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HomeMy WebLinkAbout09/25/13 PUBLIC BENEFIT CORPORATION AGENDA PACKET SPECIALNOTICE OF SPECIAL MEETING COTA d:1 BAKERSFIELD PUBLIC BENEFIT CORPORATION NOTICE IS HEREBY GIVEN that the Board of Directors of the Bakersfield Public Benefit Corporation will hold a Special Meeting on Wednesday, September 25, 2013 at 5:15 p.m., (meeting will commence immediately after adjournment of the 5:15 p.m. Regular Meeting of the City Council) at the City Council Chambers, 1501 Truxtun Avenue, Bakersfield, California, for the purpose of considering the following: SPECIAL MEETING ROLL CALL 2. PUBLIC STATEMENTS 3. NEW BUSINESS a. Resolution of the Board of Directors of the Bakersfield Public Benefit Corporation ratifying the Articles and Incorporation and Bylaws of the Bakersfield Public Benefit Corporation and authorizing the Execution and Delivery of a Trust Agreement, a Certificate Purchase Agreement, and an Installment Sale Agreement in connection with the City Gas Tax, Transportation Impact Fee and Restricted Utility Franchise and Surcharge Revenue Certificates of Participation, Series 2013 (Thomas Roads Improvement Program) and other matters relating thereto. Staff recommends adoption of the Resolution. 4. ADJOURNMENT /s/ Harvey L. Hall Harvey L. Hall, Chairman of the Board of Directors Bakersfield Public Benefit Corporation B A K E R S F I E L D NOTICE OF SPECIAL MEETING COTA d:1 BAKERSFIELD PUBLIC BENEFIT CORPORATION NOTICE IS HEREBY GIVEN that the Board of Directors of the Bakersfield Public Benefit Corporation will hold a Special Meeting on Wednesday, September 25, 2013 at 5:15 p.m., (meeting will commence immediately after adjournment of the 5:15 p.m. Regular Meeting of the City Council) at the City Council Chambers, 1501 Truxtun Avenue, Bakersfield, California, for the purpose of considering the following: SPECIAL MEETING ROLL CALL 2. PUBLIC STATEMENTS 3. NEW BUSINESS a. Resolution of the Board of Directors of the Bakersfield Public Benefit Corporation ratifying the Articles and Incorporation and Bylaws of the Bakersfield Public Benefit Corporation and authorizing the Execution and Delivery of a Trust Agreement, a Certificate Purchase Agreement, and an Installment Sale Agreement in connection with the City Gas Tax, Transportation Impact Fee and Restricted Utility Franchise and Surcharge Revenue Certificates of Participation, Series 2013 (Thomas Roads Improvement Program) and other matters relating thereto. Staff recommends adoption of the Resolution. 4. ADJOURNMENT /s/ Harvey L. Hall Harvey L. Hall, Chairman of the Board of Directors Bakersfield Public Benefit Corporation BAKERSFIELD PUBLIC BENEFIT CORPORATION AGENDA SPECIAL MEETING OF SEPTEMBER 25, 2013 Council Chambers, City Hall, 1501 Truxtun Avenue Special Meeting - 5:15 p.m. SPECIAL MEETING (This meeting will commence immediately after adjournment of the 5:15 p.m. Regular Meeting of the City Council.) 1. ROLL CALL 2. PUBLIC STATEMENTS 3. NEW BUSINESS a. Resolution of the Board of Directors of the Bakersfield Public Benefit Corporation ratifying the Articles and Incorporation and Bylaws of the Bakersfield Public Benefit Corporation and authorizing the Execution and Delivery of a Trust Agreement, a Certificate Purchase Agreement, and an Installment Sale Agreement in connection with the City Gas Tax, Transportation Impact Fee and Restricted Utility Franchise and Surcharge Revenue Certificates of Participation, Series 2013 (Thomas Roads Improvement Program) and other matters relating thereto. Staff recommends adoption of the Resolution. 4. ADJOURNMENT Respectfully submitted, qAwo&-) Alan Tandy v City Manager 09/18/13 11:40am A E PO., p l�1Cn ADMINISTRATIVE REPORT 9 !F MEETING DATE: September 25, 2013 AGENDA SECTION: New Business ITEM: g TO: Board of Directors of the Bakersfield Public Benefit Corporation FROM: Nelson K. Smith, Finance Director DATE: September 13, 2013 APPROVED DEPARTMENT HEAD CITY ATTORNEY CITY MANAGER SUBJECT: A Resolution of the Board of Directors of the Bakersfield Public Benefit Corporation ratifying the Articles of Incorporation and Bylaws of the Bakersfield Public Benefit Corporation and authorizing the execution and delivery of a Trust Agreement , a Certificate Purchase Agreement, and an Installment Sale Agreement in connection with the City of Bakersfield Gas Tax, Transportation Impact Fee and Restricted Utility Franchise and Surcharge Revenue Certificates of Participation, Series 2013 (Thomas Roads Improvement Program) and other matters relating thereto. (All wards) RECOMMENDATION: Staff recommends adoption of the Resolution. BACKGROUND: In February 2013 staff provided the City Council with an overview of various actions necessary to prepare for the future funding needs of the TRIP capital project program. At the June 2013 Council meeting staff provided the Council with additional details regarding the proposed Validation Action and the need to form a Public Benefit Corporation to facilitate the future borrowing transactions. In July 2013 the Council authorized staff to file the necessary documents to form the Bakersfield Public Benefit Corporation with the State of California. That process has now been completed and the Corporation is now formed. The Bakersfield Public Benefit Corporation was formed to assist and be a party to future financings associated with local funding needs of various Thomas Roads Improvement Program (TRIP) projects. The Corporation was formed with the Mayor and Councilmembers functioning as the Board of Directors. The Corporation is a separate legal entity from the City of Bakersfield and thus requires their meeting activities and actions to be separate and distinct from those of the City Council. The proposed financing structure, which is subject to legal validation, contemplates certain financing documents to be entered into with both the City of Bakersfield and the Bakersfield Public Benefit Corporation as separate parties to the agreements. September 17, 2013, 10:32AM S:Wdmin\Admin Reports\Admin - TRIP Financing Public Benefit Corp Reso Sept 2013.doc ADMINISTRATIVE REPORT The Resolution being considered this evening by the Corporation accomplishes the following: - Ratifies the Articles of Incorporation and Bylaws of the Public Benefit Corporation; and - Approves the form and substance of certain financing documents, including a Master Trust Agreement, a Certificate Purchase Agreement, an Installment Sale Agreement and Revenue Certificates of Participation. The financing documents are being considered by the City in a separate agenda item under the City Council agenda. Approval of this item will further support the documents being submitted by the City for completion of a Legal Validation procedure through the courts. None of the documents included in this action obligate the Corporation to borrow any specified amount, nor do they obligate the Corporation to pay any specified interest rate or fee. The figures are proposed to be set as they are listed to provide some level of flexibility when we get to the point of actually pricing and sizing the long term debt obligations, which could be as long as two or three years from now. Keep in mind that the Legal Validation procedure validates both the maximum debt issuance and the nexus of revenues pledged to repay the debt. Please be assured that any actual borrowing transaction, whether short term or long term, will come back before the Board of the Corporation for approval. September 17, 2013, 10:32AM SAAdmin\Admin Reports\Admin - TRIP Financing Public Benefit Corp Reso Sept 2013.doc RESOLUTION NO. A RESOLUTION OF THE BOARD OF DIRECTORS OF THE BAKERSFIELD PUBLIC BENEFIT CORPORATION RATIFYING THE ARTICLES OF INCORPORATION AND BYLAWS OF THE BAKERSFIELD PUBLIC BENEFIT CORPORATION AND AUTHORIZING THE EXECUTION AND DELIVERY OF A TRUST AGREEMENT, A CERTIFICATE PURCHASE AGREEMENT, AND AN INSTALLMENT SALE AGREEMENT IN CONNECTION WITH THE CITY OF BAKERSFIELD GAS TAX, TRANSPORTATION IMPACT FEE AND RESTRICTED UTILITY FRANCHISE AND SURCHARGE REVENUE CERTIFICATES OF PARTICIPATION, SERIES 2013 (THOMAS ROADS IMPROVEMENT PROGRAM) AND OTHER MATTERS RELATING THERETO RECITALS: WHEREAS, the Bakersfield Public Benefit Corporation (the "Corporation ") is a nonprofit public benefit corporation organized and existing under the laws of the State of California (the "State ") and was formed to assist the City of Bakersfield (the "City "), among other things, in the financing and/or refinancing of the Project (as defined herein), pursuant to the Nonprofit Public Benefit Corporation Law (being Part 2 of Division 2 of Title 1 of the California Corporations Code, as amended) and pursuant to the articles of incorporation (the "Articles of Incorporation ") and bylaws of the Corporation (the "Bylaws "); and WHEREAS, the Articles of Incorporation as adopted by the sole incorporator and as filed with the Secretary of State of the State and bearing the file stamp and certification of the Secretary of State of the State be, and they hereby are, ratified and approved as the Articles of Incorporation of the Corporation and that they be inserted in the minute book of the Corporation; and WHEREAS, the Bylaws of the Corporation as adopted by the sole incorporator be, and they hereby are, ratified and approved as the Bylaws of the Corporation and that such Bylaws be inserted in the minute book of the Corporation; and WHEREAS, the City is a charter city organized and existing under the laws of the State; and WHEREAS, Section 12 of Article III of the Charter of the City, authorizes the City, among other things, to acquire property for any municipal purpose, and provide for the construction of public improvements; and WHEREAS, the City has determined that the design, acquisition and construction of public street and highway projects (and as more fully described in the herein defined 2013 Installment Sale Agreement, the "Project ") is necessary and proper for, and for the benefit of, the City, and under the terms of applicable law, the payment for such Project may be made from (i) motor vehicle fuel tax revenues received by the City from the State (the "Gas Tax Revenues "), and deposited into the Gas Tax Fund (as defined in the hereinafter defined 2013 4823 - 9999 - 6948.2 Installment Sale Agreement); (ii) transportation impact fee revenues received by the City from developers of land to mitigate traffic impacts caused by a development project (the "Transportation Impact Fee Revenues "), and deposited into the Transportation Impact Fee Trust Fund (as defined in the 2013 Installment Sale Agreement); (iii) certain additional electricity franchise payments and the electricity and gas surcharge payments paid to the City by certain franchisees for the use of the City's streets (the "Restricted Utility Franchise and Surcharge Revenues "), and deposited into the Roads Program Utility Franchise Fee and Surcharge Fund (as defined in the 2013 Installment Sale Agreement); and (iv) any other moneys of the City that are legally available to pay for the Project; and WHEREAS, to effectuate the financing, it is proposed that the Corporation and the City enter into that certain 2013 Installment Sale Agreement, by and between the Corporation and the City (the "2013 Installment Sale Agreement "), pursuant to which the Corporation will acquire and construct the Project for, and sell the Project to, the City; and WHEREAS, pursuant to the 2013 Installment Sale Agreement, the City, acting as agent for the Corporation, will agree to design, acquire and construct the Project using proceeds from the sale of City of Bakersfield Gas Tax, Transportation Impact Fee and Restricted Utility Franchise and Surcharge Revenue Certificates of Participation, Series 2013 (Thomas Roads Improvement Program) (the "Certificates ") evidencing and representing a proportionate undivided interests of the owners thereof in the 2013 Installment Sale Payments (the "2013 Installment Sale Payments ") to be made by the City to the Corporation under the 2013 Installment Sale Agreement; and WHEREAS, the Board of Directors of the Corporation (the "Board of Directors ") intends to authorize the execution and delivery of additional Contracts (as defined in the 2013 Installment Sale Agreement) at some time in the future and from time to time for the purpose of facilitating the financing of the design, acquisition and construction of additional street and highway improvements; and WHEREAS, it is further proposed that the Corporation, the City and the trustee (which shall be determined at a later date) (the "Trustee ") shall enter into a Trust Agreement (such Trust Agreement, in the form presented to this meeting, with such changes, insertions and omissions made pursuant to this resolution, being referred to as the "Trust Agreement") pursuant to which the Trustee will execute and deliver the Certificates; and WHEREAS, the Board of Directors desire to enter into a Certificate Purchase Agreement (the "Certificate Purchase Agreement ") by and among the District, the Corporation and the purchaser / purchasers /underwriter /underwriters (which will be determined at a later date) (the "Purchaser/Underwriter "), pursuant to which the Purchaser /Underwriter will agree to buy the Certificates on the terms and conditions set forth therein; and WHEREAS, the Corporation may determine that securing the timely payment of the principal and interest evidenced by the Certificates by obtaining a bond insurance policy (a "Certificate Insurance Policy ") with respect thereto issued by a municipal bond insurer could be economically advantageous to the City; and 2 4823 - 9999 - 6948.2 WHEREAS, the Corporation and the City intend to assist the Purchaser /Underwriter in the preparation of a preliminary official statement in connection with the sale and delivery of the Certificates, a form of such preliminary official statement to be presented to this Board of Directors at a later date; and WHEREAS, there have been presented to the Board of Directors the following documents: 1. Proposed form of the Trust Agreement; 2. Proposed form of the 2013 Installment Sale Agreement; and 3. Proposed form of the Certificate Purchase Agreement. NOW, THEREFORE THE BOARD OF DIRECTORS OF THE BAKERSFIELD PUBLIC BENEFIT CORPORATION DOES RESOLVE AS FOLLOWS: Section 1. Ratification of the Adopted Articles of Incorporation. The Articles of Incorporation, as adopted by the sole incorporator and as filed with the Secretary of State of the State and bearing the file stamp and certification of the Secretary of State of the State' be, and they hereby are, ratified and approved as the Articles of Incorporation of the Corporation and that they be inserted in the minute book of the Corporation. Section 2. Ratification of the Adopted Bylaws. The Bylaws of the Corporation, as adopted by the sole incorporator be, and they hereby are, ratified and approved as the Bylaws of the Corporation and that such Bylaws be inserted in the minute book of the Corporation. Section 3. Form of the 2013 Installment Sale Agreement. The 2013 Installment Sale Agreement in substantially the form submitted to this meeting and made a part hereof as though set forth in full herein, be and the same is hereby approved, and the Presideynt/Executive Manager, Vice President and /or Chief Financial Officer of the Corporation, any gone or more thereof, are hereby authorized and directed, for and in the name and on behalf of the Corporation, to execute and deliver the 2013 Installment Sale Agreement with such changes, insertions and omissions therein as such officers may require or approve, such approval to be conclusively evidenced by the execution and delivery thereof. Section 4. Form of the Trust Agreement. The Trust Agreement in substantially the form submitted to this meeting and made a part hereof as though set forth in full herein, be and the same is hereby approved, and the President/Executive Manager, Vice President and/or Chief Financial Officer of the Corporation, any one or more thereof, are hereby authorized and directed, for and in the name and on behalf of the Corporation, to execute and deliver a Trust Agreement in substantially said form, with such changes, insertions and omissions therein as such officers may require or approve, such approval to be conclusively evidenced by the execution and delivery thereof. Section 5. Form of the Certificate Purchase Agreement. The Certificate Purchase Agreement in substantially the form submitted to this meeting and made a part hereof as though set forth in full herein, be and the same is hereby approved, and the President/Executive 4823 - 9999 - 6948.2 Manager, Vice President and /or Chief Financial Officer of the Corporation, any one or more thereof, are hereby authorized and directed, for and in the name and on behalf of the Corporation, to execute and deliver a Certificate Purchase Contract in substantially such form, with such changes, insertions and omissions therein as such officers may require or approve, such approval to be conclusively evidenced by the execution and delivery thereof. Section 6. Authorization to Obtain Certificate Insurance Policy. The Corporation is hereby authorized to apply for a Certificate Insurance Policy for the Certificates and to obtain such Certificate Insurance Policy if the present value cost of such Certificate Insurance Policy is less than the present value of the estimated interest savings with respect to the Certificates. Section 7. Additional Authorization. The President/Executive Manager, Vice President and /or Chief Financial Officer of the Corporation and the other officers of the Corporation are hereby authorized and directed, jointly and severally, to do any and all things and to execute and deliver any and all documents which they may deem necessary or advisable in order to consummate the offer and sale of the Certificates, and otherwise to carry out, give effect to and comply with the terms and intent of this resolution and the Certificates. Such actions heretofore taken by such officers are hereby ratified, confirmed and approved. Section 8. Severability. The provisions of this resolution are hereby declared to be severable and if any section, phrase or provision shall for any reason be declared to be invalid, such declaration shall not affect the validity of the remainder of the sections, phrases and provisions hereof. Section 9. Attestations. The secretary is hereby authorized and directed to attest the signature of the President/Executive Manager, Vice President and/or Chief Financial Officer of the Corporation, as may be required or appropriate in connection with the execution and delivery of said 2013 Installment Sale Agreement, Trust Agreement and Certificate Purchase Contract. Section 10. Governing Law. This resolution shall be construed and governed in accordance with the laws of the State of California. Section 11. Effective Date of Resolution. This resolution shall take effect immediately upon its passage. [Remainder of page intentionally left blank] 4 4823 - 9999 - 6948.2 Attest: 2 PASSED AND ADOPTED THIS 25`" day of September, 2013. Roberta Gafford, Secretary By Alan Tandy, President /Executive Manager I, Roberta Gafford, Secretary for the Bakersfield Public Benefit Corporation, do hereby certify that the foregoing resolution was passed and adopted at a meeting of the Board of Directors held on the 25th day of September, 2013, by the following vote: Ayes: Directors: Noes: Directors: Absent: Directors: Abstain: Directors: By Roberta Gafford, Secretary Approved as to form by: LM Virginia Gennaro, Counsel to the Bakersfield Public Benefit Corporation 5 4823 - 9999 - 6948.2 Bakersfield Public Benefit Corporation Articles of Incorporation t F UL) 3589351 y% Maw Sub oicel wnis JUL 18 2M ARTICLES OF INCORPORATION . 'Z cc BAKERSFIELD PUBLIC BENEFIT CORPORATION ARTICLE I The name of this Corporation is `Bakersfield Public Benefit Corporation (hereinafter referred to as the "Corporation'). ARTICLE H The Corporation is a nonprofit public benefit corporation and is not organized for the private gain of any person. It is organized under the California Nonprofit Public Benefit Corporation Law for public purposes. The specific and primary purposes for which the Corporation is formed are: (a) To render financial or other assistance to the City of Bakersfield, California, or any successor public entity or assignee public entity which succeeds to the functions of the City of Bakersfield, California (collectively herein referred to as the "City "), by financing, refinancing, acquiring, constructing, improving, remodeling, leasing and selling buildings, building improvements, fixtures, equipment, facilities, improvements for electrical, water, sewer, parking, site development, furnishings, improvements, transportation, communications and any other public purposes, lands, insurance policies, self - insurance and funding mechanisms of any Type, and any other real or personal property for the benefit of the City or the local metropolitan area. (b) To acquire by lease, purchase, installment purchase, or otherwise, real or personal property, or any interest therein; to enter into contracts for services or for other purposes; to construct, reconstruct, modify, add to, and to improve or otherwise acquire or equip buildings, structures or improvements and (by sale, installment sale, lease, sublease, leaseback, gift or otherwise) make any part or all of any such real or .personal property, or improvements, available to or for the benefit of the public or the City or the local metropolitan area. (c) To promote the common good and general welfare of the City area and the inhabitants thereof and for the inhabitants of the local metropolitan area by providing the real and personal property and public improvements as hereinabove described. (d) To borrow the necessary funds to pay the cost of financing, refinancing, acquiring, constructing, replacing, establishing, improving, maintaining, equipping and operating such real and personal properties, facilities and improvements for the herein described purposes; the indebtedness for which borrowed money may, but need not, be evidenced by securities of the Corporation of any kind or character issued at any one or more times, which may be either unsecured or secured by any mortgage, trust, deed, pledge, encumbrance or other lien upon any part or all of the properties and assets at any time then or thereafter owned or acquired by the Corporation. (e) To conduct its business and affairs so that the City will have a beneficial interest in the Corporation. (f) To receive limited or conditional gifts or grants in trust, intervivos, or by way of testamentary devises, bequests or grants in trust, or otherwise, funds of all kinds including property, both real and personal, and mixed, whether principal or income, tangible or intangible, present or future, vested or contingent, in order to carry on the purposes of the Corporation. In addition to the foregoing, the Corporation shall have, and shall be entitled to exercise, all the powers of every kind lawfully available to a nonprofit public benefit corporation organized under the laws of the State of California; provided, however, that the Corporation shall not have the power to, and shall not, do any act or conduct any activity, plan, scheme, design or course of conduct which in any way conflicts with Sections 501(c)(3) or 501(c)(4) of the Internal Revenue Code of 1986, as amended, and regulations promulgated pursuant to such sections as they now exist or as they may hereafter be amended (collectively, the "Code "). ARTICLE III The name and address of the initial agent for service of process of the Corporation is Roberta Gafford, c/o City of Bakersfield, 1600 Truxtun Avenue, Bakersfield, California 93301. The principal office of the Corporation is located at 1600 Truxtun Avenue, Bakersfield, California 93301. ARTICLE IV The Corporation is organized as a nonprofit public benefit corporation, without capital stock and without members. The Corporation is organized and operated exclusively for social welfare purposes within the meaning of Section 501(c)(4) of the Internal Revenue Code of 1986. No gains, profits or dividends shall be distributed to any of the directors or officers of the Corporation, and no part of the new earnings, funds or assets of the Corporation shall inure to the benefit of any director, officer or individual, or any other person, firm or corporation excepting only the United States of America, the State of California, or any municipal corporation or political subdivision thereof, or to a nonprofit fund, foundation or corporation which is organized and operated exclusively for charitable or social welfare purposes and which has established its tax- exempt status under Section 501(c)(3) or 501(c)(4) of the Code. No part of the activities of the Corporation shall consist of carrying on propaganda, or otherwise attempting to influence legislation, nor shall it participate in, or intervene in, or publish or distribute statements concerning, any political campaign on behalf of any candidate for public office. The property of the Corporation is irrevocably dedicated to the United States of America, the State of California, or any municipal corporation or political subdivision thereof, or to a nonprofit fund, foundation or corporation which is organized and operated exclusively for charitable or social welfare purposes and which has established its tax - exempt status under Section 501(c)(3) or 501(c)(4) of the Code; provided, however, that until all debts and obligations of the Corporation shall have been paid, such property and any net revenues therefrom may be used for the purpose of paying and retiring the debts and obligations of the Corporation. W ARTICLE V The number of directors of the. Corporation shall be fixed pursuant to the bylaws of the Corporation (the "Bylaws "). The provisions governing the designation and removal of the directors shall be as set forth in the Bylaws. ARTICLE VI In order to preserve and ensure its separate and distinct corporate identity, in addition to the other provisions set forth in these Articles of Incorporation, the Corporation shall conduct its affairs in accordance with the following provisions: 1. It shall maintain separate corporate records and books of account from those of any affiliate. 2. Its board of directors shall hold appropriate meetings (or act by unanimous consent) to authorize all appropriate corporate actions, and in authorizing such actions, shall observe all corporate formalities. 3. It shall not commingle assets with those of any affiliate. 4. It shall conduct its own business in its own name. 5. It shall pay any liabilities out of its own funds, including salaries of any employees, not funds of any affiliate. 6. ;It shall maintain an arm's length relationship with all affiliates. 7. It shall not guarantee or become obligated for the debts of any other entity, including any affiliate, or hold out its credit as being available to satisfy the obligations of others. 8. It shall not pledge its assets for the benefit of any other entity, including any affiliate. 9. It shall hold itself out as an entity separate from all affiliates. For purpose of this Article VI, the following terms shall have the following meanings: "affiliate" means any person controlling or controlled by or under common control with the Corporation, including, without limitation (i) any person who has a familial relationship, by blood, marriage or otherwise with any director, officer or employee of the Corporation, its parent, or any affiliate thereof and (ii) any person which receives compensation for administrative, legal or accounting services from the Corporation, its parent or any affiliate. For purposes of this definition, "control" when used with respect to any specified person, means. the power to direct the management and policies of such person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms "controlling" and "controlled" have meanings correlative to the foregoing. "person" means any individual, corporation, partnership, limited liability company, joint venture, association, joint stock company, trust (including any beneficiary thereof), unincorporated organization or government, or any agency or political subdivision thereof. ARTICLE VII Subject to the limitations set forth in these Articles of Incorporation, the Corporation reserves the right to amend, alter, change or repeal any provisions contained in these Articles of Incorporation, in the manner now or hereafter prescribed by statute, and all rights and powers conferred upon directors and officers herein are granted subject to this reservation. ARTICLE VIII A director of the Corporation shall not be liable to the Corporation for monetary damages for breach of fiduciary duty as a director, except to the extent such exemption from the liability or limitation thereof is not permitted under the California General Corporation Law as currently in effect or as the same may hereafter be amended. No amendment, modification or repeal of this Article VIII shall adversely affect any right or protection of a director that exists at the time of such amendment, modification or repeal. ARTICLE IX During the continuance of the Corporation, it may distribute any of its assets to the City. If for any reason the City is unable or unwilling to accept the assets of the Corporation, said assets will be distributed to the United States of America, the State of California, or any municipal Corporation or political subdivision thereof, to a nonprofit fund, foundation or corporation which is organized and operated exclusively for charitable or social welfare purposes and which has established its tax- exempt status under Section 501(c)(3) or 501(c)(4) of the Code. Upon any liquidation, dissolution or winding up of the Corporation, its assets remaining after payment of, or provisions made for the payment of, all debts and liabilities of the Corporation, shall be distributed to the City. if for any reason the City is unable or unwilling to accept the assets of the Corporation, said assets will be distributed to the United States of America, the State of California, or any municipal corporation or political subdivision thereof or to a nonprofit fund, foundation or corporation which is organized and operated exclusively for charitable or social welfare purposes and which has established its tax - exempt status under Section 501(c)(3) or 501(c)(4) of the Code. ARTICLE X These Articles of Incorporation shall become effective on the date these Articles of Incorporation are filed with the Secretary of State of the State of California.. 4 6, . I, the undersigned, being the sole incorporator of the Corporation.. do hereby declare and certify that this is my act and deed, and accordingly have hereunto set my hand this 18`x' day of July, 2013. By I hereby cerfNy that the egoing rmUue and correct oopr'jT ' WOW record in tlw:0:9 oathe •.,,... Caltomis Saaetary of Slaw's office. JUL 31 2013 Date: _ DEBRA BOWEN, Secretary of State Bakersfield Public Benefit Corporation Bylaws BYLAWS OF BAKERSFIELD PUBLIC BENEFIT CORPORATION ARTICLE I NAME, ORGANIZATION AND PURPOSE, PRINCIPAL OFFICE Section 1.01. Name. The name of this corporation is `Bakersfield Public Benefit Corporation" (hereinafter referred to as the "Corporation "). Section 1.02. Organization, Purpose and Use of Funds. The activities of the Corporation shall be limited to the activities described in its Articles of Incorporation. No gains, profits or dividends shall be distributed to any of the directors or officers of the Corporation, and no part of the net earnings, funds or assets of the Corporation shall inure to the benefit of any director, officer or individual or any other person, firm or corporation excepting only the United States of America, the State of California, or any municipal corporation or political subdivision thereof, or to a nonprofit fund, foundation or corporation which is organized and operated exclusively for charitable or social welfare purposes and which has established its tax- exempt status under Section 501(c)(3) or 501(c)(4) of the Internal Revenue Code of 1986. Section 1.03. Principal O,07ce. The principal office of the Corporation for its transaction of business is located at 1600 Truxtun Avenue, Bakersfield, California 93301. Section 1.04. Change Of Principal Office. The Board of Directors of the Corporation (the "Board of Directors ") are hereby granted full power and authority to change the principal office of the Corporation from one location to another in the City of Bakersfield, California (the "City "). Any such change shall be noted by the Secretary of the Corporation (the "Secretary") in an appendix to these Bylaws, but no such appendix shall be considered an amendment of these Bylaws. ARTICLE II MEMBERSHIP The Corporation shall not have members within the meaning of Section 5056 of the California Nonprofit Corporation Law. Any action which would otherwise require approval by a majority of all members or approval by the members shall require only approval of the Board of Directors. All rights which would otherwise vest in the members shall vest in the directors. 4851 - 2389 - 2244.3 ARTICLE III DIRECT ®RS Section 3.01. Number. The authorized number of directors of the Corporation shall be eight, one of whom serves in an ex- officio capacity, as described in Section 3.02 herein. The exact number of directors may from time to time be changed by a resolution, Bylaw or amendment thereof adopted by the Board of Directors. Section 3.02. Designation of Directors. The Corporation's Board of Directors shall consist of the following persons who serve in the following positions for the City: (i) Chairman of the Board of Directors shall be the Mayor of the City (ex- officio capacity); (ii) Vice Chairman of the Board of Directors shall be one of the Councilmembers listed in parts (iii) through (ix) of this Section 3.02 who concurrently serves as the Vice Mayor of the City; (iii) a director of the Board of Directors shall be Councilmember, Ward 1 of the City; (iv) a director of the Board of Directors shall be Councilmember, Ward 2 of the City; (v) a director of the Board of Directors shall be Councilmember, Ward 3 of the City; (vi) a director of the Board of Directors shall be Councilmember, Ward 4 of the City; (vii) a director of the Board of Directors shall be Councilmember, Ward 5 of the City; (viii) a director of the Board of Directors shall be Councilmember, Ward 6 of the City; and, (ix) a director of the Board of Directors shall be Councilmember, Ward 7 of the City. Each current and future person who serves in the above described positions for the City shall serve as a director of the Board of Directors of the Corporation. Section 3.03. Term of Office. All directors of the Corporation shall serve as a director of the Board of Directors of the Corporation until such time as they no longer serve in one of the positions described in Section 3.02 of these Bylaws. Additionally, all directors of the Corporation may resign as a director of the Board of Directors of the Corporation by giving written notice of such resignation at least forty -five (45) days prior to the effective date of such resignation to the Board of Directors of the Corporation. Section 3.04. Voting. Voting at meetings may be by voice or by ballot. Section 3.05. Place of Directors' Meetings. Meetings of the Board of Directors shall be held at 1501 Truxtun Avenue, Bakersfield, California 93301, unless a different place is designated in the notice of such meeting. Section 3.06. Annual Meetings. The annual meeting of the Board of Directors shall be held in July of each year, or at such time as the Board of Directors may from time to time determine, for the purpose of electing directors, if required, and for the transaction of such other business as may properly come before the meeting. Section 3.07. Regular Meetings. The Board of Directors by resolution may provide for the holding of regular meetings and may fix the time and place of holding such meetings. Section 3.08. Special Meetings. Special meetings of the Board of Directors may be called in accordance with the provisions of Section 54956 of the Government Code of the State of California. 2 4851- 2389 - 2244.3 Section 3.09. Consent to Meetings. Any director not present at a meeting may, if such director so desires, file a written consent to actions taken at such meeting with the Secretary. Section 3.10. Quorum and Manner of Action. A quorum shall consist of a majority of the voting members of the Board of Directors unless a greater number is expressly required by these Bylaws. Unless expressly required by statute or by these Bylaws, every act or decision done or made by a majority of the Board of Directors, at a meeting duly held at which a quorum is present, shall be the act of the Board of Directors. Subject to the Articles of Incorporation, no action may be taken by the Board of Directors except upon the affirmative vote of a majority of the voting members of the Board of Directors. Notwithstanding Sections 3.01 and 3.02 herein, in the event there is no affirmative vote of a majority of the voting directors of the Board of Directors, the Chairman of the Board shall vote to break the tie vote. Section 3.11. Notice; Conduct of Meeting. All meetings of the Board of Directors shall be called, noticed, held and conducted subject to the provisions of the Ralph M. Brown Act (Chapter 9 of Part 1 of Division 2 of Title 5 of the Government Code of the State of California). The Chairman of the Board or, in his or her absence, the Vice Chairman of the Board, or, in the absence of the Vice Chairman of the Board, a chair chosen by a majority of the directors present, shall preside at all meetings of the Board of Directors. Section 3.12. Compensation of Directors. No director shall be entitled to receive any compensation for serving as a director or as an officer of the Corporation, except that any director or officer may be reimbursed for expenses duly incurred in the performance of duties as director or officer of the Corporation, upon approval of the Board of Directors. Any director may elect, however, to decline such reimbursement. ARTICLE IV POWERS OF BOARD OF DIRECTORS Section 4.01. General Powers of Board of Directors. Subject to the limitations of the Articles of Incorporation of the Corporation, the terms of these Bylaws, and the laws of the State of California, all corporate powers shall be vested in and exercised by or under the authority of, and the business, property and affairs of the Corporation shall be controlled by, the Board of Directors. The Board of Directors may delegate the management of the activities of the Corporation to any person or persons, management company or committee, however composed, provided that the activities and affairs of the Corporation shall be managed and all corporate powers shall be exercised under the ultimate direction of the Board of Directors. Section 4.02. IndemnUlcation. To the fullest extent permitted by law, the Board of Directors may authorize indemnification by the Corporation of any person who is or was a director, officer, employee or other agent of the Corporation, against expenses, judgments, fines, settlements and other amounts actually and reasonably incurred in connection with such proceeding, if such person acted in good faith and in a manner such person reasonably believed to be in the best interests of the Corporation and, in the case of a criminal proceeding, had no reasonable cause to believe the conduct of such person was unlawful and, in the case of an 3 4851- 2389 - 2244.3 action by or in the right of the Corporation, acted with such care, including reasonable inquiry, as an ordinarily prudent person in a like position would use under similar circumstances. Section 4.03. Incurring of Indebtedness. The Board of Directors, on behalf of the Corporation and in furtherance of its proper purposes, may incur such indebtedness, may issue bonds, notes, debentures and other evidences of indebtedness of the Corporation, may secure the same by mortgage, transfer in trust, pledge or other encumbrance of the whole or any part of the assets of the Corporation, may establish funds and make other provisions for the payment of such indebtedness and interest thereon, and may otherwise act or enter into other agreements in connection therewith, in each case as shall be deemed necessary or appropriate by the Board of Directors. Section 4.04. Loans and Other Agreements. Subject to the provisions of the California Nonprofit Public Benefit Corporation Law, the Board of Directors, on behalf of the Corporation and in furtherance of its proper purposes, may make loans to, enter into leases or subleases with, or otherwise enter into agreements with, any person, and may take such collateral or other security with respect thereto and may otherwise act or enter into other agreements in connection therewith, in each case as shall be deemed necessary or appropriate by the Board of Directors. ARTICLE V LIABILITY Section 5.01. Nonliability for Debts. The private property of the Board of Directors shall be exempt from execution or other liability for any debts, liabilities or obligations of the Corporation and no director shall be liable or responsible for any debts, liabilities or obligations of the Corporation. Section 5.02. Property Interest of Directors. No director of the Corporation shall have any right, title or interest in or to any property or assets of the Corporation either prior to or at the time of any liquidation or dissolution of the Corporation, all of which properties and assets shall at the time of any liquidation or dissolution vest to the City, State of California or otherwise as provided in the Articles of Incorporation of the Corporation. ARTICLE VI OFFICERS Section 6.01. Officers. The officers of the Corporation shall be a President/Executive Manager, a Vice President, a Chief Financial Officer, an Assistant Chief Financial Officer, a Secretary and an Assistant Secretary and such subordinate officers as the Board of Directors may appoint. Subject to Section 6.03 of these Bylaws, the office of President/Executive Manager shall always be held by the City Manager of the City and the office of Vice President shall always be held by the Assistant to the City Manager of the City without the need for the Board of Directors to make an appointment for such offices. Additionally, subject to Section 6.03 of these Bylaws and unless otherwise prescribed by the Board of Directors, the office of 4 4851- 2389 - 2244.3 the Chief Financial Officer shall be held by the Finance Director of the City, the office of the Assistant Chief Financial Officer of the City shall be held by the Assistant Finance Director of the City, the office of Secretary shall be held by the City Clerk of the City and the office of the Assistant Secretary shall be held by the Assistant City Clerk of the City without the need for the Board of Directors to make an appointment for such offices. When the duties do not conflict, one person may hold more than one of these offices; provided, however, that neither the Secretary nor the Chief Financial Officer may serve concurrently as the President/Executive Manager of the Board. The President/Executive Manager, Vice President, Chief Financial Officer, Assistant Chief Financial Officer, Secretary and Assistant Secretary shall have such powers and duties as may be prescribed by the Board of Directors or by these Bylaws. Section 6.02. Election, Terns of Off ce. Except as provided in Section 6.0 1, each officer shall be appointed by the Board of Directors, or, in the case of the initial officers, designated by the incorporator, and shall hold office until his or her successor shall have been appointed and qualified, or until the death, resignation or removal of such officer. Section 6.03. Resignations and Removal. Any officer may resign at any time by giving written notice to the President/Executive Manager or to the Secretary of the Corporation. Any such resignation shall take effect at the time specified therein and, unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective. Any officer may be removed, either with or without cause, by a majority of the Board of Directors then in office at any regular or special meeting of the Board of Directors, or except in the case of an officer chosen by the Board of Directors, by any officer upon whom such power of removal may be conferred by the Board of Directors. Section 6.04. Vacancies. A vacancy in any office because of death, resignation, removal, disqualification or any other cause, shall be filled in the manner prescribed in these Bylaws for regular appointment to such office. Section 6.05. PresidendEacecutive Manager. The President/Executive Manager shall be the chief executive officer of the Corporation and shall, subject.to the control of the Board of Directors, have general supervision, direction and control of the business and officers of the Corporation. The President/Executive Manager shall be ex- officio member of all standing committees, if any, and shall have the general powers and duties of management usually vested in the office of chief executive officer of a corporation and shall have such other powers and duties as may be prescribed by the Board of Directors or by these Bylaws. At each meeting of the Board of Directors, the President/Executive Manager shall submit such recommendations and information as he or she may consider proper concerning the business, affairs and policies of the Corporation. Section 6.06. Vice President. At the request of the President/Executive Manager or in the absence or disability of the President/Executive Manager, the Vice President shall perform all the duties of the President/Executive Manager and when so acting shall have all the powers of and be subject to all of the restrictions upon the President/Executive Manager. The Vice 5 4851 -2389- 2244.3 President shall have such other powers and perform such other duties as may from time to time be assigned to that office by the President/Executive Manager, the Board of Directors or by these Bylaws. Section 6.07. Chief Financial Offwer. The Chief Financial Officer shall keep and maintain or cause to be kept or maintained adequate and correct accounts of the properties and business transactions of the Corporation, including accounts of its assets, liabilities, receipts, disbursements, gains and losses. The books of account shall at all times be open to inspection by any director of the Board of Directors. The Chief Financial Officer shall deposit all moneys and other valuables in the name and to the credit of the Corporation in such depositories as may be designated by the Board of Directors. The Chief Financial Officer shall disburse the funds of the Corporation as shall be ordered by the Board of Directors, shall render to the President/Executive Manager and the Board of Directors whenever they shall request it, an account of all transactions and of the financial condition of the Corporation, shall take proper vouchers for all disbursements of the funds of the Corporation, and shall have such other powers and perform such other duties as may be prescribed by the Board of Directors, the President/Executive Manager or by these Bylaws. Section 6.08. Assistant Chief Financial 0.fter. At the request of the Chief Financial Officer or in the absence or disability of the Chief Financial Officer, the Assistant Chief Financial Officer shall perform all the duties of the Chief Financial Officer and when so acting shall have all the powers of and be subject to all of the restrictions upon the Chief Financial Officer. The Assistant Chief Financial Officer shall have such other powers and perform such other duties as may from time to time be assigned to that office by the Chief Financial Officer, the Board of Directors or by these Bylaws. Section 6.09. Secretary. The Secretary .shall: (a) certify and keep at the office of the Corporation, or at such other place as the Board of Directors may order, the original or a copy of these Bylaws, as amended or otherwise altered; (b) keep at the office of the Corporation, or at such other place as the Board of Directors may order, a book of minutes of all meetings of the directors, recording therein the time and place of holding, whether regular or special, and, if special, how authorized, the notice thereof given, and the proceedings thereat; (c) see that all notices are duly given in accordance with the provisions of these Bylaws or as required by law; (d) be custodian of the records of the Corporation; (e) exhibit at all reasonable times to any director, upon application, these Bylaws and the minutes of the proceedings of the directors of the Corporation; and (f) in general, perform all duties of the office of Secretary and such other duties as may from time to time be assigned to such office by the Board of Directors or the President/Executive Manager. 6 4851- 2389 - 2244.3 Section 6. 10. Assistant Secretary. At the request of the Secretary or in the absence or disability of the Secretary, the Assistant Secretary shall perform all the duties of the Secretary and when so acting shall have all the powers of and be subject to all of the restrictions upon the Secretary. The Assistant Secretary shall have such other powers and perform such other duties as may from time to time be assigned to that office by the Secretary, the Board of Directors or by these Bylaws. Section 6.11. Subordinate QTwers. The Board of Directors may elect or authorize the appointment of such other officers than those hereinabove mentioned as the business of the Corporation may require, each of whom shall hold office for such period, have such authority and perform such duties as are provided in these Bylaws, or as the Board of Directors or the President/Executive Manager from time to time may authorize or determine. ARTICLE VII OBJECTS AND PURPOSES Section 7.01. Nature of Objects and Purposes. The business of the Corporation is to be operated and conducted in the promotion of its objects and purposes as set forth in Article II of the Articles of Incorporation. Section 7.02. Disbursement of Assets During Continuance of Corporation. During the continuance of the Corporation, the Corporation may distribute any of its assets to the City. If for any reason the City is unable or unwilling to accept the assets of the Corporation, said assets will be distributed to the United States of America, the State of California, or any municipal corporation or political subdivision thereof or to a nonprofit fund, foundation or corporation which has established its tax- exempt status under Section 501(c)(3) or 501(c)(4) of the Internal Revenue Code of 1986, as amended. Section 7.03. Dissolution. Subject to the limitations contained in the Articles of Incorporation, the Corporation shall not be voluntarily dissolved, except by the vote of a majority of the Board of Directors. Upon the dissolution or winding up of the Corporation, its assets remaining after payment of, or provision made for the payment of, all debts and liabilities of the Corporation, shall be distributed to the City. If for any reason the City is unable or unwilling to accept the assets of the Corporation, said assets will be distributed to the United States of America, the State of California, or any municipal corporation or political subdivision thereof or to a nonprofit fund, foundation or corporation which has established its tax- exempt status under Section 501(c)(3) or 501(c)(4) of the Internal Revenue Code of 1986, as amended. Section 7.04. Merger. The Corporation may merge with other corporations organized solely for nonprofit purposes, qualified and exempt from State of California taxation and from Federal taxation pursuant to Section 501(c)(3) or 501(c)(4) of the Internal Revenue Code of 1986, as amended, upon compliance with the provision of California law relating to merger and consolidation. 7 4851 - 2389 - 2244.3 ARTICLE VIII GENERAL PROVISION Section 8.01. Payment of Money, Signatures. All checks, drafts or other orders for payment of money, notes or other evidences of indebtedness issued in the name of or payable to the Corporation and any and all securities owned by or held by the Corporation requiring. signature for transfer shall be signed or endorsed by such person or persons in such manner as from time to time shall be determined by the Board of Directors. Section 8.02. Execution of Contracts. The Board of Directors, except as otherwise provided in these Bylaws, may authorize any officer or officers, agent or agents, to enter into any contract or execute any contract or execute any instrument, in the name of and on behalf of the Corporation and such authority may be general or confined to specific instances and unless so authorized by the Board of Directors, no officer, agent or employee shall have any power or authority to bind the Corporation by any contract or engagement or to pledge its credit or to render it liable for any purpose or in any amount. Section 8.03. Fiscal Year. The fiscal year of the Corporation shall commence on July 1 of each year and shall end June 30 of the next succeeding year. Section 8.04. Annual Audit. The affairs and financial condition of the Corporation shall be audited annually at the end of each fiscal year as a part of the annual audit of the City. Section 8.05. Construction and Definitions. Unless otherwise provided herein or in the Articles of Incorporation, the general provisions, rules of construction and definitions contained in the General Provisions & Definitions of the California Nonprofit Corporation Law and in the California Nonprofit Public Benefit Corporation Law shall govern the construction of these Bylaws. ARTICLE IX EXEMPT ACTIVITIES Notwithstanding any other provisions of these Bylaws, no director, officer, employee, or representative of the Corporation shall take any action or carry on any activity by or on behalf of the Corporation not permitted to be taken or carried on by an organization exempt under Section 501(c)(3) or Section 501(c)(4) of the Internal Revenue Code of 1986, as amended, and its Regulations as they now exist or as they may hereafter be amended. ARTICLE X AMENDMENT OF BYLAWS AND ARTICLES OF INCORPORATION Section 10.01. Amendment of Bylaws. Subject to the limitations contained in the Articles of Incorporation, any of these Bylaws may be amended or repealed, and new Bylaws may be adopted, by the affirmative vote of a majority of the directors of the Board of Directors. 8 4851- 2389 - 2244.3 Section 10.02. Amendment of Articles of Incorporation. Subject to the limitations contained in the Articles of Incorporation, the Articles of Incorporation of the Corporation may be amended by unanimous vote of the Board of Directors. I 4851 -2389- 2244.3