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Res 76-85 RESOLUTION NO. 76-85 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DELRAY BEACH, FLORIDA AUTHORIZING THE FINANCING OF A WAREHOUSE, OFFICE AND SHOWROOM FACILITY FOR THE SENECA GROUP TO BE LOCATED IN AN ENTERPRISE ZONE LOCATED IN THE CITY OF DELRAY BEACH, FLORIDA; AND PROVIDING FOR AN EFFECTIVE DATE. WHEREAS, The City of Delray Beach, Florida, (the "City"), municipality of the State of Florida (the "State") through its City Council (the "City Council") is authorized by Part II of Chapter 159 of the Florida Statutes, as amended, codified as Florida Statutes Annotated, Sections 159.25 to 159.43, and other applicable provisions of law (the "Act"), to issue its industrial development revenue bonds and use the proceeds thereof to facilitate the financing of certain facilities provided for in the Act; and WHEREAS, the City Council has been informed by The Seneca Group, a Florida general partnership (the "Partnership"), that the Partnership proposes to acquire, construct and equip a facility which is to be used for a warehouse, office and show- room facility located in an "enterprise zone" (as provided by Chapter 290, Florida Statutes) at Interstate Route 95 and 10th Avenue, Delray Beach, Florida (the "Project"), such Project being more fully described in the Preliminary Agreement for Issuance of Industrial Development Revenue Bonds (the "Prelimi- nary Agreement") attached hereto as Exhibit A; and WHEREAS, the Partnership has requested that the City Council approve the issuance of its industrial development revenue bonds (the "Bonds") pursuant to the Act in one or more issues or series in an aggregate principal amount sufficient to finance all or a portion of the total cost of acquiring, constructing and equipping the Project, including all costs incurred in connection with the issuance of the Bonds by the City and such other costs permitted by the Act (the "Cost of the Project"), which Cost of the Project is presently estimated not to exceed $5,000,000; and WHEREAS, a determination by the City to issue the Bonds under the Act, if so requested by the Partnership, in one or more issues or series and to use the proceeds thereof to finance for the Partnership the Cost of the Project under a lease agreement, loan agreement, installment sales agreement or other forms of agreement permitted by the Act, or any combina- tion thereof, which will provide that payments thereunder shall be at least sufficient to pay the principal of and interest and redemption premium, if any, on the Bonds and such other costs in connection therewith as may be incurred by the City, will assist the Partnership in the implementation of its plan of leasing the facilities to qualified tenants; and WHEREAS, the Partnership has submitted the Preliminary Agreement relating to the issuance of the Bonds, attached hereto; and WHEREAS, it is intended that this resolution will consti- tute official actiop toward the issuance of the Bonds within the meaning of the applicable United States Treasury Regula- tions; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF DELRAY BEACH, FLORIDA, AS FOLLOWS: 1. That the Project will make a significant contribution to the economic growth of the City, will provide gainful employment, and will serve a public purpose by advancing the economic prosperity and the general welfare of the City, the State, and its people; the Partnership is financially respon- sible and fully capable of fulfilling any obligations which it may incur in connection with the financing of the Project as contemplated by this resolution; the City will be able to cope satisfactorily with the impact of the Project and will be able to provide, or cause to be provided when needed, the public facilities, including utilities and public services, that will be necessary for the operation, repair and maintenance of the Project and on account of any increases in population or other circumstances resulting therefrom; and adequate provision will be made for the operation, repair and maintenance of the Project at the expense of the Partnership and for the payment of the principal of, premium, if any, and interest on the Bonds and for reserves therefor; 2. That the Mayor be, and hereby is, authorized and directed to execute, for and on behalf of the City, the Preliminary Agreement attached hereto as Exhibit A between the City and the Partnership providing understandings relative to the proposed issuance of the Bonds by the City in one or more series or issues to finance the Cost of the Project in an aggregate principal amount not to exceed the lesser of: (a) $5,000,000; or (b) the Cost of the Project; 3. That there is hereby authorized to be issued and this City Council hereby determines to issue its Bonds pursuant to the Act, if so requested by the Partnership and subject to the conditions set forth in the Preliminary Agreement attached hereto, in one or more issues or series in an aggregate princi- pal amount not to exceed the Cost of the Project for the purpose of financing the Cost of the Project described in the Preliminary Agreement; 4. That Mudge Rose Guthrie Alexander & Ferdon be, and hereby is, appointed as bond counsel to the City in connection with the issuance of the Bonds; 5. That this Resolution is an affirmative action of the City Council toward the issuance of the Bonds, as contemplated in the Preliminary Agreement, in accordance with the purposes of the laws of the State and the applicable United States Treasury Regulations; and 6. This resolution shall take effect upon its passage in the manner provided by law. PASSED AND ADOPTED in regular session on this 10th day of September, 1985. MAYOR / ~ ATTEST: City Clerk 0220s 2 Res. No. 76-85 EXHIBIT "A" PRELIMINARY AGREEMENT FOR ISSUANCE OF INDUSTRIAL DEVELOPMENT REVENUE BONDS This Agreement between The City of Delray Beach, Florida, (the "City"), municipality of the State of Florida (the "State") and The Seneca Group, a Florida general partnership (the "Partnership") WITNESSETH : 1. Preliminary Statement. Among the matters of mutual understanding which have resulted in the execution of this Agreement are the following: (a) Part II of Chapter 159 of the Florida Statutes, as amended, codified as Florida Statutes Annotated, Section 159.25 to 159.43 and other applicable provisions of law (the "Act"), provides that the City may issue industrial development revenue bonds and use the proceeds thereof to facilitate the financing of certain facilities provided for in the Act. (b) The Partnership is considering the acquisition, con- struction and equipping of a warehouse, office and showroom facility to be located in an "enterprise zone" (as provided by Chapter 290, Florida Statutes) in the City of Delray Beach, Florida (the "Project"), which Project is more particularly described in the attached Schedule A. (c) The City intends this Agreement to constitute its official binding commitment, subject to the terms hereof, to issue its bonds (the "Bonds") in one or more series or issues pursuant to the Act in an amount to be agreed upon by the City and the Partnership and to use the proceeds thereof to finance for the Partnership all or a portion of the total cost of the acquisition, construction and equipping the Project, including all costs incurred in connection with the issuance of the Bonds by the City and such other costs permitted by the Act (the "Cost of the Project"), up to an amount not to exceed $5,000,000. (d) The City Council of the City (the "City Council") con- siders the issuance and sale of the Bonds, for the purposes hereinabove set forth, consistent with the objectives of the Act. 2. Undertakings on the Part of the City. Subject to the terms hereof, the City agrees as follows: (a) The City will by subsequent resolution authorize the issuance of the Bonds in the aggregate principal amount neces- sary and sufficient to finance the Cost of the Project as the City and the Partnership shall agree in writing, but in all events, the principal amount of such Bonds shall not exceed the lesser of: (i) the Cost of the Project; or (ii) $5,000,000. (b) The City will cooperate with the Partnership and with Mudge Rose Guthrie Alexander & Ferdon ("Bond Counsel") with respect to the issuance and sale of the Bonds and will take such further action and authorize the execution of such docu- ments as shall be mutually satisfactory to the City and the Partnership for the authorization, issuance, and sale of such Bonds and the use of the proceeds thereof to finance the Cost of the Project. (c) Such actions and documents may permit with the approval of the City the issuance from time to time in the future of additional bonds on terms which shall be set forth therein, whether pari passu with other series of bonds or otherwise, for the purpose of defraying the cost of enlarge- ments, improvements and expansion of the Project or any segment thereof. (d) The lease agreement, loan agreement, installment sales agreement or other forms of agreement, or any combination thereof (the "Financing Agreement") between the City and the Partnership 'shall, under terms agreed upon by the parties, Provide for payments to be made by the Partnership in such sums as shall be necessary to pay the principal of and interest and redemption premium, if any, on the Bonds, as and when the same shall become due and payable. (e) In authorizing the issuance of the Bonds pursuant to this Agreement, the City will make no warranty, either expressed or implied, that the proceeds of the Bonds will be sufficient to pay all costs of constructing and equipping the Project, or that the Project will be suitable for the Partner- ship's purposes or needs or that the allocation by the Division of Bond Finance of the Department of General Services of the State pursuant to Chapter 159, Part VI, Florida Statutes, of the volume limitation on private activity bonds will be avail- able or if available, will be sufficient to pay all costs of constructing and equipping the Project. (f) The Bonds shall specifically provide that they are payable solely from the revenues derived from the Financing Agreement between the City and the Partnership and/or any credit support provided by or on behalf of the Partnership, except to the extent payable out of amounts attributable to Bond proceeds. The Bonds and the interest thereon shall not constitute an indebtedness of the City or of the State within the meaning of any constitutional, statutory or other limitation of indebtedness, and such fact shall be plainly stated on the face of the Bonds. 3. Undertakings on the Part of the Partnership. Subject to the terms hereof, the Partnership agrees as follows: (a) The Partnership will use reasonable efforts to insure that the Bonds in the aggregate principal amount as stated above are sold; provided, however, that the terms of such Bonds and of the sale and delivery thereof shall be mutually satis- factory to the City and the Partnership. (b) Prior to the issuance of the Bonds in the principal amount stated above, in one or more series or issues from time to time as the City and the Partnership shall agree in writing, the Partnership will enter into the Financing Agreement with the City, the terms of which shall be mutually agreeable to the City and the Partnership, providing for the use of the proceeds of the Bonds to finance the Cost of the Project. Such Financ- ing Agreement will provide that the Partnership will be obli- gated to pay the City (or to trustees for holders of the Bonds on behalf of the City, as the case may be at the option of the City) sums sufficient in the aggregate to enable the City to pay the principal of and interest and redemption premium, if any, on the Bonds, as and when the same shall become due and payable. The Partnership will agree in such documents that if the Cost of the Project e~:ceeds the amount of the Bond proceeds, the Partnership will pay such excess costs and shall - 2 - not be entitled to any reimbursement for any such excess either from the City, the bondholders, or the trustee for bond- holders. At the time of delivery of the Bonds, the Partnership shall pay the costs of issuance incurred in connection with the sale of the Bonds which includes but is not limited to the fees of the~ City and Bond Counsel's fees, including expenses incurred in connection with the validation of the Bonds under Chapter 75, Florida Statutes, and any appeals therefrom. If pursuant to Chapter 159, Part VI, Florida Statutes, an alloca- tion for the Bonds is unavailable or is insufficient for the purposes of financing the cost of the Project, resulting in the cancellation of this Agreement by the Partnership, the Partner- ship shall be subject to the provisions of Section 4 (d) of this Agreement. (c) The Partnership shall, in addition to paying the amounts set forth in the Financing Agreement, pay all costs of operations, maintenance, taxes, governmental and other charges which may be assessed or levied against or with respect to the Project. (d) The Partnership will hold the City free and harmless from any loss or damage and from any taxes or other charges levied or assessed by reason of any mortgaging or other dispo- sition of the Project. (e) The Partnership will take such further action as may be reguired to implement its aforesaid undertakings and as it may deem appropriate in pursuance hereof. 4. General Provisions. Ail commitments of the City under Section 2 hereof and of the Partnership under Section 3 hereof are subject to the conditions that the following events shall have occurred not later than such date as shall be mutually satisfactory to the City and the Partnership: (a) The City shall be lawfully entitled to issue the Bonds as herein contemplated. (b) The City and the Partnership shall have agreed on mutually acceptable terms for the Bonds and the sale and delivery thereof and mutually acceptable terms and conditions of any trust instrument in respect thereto and any Financing Agreement or other agreements referred to in Sections 2 and 3 hereof; provided, however, that all of such provisions shall be subject to the approval of the City Attorney for the City, and of Mudge Rose Guthrie Alexander & Ferdon in its capacity as bond counsel to the City. (c) Rulings satisfactory to the Partnership and to the City as to matters with respect to the Bonds,the Project, the Financing AGreement and any trust instrument, if specified by the City and the Partnership, shall have obtained from the Internal Revenue Service and/or the United States Treasury Department and shall be in full force and effect at the time of issuance of the Bonds. (d) Such other rulings, approvals, consents, certificates of compliance, opinions of counsel, and other instruments and proceedings satisfactory to the Partnership and the City as to such matters with respect to the Bonds, the Project, the Financing Agreement and any trust instrument, as shall be specified by the Partnership and the City, shall have been obtained from such governmental, as well as nongovernmental, agencies and entities as may have or assert competence or - 3- jurisdiction over or interest in matters pertinent thereto and shall be in full force and effect at the time of issuance of the Bo,ids. In addition, the Partnership reserves the absolute right to unilaterally cancel this Agreement at any time prior to the time the Bonds are issued by the City upon written notice of cancellation to the City. If the Partnership exercises its right to cancellation as set forth in this Section 4, or if for any reason the Bonds are not issued, the Partnership agrees that it will reimburse the City for (a) reasonable fees and disbursements of Bond Counsel and the City, including expenses incurred in connection with the validation of the Bonds under Chapter 75, Florida Statutes, and any appeals therefrom, and (b) any other reasonable and necessary direct out-of-pocket expenses which the City may incur arising from the execution of this Agreement and the performance by the City of its obligations hereunder. 5. Binding Effect. All covenants and agreements herein contained by or on behalf of the City and the Partnership shall bind and inure to the benefit of the respective successors and assigns of the City and the Partnership whether so expressed or not. IN WITNESS WHEREOF, the parties hereto have entered into this Agreement by their officers thereunder duly authorized as of the 10th day of September, 1985. CITY OF DELRAY BEACH, FLORIDA (Seal) BY: Mayor ATTEST: City Clerk THE SENECA GROUP ( Seal ) BY: Title ATTEST: Title - 4 - Schedule A THE PROJECT The Project will consist of four separate buildings to be built on 6-1/2 acres located at the intersection of Interstate Route 95 and 10th Avenue in an "enterprise zone" (as provided by Chapter 290, Florida Statutes) in the City of Delray Beach, Florida. The Project will contain a gross floor area of approximately 127,000 square feet and will be used as ware- house, office and showroom buildings. The space in the build- ings will be leased to qualified tenants who will use the designer showroom and industrial warehouse facilities in a manner consistent with the adjacent warehouse facilities. 0221s - 5-