HomeMy WebLinkAbout06-209 •
RESOLUTION Resolution No. 06-209
AUTHORIZING THE EXECUTION OF A MEMORANDUM OF AGREEMENT
WITH NELSON GRAPHIC SCREENPRINTING, INC. REGARDING
INDUSTRIAL REVENUE BONDS, SERIES 2006
WHEREAS, the City of Elgin, Illinois (the "Issuer") is authorized under its home rule
powers, as set forth in the 1970 Constitution of the State of Illinois, Article VII, Section 6, and
the provisions of an Ordinance adopted on February 13, 1980, as from time to time
supplemented and amended (the "Act"), to issue industrial revenue bonds for the purpose of
financing, in whole or in part, the cost of the acquisition, purchase, construction, reconstruction,
improvement,betterment or extension of any industrial project;
WHEREAS, Nelson Graphic Screenprinting, Inc., an Illinois corporation and Gerhard G.
Landrowski, as co-trustee under the Gerhard G. Landrowski Declaration of Trust dated
November 18, 1993 (collectively, the "Borrower") wish to (i) refund the $3,795,000 original
principal amount Variable Rate Industrial Development Revenue Bonds (Nelson Graphic
Screenprinting, Inc. Project), Series 2000 (the "Prior Bonds") and (ii) finance an expansion to an
existing facility located at 1400 Crispin Drive in Elgin, Illinois, and the acquisition and
installation of additional equipment in connection with such addition(the "Project"); and wish to
have the Issuer issue its industrial revenue bonds to finance the acquisition, rehabilitation and
equipping of such Project and the refunding of the Prior Bonds; and
WHEREAS, a Memorandum of Agreement (the "Agreement") has been presented to the
Issuer under the terms of which the Issuer agrees, subject to the provisions of such Agreement,to
issue its industrial revenue bonds to finance the Project and refund the Prior Bonds; and
C/45083.1
WHEREAS, all or a portion of the expenditures relating to the Project (the
"Expenditures") (i) have been paid within 60 days prior to the date of this Resolution, or(ii) will
be paid on or after the passage of this Resolution; and
WHEREAS, for purposes of Treasury Regulations Section 1.150-2, the Issuer (based
solely on information supplied by the Borrower,on which the Issuer believes it is reasonable and
prudent to rely) reasonably expects to reimburse itself for the Expenditures with the proceeds of
the Bonds;
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF ELGIN, KANE AND COOK COUNTIES, ILLINOIS,as follows:
SECTION 1. The form, terms and provisions of the Agreement presented to this
meeting are hereby approved.
SECTION 2. That the Mayor of the Issuer is hereby authorized to execute, and the City
Clerk of the Issuer is hereby authorized to attest to the Agreement with the Borrower in
substantially the form of such agreement appended to this Resolution as Exhibit A or with such
changes as shall be approved by the officers executing the same, such approval to be
conclusively evidenced by the execution of such Agreement.
SECTION 3. That the officers and employees of the Issuer are hereby authorized to take
such further action as is necessary to carry out the intent and purposes of the Agreement as
executed and to issue not to exceed $4,000,000 of its industrial revenue bonds, in one or more
series (the "Bonds"), and upon the terms and conditions stated in such Agreement and for the
purposes for the purpose of defraying the cost of the Project and refunding the Prior Bonds and
that the same is declared to be for a public purpose, which Agreement is hereby deemed a part of
this Resolution.
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C/45083.1
SECTION 4. The Issuer hereby declares its intent to assist the Borrower under Treasury
Regulations Section 1.150-2 to reimburse any expenditures made on costs of the Project prior to
the issuance of the Bonds with proceeds of the Bonds.
SECTION 5. All ordinances, resolutions, orders and parts thereof in conflict herewith
are hereby superseded to the extent of such conflict.
SECTION 6. If any section, paragraph, clause or provision of this Resolution shall be
held invalid, the invalidity of such section, paragraph, clause or provision shall not affect any of
the other provisions of this Resolution.
SECTION 7. This Resolution shall be in full force and effect upon its passage and
approval.
PASSED this 23rd day of August, 2006 pursuant to roll call vote as follows.
AYES: Councilmembers Figueroa, Gilliam, Kaptain, Rodgers, Sandor, Walters,
and Mayor Schock.
NAYS: None.
ABSENT: None.
APPROVED by me this 23rd day of August, 2006.
s/Ed Schock
Ed Schock, Mayor
ATTEST:
s/Dolonna Mecum
Dolonna Mecum, City Clerk
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C/45083.1
•
STATE OF ILLINOIS )
COUNTIES OF KANE )
AND COOK )
I, the undersigned, do hereby certify that I am the duly qualified and elected Clerk of the
City of Elgin, in the Counties and State aforesaid; and as such Clerk, I am the keeper of the
official journal, records and files of the City Council of said City.
I do further certify that the attached and foregoing is a full, true and correct copy of:
RESOLUTION NO. 06-209
RESOLUTION AUTHORIZING THE EXECUTION OF
A MEMORANDUM OF AGREEMENT WITH
NELSON GRAPHIC SCREENPRINTING, INC.
REGARDING INDUSTRIAL REVENUE BONDS,
SERIES 2006
Passed and Approved: August 23,2006
as passed by the City Council of the City of Elgin, at a legally convened meeting in the City of
Elgin.
IN WITNESS WHEREOF, I have hereunto affixed my official signature and the
corporate seal of said City of Elgin, Kane and Cook Counties, Illinois this 23rd day of August,
2006.
City Clerk
(CITY SEAL)
.e4
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C/45083.1
EXHIBIT A
MEMORANDUM OF AGREEMENT
THIS MEMORANDUM OF AGREEMENT is among the City of Elgin, Illinois (the
"Issuer"), Nelson Graphic Screenprinting, Inc., an Illinois corporation and Gerhard G.
Landrowski, as co-trustee under the Gerhard G. Landrowski Declaration of Trust dated
November 18, 1993 (collectively, the "Borrower").
1. Preliminary Statement. Among the matters of mutual inducement which have
resulted in this Agreement are the following:
(a) The Issuer is authorized under its home rule powers, as set forth in the
1970 Constitution of the State of Illinois, Article VII, Section 6, and the provisions of an
Ordinance adopted on February 13, 1980, as from time to time supplemented and
amended (the "Act"), to issue industrial revenue bonds for the purpose of financing, in
whole or in part, the cost of the acquisition, purchase, construction, reconstruction,
improvement, betterment or extension of any industrial project and to enter into a loan
agreement with the Borrower pursuant to which the proceeds of such industrial revenue
bonds may be lent to the Borrower to finance the costs of the acquisition, rehabilitation
and equipping of such an industrial project.
(b) The Borrower wishes to obtain satisfactory assurance from the Issuer that
the proceeds of the sale of such industrial revenue bonds of the Issuer will be made
available to the Borrower to finance the costs of an expansion to an existing facility
located at 1400 Crispin Drive in Elgin, Illinois and the acquisition and installation of
additional equipment in connection with such addition (the "Project") and to refund in
whole the $3,795,000 original principal amount Variable Rate Industrial Development
Revenue Bonds (Nelson Graphic Screenprinting, Inc. Project), Series 2000 (the "Prior
Bonds").
(c) Subject to the conditions contained herein and to the due compliance with
all requirements of law, the Issuer, by virtue of such statutory authority as may now or
hereafter be conferred by the Act, will issue and sell its industrial revenue bonds, in one
or more series, in an aggregate amount not to exceed $4,000,000 (the "Bonds") to finance
the costs of the Project and to refund the Prior Bonds.
(d) The Issuer has determined that it is necessary and in the best interests of
the Issuer to authorize its obligations to refund the Prior Bonds and to pay the costs of the
Project and costs related to the issuance of its obligations.
Issuer with evidence satisfactory The Borrower has presented the ss to the
Issuer of its intention to reimburse itself for expenditures relating to the Project which it
may pay from funds which are not proceeds of the Bonds.
(f) The Bonds shall be limited obligations of the Issuer payable solely and
only out of the revenues and receipts derived from the trust estate established under a
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C/45083.1
loan agreement, indenture of trust, bond purchase agreement, or any similar document
pursuant to which the Bonds are issued; the Project shall be financed by means of a loan
of the proceeds of the Bonds to the Borrower, and the Borrower shall agree to make
payments in an amount sufficient to pay the principal and purchase price of, and premium,
if any, and interest on, and expenses of,the Bonds. No holder of any of the Bonds shall
have the right to compel any exercise of the taxing power of the Issuer, and the Bonds
shall not constitute an indebtedness or a loan of credit of the Issuer within the meaning of
any constitutional or statutory provision.
2. Undertakings on the Part of the Issuer. Subject to the conditions above stated, the
Issuer agrees as follows:
(a) That it will authorize the issuance and sale of the Bonds pursuant to the
terms of the Act as then in force.
(b) That it will, at the proper time and subject in all respects to the prior
advice, consent and approval of the Borrower, adopt or cause to be adopted, such
proceedings and authorize the execution of such documents as may be necessary and
advisable for the authorization, issuance, and sale of the Bonds as aforesaid, and that it
will enter into a loan agreement whereby the Borrower will pay to or on behalf of the
Issuer such sums as shall be sufficient to pay the principal and interest and redemption
premium, if any, and expenses on the Bonds as and when the same shall become due and
payable.
(c) The Issuer hereby declares its intent to assist the Borrower under Treasury
Regulations Section 1.150-2 to reimburse any expenditures made on costs of the Project
prior to the issuance of the Bonds with proceeds of the Bonds.
3. Undertakings on the Part of the Borrower. Subject to the conditions above stated,
the Borrower agrees as follows:
(a) That it will use all reasonable efforts to find one or more purchasers for
the Bonds.
(b) That contemporaneously with the delivery of the Bonds the Borrower will
enter into a loan agreement with the Issuer under the terms of which the Borrower will
obligate itself to pay to or on behalf of the Issuer sums sufficient in the aggregate to pay
the principal of and interest and redemption premium, if any, and expenses on the Bonds
as and when the same shall become due and payable.
4. General Provisions.
(a) All commitments of the Issuer under Paragraph 2 hereof and of the
Borrower under Paragraph 3 hereof are subject to the condition that on or before 365
days from the date hereof (or such other date as shall be mutually satisfactory to the
Issuer and the Borrower), the Issuer and the Borrower shall have agreed to mutually
acceptable terms and conditions of the loan agreement and of the Bonds and other
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instruments or proceedings relating to the Bonds. The decision not to approve or agree to
any term or condition of any document or not to take any action prior to issuance of the
Bonds shall rest solely within the complete discretion of the parties to this Agreement.
(b) All costs and expenses in connection with the Project, including the fees
and expenses of counsel to the Issuer, Bond Counsel, Issuer's Counsel and any other fees
required to be paid by the Issuer upon the Issuer upon the issuance of the Bonds, shall be
paid from the proceeds of the Bonds or by the Borrower. If the events set forth in (a) of
this Paragraph 4 do not take place within the time set forth or any extension thereof and
the Bonds in an amount not exceeding the amount stated above are not sold within such
time, the Borrower agrees that it will reimburse the Issuer for all reasonable and
necessary direct out-of-pocket expenses which the Issuer may incur at the Borrower's
request or as a result of or arising out of this Agreement including but not limited to the
payment of attorney and other consultant fees arising from the execution of this
Agreement and the performance by the Issuer of its obligations hereunder, and this
Agreement shall thereupon terminate.
(c) The obligations of the Issuer under this Agreement and the closing of the
Bonds in regard to the Project are subject to and contingent upon the possession by the
Issuer or the receipt by the Issuer of sufficient 2006 volume cap allocation from the State
of Illinois or otherwise pursuant to the Illinois Private Activity Bond Allocation Act (30
ILCS 345/1 through 345/9), as supplemented and amended. In addition, in the event the
Issuer possesses or receives such sufficient 2006 volume cap allocation, the Issuer agrees
to apply such 2006 volume cap allocation to the issuance of the Bonds.
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•
IN WITNESS WHEREOF, the parties hereto have entered into this Agreement by their
officers thereunto duly authorized as of the 23rd day of August,2006.
CITY OF ELGIN, ILLINOIS
-‘1011.41c4e/I'PeA"
Mayor
(SEAL)
ATTEST:
Me-C(A41A,
City Clerk
NELSON GRAPHIC SCREENPRINTING,
INC.
By
Its See„
GERHARD G. LANDROWSKI, AS CO..
TRUSTEE UNDER THE GERHARD G.
LANDROWSKI DECLARATION OF TRUST
DATED NOVEMBER 18, 1993
B �� ���
Gerhard G. Landrowski
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C/45083.I
.4 OF EEC,.;.
' City of Elgin Agenda Item No. Pt
RATED FEl'.
4
August 18,2006 k -
N••THWEST ;J
TO: Mayor and Members of the City Council
FROM: Olufemi Folarin, City Manager ( a,,,w„,t;l Growth and
Raymond H. Moller, Dire or of Economic Dher'ified Ts-base
Development&Business Services
SUBJECT: Request from Nelson Graphic Screenprinting, Inc. for a Portion of the City's
2006 Annual Industrial Revenue Bond Authority
PURPOSE
The purpose of this memorandum is to present to the Mayor and members of the City Council a
request from Nelson Graphic Screenprinting, Inc. for $3,795,000 of the year 2006 Industrial
Revenue Bond (IRB) authority.
RECO
MMENDATION
It is recommended that the City Council adopt an inducement resolution for Nelson Graphics
Screenprinting, Inc. in the amount of$3,795,000 in Industrial Revenue Bonds and that the City
of Elgin Fiscal Services Group Director be authorized to conduct the TEFRA public hearing at
an appropriate time and place.
BACKGROUND
The City has received a request regarding the availability of IRBs for business expansion for
Nelson Graphics Screenprinting, Inc. The company is requesting $3,795,000 in IRB capacity.
The City is allocated $7,820,880 from the State of Illinois. The purchaser is expected to be
LaSalle Financial Services, Inc. of Chicago, Illinois. Bond Counsel is expected to be Ice Miller
LLP of Chicago, Illinois. Proceeds will be used for (i) the purchase of a six color, mid size
format, screen-printing press; (ii) the purchase of a state-of-the-art screen making machine; and
(iii) a 15,000 square foot expansion of the Company's existing facility in the City. A portion of
the proceeds will be used to refund the Company's existing industrial revenue bond. Legal,
financial and other costs, in the amount of approximately $270,000 will be paid from the
proceeds.
The Company was founded in 1957. The principal product of the Company is the screen
printing and fabrication of plastics, metal, paper and glass. The new, six-color, mid-size format,
screen-printing press is expected to increase printing capacity, provide back up for existing
presses and make the Company more cost competitive. The new screen making
p Y p machine utilizes
Nelson Graphic Screenprinting, Inc.
August 18, 2006
Page 2
a filmless technology that is estimated to save the Company about $180,000 annually and
decrease production time. The 15,000 square foot expansion will allow the Company to add the
new six-color press and further develop kit packaging and assembly services. The expansion is
expected to be completed by the end of calendar year 2006, with the new equipment to follow
shortly Thereafter.
The market areas served are the advertising and gaming industries. The customer base is spread
throughout the U.S., but the Company focuses on the Midwest. The Company currently has 42
full-time employees, 18 of whom live in the City. This is up from the 17 employees the
Company had when it moved to the City. The average employee's salary for the year ending
December 31, 2005 was $45,475 annually or $21.86 hourly. For the fiscal year ending
September 30, 2005, the Company's yearly payroll was $2,075,000. The Company estimates its
yearly payroll to increase to $2,600,000 upon completion of the expansion and purchase of the
new machines, depending on sales. The Company expects to add between 4 and 8 new,
permanent, full time jobs. The benefit to the City is job creation and minor tax base growth due
to the expansion of the Company's current facility.
The Company's financial position has been improving over the past five fiscal years. Sales
revenues have increased by nearly 140% from fiscal year 2001 to fiscal year 2005, from
$2,381,410 to $5,714,533. The cost of sales has increased by approximately 134% over the same
time period. Net income, which includes depreciation and excludes debt service payments, has
averaged about $165,000 per year for the last five fiscal years. Retained earnings have increased
by nearly 167% from fiscal year 2001 to fiscal year 2005. The Company's total assets have
grown modestly from $3,244,898 in fiscal year 2001 to $3,602,264 in fiscal year 2005, while
total liabilities have decreased from $2,551,788 in fiscal year 2001 to $1,678,010 in fiscal year
2005. The ratio of current assets to total assets has averaged approximately 28% and has been
fairly steady. The bulk of the Company's assets are property and equipment. In addition,
retained earnings as a percent of total liabilities and stockholders' equity has increased from
approximately 15% in fiscal year 2001 to approximately 41% in fiscal year 2005.
The $3 795 000 of bonds is to be amortized over 20year
s. The bonds willpayinterest based
upon the Weekly Floater Bond Rate, plus 1.25% bank fees. Annual debt service at an estimated
average rate of 5.15% is some $300,000 annually. Based on the Company's net income, as
reported in the financial statements for the year ending September 30, 2005 of.$181,000 and
depreciation in the amount of$376,773, the Company had $557,773 available for debt service.
This provides approximately 1.86x coverage. In addition, the Company expects to save
$180,000 annually in film costs as a result of the purchase of the new screen making machine.
Other debt of the Company consists of the original industrial revenue bond, which is expected to
be refunded in its entirety by this proposed issue, and, as of September 30, 2005, a note payable
to the shareholders in the amount of$313,250. The note payable is subordinate to the industrial
revenue bonds. The new debt is expected to be secured by a lien on the building and equipment.
•
•
Nelson Graphic Screenprinting, Inc.
August 18, 2006
Page 3
COMMUNITY GROUPS/INTERESTED PERSONS CONTACTED
None
FINANCIAL IMPACT
Nelson Graphics Screenprinting, Inc. has paid the $10,000 IRB application fee. All costs
pertaining to the IRB issuance will be borne by Nelson Graphics Screenprinting, Inc. The City
has no responsibility or obligation as it relates to the payment of the outstanding bonds.
Speer Financial, Inc. found the Company, based on its audited financial reviews,to be financially
sound. The IRB project will allow the Company to continue operations, enhance its business,
and create 4 to 8 new jobs. Speer finds this a worthwhile project and recommends that the City
proceed with the inducement resolution.
` LEGAL IMPACT
r dV��,�,,
None
ALTERNATIVES
1. Authorize Nelson Graphics Screenprinting, Inc to use $3,795,000 of the City's 2006 IRB
capacity.
2. Deny the request by Nelson Graphics Screenprinting, Inc.
Respectfully submitted for Council consideration.
RHM/jr
Attachment
PUB'I( FINANCE:CONS I]ANTS SINCE. 19 4
ral SPEER FINANCIAL, INC.
KF.VIN 'Oct ANNA DAVID F.PHII..LIPS LARRY P BURGER D.AN►EL I) FORBES f3ARRARA f_ k'HI%At IF R R.:PH,ALI-AT a AkKFAZIF=
PitIcatt\F \R\'ICI PYt F,.)t3?Q'.`.T \H!-PR¢..\zt}::aT '.4 I Pit}:SO1';
August 2, 2006
The Honorable Ed Shock and
Members of the City Council
City of Elgin
150 Dexter Court
Elgin, Illinois 60120
Dear Mayor and Council:
Pursuant to the request of the City of Elgin (the "City"), Speer Financial, Inc. has reviewed the
industrial revenue bond application, and supporting documentation including audited financial
statements of Nelson Graphic Screenprinting, Inc. (the "Company"). The financial statements are
prepared by Weiss & Company LLP of Glenview, Illinois. The Company is applying for City
approval of $3,795,000 of industrial revenue bonds. The purchaser is expected to be LaSalle
Financial Services, Inc. of Chicago, Illinois. Bond Counsel is expected to be Ice Miller LLP of
Chicago, Illinois. Proceeds will be used for (i) the purchase of a six color, mid size format,
screenprinting press; (ii) the purchase of a state-of-the-art screen making machine; and (iii) a
15,000 square foot expansion of the Company's existing facility in the City. A portion of the
proceeds will be used the refund the Company's existing industrial revenue bond. Legal;
financial and other costs, in the amount of approximately $270,000, will be paid from the
proceeds.
The Company was founded in 1957. The principal product of the Company is the screenprinting
and fabrication of plastics, metal, paper and glass. The new six color, mid size format,
screenprinting press is expected to increase printing capacity,provide back up for existing presses
and make the Company more cost competitive. The new screen making machine utilizes a
filmless technology that is estimated to save the Company about $180,000 annually and decrease .
production time. The 15,000 square foot expansion will allow the Company to add the new six
color press and further develop kit packaging and assembly services. The expansion is expected
to be completed by the end of calendar year 2006, with the new equipment to follow shortly.
The market areas served are the advertising and gaming industries. The customer base is spread
throughout the U.S., but the Company focuses on the Midwest. The Company currently has 42
full-time employees, 18 of whom live in the City. This is upfrom the 17
employees the
Company had when it moved to the City. The employee avera afor gsalary the year ending
December 31, 2005 was $45,475 annually or$21.86 hourly. For the fiscal year ended September
30, 2005, the Company's yearly payroll was $2,075,000. The Company estimates its yearly
payroll to increase to $2,600,000 upon completion of the expansion and purchase of the new
machines, depending on sales. The Company expects to add between 4 and
8 new, permanent,
full time jobs. The benefit to the City is job creation and minor tax base growth due to the
expansion of the Company's current facility.
SUITE 4100.ONE NORTH LAS.A(..LE STREET•CHICAGO.ILLINOIS 60602•(312)346-37Q0•FAX(31222)346-8833
SUITE 608.531 COMMERICAL STREET•WATERLOO.IOWA 50701•(319)291-2077•FAX(319)291-8628
•
SPEER FINANCIAL, INC.
Financial Analysis
As the accompanying tables indicate, the Company's financial position has been improving over
the past five fiscal years. Sales revenues have increased by nearly 140% from fiscal year 2001 to
fiscal year 2005, from $2,381,410 to $5,714,533. The costs of sales has increased by
approximately 134% over the same time period. Net income, which includes depreciation and
excludes debt service payments, has averaged about $165,000 per year for the last five fiscal
years. Retained earnings has increased by nearly 167% from fiscal year 2001 to fiscal year 2005.
The Company's total assets have grown modestly from $3,244,898 in fiscal year 2001 to
$3,602,264 in fiscal year 2005, while total liabilities have decreased from $2,551,788 in fiscal
year 2001 to $1,678,010 in fiscal year 2005. The ratio of current assets to total assets has
averaged approximately 28% and has been fairly steady. The bulk of the Company's assets are
property and equipment. In addition, retained earnings as a percent of total liabilities and
stockholders' equity has increased from approximately 15% in fiscal year 2001 to approximately
41%in fiscal year 2005.
The $3,795,000 of bonds are to be amortized over 20 years. The bonds will pay interest based
upon the Weekly Floater Bond Rate, plus 1.25% bank fees. Annual debt service at an estimated
average rate of 5.25% is some $300,000 annually. Based on the Company's net income, as
reported in the financial statements for the year ending September 30, 2005, of $181,000 and
depreciation in the amount of$376,773, the Company had $557,773 available for debt service.
This provides approximately 1.86x coverage. In addition, the Company expects to save $180,000
annually in film costs as a result of the purchase of the new screen making machine. Other debt
of the Company consists of the original industrial revenue bond, which is expected to be refunded
in its entirety by this proposed issue, and, as of September 30, 2005, a note payable to the
shareholders in the amount of $313,250. The note payable is subordinate to the industrial
revenue bonds. The new debt is expected to be secured by a lien on the building and equipment.
Conclusion
In summary, we find the Company,based on its audited financial reports, to be financially sound.
The IRB project will enhance their business and maintain a corporate citizen in the City. We find
this a worthwhile project and recommend that the City proceed with the inducement resolution.
We would be pleased to discuss this with you.
Sincerely,
Kevin W. McCann
President
KWM/wjk
Enclosure
,
•
SPEER FINANCIAL, INC. Nelson Graphic Screenprinting, Inc.
Balance Sheet
Audited as of:
August 31 September 30
2001 2002 2003 2004 2005
ASSETS:
Current Assets:
Cash and Cash Equivalents $ (7,158) $ 9,788 $ 8,959 $ 103,671 $ 101,129
Marketable Securities 25,497 25,497 25,497 25,497 25,497
Accounts Receivable 400,248 695,718 602,082 735,957 655,691
Inventories 119,536 182,823 368,504 277,984 252,167
Prepaid Expenses 23,277 19,700 24,810 23,481 43,668
Deferred Income Tax 13,153 2,760 3,818 7,351 501
Other 6,352 14,463 9,330 19,576 7,791
Total Current Assets $ 580,905 $ 950,749 $ 1,043,000 $ 1,193,517 $ 1,086,444
Property and Equipment:
Furniture and Fixtures $ 15,775 $ 24,284 $ 24,284 $ 42,028 $ 52,081
Computer Equipment 146,582 150,034 169,610 228,692 352,493
Vehicles 164,489 165,489 165,489 170,623 216,716
Buildings and Improvements 338,563 315,663 315,663 315,663 320,298
Machinery and Equipment 2,393,735 2,314,957 2,527,986 2,836,366 2,886,221
Less: Accumulated Depreciation (712,845) (919,015) (1,182,599) (1,427,552) (1,799,828)
Net Property and Equipment $2,346,299 $2,051,412 $2,020,433 $2,165,820 $ 2,027,981
Other Assets:
Cash and Cash Equivalents-Restricted $ 230,950 $ 210,197 $ 137,217 $ 138,574 $ 75,001
Marketable Securities-Restricted - - 90,441 90,441 -
Intangible Assets, Net 86,744 33,116 21,427 9,739
Total Other Assets $ 317,694 $ 243,313 $ 249,085 $ 238,754 $ 487,839
Total Assets $3,244,898 $3,245,474 $3,312,518 $3,598,091 $ 3,602,264
LIABILITIES AND SHAREHOLDERS' EQUITY:
Liabilities:
Current Liabilities:
Notes Payable-Current Maturities $ 262,900 $ 193,774 $ 277,172 $ 232,500 $ 112,500
Accounts Payable 268,222 126,345 78,758 156,450 1,430
Accrued Real Estate Taxes 42,485 49,584 31,267 54,762 33,700
Accrued Payroll and Payroll Taxes 32,745 38,509 68,307 212,788 93,837
Accrued Interest 11,625 9,631 9,075 9,009 7,642
Accrued Profit Sharing - 20,000 - - 25,000
Other - 23,116 30,286 36,744 37,504
Total Current Liabilities $ 617,977 $ 460,959 $ 494,865 $ 702,253 $ 311,613
Other Liabilities:
Notes Payable-Net of Current Maturities $1,808,981 $1,715,312 $1,588,139 $ 1,448,249 $ 1,335,749
Deferred Income Tax 96,385 136,489 173,059 221,239 15,085
Accrued Rent 28,445 37,025 34,605 31,185 15,563
Total Other Liabilities $1,933,811 $1,888,826 $1,795,803 $ 1,700,673 $ 1,366,397
Total Liabilities $2,551,788 $2,349,785 $2,290,668 $2,402,926 $ 1,678,010
Shareholders'Equity:
Common Stock $ 7,500 $ 7,500 $ 7,500 $ 7,500 $ 7,500
Paid-In Capital 193,975 193,975 193,975 193,975 193,975
Retained Earnings 491,635 694,214 820,375 993,690 1,309,941
Total Shareholders'Equity $ 693,110 $ 895,689 $ 1,021,850 $ 1,195,165 $ 1,511,416
Total Liabilities and Shareholders' Equity $3,244,898 $3,245,474 $3,312,518 $3,598,091 $ 3,189,426
SPEER FINANCIAL, INC. Nelson Graphic Screenprinting, Inc.
Statement of Income and Retained Earnings
Audited for the Fiscal Year Ended:
August 31 September 30
2001 2002 2003 2004 2005
Sales $2,381,410 $3,574,227 $4,268,295 $5,436,706 $ 5,714,533
Cost of Sales 1,806,586 2,391,322 3,000,747 3,849,541 4,224,863
Gross Profit $ 574,824 $ 1,182,905 $ 1,267,548 $ 1,587,165 $ 1,489,670
Selling and Administrative 726,186 831,170 1,043,658 1,317,073 1,307,920
Income From Operation $ (151,362) $ 351,735 $ 223,890 $ 270,092 $ 181,750
Other Income(Expense) 390,238 (95,544) (55,966) (38,141) (37,697)
Income Before Income Taxes $ 238,876 $ 256,191 $ 167,924 $ 231,951 $ 144,053
Income Taxes (56,621) (53,612) (41,763) (58,636) (1,019)
Net Income $ 182,255 $ 202,579 $ 126,161 $ 173,315 $ 143,034
Retained Earnings, Beginning $ 309,380 $ 491,635 $ 694,214 $ 820,375 $ 1,166,907
Retained Earnings, Ending $ 491,635 $ 694,214 $ 820,375 $ 993,690 $ 1,309,941
OAF fCC
�% 4 City of Elgin C 0 PY
Mayor
is Ed Schock
'untt0
Council Members
Juan Figueroa
Robert Gilliam
Ruth Munson
John Walters
Stuart Wasilowski
Marie Yearman
June 5, 2000 City Manager
VIA FEDERAL EXPRESS OVERNIGHT Joyce A. Parker
Mr. Thomas Smith
Ice, Miller, Donadio & Ryan
Attorneys at Law
135 S . LaSalle Street, Suite 4100
Chicago, IL 60603-4800
Re : City of Elgin, Illinois, Variable Rate Industrial
Development Revenue Bonds (Nelson Graphic Screen Printing,
Inc . Project) , Series 2000
Dear Mr. Smith:
The following additional documents are enclosed regarding the
above :
Certified copy of Resolution 99-275 adopted by the Elgin
City Council on October 27, 1999
Certified copy of Ordinance S3-00 passed by the Elgin City
Council on May 10 , 2000
Certified copy of City Council Minutes for the October 27,
1999, meeting at which the public hearing was held
Three copies of letter to Office of the Governor signed by
Mayor Schock
Further, pursuant to your request, I am faxing you the
certification and resolution for Resolution 99-275 . I am also
faxing you the certification and signature page for Ordinance
S3-00 .
Sincerely,
Dolonna "Loni" Mecum, CMC
City Clerk
Enclosure
150 Dexter Court • Elgin, IL 60120-5555 • Phone 847/931-6100 • Fax 847/931-5610 • TDD 847/931-5616
Printed on recycled paper
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% City of Elgin
.4 , Mayor
Ed Schock
Council Members
Juan Figueroa
(v1D
Robert Gilliam
f Ruth Munson
John Walters
Stuart Wasilowski
Marie Yearman
City Manager
June 1, 2 0 0 0 Joyce A. Parker
VIA FEDERAL EXPRESS OVERNIGHT ( .2_-c7
Ms . Judith Jach
Ice, Miller, Donadio & Ryan
Attorneys at Law
135 S . LaSalle Street, Suite 4100
Chicago, IL 60603-4800
Re : City of Elgin, Illinois, Variable Rate Industrial
Development Revenue Bonds (Nelson Graphic Screen
printing, Inc . Project) , Series 2000
Dear Ms . Jach:
The documents you sent us May 25, 2000 , to be signed
by the Mayor and me have been signed, sealed when
appropriate, and are enclosed. - Also enclosed are five
copies of the Attorney' s Opinion Letter dated June 6,
2000 , executed by Corporation Counsel , William A.
Cogley.
Sincerely,
Dolonna "Loni” Mecum, CMC
City Clerk
847/931-5660
dkm
Enclosures
150 Dexter Court • Elgin, IL 60120-5555 • Phone 847/931-6100 • Fax 847/931-5610 • TDD 847/931-5616
® Printed on recycled paper
SPG11 1
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ICE
MILLER
DONADIO
& RYAN
May 25,2000 WRITER'S DIRECT NUMBER:(312)726-8157
direct fax:(312)641-6263
intemet:jachj@imdr.com
VIA UPS OVERNIGHT
Dolonna Mecum
City Clerk
City of Elgin
150 Dexter Court
Elgin,Illinois 60120
Re: City of Elgin, Illinois, Variable Rate Industrial Development Revenue Bonds
(Nelson Graphic Screenprinting,Inc.Project),Series 2000
Dear Dolonna:
Due to the change in closing date with respect to the captioned financing,enclosed please find the following
documents to be re-executed,to be signed by the Mayor and City Clerk as indicated:
— Promissory Notes(two original notes enclosed to be signed by the Mayor)
— IRS Form 8038(five signature pages enclosed to be signed by the Mayor)
— City of the City of Elgin,Illinois(five signature pages enclosed to be signed by the Mayor and City Clerk-
Please also(SEAL) these pages)
— Certificate of the Issuer re:Arbitrage(five signature pages enclosed to be signed by the Mayor and City
Clerk)
Please ensure delivery of these executed documents to my attention for receipt no later than Friday,June 2,
2000. Also attached is the revised form of City Attorney opinion-could you please give this to Nancy Roll in the Law
Department-thank you. If you have any questions with respect to any of the documents enclosed or any other matter
relating to this financing,please do not hesitate to contact me or Tom Smith.
Very truly yours,
ICE MILLER DONADIO&RYAN
ud' Jach
Paralegal
'JJ
11749.1
135 South LaSalle Street • Suite 4100 • Chicago, Illinois 60603-4800
Telephone: (312) 726-1567 • Facsimile: (312) 641-6263
Indianapolis • Chicago • South Bend
foci
¢ �! City of Elgin Mayor
Ed Schock
Council Members
Juan Figueroa
Robert Gilliam
Ruth Munson
John Walters
Stuart Wasilowski
Marie Yearman
City Manager
May 11, 2000 Joyce A. Parker
VIA FEDERAL EXPRESS OVERNIGHT
Ms . Judith Jach
Ice, Miller, Donadio & Ryan
Attorneys at Law
135 S . LaSalle Street, Suite 4100
Chicago, IL 60603-4800
Re : City of Elgin, Illinois, Variable Rate Industrial
Development Revenue Bonds (Nelson Graphic Screen
printing, Inc . Project) , Series 2000
Dear Ms . Jach:
All of the documents you sent us to be signed by the
Mayor and me have been signed, sealed when
appropriate, and are enclosed. Also enclosed are five
copies of the Attorney' s Opinion Letter executed by
Corporation Counsel, William A. Cogley.
Sincerely,
Dolonna "Loni" Mecum, CMC
City Clerk
847/931-5660
dkm
Enclosure
150 Dexter Court • Elgin, IL 60120-5555 • Phone 847/931-6100 • Fax 847/931-5610 • TDD 847/931-5616
® Printed on recycled paper
ICE
MILLER
DONADIO
& RYAN
May 8, 2000 WRITER'S DIRECT'NUMBER:(312)726-8157
direct fax:(312)641-6263
interne:jachj@imdr.com
VIA UPS OVERNIGHT
Dolonna Mecum
City Clerk
City of Elgin
150 Dexter Court
Elgin, Illinois 60120
Re: City ofElgin,Illinois,Variable Rate Industrial Development Revenue
Bonds (Nelson Graphic Screenprinting, Inc. Project), Series 2000
Dear Dolonna:
With respect to the captioned financing and at the request of Ray Moller,enclosed please find
execution copies of the following documents,to be signed by the Mayor and City Clerk as indicated:
— Loan Agreement(five signature pages enclosed to be signed by the Mayor and City
Clerk - Please also (SEAL) these pages)
Indenture of Trust(five signature pages enclosed to be signed by the Mayor and City
Clerk- Please also (SEAL) these pages)
— Placement Agency Agreement (five signature pages enclosed to be signed by the
Mayor)
- Remarketing Agreement(five signature pages enclosed to be signed by the Mayor)
- Bond No.R-1 (one original bond enclosed to be signed by the Mayor and City Clerk
-Please also (SEAL) the signature page)
- Promissory Notes (two original notes enclosed to be signed by the Mayor)
— UCC-1 Financing Statement (one original enclosed to be signed by the Mayor)
135 South LaSalle Street • Suite 4100 • Chicago, Illinois 60603-4800
Telephone: (312) 726-1567 • Facsimile: (312) 641-6263
Indianapolis • Chicago • South Bend
Dolonna Mecum
City of Elgin
May 8, 2000
Page 2
- IRS Form 8038 (five signature pages enclosed to be signed by the Mayor)
- City of the City of Elgin, Illinois(five signature pages enclosed to be signed by the
Mayor and City Clerk-Please also (SEAL) these pages)
- Certificate of the Issuer re: Arbitrage(five signature pages enclosed to be signed by
the Mayor and City Clerk)
- Blanket Issuer Letter of Representations(five signature pages enclosed to be signed
by the Mayor)
Please ensure delivery of these executed documents to my attention for receipt no later than
Friday,May 12, 2000. If you have any questions with respect to any of the documents enclosed or
any other matter relating to this financing, please do not hesitate to contact me or Tom Smith.
Very truly yours,
ICE MILLER DONADIO & RYAN
Jud. Jac
aralegal
'JJ
11591.1