HomeMy WebLinkAboutORDINANCE - 1620 - 2/21/1984 - ESCROW AGREEMENT/DUPAGE COUNTYr
ORDINANCE NO. 1620
AN ORDINANCE of the Village of
Elk Grove Village, Cook and DuPage
Counties, Illinois, Authorizing
and Directing the Execution of an
Escrow Agreement.
WHEREAS, the Village of Elk Grove.Village, Cook and
DuPage Counties, Illinois (the "Municipality") has provided by
Ordinance Number 263, adopted by the President and Board of Trustees
(the "Corporate Authorities") of the Municipality on December 20,
1962, for the issuance of $4,000,000 Waterworks and Sewerage
Revenue Bonds, Series 1963, dated February 1, 1963, the outstanding
balance of which are due on May 1 of each of the years and in the
amounts and bearing interest at the rates per annum as follows:
Year
Amount
Rate
1984
$190,000
3-3/4%
1985
200,000
3-3/4%
1986
210,000
3-3/4%
1987
220,000
3.90%
1988
230,000
3.90%
1989
240,000
3.90%
1990
240,000
3.90%
1991
250,000
3.90%
1992
260,000
3.90%
(the "Outstanding Bonds"); and
WHEREAS, it is hereby found to be desirable and advan-
tageous for the Municipality to apply certain funds on hand of the
Municipality lawfully available for such purpose to refund the
Outstanding Bonds in advance of maturity; and
WHEREAS, in order properly to provide for the refunding
of the Outstanding Bonds, it will be necessary to place such
funds of the Municipality on hand and lawfully available for the
purpose in trust with an escrow agent to be invested in direct
obligations of the United States of America obtained for the Munici-
pality by such escrow agent in the open market; and
WHEREAS, such investments must be of amount and kind
such that the principal of and interest thereon will be sufficient,
when added to such beginning deposit on demand as may be necessary,
to pay all interest on and principal of the Outstanding Bonds when
due; and
WHEREAS, it is necessary that the Corporate Authorities of
the Municipality authorize the form of agreement with an escrow agent
and direct the execution of such escrow agreement by officers of
the Municipality:
NOW, THEREFORE, Be It Ordained by the President and
Board of Trustees of the Village of Elk Grove Village, Cook and
DuPage Counties, Illinois, as follows:
Section 1. Definitions. The words and terms used in
this ordinance shall have the definitions set forth for them in
the form of escrow agreement provided herein, unless the context
or use of same shall clearly indicate that another meaning is
intended.
Section 2. The Funding of the Escrow. The sum of
$ 1,63o,000 of funds on hand of the Municipality and lawfully avail-
able for such purpose shall be used to acquire the Government
Securities and to establish such beginning deposit on demand as
may be necessary to pay all interest on and all principal of the
Outstanding Bonds when due, and to pay certain expenses related
thereto. Such money will be deposited in trust in the Escrow
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Account with the Escrow Agent as provided in this ordinance. The
final amount thereof necessary to be deposited in the Escrow
Account shall be conclusively established under the terms of the
Escrow Agreement by the execution thereof by designated officers
of the Municipality.
Section 3. Form and Authorization of Agreement. The
Agreement and all the terms thereof, in the form provided hereby,
and the Escrow Agent as named therein is hereby approved, and
the President and Municipal Clerk are hereby authorized and
directed to execute the Agreement in the name of the Municipality.
The Agreement shall be in substantially the following form:
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Section 4. Severability. If any section, paragraph,
clause or provision of this ordinance shall be held invalid, the
invalidity of such section, paragraph, clause or provision shall
not affect any of the other provisions of this ordinance.
Section 5. Repealer. All ordinances, resolutions or
orders or parts thereof in conflict with the provisions of this
resolution are to the extent of such conflict hereby repealed.
Section 6. Effective Date. This ordinance shall be in
effect immediately upon its passage by the Corporate Authorities
and signing and approval by the President of the Municipality.
Approved:
February 14 , 1984
By
P ident
Attest:
MIAMI
�VFGMF�le M—
Ayes: Trustees Joseph T. Bosslet, Ronald L. Chernick, Edward R.
Hauser, James P. Petri, Michael Tosto, Stephen M. Uhlarik
Nays : none
Absent:
Recorded In Municipal Records: February 14, 1984
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ESCROW AGREEMENT
This Escrow Agreement dated as of February 15, 1984, but
actually executed on the date witnessed hereinbelow, by and between
the Village of Elk Grove Village, Cook and DuPage Counties, Illinois,
and American National Bank and Trust Company of Chicago, a banking
corporation organized and operating under the laws of the United
States of America, with principal offices located in the City of
Chicago, Illinois, not individually but in the capacity as hereinafter
described, for and in consideration of Ten Dollars ($10.00) duly
paid by the Village to said Bank, the receipt whereof is hereby
acknowledged:
W I T N E S S E T H
Article 1. DEFINITIONS
The following words and terms used in this Agreement
shall have the following meanings unless the context or use
clearly indicates another or different meaning:
Section 1.01. Agreement - "this Escrow Agreement, dated
as of February 15, 1984."'
Section 1.02. Corporate Authorities - "the President
and Board of Trustees which is the governing body of the Municipality."
Section 1.03. Defeasance Report - "the report of Coopers
b Lybrand, Washington,. D.C., attached hereto as Exhibit A, that
the principal of, interest on and profit realized from the Government
Securities, when received, and the beginning deposit on demand
held hereunder will be sufficient at all times to pay all principal
of and interest on the Outstanding Bonds when due."
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Section 1.04. Escrow Account - "the trust fund created
under the terms of this Agreement with the Escrow Agent and
comprised of the Government Securities and a certain beginning
deposit as more fully described in Section 2.02 hereof."
Section 1.05. Escrow Agent - "American National Bank
and Trust Company of Chicago, a banking corporation organized and
operating under the laws of -the -Unit -ed States of America with
principal offices located in the City of Chicago, Illinois, not
individually but in the capacity for the uses and purposes herein-
after mentioned, or any successor thereto."
Section 1.06. Government Securities - "the direct full
faith and credit non -callable obligations of the United States of
America purchased with funds of the Muncipality on hand and legally
available for such purpose and not derived from any borrowing, and
deposited hereunder."' --
Section 1.07. Municipality - "the Village of Elk Grove
Village, Cook and DuPage Counties, Illinois."
Section 1.08. Paying Agent - "the paying agent on the
Outstanding Bonds, namely: American National Bank and Trust Company
of Chicago, Chicago, Illinois."
Section 1.09. Outstanding Bonds - "$4,000,000 Waterworks
and Sewerage Revenue Bonds,_ -dated February 1, 1963, the outstanding.
balance of which are due on May 1 of each of the years and in the
amounts and bearing interest at the rates per annum as follows:
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Year
Amount
Rate
1984
$190,000
3-3/4%
1985
200,000
3-3/4%
1986
210,000
3-3/4%
1987
220,000
3.90%
1988
230,000
3.90%
1989
240,000
3.90%
1990
240,000
3.90%
1991
250,000
3.90%
1992
260,000
3.90%
Section 1.10. Treasurer - "the Treasurer of the
Municipality."
ARTICLE II. CREATION OF ESCROW
Section 2.01. All of the Outstanding Bonds are hereby
refunded by the deposit with the Escrow Agent of the Government
Securities described in Section 2.02 hereof which Government
Securities (together with the beginning deposit on demand as
described herein) will provide all moneys necessary to pay all
principal of and interest on the Outstanding Bonds when due.
Section 2.02. The Municipality has deposited with the
Escrow Agent the Government Securities and the sum of $ 49400.00
beginning deposit on demand derived from funds on hand of the
Municipality and not derived from any borrowing. The Government
Securities are described as follows:
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PART II
GOVERNMENT SECURITIES
*USTN — United States Treasury Note
USTB United States Treasury Bond
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Total
Par
Coupon
Purchase
Description*
Amount
Maturity
Rate
Callable
Price
Accrued
Price
USTN
$150,000
4/30/84
13.875%
No
101:3125
$6,175.14
$158,143.89
USTN
105,000
4/30/85
9.500%
No
99.6875
2,959.62
107.631.30
USTN
119,000
3/31/86
14.000%
No
106.6562
6,327.16
133,248.10
USTN
137,000
3/31/87
10.250%
No
98.5625.
5,333.08
140,363.71
USTN
153,000
4/15/88
13.250%
No
106.4375
6,868.28
169,717.66
USTN
174,-000
4/15/89
14.375%
No
11I.5000
8,474.18
202,484.18
USTN
190,000
4/15/90
10.500%
No
95,5000
6,759.02
188,209.02
USTN
224,000
10/15/90
11.500%
No
99.7500
9,431.26
232,871.26
USTN
236,000
2/15/92
14.625%
No
115.7500
94.82
273,264.82
*USTN — United States Treasury Note
USTB United States Treasury Bond
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Section 2.03. The Escrow Agent and the Municipality
have each received the Defeasance Report.
ARTICLE III. COVENANTS OF ESCROW AGENT
The Escrow Agent covenants and agrees with the Munici-
pality as follows:
Section 3.01. The Escrow Agent will hold the Government
Securities and all interest, income and profit derived therefrom
and all uninvested cash in a segregated and separate trust fund
account for the sole and exclusive benefit of the Municipality to
the purposes for which escrowed.
Section 3.02. Balances in the Escrow Account from time
to time shall be invested to the extent possible in direct full
faith and credit obligations of the United States of America
maturing not less than two days prior to the next succeeding
interest payment date on the Outstanding Bonds. The net interest
on or income realized from such reinvestments shall be applied
first to -the payment of Escrow Agent's fees occasioned by such
reinvestment and the balance shall be held by the Escrow Agent
until the next succeeding May 1 or November 1, whichever occurs
first, on which date any balance in excess of the balance as
specified for such May 1 or such November 1 in the Defeasance
Report shall be disbursed to the Treasurer for deposit in the
Waterworks and Sewerage of the Municipality.
Section 3.03. The Escrow Agent shall hold all balances
not so invested or reinvested as hereinabove described and on
deposit in the Escrow Account on demand and in trust for the purposes
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hereof and shall secure same in accordance with applicable Illinois
law for the securing of public funds.
Section 3.04. The Escrow Agent will promptly collect
the principal of, interest on and income and profit from the Govern-
ment Securities and promptly apply the same solely and only to the
payment of the principal of and interest on the Outstanding Bonds
as the same mature and to such other purposes as are herein expressly
stated.
Section 3.05. The Escrow Agent will remit to the Paying
Agent in good funds on or before each principal maturity or interest
payment date of the Outstanding Bonds moneys sufficient to pay
such principal and interest as will meet the requirements for the
timely payment of said Outstanding Bonds as set out in the Defeasance
Report, and each such remittance shall fully release and discharge
the Escrow Agent from any further duty or obligation thereto under
this Agreement.
Section 3.06. The Escrow Agent will make no payment of
fees, due or to become due, of the Paying Agent, and the Munici-
pality covenants to pay the same as they become due.
Section 3.07. The costs and expenses of the Escrow
Agent (except those mentioned in Section 3.08 hereof) in carrying
out any of the duties, terms or provisions of this Agreement
shall be paid in the amount of $475 on February 15, 1984, and
thereafter in the amount of $475 each May 1 and November 1, as
set out in the Defeasance Report, from balances in the Escrow
Account. The Escrow Agent shall charge such fees for its services,
if any, as rendered under said Section 3.08, which are reasonable
and usual for like services rendered by similar institutions.
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Section 3.08. The Escrow Agent has all the powers and
duties herein set forth with no liability in connection with any
act or omission to act hereunder, except for its own negligence
or willful breach of trust, and shall be under no obligation to
institute any suit or action or other proceeding under this
Agreement or to enter any appearance in any suit, action or pro-
ceeding in which it may be defendant or to take any steps in
the enforcement of its, or any, rights and powers hereunder,
nor shall be deemed to have failed to take any such action,
unless and until it shall have been indemnified by the Municipality
to its satisfaction against any and all costs and expenses, out-
lays, counsel fees and other disbursements, including its own
reasonable fees, and if any judgment, decree or recovery be
obtained.by the Escrow Agent, payment of all sums due it, as
aforesaid, shall be a first charge against the amount of any
such judgment, decree or recovery.
Section 3.09. The Escrow Agent may in good faith buy,
sell or hold and deal in any of the Outstanding Bonds.
Section 3.10. The Escrow Agent will submit to the Treasurer
and to John Nuveen & Co., Incorporated, Chicago, Illinois, a statement
within twenty (20) days after May 1 and November 1 of each calendar
year, commencing May 1, 1984, itemizing all moneys received
by it and all payments made by it under the provisions of this
Agreement during the preceding six (6) months period, and also
listing the Government Securities and the securities derived
from reinvestments (if any, and identified as such) on deposit
and all moneys held by it on demand as of the date of the report.
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Section 3.11. If at any time it shall appear to the
Escrow Agent that the available proceeds of the Government
Securities and deposits on demand in the Escrow Account will not
be sufficient to make any payment due to the holders of any of the
Outstanding Bonds, the Escrow Agent shall notify the Municipality not
less than fifteen (15) days prior to such date, and the Municipality
agrees that it will from any funds lawfully available for such
purpose make up the anticipated deficit so that no default in
the making of any such payment will occur.
ARTICLE IV. COVENANTS OF MUNICIPALITY
The Municipality covenants and agrees with the Escrow Agent
as follows:
Section 4.01. The Escrow Agent shall have no respon-
sibility or liability whatsoever for (a) any of the recitals of
the Municipality herein, (b) the performance of or compliance with
any covenant,. condition, term or provision of the ordinance autho-
rizing the Outstanding Bonds, and (c) any undertaking or statement
of the Municipality hereunder or under said ordinance authorizing
the Outstanding Bonds.
Section 4.02. The Municipality will promptly and without
delay remit to the Escrow Agent, within five (5) days after receipt
of its written request, such sum or sums of money as are necessary
to make the payments required under Section 3.11 hereof and to
fully pay and discharge any obligation or obligations or charges,
fees or expenses, if any, incurred by the Escrow Agent in carrying
out any of the duties, terms or provisions of this Agreement that
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are in excess of the sums expressly deposited hereunder. The
Municipality will promptly pay all Paying Agent's fees as submitted.
Section 4.03. All payments to be made by, and all
acts and things required to be done by, the Escrow Agent under
the terms and provisions hereof shall be made and done by said
Escrow Agent without any further direction or authority of the
Municipality or Treasurer.
ARTICLE V. AMENDMENTS, REINVESTMENT OF
FUNDS, IRREVOCABILITY OF AGREEMENT
Section 5.01. This Agreement may be amended or supple-
mented, the Government Securities or any portion thereof sold or
redeemed, and moneys derived therefrom invested, reinvested or
disbursed in any manner provided (any such amendment, supplement,
direction to sell or redeem or invest, reinvest or disburse to be
referred to as a "Subsequent Action"), upon submission to the
Escrow Agent of each of the following:
(1) Certified copy of proceedings of the Corporate
Authorities of the Municipality authorizing the Subsequent Action
and copy of the document effecting the Subsequent Action signed
by duly designated officers of the Municipality.
(2) An opinion of nationally recognized bond counsel
or tax counsel nationally recognized as having an expertise in the
area of tax-exempt municipal bonds that the Subsequent Action will
not cause the Outstanding Bonds to become taxable under the laws
of the United States of America providing for taxation of income
nor violate the covenants of the Municipality not to cause the
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Outstanding Bonds to become "arbitrage bonds" under §103(c) of the
Internal Revenue Code of 1954, and that the Subsequent Action does
not materially adversely affect the legal rights of the holders of
the Outstanding Bonds.
(3) An opinion of a firm of independent certified
public accountants that the funds available or to be available for
payment of the Outstanding Bonds will remain sufficient to pay when
due all principal of and interest on the Outstanding Bonds after
the taking of the Subsequent Action.
Section 5.02. The Municipality and the Escrow Agent may
amend or add to the terms of this Agreement to correct errors,
clarify ambiguities or insert inadvertently omitted material.
Section 5.03. Except as provided in Sections 5.01 and
5.02 hereof, all of the rights, powers, duties and obligations of
the Escrow Agent hereunder shall be irrevocable and shall not be
subject to amendment by the Escrow Agent and shall be binding on
any successor to the Escrow Agent during the term of this Agreement.
Section 5.04. Except as provided in Sections 5.01 and
5.02 hereof, all of the rights, powers, duties and obligations of
the Municipality hereunder shall be irrevocable and shall not be
subject to amendment by the Municipality and shall be binding on
any successor to the officials now comprising the Corporate Authori-
ties of the Municipality during the term of this Agreement.
Section 5.05. Except as provided in Sections 5.01 and
5.02 hereof, all of the rights, powers, duties and obligations of
the Treasurer hereunder shall be irrevocable and shall not be
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subject to amendment by the Treasurer and shall be binding on any
successor to said official now in office during the term of this
Agreement.
ARTICLE VI. NOTICES TO THE MUNICIPALITY,
THE TREASURER AND THE ESCROW AGENT
Section 6.01. All notices and communications to the
Municipality and the Corporate Authorities shall be addressed in
writing to:
Director of Finance
Village of Elk Grove Village
901 Wellington Avenue
Elk Grove Village, Illinois 60007
or at such other address as is furnished from time to time by the
Municipality.
Section 6.02. All notices and communications to the
Escrow Agent shall be addressed in writing to:
American National Bank and
Trust Company of Chicago
33 North LaSalle Street
Chicago, Illinois 60690
Attention: Corporate Trust Division
or at such other address as is furnished from time to time by the
Escrow Agent.
Section 6.03. All notices and communications to the
Treasurer shall be addressed in writing to:
Director of Finance
Village of Elk Grove Village
901 Wellington Avenue
Elk Grove Village, Illinois 60007
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or at such other address as is furnished from time to time by the
Treasurer.
ARTICLE VII. RESIGNATION OF ESCROW AGENT
The Escrow Agent may at any time resign as Escrow Agent
under this Agreement by giving thirty (30) days' written notice to
the Municipality, and such resignation, shall take effect upon the
appointment of a successor Escrow Agent by the Municipality. The
Municipality may select as successor Escrow Agent any financial
institution with capital, surplus and undivided profits of at
least $10,000,000 and located within the City of Chicago, Illinois,
and which is authorized to maintain trust accounts under federal or
Illinois law.
ARTICLE VIII. TERMINATION OF
Upon the retirement of the Outstanding Bonds as hereinabove
provided for, the Escrow Agent will transfer any balance remaining
in the Escrow Account to the Treasurer with due notice thereof
mailed to the Municipality, and thereupon this Agreement shall
terminate.
IN WITNESS WHEREOF, the Village of Elk Grove Village,
Cook and DuPage Counties, Illinois, has caused this Agreement to be
signed in its name by its President, to be attested by the Municipal
Clerk of the Municipality under its municipal seal hereunto affixed;
and American National Bank and Trust Company of Chicago, not
individually, but in the capacity as hereinabove described, has
caused this Agreement to be signed in its corporate name by q=Xg[:R
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Village
its President and to be attested by Rx7f its Village Clerk
under its corporate seal hereunto affixed, all this 14th day of
February, 1984.
Attest:
Municipal Clerk
(SEAL)
Attest:
VILLAGE OF ELK GROVE VILLAGE,
COOK AND DUPAGE COUNTIES,
I
By
AMERICAN NATIONAL BANK AND TRUST
COMPANY OF CHICAGO
By
Its e-�—�icc-�. v7—
C&46tip 1
Its
(SEAL)
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