20-53 Amortizing Debentures by-law October 27, 2020CORPORATION OF THE COUNTY OF ELGIN
BY-LAW NUMBER 20-53
A BY-LAW OF CORPORATION OF THE COUNTY OF ELGIN TO AUTHORIZE THE
BORROWING UPON AMORTIZING DEBENTURES IN THE PRINCIPAL AMOUNT OF
$6,000,000.00 TOWARDS THE COST OF WONDERLAND ROAD RECONSTRUCTION
WHEREAS subsection 401 (1) of the Municipal Act, 2001, as amended (the
"Act") provides that a municipality may incur a debt for municipal purposes, whether by
borrowing money or in any other way, and may issue debentures and prescribed financial
instruments and enter prescribed financial agreements for or in relation to the debt;
WHEREAS subsection 408 (2.1) of the Act provides that a municipality may issue
a debenture or other financial instrument for long-term borrowing only to provide financing for
a capital work;
WHEREAS the Council of CORPORATION OF THE COUNTY OF ELGIN (the
"Municipality") has passed the By-law(s) enumerated in column (1) of Schedule "A" attached
hereto and forming part of this By-law to authorize the capital work(s) described in column (2)
of Schedule "A" (the "Capital Work(s)"), to authorize the long-term borrowing from Ontario
Infrastructure and Lands Corporation ("OILC") in respect of the Capital Work(s) and to confirm,
ratify and approve the execution by the Treasurer of the application to OILC for financing the
Capital Work (the "Application") and the submission by such authorized official of the
Application; and to execute and deliver to OILC the rate offer letter agreement in respect of
such long-term borrowing for the Capital Work(s);
WHEREAS before authorizing the Capital Work(s) and before authorizing any
additional cost amount and any additional debenture authority in respect thereof (if any) the
Council of the Municipality had its Treasurer calculate an updated limit in respect of its most
recent annual debt and financial obligation limit received from the Ministry of Municipal Affairs
and Housing in accordance with the applicable regulation and, prior to the Council of the
Municipality authorizing the Capital Work(s), each such additional cost amount and each such
`additional debenture authority (if any) the Treasurer determined that the estimated annual
amount payable in respect of the Capital Work(s), each such additional cost amount and each
such additional debenture authority (if any) would not cause the Municipality to exceed the
updated limit and that the approval of the Capital Work(s), each such additional cost amount
and each such additional debenture authority (if any) by the Local Planning Appeal Tribunal
pursuant to such regulation was not required;
WHEREAS the Municipality has submitted the Application to OILC and the
Application has been approved;
AND WHEREAS to provide long-term financing for the Capital Work(s) it is now
deemed to be expedient to borrow money by the issue of amortizing debentures in the
aggregate principal amount of $6,000,000.00 dated November 16, 2020 and maturing on
November 16, 2030, and payable in semi-annual instalments of combined principal and
interest on the sixteenth day of May and on the sixteenth day of November in each of the years
2021 to 2030, both inclusive on the terms hereinafter set forth;
NOW THEREFORE THE COUNCIL OF CORPORATION OF THE COUNTY OF
ELGIN ENACTS AS FOLLOWS:
1. THAT for the Capital Work(s), the borrowing upon the credit of the Municipality at
large of the aggregate principal amount of $6,000,000.00 and the issue of amortizing
debentures therefor to be repaid in semi-annual instalments of combined principal
and interest as hereinafter set forth, are hereby authorized.
2. THAT the Warden and the Treasurer of the Municipality are hereby authorized to
cause any number of amortizing debentures to be issued for such amounts of money
as may be required for the Capital Work(s) in definitive form, not exceeding in total
the said aggregate principal amount of $6,000,000.00 (the "Debentures"). The
Debentures shall bear the Municipality's municipal seal and the signatures of Warden
and the Treasurer of the Municipality, all in accordance with the provisions of the Act.
The municipal seal of the Municipality and the signatures referred to in this section
may be printed, lithographed, engraved or otherwise mechanically reproduced. The
Debentures are sufficiently signed if they bear the required signatures and each
person signing has the authority to do so on the date he or she signs.
3. THAT the Debentures shall be in fully registered form as one or more certificates in
the aggregate principal amount of $6,000,000.00, in the name of OILC, or as OILC
may otherwise direct, substantially in the form attached as Schedule "B" hereto and
forming part of this By-law with provision for payment of principal and interest (other
than in respect of the final payment of principal and outstanding interest on maturity
upon presentation and surrender) by pre -authorized debit in respect of such principal
and interest to the credit of such registered holder on such terms as to which the
registered holder and the Municipality may agree.
4. THAT in accordance with the provisions of section 25 of the Ontario Infrastructure
and Lands Corporation Act, 2011, as amended from time to time hereafter, the
Municipality is hereby authorized to agree in writing with OILC that the Minister of
Finance is entitled, without notice to the Municipality, to deduct from money
appropriated by the Legislative Assembly of Ontario for payment to the Municipality,
amounts not exceeding any amounts that the Municipality fails to pay OILC on
account of any unpaid indebtedness of the Municipality to OILC under the Debentures
and to pay such amounts to OILC from the Consolidated Revenue Fund.
5. THAT the Debentures shall all be dated November 16, 2020, and as to both principal
and interest shall be expressed and be payable in lawful money of Canada. The
Debentures shall bear interest at the rate of 1.43% per annum and mature during a
period of 10 year(s) years from the date thereof payable semi-annually in arrears as
described in this section. The Debentures shall be paid in full by November 16, 2030
and be payable in equal semi-annual instalments of combined principal and interest
on the sixteenth day of May and on the sixteenth of November in each of the years
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2021 to 2030, both inclusive, save and except for the last instalment which may vary
slightly from the preceding equal instalments, as set forth in Schedule "C" attached
hereto and forming part of this By-law ("Schedule "C").
6. THAT payments in respect of principal of and interest on the Debentures shall be
made only on a day, other than Saturday or Sunday, on which banking institutions in
Toronto, Ontario, Canada and the Municipality are not authorized or obligated by law
or executive order to be closed (a "Business Day") and if any date for payment is not
a Business Day, payment shall be made on the next following Toronto Business Day.
7. THAT interest shall be payable to the date of maturity of the Debentures and on
default shall be payable on any overdue amounts both before and after default and
judgment at a rate per annum equal to the greater of the rate specified on the
Schedule as attached to and forming part of the Debentures for such amounts plus
200 basis points or Prime Rate (as defined below) plus 200 basis points, calculated
on a daily basis from the date such amounts become overdue for so long as such
amounts remain overdue and the Municipality shall pay to the registered holders any
and all costs incurred by the registered holders as a result of the overdue payment.
Any amounts payable by the Municipality as interest on overdue principal or interest
and all costs incurred by the registered holders as a result of the overdue payment in
respect of the Debentures shall be paid out of current revenue. Whenever it is
necessary to compute any amount of interest in respect of the Debentures for a period
of less than one full year, other than with respect to regular semi-annual interest
payments, such interest shall be calculated on the basis of the actual number of days
in the period and a year of 365 days or 366 days as appropriate.
"Prime Rate" means, on any day, the annual rate of interest which is the arithmetic
mean of the prime rates announced from time to time by the following five major
Canadian Schedule 1 banks, as of the issue date of the Debentures: Royal Bank of
Canada; Canadian Imperial Bank of Commerce; The Bank of Nova Scotia; Bank of
Montreal; and The Toronto -Dominion Bank (the "Reference Banks") as their
reference rates in effect on such day for Canadian dollar commercial loans made in
Canada. If fewer than five of the Reference Banks quote a prime rate on such days,
the "Prime Rate" shall be the arithmetic mean of the rates quoted by those Reference
Banks.
8. THAT in each year in which a payment of equal semi-annual instalments of combined
principal and interest becomes due in respect of the Capital Work(s) including the last
`non -equal' instalment, there shall be raised as part of the Municipality's general levy
the amounts of principal and interest payable by the Municipality in each year as set
out in Schedule "C to the extent that the amounts have not been provided for by any
other available source including other taxes or fees or charges imposed on persons
or property by a by-law of any municipality.
9. THAT the Debentures may contain any provision for their registration thereof
authorized by any statute relating to municipal debentures in force at the time of the
issue thereof.
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10. THAT the Municipality shall maintain a registry in respect of the Debentures in which
shall be recorded the names and the addresses of the registered holders and
particulars of the Debentures held by them respectively and in which particulars of
the cancellations, exchanges, substitutions and transfers of Debentures, may be
recorded and the Municipality is authorized to use electronic, magnetic or other media
for records of or related to the Debentures or for copies of them.
11. THAT the Municipality shall not be bound to see to the execution of any trust affecting
the ownership of any Debenture or be affected by notice of any equity that may be
subsisting in respect thereof. The Municipality shall deem and treat registered
holders of the Debentures as the absolute owners thereof for all purposes whatsoever
notwithstanding any notice to the contrary and all payments to or to the order of
registered holders shall be valid and effectual to discharge the liability of the
Municipality on the Debentures to the extent of the amount or amounts so paid. When
a Debenture is registered in more than one name, the principal of and interest from
time to time payable on such Debenture shall be paid to or to the order of all the joint
registered holders thereof, failing written instructions to the contrary from all such joint
registered holders, and such payment shall constitute a valid discharge to the
Municipality. In the case of the death of one or more joint registered holders, despite
the foregoing provisions of this section, the principal of and interest on any
Debentures registered in their names may be paid to the survivor or survivors of such
holders and such payment shall constitute a valid discharge to the Municipality.
12. THAT the Debentures will be transferable or exchangeable at the office of the
Treasurer of the Municipality upon presentation for such purpose accompanied by an
instrument of transfer or exchange in a form approved by the Municipality and which
form is in accordance with the prevailing Canadian transfer legislation and practices,
executed by the registered holder thereof or such holder's duly authorized attorney
or legal personal representative, whereupon and upon registration of such transfer or
exchange and cancellation of the Debenture or Debentures presented, the Warden
and the Treasurer shall issue and deliver a new Debenture or Debentures of an equal
aggregate principal amount in any authorized denomination or denominations as
directed by the transferor, in the case of a transfer or as directed by the registered
holder in the case of an exchange.
13. THAT the Warden and the Treasurer shall issue and deliver new Debentures in
exchange or substitution for Debentures outstanding on the registry with the same
maturity and of like form which have become mutilated, defaced, lost, subject to a
mysterious or unexplainable disappearance, stolen or destroyed, provided that the
applicant therefor shall have: (a) paid such costs as may have been incurred in
connection therewith; (b) (in the case when a Debenture is mutilated, defaced, lost,
mysteriously or unexplainably missing, stolen or destroyed) furnished the Municipality
with such evidence (including evidence as to the certificate number of the Debenture
in question) and an indemnity in respect thereof satisfactory to the Municipality in its
discretion; and (c) surrendered to the Municipality any mutilated or defaced
Debentures in respect of which new Debentures are to be issued in substitution.
14. THAT the Debentures issued upon any registration of transfer or exchange or in
substitution for any Debentures or part thereof shall carry all the rights to interest if
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any, accrued and unpaid which were carried by such Debentures or part thereof and
shall be so dated and shall bear the same maturity date and, subject to the provisions
of this By-law, shall be subject to the same terms and conditions as the Debentures
in respect of which the transfer, exchange or substitution is effected.
15. THAT the cost of all transfers and exchanges, including the printing of authorized
denominations of the new Debentures, shall be borne by the Municipality. When any
of the Debentures are surrendered for transfer or exchange the Treasurer of the
Municipality shall: (a) in the case of an exchange, cancel and destroy the Debentures
surrendered for exchange; (b) in the case of an exchange, certify the cancellation and
destruction in the registry; (c) enter in the registry particulars of the new Debenture or
Debentures issued in exchange; and (d) in the case of a transfer, enter in the registry
particulars of the registered holder as directed by the transferor.
16. THAT reasonable fees in respect of the Debentures, in the normal course of business,
other than reasonable fees for the substitution of a new Debenture or new Debentures
for any of the Debentures that are mutilated, defaced, lost, mysteriously or
unexplainably missing, stolen or destroyed and for the replacement of any of the
principal and interest cheques (if any) that are mutilated, defaced, lost, mysteriously
or unexplainably missing, stolen or destroyed may be imposed by the Municipality.
When new Debentures are issued in substitution in these circumstances the
Municipality shall: (a) treat as cancelled and destroyed the Debentures in respect of
which new Debentures will be issued in substitution; (b) certify the deemed
cancellation and destruction in the registry; (c) enter in the registry particulars of the
new Debentures issued in substitution; and (d) make a notation of any indemnities
provided.
17. THAT except as otherwise expressly provided herein, any notice required to be given
to a registered holder of one or more of the Debentures will be sufficiently given if a
copy of such notice is mailed or otherwise delivered to the registered address of such
registered holder.
18. THAT the Warden and the Treasurer are hereby authorized to cause the Debentures
to be issued, one or more of the Clerk and Treasurer are hereby authorized to
generally do all things and to execute all other documents and other papers in the
name of the Municipality in order to carry out the issue of the Debentures and the
Treasurer is authorized to affix the Municipality's municipal seal to any of such
documents and papers.
19. THAT the money received by the Municipality from the sale of the Debentures to
OILC, including any premium, and any earnings derived from the investment of that
money, after providing for the expenses related to their issue, if any, shall be
apportioned and applied to the Capital Work(s) and to no other purpose except as
permitted by the Act.
20. THAT subject to the Municipality's statement of investment policies and goals, the
applicable legislation and the terms and conditions of the Debentures, the Municipality
may, if not in default under the Debentures, at any time purchase any of the
Debentures in the open market or by tender or by private contract at any price and on
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such terms and conditions (including, without limitation, the manner by which any
tender offer may be communicated or accepted and the persons to whom it may be
addressed) as the Municipality may in its discretion determine.
21. AND THAT this By-law takes effect on the day of passing.
Read a first and second time this 27th day of October, 2020.
Read a third time and finally passed this 27th day of October, 2020.
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Julie onyou
Clerk
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