HomeMy WebLinkAbout98-15Resolution No. 98- 15
RESOLUTION AUTHORIZING THE ISSUANCE OF
GENERAL OBLIGATION BONDS AND THE ISSUANCE
OF A BOND ANTICIPATION NOTE
OF THE TOWN OF PULASKI, VIRGINIA,
AND PROVIDING FOR THE SALE, FORM, DETAILS
AND PAYMENT OF THE NOTE
AND AUTHORLZING CERTAIN RELATED ACTIONS
The Council of the Town of Pulaski, Virginia (the "Council") has determined it
necessary and expedient to make improvements (the "Projects") to water, sewer and other
public facilities, including Calfee Park, of the Town of Pulaski, Virginia (the "Town")
and to issue general obligation bonds of the Town in an amount not to exceed $1,000,000
to provide funds, together with other available funds, to finance the costs of the Projects.
Pursuant to the Public Finance Act of 1991, the Town is authorized to issue its
bonds to pay for the Projects and the cost of issuing the bonds and, in anticipation of the
issuance of such bonds, to borrow money and issue its notes for such purposes.
The Council has held a public hearing on the proposed bond issue and the bond
anticipation notes in accordance with Section 15.2-2606 of the Public Finance Act of
1991.
BE IT RESOLVED BY THE COUNCIL OF THE TOWN OF PULASKI,
VIRGINIA:
Section 1.1. Pursuant to the Constitution of Virginia and the Public Finance Act
of 1991, there are hereby authorized to be issued general obligation bonds of the Town
of Pulaski (the "Town") in an aggregate principal amount not to exceed $1,000,000 (the
"Bonds"), to provide funds to pay the cost of improvements (the "Projects") to water,
sewer and other public facilities, including Calfee Park, of the Town and the cost of
issuing the bonds. To the extent allowed under Section 15.2-2601 of the Public Finance
Act of 1991 (Chapter 26, Title 15.2, Code of Virginia of 1950, as amended) (the "Act"),
the Council of the Town (the "Council") hereby elects to have the Bonds issued under
the provisions of the Act without regard to the requirements, restrictions or other
provisions contained in any charter or local or special act applicable to the Town. The
Bonds shall be sold on such terms, shall be in such form, shall have such details and shall
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April !0, 1998
be payable as shall be determined or provided for by resolution of the Council before the
issuance of the Bonds.
Section 1.2. Authorization of Note. It is hereby determined to be advisable,
necessary and expedient for the Town to borrow an amount equal to $1,000,000 in
anticipation of the issuance of the Bonds and the receipt of proceeds from the sale of the
Bonds. Pursuant to the Constitution of Virginia and the Act, there is hereby authorized
to be issued and sold a bond anticipation note of the Town in an aggregate principal
amount equal to $1,000,000 (the "Note").
The Note shall be a general obligation of the Town and shall be payable from the
proceeds from the sale of the Bonds and any other funds lawfully available and
appropriated for such purpose. The proceeds of the Bonds shall be used for no other
purpose until the Note has been retired or provision for its retirement has been made. In
addition, the principal of, and interest on the Note shall be payable from ad valorem taxes
to be levied without limitation as to rate or amount on all property in the Town subject
to taxation, to the extent other funds of the Town are not available and appropriated for
such purpose, and a pledge of the full faith and credit of the Town.
To the extent permitted by Section 15.2-2501 of the Act, the Council hereby elects
to issue the Note under the provisions of the Act without regard to the requirements,
restrictions or other provisions contained in any charter or local or special act.
Section 1.3. Details of Note. The Note shall be issued as a fully registered note
without coupons in an aggregate principal amount equal to $1,000,000. The Note shall
bear interest from its date at the rate of 4.26% percent per annum. The execution and
delivery of the Note pursuant to this resolution shall conclusively evidence the details of
the Note as having been approved and authorized by this resolution. The Note shall be
dated the date of its delivery to the purchaser thereof. Beginning on the first day of the
fast full month after the date of the Note and continuing on the same day ~of each month
thereafter, the amount of accrued interest an the Note shall be due and payable. If not
sooner paid, the principal of and interest on the Note shall be due and payable three years
from its date.
Section 1.4. Prepayment The principal of the Note maybe prepaid at the option
of the Town at any time in whole or in part from time to timc without premium, upon 30
days prior notice of such prepayment to the registered owner of the Note.
Section 1.5. Execution.of Note. The Note shall bear the manual signature of the
Mayor or ice Mayor and shall bear a manually impressed or imprinted facsimile of the
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April 10, 1998
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seal of the Town and attested by the manual signature of the Town Clerk or Deputy
Clerk. In case any officer whose signature shall appear on the Note shall cease to be such
officer before the delivery of the Note, such signature shall nevertheless be valid and
sufficient for all purposes, the same as if he had remained in office until such delivery.
The Note may be signed by such persons as at the actual time of the execution thereof
shall he the proper officers to sign the Note although at the date of such Note such
persons may not have been such officers.
Section 1.6. Form of Note. The Note shall be in substantially the following form
with such appropriate variations, insertions and omissions as shall be consistent herewith:
UNITED STATES OF AMERICA
COMMONWEALTH OF VIRGIlVIA
TOWN OF PULASKI
Bond Anticipation Note
INTEREST RATE MATURITY DATE DATED DATE
4,26% , 2001 , 1998
REGISTERED OWNER:
PRINCIPAL AMOUNT: ONE MILLION AND 00/I00 DOLLARS
($1,000,000)
The Town of Pulaski, Virginia (the "Town"), for value received, hereby
acknowledges itself indebted and promises to pay to the registered. owner hereof, or
registered assigns, upon presentation and surrender hereof at the office of the Registrar,
the principal sum set forth above together with interest from the date of this note on the
unpaid principal at the per annum Interest Rate set forth above. On ~ 1, 1998, and
on the first day of each month thereafter the amount of accrued interest on this Note shall
be due and payable. If not sooner paid, the principal of and interest on this note shall
be due and payable on the Maturity Date set forth above.
Interest on this note shall be calculated on the basis of a 360-day year for the
actual number of days elapsed.
The interest on and, upon presentation and surrender of this note, the principal of
this note shall be payable in lawful money of the United States of America to the
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registered owner, determined as of the fifteenth day preceding the payment date, at its
address as it appears on the registration books kept for that purpose at the office of the
Town Manager, Pulaski, Virginia, who has been appointed Registrar. If the maturity date
is a date on which banking institutions aze authorized or obligated by law to close at the
place where the office of the Registrar is located, then payment of principal and interest
need not be made on such date, but may be made on the next succeeding date which is
not such a date at the place where the office of the Registrar is located, but additional
interest shall accrue for such period after such Maturity Date. Upon final payment, this
note shall be surrendered to the Registrar for cancellation.
This note has been authorized by a resolution duly adopted by the Council of the
Town on April 14, 1998 (the "Resolution"), and is issued pursuant to the Constitution
and applicable statutes of the Commonwealth of Virginia, including the Public Finance
Act of 1991 (Chapter 26, Title 15.2, Code of Virginia of 1950, as amended) in
anticipation of the issuance of bonds authorized under the Resolution and the receipt of
proceeds from the sale of such bonds. A copy of the Resolution is on 51e at the office
of the Registrar. Reference is hereby made to the Resolution and any amendments
thereto for the provisions, among others, describing the pledge of the full faith and credit
of the Town and covenants securing this note, the nature and extent of the security, the
terms and conditions upon which this note is issued, the rights and obligations of the
Town and the rights of the holder of this note and the provisions for defeasance of such
rights.
This note and the interest hereon aze payable from the proceeds from the sale of
the bonds authorized under the Resolution and, in addition, from ad valorem taxes to be
levied without limitation as to rate or amount on all property in the Town subject to
taxation to the extent other funds of the Town are not available and appropriated for such
purpose, and aze secured by a pledge of the full faith and credit of the Town. This note
and interest hereon shall not be deemed to constitute a pledge of the faith and credit of
the Commonwealth of Virginia or any political subdivision thereof, except the Town.
Neither the faith and credit nor the taxing power of the Commonwealth of Virginia or any
political subdivision thereof, except the Town, is pledged to the payment of the principal
of, and interest on, this note.
The Council of the Town has designated this note as a "Qualified Tax-Exempt
Obligation" for purposes of Section 265 of the Internal Revenue Code of 1986, as
amended.
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April 10, 1998
This note is subject to prepayment at the option of the Town at any time, in whole
or in part from time to time, without premium, upon 30 day's prior notice of such
prepayment to the holder of this note.
This note shall be governed by and construed in accordance with the laws of the
Commonwealth of Virginia.
All acts, conditions and things required by the Constitution and statutes of the
Commonwealth of Vvrginia to happen, exist or be performed precedent to and in the
issuance of this note have happened, exist and have been performed, and this note,
together with all other indebtedness of the Town, is within every debt and other limit
prescribed by the Constitution and statutes of the Commonwealth of Virginia.
IN VJ~I1"1`TESS WHEREOF, the Council of Town of Pulaski has caused this note
to be issued in the name of the Town and to bear the manual signature of its Mayor, its
seal to be imprinted or impressed hereon and attested by the manual signature of the
Town Clerk, and this note to be dated as of the dated date shows above.
SEAL
Attest:
[SPECIMEN [SPECIMEN
DO NOT SIGN] DO NOT SIGN]
Town Clerk, Town of Pulaski Mayor, Town of Pulaski
(FORM OF NOTE POWER)
FOR VALUE RECEIVED the undersigned sell(s), assign(s) and transfer(s) unto
(Please print or type name and address of Transferee)
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naa io, ivss 5
(Please insert social security number of other identifying
number of Transferee)
the within note and all rights thereunder, and hereby irrevocably constitutes and appoints
Attorney, to transfer
the within note on the books kept for registration thereof, with full power of substitution
in the premises.
Dated:
Signature Guaranteed
[SPECIlVIEN
DO NOT SIGN]
[SPECIMEN
DO NOT SIGN]
Notice: Signature(s) must be guaranteed
by a member firm of the New York
Stock Exchange or a commercial bank or
trust company.
(NOTICE: The signature above must
correspond with the name of the
registered owner as it appears on the
front of this note in every particular,
without alteration or enlargement or any
change whatsoever.)
Section 1.7. Reg}strar. The Town Manager is hereby appointed Registrar for the
Note.
Section 1.8. Registration and Transfer. The Registrar shall cause books for the
registration and transfer of the Note to be kept at the office of the Registrar, and the
Town hereby instructs the Registrar to keep such books and to make such registrations
and transfers under such reasonable regulations as the Council or the Registrar may
prescribe. Transfer of the Note may be registered upon books maintained for this
purpose at the office of the Registrar. Prior to due presentment for registration of transfer
the Registrar shall treat the registered owner as the person exclusively entitled to payment
of principal and interest and the exercise of all other rights and powers of the owner..
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APrit 10,1998 6
Upon surrender for transfer of the Note at such office, the Mayor and the Town
Clerk shall execute and the Registrar shall deliver in the name of the transferee a new
Note, subject in each case to such reasonable regulations as the Council or the Registrar
may prescribe. If presented for transfer the Note (if so required by the Council or the
Registrar} shall be accompanied by a written instrument or instruments of transfer in form
and substance reasonably satisfactory to the Council and the Registrar, duly executed by
the registered owner or by his duly authorized attorney-in-fact or legal representative.
The Note may not be registered to bearer.
Neither the Council nor the Registrar shall be required to issue or transfer the Note
for a period of fifteen days next preceding the maturity date of the Note.
The new Note delivered upon any transfer shall be a valid obligation of the Town,
evidencing the same debt as the Note surrendered, shall be secured by this Resolution and
entitled to all of the security and benefits hereof to the extent as the Note surrendered.
Section 1.9. Charges for Transfer. No service charge shall be made for zny
transfer of the Note, but the Council may require payment of a sum sufficient to cover
any tax or other governmental charge that maybe imposed in relation thereto.
Section 1.10. Sale and Award of Note.
(a) The Town Manager has solicited proposals from persons to purchase
the Note.
(b} The proposal of Crestar Bank to purchase the Note at par with a
fixed interest rate to maturity of 4.26% per annum, which proposal has been presented
to the Council at the time of adoption of this resolution, is hereby determined to be the
proposal in the best interest of the Town, and the Note is hereby awarded to such
proposer.
(c) The Mayor and the Town Clerk are hereby authorized and directed
to take all proper steps to have the Note prepared and executed in accordance with the
terms of this resolution.
Section 1.11. Public Facilities Improvement Fund. On the date of delivery of the
Note all proceeds derived from the sale of the Note shall be deposited in a bank or other
depository to the credit of the Town, and such proceeds shall be accounted for through
a fund designated the "Public Facilities Improvement Fund" (the "Improvement Fund"),
to be applied to the cost of the Projects and the costs of issuance of the Note.
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April 10, 1996
Payments shall be made from the Improvement Fund on checks signed by any
authorized representative of the Town only after the Town Manager has certified that the
payment being withdrawn from the Improvement Fund is being used to pay bona fide
costs of the Projects or bona fide costs of issuing the Note.
The Finance Director of the Town shall preserve at his or her office, accurate
records available at all times which show that the proceeds from the sale of the Note and
investment earnings thereon were used for the purposes set forth in this section. Barring
unforseen cvrcumstances, any balance of the original proceeds of the Note and investment
earnings thereon remaining in the Improvement Fund upon the earlier of substantial
completion of the Projects or three years after the issuance date of the Note shall be used
at the earliest date possible to make a partial redemption of the Note.
ARTICLE II
PARTICULAR COVENANTS
Section 2.1. Payment of Note. The Town shall pay promptly, as provided herein,
the principal of and interest on the Note. Nothing in the Note or in this Resolution shall
be deemed to create or constitute an indebtedness of the Commonwealth of Virginia or
any political subdivision thereof other than the Town, or a pledge of the full faith and
credit of the Commonwealth of Virginia or of any political subdivision thereof other than
the Town.
Section 2.2. Tax Rate Covenant, The Council hereby covenants and agrees that
so Iong as the Note is outstanding, to the extent other funds are not lawfully available and
appropriated for timely payment of the Note, the Council will levy and collect annually
over and above all other taxes authorized or limited by Iaw, an ad valorem tax, without
limitation as to rate or amount, on all the taxable properly in the Town in an amount
sufficient to pay principal of and interest on the Note as the same become due and
payable.
Section 2.3. Maintenance of Tax-Exempt Status.
(a) No Adverse Action: The Town shall not take any action that would
adversely affect the exemption of interest on the Note from Federal income taxation. The
Town shall, to the extent permitted by Vuginia law, take all actions necessary to maintain
the tax-exempt status of interest on the Note under Federal or Virginia law, including all
actions necessary to comply with Section 103 or Sections 141 through 150 of the Internal
Revenue Code of 1986, as amended (the "Code") or the regulations promulgated by the
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Treasury Department with respect thereto. Without limiting the generality of the
foregoing, the Town shall comply with any provision of law which may require the Town
at any time to rebate to the United States any part of the earnings derived from the
Investment of the gross proceeds of the Note, unless the Town receives an opinion of
nationally recognized bond counsel that such compliance is not required to prevent
interest on the Note from being includable in the gzoss income for Federal income tax
purposes of the registered owners thereof under existing law.
(b) Arbitra~e/Investment: The Town shall not take or approve any
action, investment or use of the proceeds of the Nate which would cause the Note to be
an "arbitrage bond" within the meaning of Section 148 of the Code and the regulations
thereunder. The Town, bamng unforeseen circumstances, shall not request or approve
the use of the proceeds of the Note other than in accordance with the Town's "non-
arbitrage" certificate delivered at the time of the issuance of the Note.
(c) Information Report: The Town shall file the information report with
respect to the Note required by Section 149(e) of the Code within the time provided in
such Section.
(d) Not Federally Guaranteed: The Town represents that the Note is not
~ and will not be "federally guaranteed," as such term is used in Section 149(b) of the
! Code.
(e) Designation as Qualified Tax-Exempt Obligation: The Note is not
a private activity bond and is hereby designated by the Council as a Qualified Tax-
Exempt Obligation, as defined in Section 265(b)(3) of the Code. The Council hereby
represents and covenants as follows:
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(i) The Council will in no event designate more than
$10,000,000 of obligations as qualified tax-exempt obligations in the year
in which the Note is issued, including the Note, for the purpose of Section
265(b)(3) of the Code;
(ii) The Town, all its "subordinate entities," within the
meaning of Section 265(b)(3) of the Code, and all entities which issue tax-
exempt bonds on behalf of the Town and such subordinate entities have
together not issued more than $10,000,000 oftax-exempt obligations in the
current calendar year (not including "private activity bonds," as defined in
Section 141 of the Code, other than "qualified SOl(c)(3) bonds," as defined
in Section 145 of the Code), including the Note;
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April 10, 1998 9
is
(iii) Barring circumstances unforeseen as of the date of
delivery of the Note, the Town will not issue tax-exempt obligations itself
or approve the issuance of tax-exempt obligations of any of such other
entities if the issuance of such tax-exempt obligations would, when
aggregated with all other ta.Y-exempt obligations theretofore issued by the
Town and such other entities in the year in which the Note is expected to
be issued, result in the Town and such other entities having issued a total
of more than ~ 10,000,000 of tax-exempt obligations in such year (not
including private activity bonds, other than qualified 501(c)(3) bonds),
including the Note; and
(iv) The Council has no reason to believe that the Town
and such other entities will issue tax-exempt obligations in an aggregate
amount that will exceed such $10,000,000 limit;
provided however, that if the Town receives an opinion of nationally recognized band
counsel that compliance with any covenant set forth in (i) or {iii) above is not required
for the Note to be aqualifiedtax-exempt obligation, the Town need not comply with such
restriction.
(f) Small Issuer Exception from Rebate Requirement: The Council
hereby represents and covenants as follows:
(i) The Town, all its "subordinate entities," within the
meaning of Section 148(f)(4)(iu) of the Code, and all entities which issue
tax-exempt obligations on behalf of the Town and such subordinate entities
have together not issued more than $5,000,000 of tax-exempt obligations
in the current calendar year (not including private activity bonds),
including the Note;
(ii) Barring circumstances unforeseen as of the date of
delivery of the Note, the Town will not issue tax-exempt obligations itself
or approve the issuance of tax-exempt obligations of any of such other .
'' entities if the issuance of such tax-exempt obligations would, when
t
aggregated with all other tax-exempt obligations theretofore issued by the
Town and such other entities in the year in which the Note is expected to
be issued, result in the Town and such other entities having issued a total
of more than $5,000,000 of tax-exempt obligations in such year (not
including private activity bonds), including the Note;
i
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April 10,1998 10 i
(iii) The Council has no reason to believe that the Town
and such other entities will issue tax-exempt obligations in the year in
which the Note is expected to be issued in an aggregate amount that will
exceed such $5,000,000 limit; and
(iv) At least 95% of the proceeds of the Note shall be used
for "local government activities" of the Town within the meaning of
Section 148(f){4)(i) of the Code;
provided, however, that if the Town receives an opinion of nationally recognized bond
counsel that compliance with any covenant set forth in {ii) or (iv) above will not prevent
the Town from having to rebate to die United States any part of the earnings derived from
the investment of the gross proceeds of the Note, the Town need not comply with such
restriction.
ARTICLE III
MISCELLANEOUS
Section 3.1. Contract with Noteholder. The provisions of this resolution shall
constitute a contract between the Town and the holder of the Note for so long as the Note
is outstanding.
Sectioa 3.2. Authority of Officers and Agents. The officers and agents of the
Town shall do all acts and things required by them of this resolution and the Note for the
complete and punctual performance of all the terms, covenants and agreements contained
therein. The appropriate officers of the Town are further authorized and empowered to
take such other action as they may consider necessary or desirable to carry out the intent
and purpose of this resolution, and the issuance of the Note.
Section 3.3. Limitation of Liability of Officials of Town. No covenant, condition
or agreement contained herein shall be deemed to be a covenant, agreement or obligation
of an officer, employee or agent of the Town in his or her individual capacity, and no
officer of the Town executing the Note shall be liable personally on the Note or be
subject to any personal liability or accountability by reason of the issuance thereof No
officer, employee or agent of the Town shall incur any personal liability with respect to
any other action taken by him or her pursuant to this resolution, provided he or she acts
in good faith.
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~Wcil 10, 1998 11
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Section 3.4. Conditions Precedent. Upon the issuance of the Note all acts,
conditions and things required by the Constitution and statutes of the Commonwealth of
~Iirginia or this resolution to have happened, exist and to have been performed precedent
to or in the issuance of the Note shall have happened, exist and have been performed.
Section 3.5. Non-Arbitrage and Other Certificates. The Mayor of the Town, the
Town Manager and such other officers as may be requested are hereby authorized to sign
appropriate certificates setting forth, among other things, the expected use and investment
of the proceeds of the Note in order to show that such expected use and investment will
not violate the provisions of Section 148 of the Code and regulations issued pursuant
thereto, applicable to "arbitrage bonds". Such certificates may also contain certain
elections with regard to Section 148 of the Code and such officers are hereby authorized
to make such elections on behalf of the Town and the Council.
Section 3.6. Headins;s. Any headings in this resolution are solely for
convenience of reference and shall not constitute a part of the resolution nor shall they
affect its meaning, construction or effect.
Section 3.7. Severability. If any court of competent jurisdiction shall hold any
provision of this resolution to be invalid and unenforceable, such holding shall not
invalidate any other provision hereof.
Section 3.8. Effective Date. This resolution shall take effect immediately. Ali
ordinances, resolutions or parts thereof in conflict herewith are hereby repealed.
Section 3.9. Filing of Resolution. The Town. Clerk is hereby authorized and
directed to see to the immediate filing of a certified copy of this resolution with the Clerk
of the Circuit Court of Pulaski County, pursuant to Section 15.2-2607 of the Act.
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At a meeting of the Council of the Town of Pulaski, Virginia, held on April 14, 1998, at
which meeting the following members were present and absent:
Member Present/Absent
James M. Neblett Present
Lane R. Penn Present
Bettye H. Steger Present
Charles W. Stewart, Jr. nTP~enr
W. Edgar Hale Present
Joseph L. Weddle Present
Pauline G. Mitchell Pr _ n
Gerald E. Bolen Present
Jahn A. Johnston, Mayor
The following resolution was adopted by an affirmative roll call vote of a majority of all
members of the Council, the ayes and nays being recorded in the minutes of the meeting
as follows:
Mr. Neblett - Awe Mr. Hale - ~e
Mr. Penn - ,~, Mr. Weddle - -~
Mrs. Steger - .AXX~ Mrs. Mitchell - gyg
Mr. Stewart -Aye Mr. Bolen -Aye
ATTEST: ~ ~ ~n ~`
Patricia Pendergrast, Cl k
John A. Jo~ ton, Mayor
~.
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The undersigned Clerk of the Town of Pulaski, Virginia, hereby certifies that the
foregoing constitutes a true and correct copy of a Resolution adopted at a meeting of the
Council of the Town of Pulaski, Virginia, held on the 14~' day of April, 1998, and of the
whole thereof so far as applicable to the matters referred to in such extract.
WITNESS my hand and the seal of the Town of Pulaski, Virginia, this ~ { -day
of April, 1998.
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Clerk, Town of Pulaski, ~~ ginia
(SEAL)
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Apal 10,1998