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MEMO TO: HONORABLE MAYOR AND MEMBERS OF THE CITY
COUNCIL
FROM: BRUNO RUMBELOW, CITY MANAGER3�
MEETING DATE: JANUARY 15, 2008
SUBJECT: A RESOLUTION APPROVING THE ACTION OF THE
GRAPEVINE INDUSTRIAL DEVELOPMENT CORPORATION
FOR SENIOR AIR CARGO SPECIAL FACILITY BOND SERIES
2008
RECOMMENDATION:
City Council to consider approving a resolution which approves the action of the
Grapevine Industrial Development Corporation for its Senior Air Cargo Special Facility
f�evenue Bonds, Series 2008 (Aero DFW II, LP Project) (Cargo Acquisition Companies
Obliga4ed Group II).
BACKGROUND:
Both the Grapevine Industrial Development Corporation and the City Council took action
on November 20, 2007 to approve a resolution related to the issuance of non-profit
bonds for financing a project at DFW Airport. The bonds are referred to as the Aero
DFW Bonds Series 2007.
Subsequent to that action by the Board and the City Council, staff was advised by the
attorney with Vinson & Elkins that during the finalization of the bond sale, it was
determined that one of the users does not qualify for tax-exempt financing. As such, a
series of taxable bonds is necessary in addition to the non-taxable bonds in order to
finance the entire project. In order to accommodate this change, a revised resolution
was approved by the Industrial Development Corporation at their board meeting on
January 15, 2008.
In order to complete the approval process, it is necessary for the City Council to ratify
the action taken by the Industrial Development Corporation. The changes in the
resolution are administrative in nature and refer to the issuance of taxable bonds in
addition to the non-taxable bonds. The total amount of the issue is still not to exceed
$11,000,000 and there is no costs other than administrative time to the City of
Grapevine.
This matter has been reviewed by the City Attorney as well as staff. Staff recommends
ap�rova�,
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RESOLUTION NO.
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A RESOLUTION APPROVING THE ACTION OF THE
GRAPEVINE INDUSTRIAL DEVELOPNIENT
CORPORATION FOR ITS SENIOR AIR CARGO SPECIAL
FACILITY REVENUE BONDS, SERIES 2008 (AERO DFW
II, LP PROJECT) (CARGO ACQUISITION COMPANIES
OBLIGATED GROUP II)
WHEREAS, by resolution, the City Council (the "City Council") of the City of
Grapevine, Texas (the "City"), authorized and approved the creation of the Grapevine
Industrial Development Corporation (the "Issuer") as a nonprofit industrial development
corporation under the provisions of the Development Corporation Act of 1979, Texas
Revised Civil Statutes Annotated, Article 5190.6, as amended (the "Act"); and
WHEREAS, the Act authorizes and empowers the Issuer to issue industrial
development revenue bonds on behalf of the City to pay all or part of the cost of
projects pursuant to the Act; and
WHEREAS, Aero DFW II, LP (the "Borrower"), desires that the Issuer issue its
Senior Air Cargo Special Facility Revenue Bonds, Series 2008A (Aero DFW II, LP
Project) (Cargo Acquisition Companies Obligated Group II) (the "2008A Bonds") and its
Taxable Senior Air Cargo Special Facility Revenue Bonds, Series 2008B (Aero DFW II,
LP Project) (Cargo Acquisition Companies Obligated Group II) (together with the 2008A
Bonds, the "Bonds"), in an amount not to exceed $11,000,000, as special limited
obligations of the Issuer and loan the proceeds thereof to the Borrower to finance the
acquisition, construction, reconstruction, improvement and expansion of certain
leasehold air cargo facilities located at Dallas/Fort Worth International Airport (the
"Project"); and
WHEREAS, on January 15, 2008, the Board of Directors of the Issuer (the
"Board") adopted a resolution authorizing issuance of the Bonds and approving
transaction documents related thereto (the "Issuer Resolution"}; and
WHEREAS, section 147(f) of the Internal Revenue Code of 1986, as amended
(the "Code"), requires that the 2008A Bonds be approved by the "applicable elected
representative" (the "Representative") after a public hearing following reasonable public
notice; and
WHEREAS, with respect to the 2008A Bonds, the Representative shall be the
City Council; and
WHEREAS, notice of a public hearing with respect to the Project and the 2008A
Bonds which was held by the duly appointed hearing officer of the Issuer on October 2,
2007, was published no less than 14 days before said date, in a newspaper of general
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circulation availabie to residents within the City, to be evidenced by the Affidavit of .••�,
Publication attached to the Issuer's Certificate of Public Hearing; and
WHEREAS, the Issuer has held such public hearing on the date and at the time
and place set out in such published notice, and conducted such hearing in a manner
that provided a reasonable opportunity for persons with differing views on the issuance
of the 2008A Bonds and on the location and nature of the Project to be heard; and
WHEREAS, the Bonds are being issued pursuant to the Issuer Resolution to
finance the costs of the Project and costs of issuance, all as more fully provided in the
above referenced Financing Agreement; and
WHEREAS, the Act and the Bylaws of the Issuer provide that the City Council
must, by written resolution adopted no more than 60 days prior to the date of the
proposed delivery of the Bonds, specifically approve the Issuer Resolution providing for
the issuance of the Bonds; and
WHEREAS, the City Council finds and determines that the Project is furtherance
of the public purposes of the Act and therefore desires to approve the actions of the
Issuer in relation to financing the Project for the Borrower.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF GRAPEVINE, TEXAS, THAT:
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Section 1. That the statements contained in the preamble to this resolution are _
hereby adopted as findings of fact and as part of the operative provisions hereof.
Section 2. That the resolution authorizing Grapevine Industrial Development
Corporation Senior Air Cargo Special Facility Revenue Bonds, Series 2008 (Aero DFW
II, LP Project) (Cargo Acquisition Companies Obligated Group II); Approving a
Financing Agreement, a Trust Indenture, Official Statements and Contracts Of
Purchase; and Other Matters in Connection Therewith," adopted by the Board on
January 15, 2008, a copy of which is attached hereto as Exhibit "A" and made a part
hereof for all purposes, and providing for the issuance of "Grapevine Industrial
Development Corporation Senior Air Cargo Special Facility Revenue Bonds, Series
2008A (Aero DFW II, LP Project) (Cargo Acquisition Companies Obligated Group II)"
"Grapevine Industrial Development Corporation Taxable Senior Air Cargo Special
Facility Revenue Bonds, Series 2008B (Aero DFW II, LP Project) (Cargo Acquisition
Companies Obligated Group II)" in an aggregate amount not to exceed $11 ,000,000 is
hereby specifically approved.
Section 3. That the City Council, acting solely in its capacity as Representative
for purposes of the approval requirements of section 147(f) of the Code and for no other
purpose, is authorized to approve, and does hereby approve, the 2008A Bonds. Such
approval is not to be construed as (i) a representation or warranty by the City Council or
the City, the State of Texas, or any other agency, instrumentality, or political subdivision
of the State of Texas that the Bonds will be paid or that any obligations assumed by any
of the parties under the instruments delivered in connection with the Bonds will in fact
RES NO. 2
be performed, (ii) a pledge of faith and credit of or by the City or the State of Texas or
any agency, instrumentality or political subdivision of the State of Texas or the City, or
�� (iii) a representation or warranty by the City concerning the validity of the corporate
existence of the Issuer or the validity of the Bonds.
Section 4. That the Mayor and the City Secretary of the City and the other
appropriate officers of the City are hereby jointly and severally authorized to execute
and deliver such endorsements, instruments, certificates, documents, or papers
necessary and advisable to carry out the intent and purposes of this resolution.
Section 5. That it is hereby found, determined and declared that a sufficient
written notice of the date, hour, place and subject of the meeting of the City Council at
which this resolution was adopted was posted at a place convenient and readily
accessible at all times to the general public at the City Hall of the City for the time
required by law preceding this meeting, as required by the Texas Open Meetings Act,
Government Code Chapter 551, and that the meeting has been open to the public as
required by law at all times during which this resolution and the subject matter thereof
have been discussed, considered and formally acted upon. The City Council further
ratifies, approves and confirms such written notice and the contents and posting thereof.
Section 6. That this resolution shall take effect from and after the date of its
passage.
- PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF
.m�: GRAPEVINE, TEXAS on this the 15th day of January, 2008
APPROVED:
ATTEST:
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RES NO. 3
APPROVED AS TO FORM:
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RES NO. 4
EXHIBIT A
��e`� RESOLUTION AUTHORIZING GRAPEVINE INDUSTRIAL
DEVELOPMENT CORPORATION SENIOR AIR CARGO
SPECIAL FACILITY REVENUE BONDS, SERIES 2008
(AERO DFW II, LP PROJECT) (CARGO ACQUISITION
COMPANIES OBLIGATED GROUP II); APPROVING A
FINANCING AGREEMENT, A TRUST INDENTURE,
OFFICIAL STATEMENTS AND CONTRACTS OF
PURCHASE; AND OTHER MATTERS IN CONNECTION
THEREWITH
WHEREAS, the City of Grapevine, Texas (the "City"), has, pursuant to the
Development Corporation Act of 1979, Texas Revised Civil Statutes Annotated,
Article 5190.6, as amended (the "Act"), approved and provided for the creation of the
Grapevine Industrial Development Corporation (the "Issuer") as a non-stock, non-profit
corporation; and
WHEREAS, the Issuer, on behalf of the City, is empowered to finance the costs
of projects located within the boundaries of the City to promote the development and
expansion of manufacturing, industrial and transportation facilities to promote and
encourage employment and the public welfare by the issuance of obligations of the
Issuer; and
- - WHEREAS, Aero DFW II, LP, a Delaware limited partnership (the "Borrower"),
has requested that the Issuer issue its revenue bonds and lend the proceeds thereof to
the Borrower to finance the cost of a Project (defined below) to be located within the
boundaries of the City; and
WHEREAS, no public funds or credit of the City may be pledged to the payment
of such revenue bonds, and such revenue bonds shall be payable solely from amounts
made available by the Borrower or facility for which such bonds are issued; and
WHEREAS, in furtherance of the purposes of the Act, the Issuer proposes to
issue two series of its revenue bonds in the aggregate principal amount not to exceed
$11,000,000, which will be designated "Grapevine Industrial Development Corporation
Senior Air Cargo Special Facility Revenue Bonds, Series 2008A (Aero DFW II, LP
Project) (Cargo Acquisition Companies Obligated Group II)" (the "2008A Bonds") and
"Grapevine Industrial Development Corporation Taxable Senior Air Cargo Special
Facility Revenue Bonds, Series 2008B (Aero DFW II, LP Project) (Cargo Acquisition
Companies Obligated Group II)" (the "2008B Bonds," and together with the
2008A Bonds, the "Bonds"), the proceeds of which will be loaned to the Borrower to
finance the costs of acquisition, construction, reconstruction, improvement and
expansion of certain air cargo facilities (the "Project") more particularly described in the
Agreement (defined below), together with certain costs incident to the issuance of the
Bonds; and
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WHEREAS, the requirements of Section 147(f) of the Internal Revenue Code of
1986, as amended (the "Code"), provide that a public hearing in connection with the
proposed issuance of the 2008A Bonds and the use of the proceeds thereof to finance
the Project be held, and that notice of such hearing be published no less than 14 days
before the date of the public hearing in a newspaper of general circulation available to
residents within the City; and
WHEREAS, notice of a public hearing with respect to the Project and the 2008A
Bonds was published more than 14 days before the date hereof, which is the hearing
date, in a newspaper of general circulation available to residents within the City; and
WHEREAS, the public hearing was held on the date and time and place set forth
in the published notice, at which time the public had the opportunity to express their
views with respect to the proposed financing to be authorized by this Resolution; and
WHEREAS, Section 147(f) of the Code requires that the Bonds and the financing
of the Project be approved by the "applicable elected representative" (the "AER") of the
City after a public hearing following reasonable public notice; and
WHEREAS, the City Council of the City proposes to adopt a written resolution
specifically approving this Resolution of the Issuer providing for the issuance of the
Bonds as required by the Act; and
WHEREAS, there have been presented to the Issuer proposed forrns of each of �
the following:
1. Financing Agreement relating to variable rate Bonds and Financing Agreement
relating to fixed rate Bonds (collectively, the "Agreement"), in each case between
the Issuer and the Borrower;
2. Trust Indenture relating to variable rate Bonds and Trust Indenture relating to
fixed rate Bonds (collectively, the "Indenture"), in each case between the Issuer
and Wells Fargo Bank, National Association, as trustee (the "Trustee");
3. Preliminary Official Statement relating to the 2008A Bonds and Preliminary
Official Statement relating to the 2008B Bonds (collectively, the "Preliminary
Official Statement"); and
4. Bond Purchase Contract relating to tne 2008A Bonds and Bond Purchase
Contract relating to the 2008B Bonds (collectively, the "Contract of Purchase")
among the Issuer, the Company and Goldman, Sachs & Co., as underwriter (the
"Underwriter");
The Agreement, the Indenture and the Contract of Purchase are collectively
referred to herein as the "Transaction Documents";
NOW THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF ��
THE GRAPEVINE INDUSTRIAL DEVELOPMENT CORPORATION:
Section 1.The Board hereby approves the Transaction Documents in
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substantialiy the form and substance presented to the Board and the President or any
Vice President of the Issuer is hereby authorized and directed, for and on behalf of the
Issuer, to date, sign, and otherwise execute the applicable Transaction Documents, and
the Secretary or any Assistant Secretary is authorized and directed, for and on behalf of
the Issuer, if requested, to attest the applicable Transaction Documents, and such
officers are hereby authorized to deliver such Transaction Documents. The form of
Financing Agreement and Indenture to be used shall be the form relating to the type
(variable or fixed) of Bonds to be issued as approved by the President of the Issuer or
his designee pursuant to Section 2 below.
Section 2.The Board hereby approves and authorizes the Bonds to be issued in
the aggregate principal amount not to exceed $11,000,000 according to the conditions
set forth herein and in the Indenture for the purpose of providing funds for costs of the
Project. The President or his designee is hereby authorized to act on behalf of the
Board in selling and delivering the Bonds and carrying out the other procedures
specified in this Resolution, including determining whether a series of Bonds will be
issued as variable rate bonds or fixed rate bonds (and if issued as variable rate bonds,
the mode in which such Bonds will be issued), the price at which each series of Bonds
will be sold, the principal amount of each series of Bonds, the years in which the Bonds
will mature, the principal amount to mature in each of such years, the rate of interest to
be borne by each such maturity if the Bonds are issued as fixed rate bonds, the first
interest payment date for each series of Bonds, the dates, prices and terms upon and at
which the Bonds shall be subject to redemption prior to maturity at the option of the
" Board, as well as any mandatory sinking fund redemption provisions, the purchase of a
Bond insurance policy for all or any portion of the Bonds, and all matters relating to the
issuance, sale of the Bonds and other procedures relating to the Bonds. Such approval
shall be evidenced by the execution of the Indenture and the Contract of Purchase by
the authorized officers of the Issuer.
Section 3.The Board hereby approves the Bonds in substantially the form and
substance set forth in the Indenture and the President or any Vice President and the
Secretary or any Assistant Secretary are hereby authorized and directed, for and on
behalf of the Issuer, to execute the Bonds or have their facsimile signatures placed
upon the Bonds and to submit the Bonds and a transcript of proceedings therefor to the
Attorney General of the State of Texas for approval and to the Comptroller of Public
Accounts of the State of Texas for registration, and such officers are hereby authorized
and di�ected to deliver ti�e Bonds, and the seai of the Issuer is herepy authorized and
directed to be affixed or placed in facsimile on the Bonds.
Section 4.The distribution of an o .fficial statement for each series of the Bonds
(collectively, the "Official StatemenY'), in substantially the form of the Preliminary Official
Statement, is hereby approved. The Board hereby approves the use of the information
regarding the Issuer described under the caption "THE ISSUERS" and in Appendix B in
the Preliminary Official Statement and the Official Statement; provided that the Issuer
hereby disclaims any responsibility for the Preliminary Official Statement and the Official
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Statement except for the information concerning the Issuer provided under the caption ..�
"THE ISSUERS" and in Appendix B.
Section 5.Based solely upon representations made by the Borrower to the Board,
the Board hereby finds that:
(a) the Project will have the effect of increasing or stabilizing
employment within the City;
(b) the Project is required or suitable for the promotion of development
and expansion of transportation facilities and is in furtherance of the public
purposes of the Act; and
(c) all requirements for and prerequisites to final approval under the
Issuer's Local Regulations for Receiving and Approving Applications for Financial
Participation in Development Projects (the "Regulations") have either been
satisfied or waived and are in form and substance satisfactory to this Board.
Section 6.The issuance of the Bonds by the Issuer shall be subject to and
conditioned upon the receipt by the Issuer, on or before the closing date of (i) a
certificate from a representative of the Office of the Governor, Division of Economic
Development and Tourism (the "Department"), acting on behalf of the Department,
evidencing approval of the Bonds; (ii) approval of the Bonds and the Project by the City
Council of the City; (iii) the approving opinions of the Attorney General of the State of �
Texas and evidence of registration of the Bonds by the Comptroller of Public Accounts
of the State of Texas; (iv) the purchase price for the Bonds; (v) the Issuer's
administrative fee; and (vi) such opinions, evidences, certificates, instruments or other
documents as shall be requested by Bond Counsel to evidence due performance or
satisfaction by the Borrower at or prior to such time of all agreements then to be
performed and all conditions then to be satisfied by it.
Section 7.The Board hereby approves (i) the submission of an application to the
Department for its approval relating to the issuance, sale and delivery of the Bonds, and
(ii) the submission to the Attorney General of the State of Texas for its approval relating
to the issuance, sale and delivery of the Bonds.
Section 8.The Trustee is hereby appointed to serve as trustee under the
Indenture, thereby serving as Paying Agent under the terms of the Indenture.
Section 9.The President, any Vice President, or the Secretary is hereby
authorized to execute and deliver to the Trustee the written order or application of the
Issuer for the authentication and delivery of the Bonds by the Trustee in accordance
with the Indenture.
Section 10. All action (not inconsistent with provisions of this Resolution)
heretofore taken by the Board and officers of the Issuer directed toward the issuance of
the Bonds and the loan of the proceeds thereof to the Borrower to finance the costs of
the Project shall be and the same hereby is ratified, approved, and confirmed.
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Section 11. The officers of the Issuer shall take ail action necessary or
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reasonably required to effectuate the issuance of the Bonds and take ali action
necessary or desirable to provide for the loan of the proceeds thereof to finance the
Project and for carrying out, giving effe�t to, and consummating the transactions
contemplated by the Bonds and this Resolution, including without limitation, the
execution and delivery of any closing documents in connection with the issuance of the
Bonds.
Section 12. The President and any Vice President are hereby authorized to
approve such changes to said documents as are necessary and appropriate to carry out
the purposes of this Resolution as may be approved by counsel to the Issuer, including
such changes as are necessary to assure that no Additional Bonds (as defined in the
Indenture) may be issued without the express authorization of the Issuer.
Section 13. After any of the Bonds are issued, this Resolution shall be and
remain irrepealable until the Bonds or the interest thereon shall have been fully paid or
provision for payment shall have been made pursuant to the Indenture.
Section 14. If any section, paragraph, clause, or provision of this Resolution, or
any application thereof, shall be held to be invalid or unenforceable, the invalidity or
unenforceability of such section, paragraph, clause, or provision or application thereof
shall not affect any of the remaining provisions or applications of this Resolution. In
case any obligation of the Issuer authorized or established by this Resolution or the
Bonds is held to be in violation of law as applied to any person or in any circumstance,
�� such obiigation shall be deemed to be the obligation of the Issuer to the fullest extent
permitted by law.
Section 1�. The resolution of the Issuer adopted on November 20, 2007, with
respect to the Bonds is hereby rescinded and shall be of no further force and effect.
=�.,reY
ADOPTED this 15th day of January, 2008. :�,
GRAPEVINE INDUSTRIAL
DEVELOPMENT CORPORATION
By:
Ted R. Ware
President
ATTEST:
By:
C. Shane Wilbanks
Secretary
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CERTIFICATE FOR RESOLUTION
�`�" THE STATE OF TEXAS §
§
COUNTY OF TARRANT §
I, the undersigned officer of the Board of Directors of the Grapevine Industrial
Development Corporation (the "Corporation") do hereby certify as follows:
1. The Board of Directors of the Corporation convened in special session on
the 15th day of January, 2008, at Grapevine City Hall, the regular meeting place of the
Corporation; and the roll was called of the duly constituted officers and members of said
Board, to-wit:
Ted R. Ware President
William D. Tate Vice President
C. Shane Wiibanks Secretary/Treasurer
and all of said persons were present, thus constituting a quorum. Whereupon, among
other business, the following was transacted at said meeting: a written
RESOLUTION AUTHORIZING GRAPEVINE INDUSTRIAL
DEVELOPMENT CORPORATION SENIOR AIR CARGO
SPECIAL FACILITY REVENUE BONDS, SERIES 2008
(AERO DFW II, LP PROJECT (CARGO ACQUISITION
COMPANIES OBLIGATED GROUP II); APPROVING A
FINANCING AGREEMENT, A TRUST INDENTURE,
OFFICIAL STATEMENTS AND CONTRACTS OF
PURCHASE; AND OTHER MATTERS IN CONNECTION
THEREWITH
was introduced for the consideration of the Board. It was then duly moved and
seconded that the Resolution be adopted; and, after due discussion, the motion,
carrying with it the adoption of the Resolution, prevailed and carried unanimously.
2. That a true, full and correct copy of the aforesaid Resolution adopted at
the meeting described in the above and foregoing paragraph is attached to and follows
this certificate; that the Resolution has been duly recorded in the Board's minutes of the
meeting; that the persons named in the above and foregoing paragraph are the duly
chosen, qualified and acting officers and members of the Board as indicated therein;
that each of the officers and members of the Board was duly and sufficiently notified
officially and personally, in advance, of the time, place and purpose of the aforesaid
meeting, and that the Resolution would be introduced and considered for adoption at
the meeting, and each of the officers and members consented, in advance, to the
holding of the meeting for such purpose; that the meeting was open to the public as
required by law; and that public notice of the time, place and subject of the meeting was
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given as required by Chapter 551, Texas Government Code, as amended.
SIGNED this 15th day of January, 2008. � .�.�
Secretary
[Seai]
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