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HomeMy WebLinkAboutR-296-5-80RESOLUTION NO. 296 A RESOLUTION APPROVING THE LOCAL REGU- LATIONS OF ALLEN INDUSTRIAL DEVELOPMENT CORPORATION AND AUTHORIZING THE CITY AD- ' MINISTRATOR TO PROVIDE STAFF SERVICES TO SAID CORPORATION WHEREAS, the Board of Directors of the Allen Industrial Development Corporation has adopted its Local Regulations for Receiving and Approving Applications for Financial Participation in Development Projects, and has submitted the same to this City Council for its consideration; and WHEREAS, this City Council has considered said Local Regulations and desires hereby to approve the same; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ALLEN, TEXAS: (1) That the aforesaid Local Regulations of said Corporation, in the form and substance attached hereto are in all things approved; and (2) That the City Administration, under the direction of the City Manager, is authorized to provide Staff services to said Corporation, subject to payment for said services by said Corporation. ADOPTED this 15th day of May, 1980. ATTEST: ty Secretary (SEAL) Mayor ALLEN INDUSTRIAL DEVELOPMENT CORPORATION (a non-profit corporation created under the Texas Development Corporation Act of 1979) Local Regulations for Receiving and Approving Applications For Financial Participation in Development Projects I. GENERAL PURPOSE AND SCOPE OF LOCAL REGULATIONS (A) The ALLEN INDUSTRIAL DEVELOPMENT CORPORATION (the "Corpo- ration") was created as a duly constituted authority of the City of Allen, Collin County, Texas (the "Unit") pursuant to the Development Corporation Act of 1979, Article 5190.6, Vernon's Ann.Civ.Stat. (the "Act"), for the public purpose of the promotion and development of new and expanded commercial, industrial, manufacturing and medical research enterprises so as to promote and encourage employment, public health and the public welfare. The activities of the Corporation shall be limited solely to the accomplishment of such public purpose, and no plan of financing of any project ("Project"), as defined in the Act, and in the applicable portions of these local regulations (the "Regulations") will be approved by the Board of Directors (the "Board") of the Corporation unless and until the Board shall first affirmatively find that such financing and its related Project will be in furtherance of such public purpose, to be determined in accordance with the procedures set forth in these Regulations. (B) These Regulations relate solely to the requirements and procedures of the Board and the Corporation, and, notwithstanding full compliance with all of the requirements hereof, the Corporation will not issue any obligations pertaining to any Project unless the following governmental approvals have been obtained, to - wit: (1) The Governing Body of the Unit has approved by written resolution any agreement to issue obligations approved by the Corporation in the manner and within the time specified by the Act; and (2) The Texas Industrial Commission (the "Commission"), or the executive director thereof, has approved the contents of any lease, sale or loan agreement made by the Corporation under the Act in connection with the issuance of obligations by affirmatively finding that the lessee, purchaser or borrower has the business experience, financial resources and responsibility to provide reasonable assurance that all obligations and interest thereon to be paid from or by reason of such agreement will be paid as the same become due. II. APPLICATIONS, APPRQVAL STANDARDS (A) Preliminary Filing Requirements. (1) All persons, firms or corporations (the "Applicant") desiring financial participation by the Corporation in a Project shall file with the Corporation two (2) copies of an Application for Financial Participation (the "Application") as hereinafter provided and in the form accompanying these Regulations. (2) Concurrently with the closing of any financing pursuant to an approved Application, or at such other time as the Corporation may approve, the Applicant, from the proceeds of the obligations, shall pay to the Corporation a closing fee computed in accordance with the following schedule, to -wit: (a) for financing not exceeding $2,500,000 in aggregate principal amount (b) for financing over $2,500,000 but not exceeding $5,000,000 in aggregate principal amount (c) for financing over $5,000,000 but not exceeding $7,500,000 in aggregate principal amount (d) for financing over $7,500,000 but not exceeding $10,000,000 in aggregate principal amount $1,000 $2,000 $4,000 $6,000 (3) Concurrently with the closing of any financing pursuant to an approved Application, the Applicant, from the proceeds of the obligations, shall pay the following professional fees and other costs, to -wit: (a) the fees of Bond Counsel and the fees of any other Counsel ("General Counsel") retained by the Corporation with respct to the Application or the Project: (b) the amount of any fee for the services of the securities firm, dealer, broker or investment banker or advisor, or the state or federal bank or banking association contemplated by clause II(C)(1)(e) of these Regulations; and (c) the actual amount of any closing or acceptance fees of any trustee for the obligations, any fees and premiums for casualty and title insurance, any security filing costs, any fees for placing the obligations, any out-of-pocket expenses incurred by Bond Counsel and General Counsel and any other costs and expenses relating to the obligations, their security, the Project or the closing thereof, including any fees and expenses of any attorneys, consultants and other advisors employed by the Applicant or the Corporation payable at that time from that source. (B) Continuing Costs. (1) Each Applicant shall pay to the Corporation, within ten (10) days after receipt of a bill or statement therefor, the following amounts, to, - wit: (a) any amounts payable pursuant to the Inducement and Indemnity Agreement and any other indemnity contract or agree- ment executed in connection with any financing hereunder; and (E) (Ci (2) Along with the Application, the Applicant shall file with the Corporation two (2) executed original copies of an Inducement and Indemnity Agreement substantially in the form and substance ac- companying these Regulations. (3) The Applicant shall file with the Application the processing fee required elsewhere in these Regulations. (4) If the Applicant desires the Board to take preliminary official action pertaining to the issuance of obligations in accordance with relevant provisions of the Internal Revenue Code of 1954 and applicable Regulations and Revenue Rulings issued in connection therewith, then the Applicant shall also file a statement requesting such action, along with a description of the facts relating to such request. (5) The Application and the documents and fee required by this paragraph to be filed with the Corporation shall be filed with the Corporation by mailing or delivering the same to the City Manager, City Hall, Allen, Texas. One (1) copy of the Application together with the Inducement and Indemnity Agreement shall also be mailed concurrently to Bond Counsel. Preliminary Official Action. (1) Upon compliance with the preliminary filing requirements of para- graph II(A) of these Regulations, if preliminary official action is requested pursuant to subparagraph II(A)(4), the Corporation will conduct an expedited preliminary review of such request, and such action will be scheduled for the next regular or for a special meeting of the Board. (2) The Board will take the requested preliminary official action, expressing its present intention to issue the obligations requested if such preliminary review of the Application demonstrates with reasonable certainty: (a) that the Application, the obligations and the Project qualify for final approval by the Board in accordance with these Regu- lations; and (b) that all governmental approvals with respect to the obligations and the Project, including those requirements specified in para- graph I(B) of these Regulations will be obtained. Subsequent Filing Requirements. (1) Prior to review of the Application for final approval by the Board, the Applicant may file such additional documents or statements in support thereof as the Applicant shall consider relevant and appropriate and shall file the following: (a) such additional information as shall be requested of the Applicant by the Board; (b) such additional information as may be necessary to demonstrate the Applicant's ability to comply with the preliminary approval requirements of the Commission; (c) a pro -forma copy of any official statement, prospectus or other offering memoranda, through the use of which the proposed obligations are to be offered, sold or placed with any lender, purchaser or investor, which offering, sales or placement material shall contain prominent disclosure substantially to the effect (i) that neither the Corporation nor the Unit has undertaken to review or has assumed any responsibility for the matters contained therein except solely as to matters relating to the Corporation and to a description of the obligations being offered thereby; (ii) that all findings and determinations by the Corporation, the Unit and the Commission, respectively, are and have been made by each for its own internal uses and purposes in performing its duties under the Act, under Commission regulations and under these Regu- lations; (iii) that notwithstanding their respective approvals of the obligations and the Project, neither the Unit nor the Commission endorses or in any manner, directly or indirectly, guarantees or promises to pay such obligations from any source of funds of either or guarantees, warrants or endorses the creditworthiness or credit standing of the Applicant or of any guarantor of such obligations, or in any manner guarantees, warrants or endorses the investment quality or value of such obligations; (iv) that such obligations are payable solely from the funds and secured solely by property furnished and to be furnished and provided by the Applicant and any guarantor and are not in any manner payable wholly or partially from any funds or properties otherwise belonging to the Corporation; and (v) that by its issuance thereof, the Corporation does not in any manner, directly or indirectly, guarantee, warrant or endorse the creditworthiness or credit standing of the Applicant or of any guarantor of such obligations or the investment quality or value of the same; and (d) proposed final legal instruments and documents authorizing and relating to the issuance of the obligations proposed and all leases, loan agreements, purchase agreements or other documents related thereto; and (e) a financial report and analysis addressed to the Board by a registered, qualified and favorably recognized securities firm, dealer, broker or investment banker or advisor experienced in similar financing, or by a state or federal bank or banking association pertaining to the credit standing and credit worthiness of the Applicant and any guarantor of the obligations. (D) Final Approval, Standards and Requirements. (1) The Board will take up and consider its final action pertaining to an Application filed hereunder when requested to do so by the Applicant and upon receipt by it of the following: (a) evidence satisfactory to the Board that the Applicant has complied with these Regulations in all material respects not otherwise waived by the Board; (b) an opinion of the bond counsel for the Corporation ("Bond Counsel') addressed to the Corporation and the Unit, to the effect that the Application conforms in all material respects to these Regulations; that all filings required to be made hereunder have been made, that the documents or materials described in clause II(C)(1)(c) hereof contain a correct description of the Corporation and of the obligations they purport to describe and contain the disclosures required by said clause; that the legal agreements proposed in connection with the obligations being issued are in proper form and order, and will represent the binding and lawful obligations of the parties thereto; that such obligations conform in form and substance to the requirements, if any, of the resolution of the Unit authorizing the Corporation, and that neither the taxing power nor the faith, credit or other revenues of the Unit or the State of Texas are obligated or in any manner pledged to the payment of any such obligations; (c) evidence satisfactory to the Board that the Project which is the subject of the obligations has been approved or is reasonably expected to be approved by all applicable local, state or federal regulatory authorities or agencies, including compliance with all applicable local zoning, building and other codes. (2) Applications will be finally approved by the Board if it first affirmatively determines - (a) that all requirements for and prerequisites to final approval under these Regulations have been met and are in form and sub- stance satisfactory to the Board; (b) that the operation of the Project will constitute a lawful activity, is qualified for approval by the Unit and the Commission and complies with and promotes the purposes and satisfies the requirements of the Act and the statement of policy contained in paragraph I(A) of these Regulations; (3) After final approval by the Board, the Corporation will seek approval by the Unit and the Commission and will proceed to close the delivery of such obligations upon receipt of such approvals in accordance with the documents approved by the Board and when finally approved by Bond Counsel in accordance with the terms of sale or placement. III. FEES, OTHER COSTS (A) Processing, Closing Fees and Costs. (1) Concurrently with the filing of an Application, the Applicant shall pay to the Corporation a processing fee in the amount of $1,000, which amount is not refundable, whether or not the Application is approved or the financing of the Project is accomplished. (b) the amount allocable to each Applicant (whose financing has completed) of costs and expenses incurred by the Corporation for an annual accounting and/or audit of the financial records and affairs of the Corporation. The amount of costs or expenses paid or incurred by the Corporation under this clause shall be divided and allocated equally among all Applicants whose financing has been completed. (C) Changes in Fees. The Corporation reserves the right at any time to change, increase or reduce the fees payable under paragraph III(A), and to make the same effective as to any Applicant whose Application is filed subsequent to the date of such change. The Corporation reserves the right at any time to change the method of allocation described in clause III(B)(1)(b), if it should, in its sole discretion, determine such change to be reasonable and more equitable, such change to be effective upon the date specified by the Corporation. IV. MISCELLANEOUS (A) Unauthorized Representations and Bond Marketing Practices. (1) No Applicant, or any representative of Applicant or the Corpo- ration shall represent, directly or indirectly, to any lender, interim or otherwise, supplier, contractor or other person, firm or entity that the Corporation has agreed or is firmly committed to issue any obligations in relation to any Project or Application until the Board has finally approved the same under these Regulations, and then subject to the governmental approvals of the Unit and the Commission required by these Regulations and the Act. (2) No Applicant, or any representative of the Applicant or the Corporation, shall ever make any representation, directly or indirectly, express or implied, of any fact or facts contrary to the disclosures required to be made by clause II(C)(1)(c) of these Regulations. (3) Neither the Applicant nor any securities firm, underwriter, broker, dealer, salesman or other person, firm or entity shall offer, sell, distribute or place any obligations authorized by the Corporation by any process, method or technique or in any manner, transaction or circumstances or to any person or persons, the effect of which would be to require such obligations to be registered or would require filings to be made with regard thereto under the laws of the State or jurisdiction where such offer, sale, distribution or placement is made without first registering the same or making the filings regarding the same required by such laws. (B) Prohibition of Sales Tax Exemption Certificate. The Corporation shall not issue an exemption certificate under the "Limited Sales, Excise and Use Tax Act," Chapter 20, Title 122A, Texas Revised Civil Statutes, to the seller of any taxable items under such Act which will be used in or become a part of a Project financed under the Act and these Regulations. The Applicant shall pay all such taxes as a cost of the project being financed notwithstanding any tax exemption that the Corporation may claim under the Act. (C) Bond Counsel. The firm of Hutchison Price Boyle do Brooks, 211 North Ervay Building, Suite 1100, Dallas, Texas, is Bond Counsel for the Corporation. (D) Amendments, Waivers, Effective Date. (1) The Corporation reserves the right at any time to amend these Regulations effective as to any Applications filed subsequent to the effective date of any such amendment. (2) The Board reserves the right to waive any portion of these Regulations as to any Applicant, Application or Project upon written request seeking such waiver and stating the reasons therefor. (3) These Regulations are and shall be effective from and after their adoption by the Board and approval by the Governing Body of the Unit, and shall continue in effect until and unless amended, modified or repealed and shall be effective as to any application pending at the time of their adoption and approval. Application Number ALLEN INDUSTRIAL DEVELOPMENT CORPORATION APPLICATION FOR FINANCIAL PARTICIPATION The undersigned, on behalf of the entity named as Applicant, hereby applies to the Allen Industrial Development Corporation (the "Corporation") for Project Financing, pursuant to the Development Corporation Act of 1979 and pursuant to the Regulations of the Corporation. We have reviewed the Corporation's Regulations presented to us and in effect on the date hereof, and we agree to and accept the terms thereof. The following Project Financing Questionnaire has been completed to the best of our ability, and the information contained therein and on any attachments thereto, represent a reasonably comprehensive outline of the Project and the financing requested in connection therewith. We submit herewith the Processing Fee required by subparagraph III(A)(1) of your Regulations, together with two copies of the executed Inducement and Indemnity Agreement required by subparagraph II(A)(2) of the Regulations. Preliminary Official Action, pursuant to paragraph II(B) of the Regulations is (is not) requested. (If such action is requested, attach separate statement of facts related to the request.) The undersigned warrants that he is authorized to submit this application on behalf of the Applicant. Applicant By: Authorized Officer or Representative Presently Estimated Amount of Project Financing Requested: u DEVELOPMENT PROJECT FINANCING QUESTIONNAIRE 1. Name, address and telephone number of entity that will lease or purchase the project (or borrow the bond proceeds) from the Corporation: This entity is referred to as the "principal user' of the project for the remainder of this questionnaire. Name, title, address and telephone number of persons working on the financing for the principal user: 2. Form of organization of principal user (check one): corporation partnership sole proprietorship. Is the principal user related to any other organization by more tan 50% common ownership? If so, indicate name of related organization and relationship. 3. Ownership: List all stockholders or partners having 10'0 or more interest in the principal user. 4. If any of the above persons own more than 50% of the principal user, list all other organizations which are related to the principal user by virtue of such persons having more than a 50% interest in such organizations. 5. Location of the project: City or Street address Town County M 6. Project site (land) (a) Indicate approximate size (in acres or square feet) of project site. (b) Are there buildings now on the project site? yes no (c) Indicate the present use of the project site. (d) Indicate present owner of project site. 7. If the principal user now owns the project site, indicate: (a) (b) (c) (d) date of purchase purchase price balance of existing mortgage holder of mortgage 8. If the principal user is not now the owner of the project site, does the principal user have an option to purchase the site and any building on the site? If yes, indicate: (a) date option agreement signed with owner (b) purchase price under option (c) expiration date of option (d) purchase price of option 9. Has the principal user entered into contract to purchase the site? If yes, indicate: (a) date signed (b) purchase price (c) settlement date 10. If the principal user is not the owner of project site, does the princi- pal user now lease the site or any buildings of the site? 11. Is there a relationship legally or by virtue of common control or ownership between the principal user and the seller of the project? If yes, describe this relationship: 12. Does the, project involve acquisition of an existing building or buildings? If yes, indicate number and size of buildings: - 2 - 13. Does the project consist of the construction of a new building or buildings? If yes, indicate number and size of new buildings: 14. Does the project consist of additions and/or renovations to existing buildings? If yes, indicate nature of expansion and/or renovation: 15. What will the building or buildings to be acquired, constructed or expanded be used for by the principal user? Give detailed description. 16. If any space in the project is to be leased to third parties, indicate total square footage of the project,' amount to be leased to each tenant, and proposed use by each tenant. 17. Has construction work on this project begun? If yes, complete the following: (a) site clearance yes no % complete (b) foundation yes no % complete (c) footings yes no % complete (d) steel yes no % complete (e) masonary work yes no % complete (f) other (describe below) yes no % complete 18. List principal items or categories of equipment to be acquired as part of the project: - 3 - 19. Has any of the above equipment been ordered or purchased? If yes, indicate: Item Date Ordered Delivery Date Price 20. List the face amount of all tax-exempt financing previously arranged by or for the benefit of the principal user in the same municipality as the project. 21. 22. Date of Issue Original Current Outstanding face amount amount Municipality refers to incorporated city or town, or if the project is not in an incorporated city or town, to the unincorporated areas of the county in which it is located. State the proposed uses of bond proceeds: Description of Cost Amount Land $ Buildings Equipment Engineering Architecture Interest during construction Bond discount Cost of financing Other (please explain) Face amount of issue $ Have any of the above expenditures already been made by the applicant? If yes, indicate particulars: - 4 - 23. Have any of the above expenditures been incurred but not paid by the principal user? If yes, indicate particulars: 24. Are costs of working capital, moving expenses, work in process, or stock in trade included in the proposed uses of bond proceeds? 25. Will any of the funds be used to repay or refinance an existing mortgage or outstanding loan? [Complete questions 26 and 27 only if the proposed financing is an industrial development financing in excess of $1 million.] 26. List capital expenditures with respect to this project: Past 3 Years Next 3 Years Land - $ $ Buildings Equipment Engineering Architecture Research and development Interest during construction Other (please explain) Research and development. expenses with respect to a facility must be treated as capital expenditures with respect to it. This would include research and development with respect to products to be produced at the facility and with respect to , equipment to be used there. Research and development expenses allocable to the project under the foregoing rule must be treated as capital expenditures with respect to it even though the research and development work takes place in a different municipality or state. Costs of tenant finishes to be placed at a facility are capital expenditures even if paid by the tenant. Costs of equipment to be moved to a facility are capital expenditures even if the purchase and initial use of the equipment occurred outside the municipality. - 5 - 27. List capital expenditures with respect to other facilities of the principal user or any related person, if the facilities are located in the same municipality. (See definition of municipality under question 20.) Past 3 years Next 3 years Land $ $ Buildings Equipment Engineering Architecture Research and development Interest during construction Other (please explain) 28. What regulatory bodies have jurisdiction over the project or its operations? 29. For purposes of presentation for approval by the Corporation and the Unit and Commission, complete the following: (a) Estimate the number and type of jobs to be created as a result of the project and the annual payroll of employees working at the project. (b) Is it proposed the obligations be sold at public sale or ' will they be placed privately with a purchaser? (c) If the answer to (b) is public sale, then are the supplemental requirements of the TIC regulations applicable, i.e., if bonds and other corporate securities are not properly rated, has the principal user obtained an independent feasibility study for the Project, and can it produce evidence of other financing of at least 20% of the costs of the project? Note: If a public sale of the obligations is contemplated, the registration requirements of proposed regulations under the Texas Securities Act will apply. In any event, whether or not registraion is required, the bonds are subject to the anti -fraud provisions of the Texas Securities Act as well as the Securities laws of the United States. - 6 - 30. Will at least 90% of the proceeds of the issue be used to provide facilities with respect to which an urban development action grant (UDAG) has been made under Section 119 of the Housing and Community Development Act of 1974? - 7 - INDUCEMENT AND INDEMNITY AGREEMENT Allen Industrial Development Corporation Collin County, Texas Gentlemen: The below named Applicant has this day filed with your Corporation an Application for Financial Participation pursuant to the Development Corporation Act of 1979 and in accordance with your Regulations in effect on the date hereof. As an inducement to your Corporation and the City of Allen, Collin County, Texas, to accept, review and favorably consider and approve said Application and to issue the obligations therein contemplated, and whether or not all or any part thereof are ever actually approved or issued by you, the Applicant hereby irrevocably agrees that it will (a) pay all project costs which are not or cannot be paid or reimbursed from the proceeds of obligations issued by you, and (b) at all times indemnify and hold harmless your Corporation and the members and officers of its Board of Directors and the City of Allen, its Mayor, City Council and all of its agents, servants and employees against all losses, costs, damages, expenses and liabilities of whatsoever nature or kind (including but not limited to attorney's fees, litigation and court costs, amounts paid in settlement, and amounts paid to discharge judgment) directly or indirectly resulting from, arising out of or related to the acceptance, consideration and approval or disapproval of such Application or the issuance, offering, sale or delivery of any such obligations, or the design, construction, installation, operation, use, occupancy, maintenance or ownership of the Project. It is understood and agreed that this Inducement and Indemnity Agree- ment shall be continuing and shall survive and continue to be effective after any approval or disapproval of said Application and the issuance or failure to issue any such obligations and the construction and operation of the Project. It is also understood that additional indemnity agreements may be required by you from the Applicant or others, such as guarantors, prior to the final approval of such Application. This Inducement and Indemnity Agreement shall be effective upon execution by you where indicated below, and the same is dated this Sincerely, !ant By Authorized Officer or Representative Approved, Accepted and Agreed this Allen Industrial Development Corporation BY Authorized Officer or Representative