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AN ORDINANCE AUTHORIZING THE ISSUANCE OF BONDS FOR THE PURPOSE OF SECURING AND DEVELOPING INDUSTRY WITHIN THE CITY OF JONESBORO, ARKANSAS; LEVYING A SPECIAL TAX AND SETTING UP A FUND FOR THEIR PAYMENT; PRESCRIBING OTHER MATTERS RELATING THERETO; AND DECLARING AN EMERGENCY
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WHEREAS, by Ordinance No.999, passed and approved January 4, 1960, there was submitted to the qualified electors of the City of Jonesboro, Arkansas, the question of whether the City should issue bonds to the amount of $1,000.000 for the purpose of securing and developing industry within the City, bearing interest at a rate acceptable to the City Council, and
WHEREAS, due notice of the election was given as required by law and at said election, which was duly held on February 9, 1960, the bond issue was approved, and the result of the election was announced by the Mayor by a proclamation issued on February 10, 1960, and duly published in the Jonesboro Evening Sun, a newspaper having a bona fide circulation in said City, and more than thirty days have elapsed since the date of said proclamation and no suit has been filed in any court to contest the result of said election as so announced, so that it is now final; and
WHEREAS, at a public sale of the $1,000,000 in bonds held at 2:00 PM April 5, 1960, in the office of Mayor Sanderson in the City Hall in said City, after more than twenty days’ advertisement in the Jonesboro Evening Sun and one publication in the Bond Buyer, a financial journal published in the City of New York and having a national circulation, the City of Jonesboro contracted to sell the bonds to Stephens, Inc. and T.J. Raney & Sons, both of Little Rock, Arkansas, who submitted the best and highest bid, namely: a price of 100 cents on the dollar face value plus accrued interest for bonds bearing interest at the rate of 4.17% per annum; and
WHEREAS, the buyers have elected to exercise the option granted by the sale notice to convert the bonds to bonds bearing a lower rate of interest, and they have presented computations whereby they have converted $1,000.000 in bonds maturing according to the notice of sale, bearing interest at the rate of 4.17% per annum, into $1,028.00 in bonds maturing and bearing interest as hereinafter set out, and the computations show that the cost of maturing the bonds after conversion is $1,247.30 less than the cost of maturing the bonds according to the original schedule, and this complies with the requirement that the City shall receive no less and pay no more than it would receive and pay if the bonds were not converted, and also complies with the other conversion terms of the sale notice; and
WHEREAS, the buyers of said bonds have agreed to name the Citizens Bank of Jonesboro, Arkansas, as Trustee and paying agent, and are ready to accept the bonds as soon as the City can legally make delivery; now, therefore,
BE IT ORDAINED by the City Council of the City of Jonesboro, Arkansas:
Section 1: that the sale of the bonds to Stephens, Inc. and T.J. Raney & Sons is at a fair price and is one that is allowed by law and the conversion is within the limitations fixed by the notice of sale; therefore, both the sale and the conversion are hereby approved and confirmed.
Section 2: That the Mayor and City Clerk are hereby authorized and directed to issue, execute, and deliver the bonds of this City in the aggregate amount of $1,028.000, dated as of April 1, 1960, and maturing on April 1 of each year as follows:
YEAR BOND NUMBERS AMOUNT
(both inclusive)
1963 1 to 25 $25,000
1964 26 to 51 26,000
1965 52 to 78 27,000
1966 79 to 106 28,000
1967 107 to 135 29,000
1968 136 to 165 30,000
1969 166 to 196 31,000
1970 197 to 229 33,000
1971 230 to 263 34,000
1972 264 to 298 35,000
1973 299 to 334 36,000
1974 335 to 371 37,000
1975 372 to 409 38,000
1976 410 to 449 40,000
1977 450 to 490 41,000
1978 491 to 533 43,000
1979 534 to 578 45,000
1980 579 to 626 48,000
1981 627 to 676 50,000
1982 677 to 728 52,000
1983 729 to 783 55,000
1984 784 to 840 57,000
1985 841 to 900 60.000
1986 901 to 962 62,000
1987 963 to 1028 66,000
The bonds shall be negotiable and in the denomination of $1000 each; shall be called “City of Jonesboro, Arkansas, __% General Obligation Improvement Bonds of 1960”; shall be callable as hereinafter set out; shall be executed by the Mayor and City Clerk and sealed with the corporate seal of the City; shall bear interest at the following rates per annum: Numbers 1 to 371, inclusive, at 3 ¾ % and Numbers 372 to 1028, inclusive, at 4%, interest to be payable semi-annually on April 1 and October 1 in each year, beginning October 1, 1960, and to be evidenced y coupons attached to the bonds, the coupons to be signed by the Mayor by his facsimile signature, and the Mayor shall by the execution of the bonds adopt as and for his own proper signature his facsimile signature appearing on the coupons on said bonds. Both the principal of and interest on said bonds shall be payable in any coin or currency which on the date of payment is legal tender for payment of debts due the United States of America, at the office of the Citizens Bank of Jonesboro, Arkansas.
Section 3: Said bonds shall be in substantially the following form:
UNITED STATES OF AMERICA
STATE OF ARKANSAS
COUNTY OF CRAIGHEAD
CITY OF JONESBORO
No. __________ ___% General Obligation Improvement Bond of 1960 $1,000
KNOW ALL MEN BY THESE PRESENTS:
That the City of Jonesboro, in the County of Craighead, State of Arkansas, acknowledges itself to owe and for value received promises to pay to bearer the sum of ONE THOUSAND DOLLARS on the first day of April, 19__, with interest hereon from date hereof at the rate of ______per centum (___%) per annum until paid, interest payable semi-annually on the first day of April and October of each year, commencing October 1, 1960, on presentation and surrender of the annexed coupons as they severally mature. Both the principal hereof and interest hereon are payable in any coin or currency which on the respective dates of payment is legal tender for payment of debts due the United States of America, at the office of the Citizens Bank of Jonesboro, Arkansas.
This bond is one of a series of negotiable bonds aggregating One Million Twenty-eight Thousand Dollars ($1,028.00) all of like tenor and effect except as to number, interest rate, and maturity, numbered from One (1) to One Thousand Twenty-eight (1028), inclusive, issued for the purpose of securing and developing industry within the City of Jonesboro, Arkansas. This bond is a general obligation of the City and is payable in the first instance from the revenue derived from a special tax of five mills on the dollar of the total assessed valuation of the taxable property in the City, authorized by Amendment No.49 to the Constitution of the State of Arkansas, and from a pledge of the rental to be received from the lessee of the factory building for the construction of which this bond has been issued. The City reserves the right to suspend the collection of said tax in any year for which the rent from said factory building shall be sufficient to pay the principal and interest of the bonds of this issue maturing that year, or to reduce the levy in any year the entire pledged millage shall not be needed to pay such principal and interest.
The City hereby warrants and covenants that in the issuing of this bond it has proceeded in accordance with the provisions of said Amendment No.49 and in accordance with the laws of said State, under ordinances of the City Council of said City and in pursuance of an election duly held at which the majority of the legal voters of said city voting on the question voted in favor of the issue of said bonds; that all conditions, acts and things required to exist, to be performed, and to happen precedent to and in the issuance of this bond to exist, have been performed, and have happened in due time, form and manner as required by law and particularly by said Amendment No.49; that a tax sufficient to pay the bonds aforesaid has been levied in accordance with said constitutional amendment and made payable annually until all of said bonds and interest thereon have been fully paid and discharged; and that the indebtedness represented by this bond and the issue of which it forms a part does not exceed any constitutional or statutory limitation. For the prompt payment of this bond and the interest thereon, the said City of Jonesboro hereby pledges its full faith, credit, and taxing power, including the five mill special tax authorized to be levied by said Amendment to the Construction for the payment of this bond and other bonds of this series.
The bonds of this issue are callable for payment prior to maturity inverse numerical order at par and accrued interest, as follows: If called for payment with funds derived from the tax collection or from rentals or from moneys derived from the sale of this bond issue and not needed for construction, on any interest paying date; if called for payment with funds from any other source, on any interest paying date on and after April 1, 1965. In the event the City shall call bonds for payment prior to maturity, it shall publish notice of such call once a week for two weeks in some newspaper of general circulation throughout the State of Arkansas, the first publication to be not less than thirty days prior to the date fixed for redemption, giving the number and maturity of each bond being called. All bonds so called shall cease to bear interest after the date fixed for their redemption, provided the funds for their payment are on deposit with the paying agent at that time.
The bond shall not be valid until authenticated by the certificate hereon of the Citizens Bank of Jonesboro, Arkansas.
IN WITNESS WHEREOF, the City of Jonesboro, Arkansas, has executed this bond by the hands of its Mayor and City Clerk and attested it with its corporate seal, and has caused the coupons hereto attached to be authenticated by the facsimile signature of its Mayor, as of the first day of April, 1960.
HERBERT SANDERSON, MAYOR
ATTEST:
PHYLLIS STRINGER, CITY CLERK
(Form of Coupon)
No.__________ $_____________
On the first day of April and October, 19___< unless the bond to which this coupon is attached is pair prior thereto, the City of Jonesboro, Arkansas, promises to pay to bearer, upon surrender hereof, DOLLARS in any coin or currency which on said date is legal tender for payment of debts due to United States of America, at the office of the Citizens Bank of Jonesboro, Arkansas being six months’ interest then due on its General Obligation Improvement Bond of 1960 dated April 1, 1960, and numbered ________.
CITY OF JONESBSORO, ARKANSAS
BY______________________________MAYOR
(All coupons shall be for six months’ interest. The signature of the Mayor on the coupons may be lithographed or engraved.)
Each bond shall be authenticated by the Trustee as follows:
CERTIFICATE
This bond is one of the series of 1028 General Obligation Improvement Bonds of 1960 aggregating $1,028,000 described within.
CITIZENS BANK OF JONESBORO, ARKANSAS, Trustee By_________________________________
Authorized Officer
Jonesboro, Arkansas
_________________.
Section 4: the Mayor and City Clerk are hereby authorized and directed, when they have executed said bonds and have had them duly certified, to deliver them to the purchasers upon receipt of the full purchase price, and the proceeds of said bonds shall be used for no purpose except the purposes for which voted.
Section 5: In order to pay the said bonds with interest as they mature, the City of Jonesboro, under authority of said Amendment No.49, does hereby levy a tax of five mills on each dollar of assessed valuation, beginning with the taxes collected in 1961 and continuing annually as long thereafter as may be necessary in order to pay the principal of and interest on the bonds authorized by this ordinance, being a sum sufficient to meet said bonds and interest as they mature, with ten per centum added for unforeseen contingencies; and the City Clerk is hereby instructed to transmit a certified copy of this ordinance to the County Clerk of Craighead County, Arkansas, to the end that said tax may be extended on the tax books of said County and collected annually along with the other taxes; with the provision that the City reserves the right to suspend the collection of said tax in any year for which the rent from the factory building to be constructed by the use of the proceeds of the sale of the bonds of this issue shall be sufficient to pay the principal and interest of this issue maturing that year, or to reduce the levy in any year the entire pledged millage shall not be needed to pay such principal and interest. The decision of the Trustee shall be final as to the need for the levy of all or any part of said special five mill tax.
Section 6: The City will use the proceeds of the sale of the bonds of this issue to construct a factory building which it has leased to a manufacturing company, Crane Company of Chicago, Illinois, and the entire lease rentals are hereby pledged to the Trustee, hereinafter named, for the payment of all principal, interest, and paying charges of this issue.
Section 7, There is hereby created and established an account to be known as the “General Obligation Improvement Bonds of 1960 Account,” (hereinafter sometimes termed the “Bond Account”), into which shall be deposited all revenues derived from the special five mill tax levied for the bonds of this issue and the rental from the factory building constructed by the use of the proceeds of this bond issue, and the moneys in said account shall be used solely for the payment of the bonds and interest of this issue, as set out in this ordinance.
Section 8: The City will set aside the surplus revenue from the five mill tax and the rental from the tenant of the factory building until it has accumulated a surplus equivalent to the average annual requirements for payment of principal and interest of this bond issue, which shall be maintained as a reserve until used in payment of the last outstanding bonds of this issue. This reserve may be invested in securities issued by either the United States of America, and the interest derived form any investment of the funds of the reserve will be pledged to the extent necessary in any year to prevent a default in these bonds; if not needed for that purpose, it shall be paid into the Bond Account.
Section 9: In order to pay said bonds with interest thereon as they mature, there are hereby appropriated out of the Bond Account hereinafter described, and if such Bond Account be not sufficient, then out of the General revenues of the City, the sums necessary to meet payments of principal and interest as they mature, to-wit:
YEAR PRINCIPAL INTEREST TOTAL
April 1 of April 1 & October 1
Each year of each year
1960 $ 20,096.25 $20,096.25
1961 20,096.25 20,096.25 40,192.50
1962 20,096.25 20,096.25 40,192.50
1963 25,000.00 20,096.25 19,627.50 64,723.75
1964 26,000.00 19,627.50 19,140.00 64,767.50
1965 27,000.00 19,140.00 18,633.75 64,773.75
1966 28,000.00 18,633.75 18,108.75 64,742.50
1967 29,000.00 18,108.75 17,565.00 64,673.75
1968 30,000.00 17,565.00 17,002.50 64,567.50
1969 31,000.00 17,002.50 16,421.25 64,423.75
1970 33,000.00 16,421.25 15,802.50 65,223.75
1971 34,000.00 15,802.50 15,165.00 64,967.50
1972 35,000.00 15,165.00 14,507.75 64,673.75
1973 36,000.00 14,508.75 13,833.75 64,342.50
1974 37,000.00 13,833.75 13,140.00 63,973.75
1975 38,000.00 13,140.00 12,380.00 63,520.00
1976 40,000.00 12,380.00 11,580.00 63,960.00
1977 41,000.00 11,580.00 10,760.00 63,340.00
1978 43,000.00 10,760.00 9,900.00 63,660.00
1979 45,000.00 9,900.00 9,000.00 63,900.00
1980 48,000.00 9,000.00 8,040.00 65,040.00
1981 50,000.00 8,040.00 7,040.00 65,080.00
1982 52,000.00 7,040.00 6,000.00 65,040.00
1983 55,000.00 6,000.00 4,900.00 65,900.00
1984 57,000.00 4,900.00 3,760.00 65,660.00
1985 60,000.00 3,760.00 2,560.00 66,320.00
1986 62,000.00 2,560.00 1,320.00 65,880.00
1987 66,000.00 1,320.00 ---------- 67,320.00
These amounts shall be proportionately reduced in the event any bonds are paid prior to maturity.
Section 10: The Treasurer of the City of Jonesboro is hereby ordered and directed to remit to the paying agent, not less than five days before the date of each interest payment, the amount of interest or principal and interest due on said date, together with the paying charges, which shall be 1/8 of 1% on principal and 5¢ per interest coupon, with the provision that the minimum paying charge shall be $5.00. This instruction to the Treasurer is irrevocable and may be enforced by mandamus.
Section 11: The City agrees to deposit the proceeds of the sale of the bonds as follows: The accrued interest shall be paid into the Bond Account, as hereinabove defined; the balance received from the sale of the bonds shall be deposited in a separate fund to be known as the “Construction Fund,” to be used solely for the payment of the cost of the improvements for which the bonds are being issued, plus the expenses of the bond issue, and an amount equivalent to the average annual principal and interest requirements on the entire issue shall be taken from the proceeds and placed in the reserve created in Section 8 hereof, to be available to pay either principal or interest, but this money so used shall be repaid to the Construction Fund when tax revenues are available.
Section 12: Both the Bond Account and the Construction Fund shall be deposited in one or more banks holding membership the Federal Deposit Insurance Corporation, and the City agrees to require security from each such depository bank for all of the deposit over the $10,000 insured by the FDIC, such security to be in the form of a corporate surety bond or in the form of government bonds escrowed with some other bank, with the right in the depository to withdraw bonds from the escrow as the Bond Account or Construction Fund in withdrawn by the City. Vouchers upon either fund must be signed by two duly authorized persons.
Section 13: If default is made and continues for thirty days in the payment of any interest coupon, the holder of the bond to which it is attached may declare the same immediately due and payable, and the failure of the holder to exercise this option upon any default shall not be a waiver of his right to exercise the option upon any subsequent default.
Section 14: the bonds of this issue shall be callable for payment prior to maturity according to the terms set out in the face thereof.
Section 15: The Citizens Bank of Jonesboro, Arkansas, is designated as Trustee, authorized to act for and on behalf of the bondholders, but it shall be responsible only for willful wrong in the execution of its trust, and the recitals of fact contained herein and in the bonds themselves (except the recitals in the Trustee’s Certificate) are statements made by the City and not by the Trustee. The Trustee shall not be required to take notice of any default, other than those based upon Section 10 hereof, or to take any action hereunder, except with respect to defaults arising from the failure of the City to comply with the provisions of Section 10 hereof, until it shall have been notified in writing of said default and indemnified to its satisfaction against any loss, expense, or cost that it may incur by taking action. The holders of a majority in value of the outstanding bonds at any time may, by an instrument duly executed and recorded in the office of the City Clerk, appoint a new Trustee, who shall have all of the powers of the Trustee originally named, and the Trustee herein named may resign at any time upon ten days’ notice in writing mailed to the City Clerk.
Section 16: The terms of this ordinance shall constitute a contract between the City of Jonesboro and the holders of the bonds herein authorized, and no variation or change in the undertakings herein set out shall be made while any of these bonds are outstanding without the written consent of the holders of all of the bonds of this issue then outstanding, and the holder of any bond may at any time, for and on his own behalf, or the Trustee may, for and on behalf of all the bondholders, enforce the obligations of the City by a proper suit for that purpose.
Section 17: The provisions of this ordinance are separable, and in the event that any section or part of section shall be held to be invalid, such invalidity shall not affect the remainder of the ordinance.
Section 18: It is hereby ascertained and declared that there is immediate and urgent need for the construction of the improvements to be provided by the proceeds of this bond issue, in order to promote the economy of the City, the opportunities for employment, and the protection of the City of Jonesboro, Arkansas; therefore, an emergency exists and this ordinance, being necessary for the preservation of the public peace, health, and safety, shall take effect and be in force immediately upon and after its passage.
PASSED and ADOPTED this 13th day of April, 1960.