S-918 - 10/28/1998 - NOTE - Ordinances Ordinance 98-SC-S-918
AN ORDINANCE AUTHORIZING THE ISSUANCE
OF A$122,293.47 REFUNDING NOTE
OF THE VILLAGE OF OAK BROOK,
DU PAGE AND COOK COUNTIES, IL
WHEREAS, the Village of Oak Brook, DuPage and Cook Counties, IL(the"Village"), acting by its President
and Board of Trustees (the"Corporate Authorities"), borrowed$300,000 to purchase a tennis bubble and to
construct and install four tennis courts (collectively, the"Project"); and
WHEREAS, the Village negotiated and received a proposal (the"Proposal")from Oak Brook Bank, Oak
Brook, IL (the"Lender"), in connection with the issuance of a Note under and pursuant to Ordinance S-745, passed
and approved September 8, 1992 (the"Original Ordinance")of a $300,000 Note (the"Original Note"), to finance the
Project; and
WHEREAS, each October since issuance of the Original Note, the Village has renegotiated the outstanding
balance of the Original Note with Oak Brook Bank and authorized the execution of a refunding note; and
WHEREAS, the Village has insufficient funds to repay the outstanding principal balance of the Prior Note
and related costs and, therefore, must borrow money and issue its $122,293.47 Note (the"Note") under this
ordinance for such purposes; and
WHEREAS, the Village desires to issue and sell the Note to the Lender in order to repay the Prior Note; and
WHEREAS, for convenience of reference only this ordinance is divided into numbered sections with
headings, which shall not define or limit the provisions hereof, as follows:
Page
Preambles ...................................................................................................................................... 1
Section 1 Authority and Purpose .................................................................................................................... 2
Section 2 Authorization and Terms of the Note .............................................................................................. 2
Section 3 Execution and Delivery .................................................................................................................. 2
Section 4 Transfer, Exchange and Registration ............................................................................................. 2
Section5 Registrar ......................................................................................................................................... 3
Section 6 Obligation of the Village ................................................................................................................. 4
Section 7 Form of Note and Security Agreement .......................................................................................... 4
Section 8 Exception from Arbitrage Rebate .................................................................................................. 4
Section9 Tax Covenants .............................................................................................................................. 4
Section 10 Bank Qualified Note ...................................................................................................................... 4
Section 11 Ordinance to Constitute a Contract ................................................................................................5
Section12 Publication ..................................................................................................................................... 5
Section13 Effective Date ............................................................................................................................... 5
NOW, THEREFORE, BE IT ORDAINED BY THE PRESIDENT AND BOARD OF TRUSTEES OF THE
VILLAGE OF OAK BROOK, DU PAGE AND COOK COUNTIES, ILLINOIS as follows:
Section 1: Authority and Purpose. This ordinance is adopted pursuant to the Constitution and laws of
the State of Illinois, including Section 8-1-3.1 of the Illinois Municipal Code (Section 8-1-3.1 of Chapter 24 of
the Illinois Revised Statutes) (collectively, as supplemented and amended,the"Act"), for the purpose of
Ordinance 98-SC-S-918
Authorizing the Issuance of a
Refunding Note, Page 2
refunding the Prior Note (the"Refunding"),which was issued for the purpose of financing the Project, to be
made or undertaken by the Village of Oak Brook, IL.
Section 2: Authorization and Terms of the Note. To meet all or a part of the cost of the Refunding,
there is hereby appropriated the sum of$122,293.47, to be derived from the proceeds of the Note herein
described. For the purpose of financing such appropriation,the Note of the Village shall be issued and sold in
an aggregate principal amount of not to exceed $122,293.47. The Note shall be in substantially the form
generally used by the Lender for similarly sized loans, modified to conform to this ordinance. The Note shall
be dated as of the issuance, sale and delivery thereof. Pursuant to and in accordance with the Act,the Note
shall mature within one year of the date of issuance thereof. The Note shall bear interest on the outstanding
principal balance thereof at the rate of 4.81% per annum from its date, or from the date drawn upon, as the
case may be, computed on the basis of a 360-day year consisting of twelve 30-day months. If for any reason
the Note shall lose its tax-exempt status under Section 103 of the Internal Revenue Code of 1986, as
amended, it shall bear interest at a rate equal to the Lender's Index Rate Floating (subject to the statutory
interest rate limit, the"Taxable Rate"). The Note shall bear interest on overdue principal, and to the extent
lawful on overdue interest, at the Lender's Index Rate Floating plus four percent(4%) (subject to the statutory
interest rate limit, the"Overdue Rate"). The principal of and premium, if any, and interest on the Note shall be
payable in lawful money of the United States of America in eleven (11)equal monthly installments of
$2,805.78 each (based upon an approximate amortization of principal over 120 months), with a twelfth (12th)
installment equal to the principal balance plus accrued interest. The Note shall mature on or before October
28, 1999. Monthly installments on the Note shall be payable by check or draft of the Village mailed to the
registered owner of record of the Note appearing on the registration books maintained by the Village's
Treasurer, the registrar on behalf of the Village for such purpose, at the principal municipal office of such
registrar. Principal and interest payments on the Note shall be paid by check or draft(or other agreeable
method of payment)by the Village without the requirement of presentment, demand or notice, directly to the
Lender.
The Note shall be subject to prepayment prior to maturity at the option of the Village,without any required
notice, in whole or in part at any time at a prepayment price equal to the principal amount to be so prepaid,
plus accrued interest on the Note to the prepayment date, duly noted by the Lender on the Note.
Section 3: Execution and Delivery. The Note shall be executed in the name of the Village by the
manual or authorized facsimile signature of its President, and the corporate seal of the Village, or a facsimile
thereof, shall be thereon impressed, affixed or otherwise reproduced and attested by the manual or
authorized facsimile signature of its Village Clerk. In case any officer whose signature, or a facsimile of
whose signature, shall appear on the Note shall cease to hold such office before the issuance of such Note,
such Note shall nevertheless be valid and sufficient for all purposes, the same as if the person whose
signature, or a facsimile thereof, appears on such Note had not ceased to hold such office. Any Note may be
signed, sealed or attested on behalf of the Village by any person who, on the date of such act, shall hold the
proper office, notwithstanding that at the date of such Note such person may not hold such office. No
recourse shall be had for the payment of any Note against the President or any member of the Board of
Trustees or any officer or employee of the Village (past, present or future)who executes the Note, or on any
other basis.
Other than when the Lender is the registered owner of 100%of the outstanding Note, the Note shall bear
thereon a certificate of authentication executed manually by the registrar; and in such cases the Note shall
not be entitled to any right or benefit under this ordinance or shall be valid or obligatory of any purpose until
such certificate of authentication shall have been duly executed by the registrar.
Section 4: Transfer. Exchange and Registration. The Note shall be negotiable, subject to the
Ordinance 98-SC-S-918
Authorizing the Issuance of a
Refunding Note, Page 3
provisions for registration of transfer contained herein. The Note shall be transferable only upon the
registration books maintained by the registrar on behalf of the Village for that purpose at the principal office of
the registrar, by the registered owner thereof in person or by such registered owner's attorney duly authorized
in writing, upon presentation thereof together with a written instrument of transfer satisfactory to the registrar
and duly executed by the registered owner or such registered owner's duly authorized attorney. Upon
presentation to effect transfer of any such Note, the registrar shall record the transfer on a register therefor.
The holder of the Note shall report all participations therein to the registrar.
For every such exchange or registration of transfer of the Note,the Village or the registrar may make a
charge sufficient to reimburse it for any tax,fee or other governmental charge required to be paid with respect
to such exchange or transfer,which sum or sums shall be paid by the person requesting such exchange or
transfer as a condition precedent to the exercise of the privilege of making such exchange or transfer. No
other charge shall be made for the privilege of making such transfer or exchange. The provisions of the
Illinois Bond Replacement Act shall govern the replacement of a lost, destroyed or defaced Note.
The Village and the registrar may deem and treat the person in whose name the Note shall be registered
upon the registration books as the absolute owner of the Note,whether such Note shall be overdue or not, for
the purpose of receiving payment of, or on account of,the principal of, premium, if any, or interest thereon
and for all other purposes whatsoever, and all such payments so made to any such registered owner or upon
such registered owner's order shall be valid and effectual to satisfy and discharge the liability upon such Note
to the extent of the sum or sums so paid, and neither the Village nor the registrar shall be affected by any
notice to the contrary.
Section 5: Registrar. The Village covenants that it shall at all times retain a registrar with respect to
the Note and shall cause to be maintained at the office of such registrar a place where the Note may be
presented for registration of transfer, that it shall require that the registrar maintain proper registration books
and that it shall require the registrar to perform the other duties and obligations imposed upon it by this
ordinance in a manner consistent with the standards, customs and practices of the municipal securities
business. Other than with respect to the Treasurer, the Village may enter into appropriate agreements with
the registrar in connection with the foregoing. Any such registrar shall signify its acceptance of the duties and
obligations imposed upon it by this ordinance. The registrar by executing a certificate of authentication on the
Note shall be deemed to have certified to the Village that it has all requisite power to accept, and has
accepted, such duties and obligations not only with respect to the Note so authenticated. The registrar is to
be the agent of the Village for such purpose and shall not be liable in connection with the performance of its
duties except for its own negligence or default. The registrar shall, however, be responsible for any
representation in its certificate of authentication on the Note.
The Village may remove the registrar at any time. In case at any time the registrar shall resign or shall be
removed or shall become incapable of acting, or shall be adjudged bankrupt or insolvent, or if a receiver,
liquidator or conservator of the bond registrar, or of its property, shall be appointed, or if any public officer
shall take charge or control of the registrar or of its properties or affairs, the Village covenants and agrees that
it will thereupon appoint a successor registrar. The Village shall mail or cause to be mailed notice of any such
appointment made by it to the registered owner of the Note within twenty(20)days after such appointment.
Other than in respect of the Treasurer, any registrar appointed under the provisions of this Section shall be a
bank, trust company, national banking association or other qualified professional with respect to such
matters, maintaining its principal office in the State of Illinois.
A form of assignment for the Note is suggested as follows:
Ordinance 98-SC-S-918
Authorizing the Issuance of a
Refunding Note, Page 4
ASSIGNMENT
For value received the undersigned sells, assigns and transfers unto [Name,
address and social security number or FEIN of Assignee]the attached note of the Village of Oak Brook,
Illinois, issued under Ordinance S-_, and hereby irrevocably constitutes and appoints
attorney to transfer the Note on the books kept for registration thereof,with
full power of substitution in the premises.
Dated
Signature Guarantee:
Section 6: Obligation of the Villaoe. The Note shall be an obligation of the Village, described in
Section 8-1-3.1 of the Illinois Municipal Code.
Section 7: Form of Note and the Security Agreement, The Note shall be issued as a fully registered
instrument, and the Note and the Security Agreement shall be in substantially the form as generally used by
the Lender, with appropriate insertions and modifications to comply with the provisions of this ordinance and
with the blanks to be appropriately completed when the Note and the Security Agreement are prepared for
delivery. The Note shall state on its face that it is a"qualified tax-exempt obligation"under Section 265(b)(3)
of the Code and that it is issued under and pursuant to and incorporates the terms and provisions of this
ordinance.
Section 8: Exception from Arbitrage Rebate, The Village does not reasonably expect to issue more
than $5,000,000 of tax-exempt obligations in the year of the issuance of the Note within the meaning of the
small issuer exception under Section 148(f)(4)(C)of the Internal Revenue Code of 1986, as amended.
Section 9: Tax Covenants, The Village shall not take, or omit to take, any action lawful and within its
power to take, which action or omission would cause interest on the Note become subject to federal income
taxes in addition to federal income taxes to which interest on such Note is subject on the date of original
issuance thereof.
The Village shall not permit any of the proceeds of the Note, or any facilities financed with such proceeds, to
be used in any manner that would cause the Note to constitute a"private activity bond"within the meaning of
Section 141 of the Internal Revenue Code of 1986, as amended.
The Village shall not permit any of the proceeds of the Note or other monies to be invested in any manner
that would cause the Note to constitute an "arbitrage bond"within the meaning of Section 148 of the Internal
Revenue Code of 1986, as amended.
The Village shall comply with the provisions of Section 148(f)of the Internal Revenue Code of 1986, as
amended, relating to the rebate of certain investment earnings at periodic intervals to the United States of
America to the extent that there shall have been filed with the Village Clerk an opinion of Bond Counsel to the
effect that such compliance is necessary to preserve the exclusion from gross income for federal income tax
purposes of interest on the Note under Section 103 of the Internal Revenue Code of 1986, as amended.
Section 10. Bank Qualified Note. Pursuant to Section 265(b)(3)of the Internal Revenue Code of
1986, as amended, the Village hereby designates the Note as a "qualified tax-exempt obligation"as defined
Ordinance 98-SC-S-918
Authorizing the Issuance of a
Refunding Note, Page 5
in Section 265(b)(3)of the Internal Revenue Code of 1986, as amended. The Village represents that the
reasonably anticipated amount of tax-exempt obligations that will be issued by the Village and all subordinate
entities of the Village during the calendar year in which the Note is issued will not exceed$10,000,000 (and
reasonably not to exceed $5,000,000)within the meaning of Section 265(b)(3)of the Internal Revenue Code
of 1986, as amended. The Village covenants that it will not designate and issue more than $10,000,000 (and
reasonably not to exceed $5,000,000)aggregate principal amount of tax-exempt obligations in such calendar
year. For purposes of this Section 14, the term"tax-exempt obligations"includes"qualified 501(c)(3)bonds"
(as defined in the Section 145 of the Internal Revenue Code of 1986, as amended) but does not include other
"private activity bonds" (as defined in Section 141 of the Internal Revenue Code of 1986, as amended).
Section 11: Ordinance to Constitute a Contract. The provisions of this ordinance shall constitute a
contract between the Village and the registered owners of the Note. Any pledge made in this ordinance and
the provisions, covenants and agreements herein set forth to be performed by or on behalf of the Village shall
be for the equal benefit, protection and security of the registered owners of any part or all of the Note. The
Note, and any participation therein, shall be of equal rank without preference, priority or distinction of any of
the Note over any other thereof except as expressly provided in or pursuant to this ordinance. This ordinance
shall constitute full authority for the issuance of the Note, and to the extent that the provisions of this
ordinance conflict with the provisions of any other ordinance or resolution of the Village the provisions of this
ordinance shall control. If any section, paragraph or provision of this Ordinance shall be held to be invalid or
unenforceable for any reason, the invalidity or unenforceability of such section, paragraph or provision shall
not affect any of the remaining provisions of this ordinance.
Section 12: Publication. This ordinance shall be immediately published in pamphlet form under
Section 1-2-4 of the Illinois Municipal Code.
Section 13: Effective Date. This ordinance shall become effective 10 days after its passage, approval
and publication as required by law.
PASSED THIS 27`" day of October, 1998.
Ayes: Trustees Bartecki, Caleel, McInerney, Savino and Shumate
Nays:
None
Absent: Trustee Kenny
Abstain: None
APPROVED THIS 27`" day of October, 1998.
Village President
Ordinance 98-SC-S-918
Authorizing the Issuance of a
Refunding Note, Page 6
ATTEST
"�d as to Form:
Village Attorney
Published 10-28-98 Pamphlet form
Date Paper
Not Published
CERTIFICATE
1, Linda K. Gonnella,Village Clerk of the Village of Oak Brook, DuPage and Cook Counties, Illinois,
hereby certify that the foregoing Ordinance 98-SC-S-918 , "An Ordinance Authorizing the Issuance of a
$122,293.47 Refunding Note of the Village of Oak Brook, DuPage and Cook Counties, Illinois," is a true copy
of an original ordinance which was duly adopted by the recorded affirmative votes of not less than four of the
members of the Corporate Authorities of the Village of a meeting thereof which was duly noticed, called and
held at 7:30 p.m. on October 27, 1998, as a regular meeting of the President and Board of Trustees at the
Village Hall, at which a quorum was present and acting throughout, and that such copy has been compared
by me with the original ordinance signed by the President of the Village on October 27, 1998, and recorded in
the ordinance book of the Village and that it is a correct transcript thereof and of the whole of such ordinance,
and that such ordinance has not been altered, amended, repealed or revoked, but is in full force and effect.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the Village of Oak
Brook, Illinois, as of this 27"day of October, 1998. `� f- d'!:
Lima K. Gonnella
c..
%4oge Clerk
(SEAL) -