to the punctual payment of the principal thereof and interest thereon. The Municipality has established by the ordinance authorizing the issuance of the Warrants a special fund designated "Series 1982 General Obligation Warrants Fund" -4- for the payment of the principal of and interest on the Warrants and has obligated itself to pay or cause to be paid into said Fund from the taxes, revenues or funds of the Municipality sums sufficient to provide for the pay- ment of the principal of and interest on the Warrants as the same mature and come due. The Warrants shall be subject to redemption, in whole or in part, at the option of the Municipality on June 1, 1983, or on any interest payment date thereafter, at the applicable redem tion price (expressed as a percentage of principal amoun t set forth in the table below, plus accrued interest thereon to the date fixed for redemption: Redemption Date Redemption Price June 1, 1983 or December 1, 1983 102% June 1, 1984 or December 1, 1984 101-1/2% June 1, 1985 or December 1, 1985 101% June 1, 1986 or December 1, 1986 100-1/2% If less than all of the Warrants at the time outstanding are redeemed, any redemption shall be in the inverse order of identification numbers, highest numbers first. Notice of any intended redemption shall be given by publication not less than thirty (30) days prior to the proposed redemption date at least once in a financial journal or financial newspaper published in the City of New York, New York. If any of the Warrants so redeemable shall have been called for redemption as hereinabove provided, inter- est thereon shall cease to accrue from and after the date fixed for redemption unless default shall be made in the payment of the redemption price thereof. This warrant is non-negotiable but is transferable by assignment noted hereon. Each taker, owner, purchaser or holder hereof, by receiving or accepting this warrant or any interest coupon, shall consent and agree and shall be estopped to deny: (1) that title to the coupons hereunto appertaining may be transferred by delivery without the necessity of a written assignment; (2) that any person in possession of any such coupon, regardless of the manner in which he shall have acquired possession, is authorized to represent himself as the absolute owner thereof and has the power and authority to transfer.absolute title thereto by delivery thereof to a bona fide purchaser for value (present or antecedent) without notice of prior defenses or equities or claims of ownership enforceable against his transferor or any person in the chain of title and before the maturity thereof; (3) that he has waived and renounced all of his equities or rights thereto in favor of every -5- such bona fide purchaser and that every such bona fide purchaser shall acquire absolute title thereto and to all rights represented thereby; and (4) that the Municipaity may treat any person in possession of this warrant, regardless of how such possession may have been acquired and regardless of the genuineness or effectiveness of any assignment, or the bearer of any of the coupons hereunto appertaining, as the absolute owner for all purposes, and payment to any such person or such bearer shall discharge all obligations hereunder or thereunder. It is hereby recited, certified and declared that the indebtedness evidenced and ordered paid by this Warrant is lawfully due without condition, abatement or offset of any description, that this Warrant has been registered in the manner provided by law, that all acts, conditions and things required by the Constitution and laws of the State of Alabama to happen, exist and be performed precedent to and in the execution, registration and issuance of this Warrant, and the adoption of the ordinance authorizing its issuance, have happened, do exist and have been performed as so required and that the principal amount of this War- rant, together with all other indebtedness of the Munici- pality, are within every debt and other limit prescribed by the Constitution and laws of the State of Alabama. IN WITNESS WHEREOF, the Municipality has caused this warrant to be executed in its name and on its behalf by its Mayor, who has caused a facsimile of his signature to be imprinted hereon, and attested by its City Clerk, who has manually signed this Warrant and its corporate seal to be affixed hereto by imprinting a facsimile of said seal hereon, has caused the coupons hereunto attached to be executed with the facsimile signature of said Mayor and attested with the facsimile signature of said City Clerk, and has caused this warrant to be dated June 1, 1982. S E A L Attest; City Clerk CITY of FAIRHOPE, ALABAMA By (facsimile) Mayor 0 (Form of Coupon) No. $268.75 On June (December) 1, 1982 (unless the Warrant herein- after mentioned is subject to redemption, has been called for redemption and payment of the redemption price duly made or provided) the,City of Fairhope, Alabama, hereby orders and directs the Treasurer of the City of Fairhope to pay to the bearer hereof from the Fund referred to in the Warrant hereinafter mentioned, the sum of Two -hundred sixty-eight and seventy-five hundredths Dollars in lawful money of the United States of America, upon presentation and surrender of this coupon at the principal office of Central Bank, N.A. in the City of Fairhope, Alabama, being interest then due on its General Obligation Warrant, Series 1982, dated June 1, 1982, No. CITY of FAIRHOPE, ALABAMA By (facsimile) Mayor Attest: (facsimile) City Clerk (Form of registration to be printed on the reverse of each Warrant) I hereby certify that this warrant and the interest coupons hereto attached have been duly registered by me as a claim against the City of Fairhope, in the State of Alabama and the Fund referred to therein. (facsimile) Treasurer of the City of Fairhope, Alabama (Form of assignment to be printed on the reverse of each Warrant) A S S I G N M E N T For value received this warrant is assigned to the assignee designated in the left-hand column below by,the owner and assignor designated in the right-hand column below without recourse on or warranty by such assignor, _% except that he warrants that he is the owner of this war- rant and has a right to assign it. ASSIGNEE ASSIGNOR Section 6. Execution of the Warrants. Each of the Warrants shall be executed in the name and on behalf of the Municipality by the Mayor, who shall cause a facsimile of his signature to be imprinted on each of the Warrants, and shall be manually attested by the City Clerk, and the - official seal of the Municipality shall be imprinted in facsimile thereon. The coupons appertaining to the War- rants shall be executed in the name of the Municipality with the facsimiles of the signatures of the Mayor and the City Clerk. The Warrants and coupons shall be registered by the Treasurer of the Municipality in the records main- tained by the said Treasurer as a claim against the Muni- cipality and the Warrant Fund, which registration shall be made simultaneously as to all the Warrants and the cou- pons. The certificate of registration on each of the War- rants shall be executed by the Treasurer of the Municipal- ity by causing a facsimile of her signature to be imprinted thereon. Said officers are hereby directed to so execute, attest and register the Warrants and coupons. Section 7. Warrants are General Obligations. The indebtedness evidenced and ordered paid by the Warrants shall be a general obligation of the Municipality for the punctual payment of the principal of and interest on which the full faith, credit and taxing power of the Municipal- ity are hereby irrevocably pledged. The Municipality represents that ad valorem taxes have been levied and hereby covenants and agrees that such taxes will be levied and collected, insofar as such taxes may be permitted by the present or any future provisions of the Constitution of Alabama, on all taxable property in the Municipality, and applied to the maximum extent permitted by law to the payment of the principal of and interest on the Warrants as such principal matures and such interest comes due, in amounts sufficient for such purposes. Section 8. The Warrant Fund. There is hereby estab- lished a special fund designated the "Series 1982 General Obligation Warrants Fund", which shall e e y t e -8- Depository as paying agent for the Warrants. Money in the Warrant Fund shall be used solely for the payment of the principal of, premium (if any) and interest on the War- rants. The Municipality shall pay or cause to be paid into the Warrant Fund the following amounts on or before the following dates: (a) Immediately following the delivery of and payment for the Warrants, the amount received as accrued interest on the Warrants; and (b) On or before November 25, 1982, and on or before the 25th day of each May and November there- after, to and including May 25, 1987, the interest coming due on the Warrants on the next ensuing inter- est payment date; provided that there shall be allowed as a credit on the first such payment, the amount deposited in the Warrant Fund as accrued interest on the Warrants and provided further that any investment earnings, as provided in Section 10 hereof, shall be credited against the payments required to be made herein; and (c) On or before May 25, 1987, the principal maturing on the Warrants on June 1, 1987. If on any principal or interest payment date the balance in the Warrant Fund is insufficient to pay the principal of and interest on the Warrants due and payable on such date, the Municipality shall forthwith pay any such defi- ciency into the Warrant Fund. The Municipality and the Depository shall cause all money deposited in the Warrant Fund to be applied to the payment of principal or interest on the Warrants within thirteen months from the date of such deposit and shall cause all income and profits received from the investment of money in the Warrant Fund to be applied to the payment of principal or interest on the Warrants within twelve months from the date of receipt of such income or pro- fits. Income and profits received from any investment of money in the Warrant Fund shall be credited against the deposit next required to be made into the Warrant Fund and, if necessary, against successive deposits thereafter until such credits are exhausted. Section 9. Security for Warrant Fund. The money,at any time on deposit in the Warrant Fund shall be and at all times remain public funds impressed with a trust for the purpose for which the Warrant Fund is created. The Depository shall at all times keep the money on deposit with it in the Warrant Fund continuously secured for the benefit of the Municipality and the holders of the War- rants and coupons appertaining thereto either (a) by holding on deposit as collateral security Government Obligations having a market value (exclu- sive of accrued interest) not less than the amount of money on deposit in the Warrant Fund, or (b) if the furnishing of security in the manner pro- vided in the foregoing clause (a) is not permitted by the then applicable laws and regulations, then in such manner as may be required or permitted by the appli- cable State of Alabama and Federal laws and regula- tions respecting the security for or granting a pre- ference in the case of the deposit of public trust funds; provided, however, that it shall not be necessary for the Depository so to secure (i) any portion of the money on deposit in the Warrant Fund that may be insured by the Federal Deposit Insurance Corporation or by any agency of the United States of America that may succeed to its func- tions, or (ii) any portion of the money on deposit in the Warrant Fund that may be invested as provided in Section 10. Section 10. In.vestment of Money in Warrant Fund. The Municipality may cause any money on deposit in the Warrant Fund not then needed for the payment of principal of or in on the Warrants to be invested or reinvested by the Depository in Government Obligations or Eligible Certificates. All such investments must mature or be sub- ject to redemption at the option of the holder on or prior to the respective date or dates when cash funds will be required for purposes of the Warrant Fund. Any such investments shall be held by or under control of the Depository and shall be deemed at all times a part of the Warrant Fund. All interest accruing on such investments and any profit realized therefrom shall be deposited in the Warrant Fund and shall be credited to the deposits specified in Section 8 hereof; any losses resulting from liquidation of investments shall be charged to the Warrant Fund and shall be added to the next ensuing deposit speci- fied in Section 8 hereof. The Depository shall sell and reduce to cash a sufficient portion of such investments whenever the cash balance in the Warrant Fund is insuffi- cient to pay the interest and principal requirements on the Warrants. -10- �jOC' emu- _ �.. �1.�--�iC,,,,, 7►. Section 11. Depository for the Warrant Fund. The Municipality does hereby designate and appoint Central Bank, N.A., Fairhope, Alabama, as the depository for the Warrant Fund. In the event the bank so designated should refuse or cease to act as Depository or should become incapable of so acting, then the Municipality may at any time and from time to time designate as Depository any other banking institution the deposits of which are insured by the Federal Deposit Insurance Corporation and which has its principal office in the State of Alabama. Section 11. Expenses of Collection; Interest After Maturity. The Municipality covenants and agrees that, if the principal of and interest on the Warrants are not paid promptly as such principal and interest matures and comes due, it will pay to the payee of the Warrants or his assignee and the holders and owners of the coupons all expenses incident to the collection of any unpaid portion thereof, including a reasonable attorneys' fee. The War- rants and the coupons thereunto appertaining shall bear interest at the rate of 12% per annum or the maximum rate of interest allowed by law, whichever is less, from and after the respective maturity or due dates thereof, if not then paid. Section 12. Sale and Delivery of Warrants; Closing Papers. The Warrants are hereby sold to Central Bank of the South upon the payment to the Municipality of the pur- chase price of 100% of the par value or principal amount thereof, plus accrued interest from the date of the Warrants to the date of delivery and payment therefor. The City Council has determined that the sale of the War- rants to such purchaser on such terms is most advantageous to the Municipality. The Warrants shall be delivered to such purchaser at Birmingham, Alabama, upon the payment to the Municipality of the aforesaid purchase price. The Mayor and the City Clerk and City Treasurer, or any of them, are hereby authorized and directed to effect such delivery and in connection therewith to deliver such closing papers containing such representations as are required to demonstrate: the legality and validity of the Warrants, the exemption of interest on the Warrants from Federal and State of Alabama income taxation; and the absence of pending or threatened litigation with respect to any of such matters. The City Treasurer shall give a receipt to the said purchaser for the purchase price paid, and such receipt shall be full acquittal to the said pur- chaser and the said purchaser shall not be required to see to, or be responsible for, the application of the proceeds of the Warrants. Nevertheless, the proceeds of the War- rants shall be held in trust and applied solely for the purposes specified in this ordinance. -11- Section 13. Application of Proceeds of Warrants. The proceeds from the sale ot the Warrants shall be is ursed by the Treasurer of the Municipality for the following purposes and in the following order: (a) Accrued Interest. The amount received as accrued interest on the sale bf the Warrants shall be deposited in the Warrant Fund. (b) Retirement of Temporary Note. The amount necessary to prepay the principal o and accrued interest on the Temporary Note shall be paid to the holder thereof upon surrender of the Temporary Note to the City Treasurer for cancellation. (c) Acquisition and Construction of Capital Improve- ments. The remaining principal proceeds o5t the Warrants sh-lT be held in trust by the City Treasurer and applied to the acquisition and construction of the civic center improvements referred to in Section 2(a) of this ordin- ance. Section 14. Non -Arbitrage Covenant. The Municipality hereby covenants and agrees with the holders of the War- rants and the coupons appertaining thereto that the pro- ceeds of the Warrants shall not be used or applied by it, and the taxes or other revenues of the Municipality shall not be accumulated in the Warrant Fund, in such a manner as to cause any Warrant to be or become an "arbitrage bond", as that term is defined in Section 103(c) of the Internal Revenue Code of 1954, as amended. Section 15. Provisions of Ordinance a Contract. The terms, provisions and conditions set forth in this ordin- ance constitute a contract between the Municipality and the payee and each assignee of the Warrants and the owners and holders of the coupons and shall remain in effect until the principal of and interest on the Warrants shall have been paid in full. Section 16. Severabilit . The provisions of this ordinance are severable. In the event that any one or more of such provisions or the provisions of the Warrants or the coupons shall, for any reason, be held illegal or invalid, such illegality or invalidity shall not affect the other provisions of this ordinance or of the Warrants or coupons, and this ordinance and the Warrants and cou- pons shall be construed and enforced as if such illegal or invalid provision had not been contained herein or therein. -12- � �"' .. �•:,�..�' acr...;.„fir :.. a .,, . p, t------------- Section 17. Repeal of Conflicting Provisions. All ordinances, resolutions and orders or parts thereof in conflict with this ordinance are to the extent of such conflict. herebv repealed. :.. S E A L Attest: -13-