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Home My WebLink AboutRES NO 057-06 RESOLUTION NO. 057;06 A RESOLUTION APPROVING THE EXECUTION, SALE AND DELIVERY OF NOT TO EXCEED 36,700,000 OF THE 2006 REFUNDING CERTIFICATES OF PARTICIPATION TO PROVIDE FOR THE PREP A YMENT OF LEASE PAYMENTS AND REFUNDING OF THE 1997 CERTIFICATES OF PARTICIPATION (CONVENTION CENTER EXPANSION - ARENA PROJECT); AUTHORIZING AND DIRECTING EXECUTION OF CERTAIN LEASE FINANCING DOCUMENTS; APPROVING A PRELIMINARY OFFICIAL STATEMENT AND AUTHORIZING THE PREPARATION, EXECUTION, DELIVERY AND DISTRIBUTION OF A FINAL OFFICIAL STATEMENT TO BE DERIVED FROM THE PRELIMINARY OFFICIAL STATEMENT; APPROVING AND AUTHORIZING EXECUTION OF A PURCHASE CONTRACT; APPROVING AND AUTHORIZING EXECUTION OF A CONTINUING DISCLOSURE CERTIFICATE; APPROVING AND AUTHORIZING EXECUTION OF AN ESCROW AGREEMENT; AND AUTHORIZING AND DIRECTING ADDITIONAL ACTIONS TO IMPLEMENT THE PROPOSED PREP A YMENT AND REFUNDING PROGRAM WHEREAS, the City of Bakersfield (the "City") has determined that it is in the best interest of the City and its inhabitants at this time to provide for the prepayment of the lease payments required under the hereinafter defined 1997 Lease Agreement (the "1997 Lease Payments") and refunding of the remaining outstanding 1997 Certificates of Participation (Convention Center Expansion - Arena Project) (the "1997 Certificates") of the City (the "Refunding Program"), together with associated costs and expenses of the Refunding Program, including but not limited to legal and financial advisors, underwriter's discount, certificate insurance premium, debt service reserve surety premium, title and other insurance premiums and other costs associated with the execution and delivery of the Certificates (as defined below); and WHEREAS, in connection with the 1997 Certificates, the following agreements, each dated as of April I, 1997, were entered into among the parties indicated: a. a Property Lease (the "1997 Property Lease"), between the City as site lessor and the Central District Development Agency of the City of Bakersfield, since renamed the "Bakersfield Redevelopment Agency" and hereinafter in this resolution referred to as the "Agency," as site lessee, pursuant to which the City leased the Site (as defined in the next paragraph) to the Agency; b, a Lease Agreement (the "1997 Lease Agreement"), between the Agency as Lessor and the City as Lessee, respecting the City's Convention Center Complex and the Arena (collectively, the "Leased Facilities"), together with the respective parcels of land on which the Leased Facilities are situated and a non- exclusive right to use certain additional parking facilities and parcels of land for 4832-0779-5456.3 - Page 1 of 7 Pages- X ~A/((?, () <f' >-. "! r- rr - t- o <::: 0RIf:;INAI parking purposes (collectively, the "Site"), and pursuant to which the Agency leased the Site and the Leased Facilities to the City in exchange for the payment by the City of the 1997 Lease Payments in the amounts and on the dates provided by the 1997 Lease Agreement; c, a Trust Agreement (the "1997 Trust Agreement"), by and among the City, the Agency and First Trust of California, National Association, as Trustee (since succeeded by U,S, Bank National Association, hereinafter referred to as the "Trustee"), pursuant to which the 1997 Certificates were executed and delivered to George K, Bawn & Company, as the original purchaser thereof, in accordance with instructions of the City, and the proceeds of sale of the 1997 Certificates were applied for the authorized purposes thereof, including payment of a portion of the cost and expense of improvements to the City's Convention Center and Arena; and d, an Assignment Agreement (the "1997 Assignment Agreement"), between the Agency and the Trustee, pursuant to which the Agency assigned all of its right, title and interest under the 1997 Property Lease and the 1997 Lease Agreement to the Trustee; and WHEREAS, the 1997 Certificates cannot be optionally prepaid in advance of maturity until April 1,2007, which necessitates structuring the Refunding Program as an advance refunding; and due to limitations of federal income tax law, only a portion of the 1997 Certificates is eligible for advance refunding on a federally tax-exempt basis; and WHEREAS, the City now desires to prepay the 1997 Lease Payments and refund the 1997 Certificates through the issuance of one or more series of its Refunding Certificates of Participation (Convention Center - Arena Projects) Series 2006A (Tax- Exempt) (the "Series 2006A Certificates") and its Refunding Certificates of Participation (Convention Center ~ Arena Projects) Series 2006B (Taxable Convertible to Tax- Exempt) (the "Series 2006B Certificates," and together with the Series 2006A Certificates, the "Certificates"); and WHEREAS, in order to provide for, among other things, the execution, sale and delivery of the Certificates and to achieve the savings made possible by the Refunding Program, it is necessary (1) to prepay the 1997 Lease Payments and refund the 1997 Certificates, which will terminate the 1997 Property Lease, the 1997 Lease Agreement, the 1997 Trust Agreement and the 1997 Assignment Agreement, (2) to provide for the execution of a new lease agreement, trust agreement, property lease and assignment agreement, and (3) to approve the form and substance of (i) a Preliminary Official Statement (the "Preliminary Official Statement") pertaining to the Certificates and the Refunding Program, (ii) a Purchase Contract (the "Purchase Contract") providing the terms and conditions of sale by the City and purchase by George K, Baum & Company (the "Underwriter") of the Certificates, (iii) a Continuing Disclosure Certificate of the City (the "Continuing Disclosure Certificate") by which the City will enable the Underwriter to comply with certain requirements of Rule 15c2-12 of the Securities and Exchange Commission, and (iv) an Escrow Agreement, dated as of March I, 2006 (the - Page 2 of7 Pages - '< 'òM~?- o u' '" >- - ~ ~ l' ORIGINAl ~ 4832-0779-5456.3 "Escrow Agreement") providing for the establishment and application of a refunding escrow for the Refunding Program, including but not limited to the payment of current interest on April I and October I, 2006 and on April I, 2007, the payment of the principal becoming due and payable on April I, 2006, and the prepayment of the principal on April I, 2007, together with a prepayment premium, of the 1997 Certificates; and WHEREAS, there have been prepared and submitted to the City Clerk for consideration by this City Council (this "Council") forms of the following, each in connection with the implementation of the Refunding Program: a. a Property Lease, dated as of March I, 2006 (the "Property Lease"), between the City and the Agency, in substance the same as the 1997 Property Lease, pursuant to which the Agency will lease the Site from the City; b. a Lease Agreement, dated as of March I, 2006 (the "Lease Agreement"), between the City and the Agency, in substance the same as the 1997 Lease Agreement but providing for a modified schedule of lease payments to reflect the saving achieved by the Refunding Program (the "Lease Payments"), and pursuant to which the City will lease the Site and the Leased Facilities from the Agency in order to provide moneys to implement the Refunding Program; c, a Trust Agreement, dated as of March I, 2006 (the "Trust Agreement"), by and among the City, the Agency and the Trustee, providing in part for (i) the execution, sale and delivery of the 2006A Certificates, which evidence an undivided fractional interest a portion of the Lease Payments to be made by the City pursuant to the Lease Agreement and the execution, sale and delivery of the 2006B Certificates, which evidence an undivided fractional interest in a portion of the Lease Payments to be made by the City pursuant to the Lease Agreement, (ii) the administration of the proceeds of sale of the Certificates to establish the refunding escrow and to pay the financing costs associated with the implementation of the Refunding Program, and (iii) the administration of the Lease Payments to pay the principal of the interest on the Certificates; d. an Assignment Agreement, dated as of March 1, 2006 (the "Assignment Agreement"), between the Agency and the Trustee, by which the Agency assigns to the Trustee all of its right, title and interest in the Property Lease and the Lease Agreement; e. the Preliminary Official Statement; f, the Purchase Contract; g, the Continuing Disclosure Certificate; and h, the Escrow Agreement; and - Page 3 of 7 Pages - x ~Mt/y () ,[. -< >- - 1- IT _ r- Ù <::- ORIGINAl 4832·0779-5456.3 . -'->--'~-~'-'--'-'-'-'--- WHEREAS, this Council has determined that it is in the best interest of the City and for the public benefit that this Council approve the form and substance of each of the documents listed in the foregoing recital clause, to authorize modifications to each prior to execution, and (except for the Assignment Agreement, to which the City is not a party) to authorize and direct execution, distribution and delivery of each of them, as modified, and certain other financing documents in connection therewith to implement the Refunding Program, including execution, sale and delivery of the Certificates; NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Bakersfield as follows: SECTION 1. The documents enumerated below are hereby approved as to form and substance, and (except for the Assignment Agreement, to which the City is not a party) the Mayor, the Finance Director, the City Attorney and such other officers as are specified by each of the respective documents (together with any designee in writing of any such officer; all references hereinafter in this resolution to any officer of the City shall be deemed to include any designee in writing of such officer) are and each of them is hereby authorized and directed to execute said documents, with such changes and modifications as may be approved by the Finance Director, which approval shall be conclusively established by such execution: (A) the Property Lease; (B) the Lease Agreement; (C) the Trust Agreement; (D) the Assignment Agreement; (E) the Preliminary Official Statement; (F) the Purchase Contract; (G) the Continuing Disclosure Certificate; and (H) the Escrow Agreement. SECTION 2. The Finance Director, or his designee, is authorized to execute an appropriate certificate stating his determination that the Preliminary Official Statement has been "deemed final" within the meaning of Rule l5c(2)-12, - Page 4 of7 Pages - X '?>AI<.é:/y Q ú >- ~ ¡.- rt - ,... o to nRIGINAI 4832-0779-5456.3 SECTION 3. The City's Finance Director is hereby authorized and directed to deliver in printed and/or electronic format said Preliminary Official Statement to the Underwriter in substantially said form with such changes as the Finance Director approves, after consultation with Disclosure Counsel, such approval to be conclusively evidenced by such delivery, The Underwriter is hereby authorized to distribute and use the Preliminary Official Statement in connection with the pre-marketing and pricing of the Certificates, The Finance Director is authorized and directed to cause the Preliminary Official Statement to be brought into the form of a final official statement (the "Final Official Statement") and to execute said Final Official Statement, dated as of the date of sale of the Certificates, and the Finance Director is authorized and directed to execute a statement that the facts contained in the Final Official Statement, and any supplement or amendment thereto (which shall be deemed an original part thereof for the purpose of such statement) were, at the time of sale of the Certificates, true and correct in all material respects and that the Final Official Statement did not, on the date of sale of the Certificates, and does not, as of the date of delivery of the Certificates, contain any untrue statement of a material fact with respect to the City or omit to state material facts with respect to the City required to be stated where necessary to make any statement made therein not misleading in light of the circumstances under which it was made, The Finance Director shall take such further actions prior to the signing of the Final Official Statement as are deemed necessary or appropriate to verify the accuracy thereof, The Final Official Statement, when prepared, is approved for distribution, in either printed and/or electronic format, in connection with the offering and sale of the Certificates. SECTION 4. The Finance Director is authorized to (a) approve the purchase price to be set forth in Section I of the Purchase Contract, (b) approve a maturity schedule, interest rates and initial offering prices or yields to be set forth in Appendix A of the Purchase Contract, provided that the principal amount of the Certificates shall not exceed $36,700,000, the purchase price (exclusive of original issue discount, if any) shall not be less than 98.0% of par, the average interest rate shall not exceed 6,00% per annum, and the Underwriter's discount and/or underwriting fee shall not exceed ,90 percent of the aggregate principal amount of the Certificates, plus any premium thereon, and (c) approve a closing date to be set forth in Section 5 of the Purchase Contract. Upon completion of the Purchase Contract in said manner, the oÍÌÏcers of the City specified therein are authorized to execute the Purchase Contract. SECTION 5. The Finance Director IS authorized to execute the Continuing Disclosure Certificate. - Page 5 of 7 Pages - X 'òA/(~'Ý () cJ, ;>.. .., I- ¡;: - t- o c:, f)RIGINAI . 4832-0779-5456.3 SECTION 6. The Mayor, the City Manager, the Finance Director, the City Clerk, the City Attorney, the City Risk Manager, the Public Works Director and any other officer or employee of the City necessary for the purpose are authorized to execute any additional documents and agreements and to take any additional actions, including authorizing entering into a reserve fund surety policy agreement, as may be necessary or appropriate, as detennined by special legal counsel to the City for the Refunding Program, to accomplish execution, sale and delivery of the Certificates and to otherwise implement the Refunding Program. SECTION 7. This resolution shall take effect immediately upon its passage, - Page 6 of7 Pages- X 'òAl\l:/y () ò >- :'. >- fT - r- tJ <:- ORIGINAl 4832-0779-5456.3 I HEREBY CERTIFY that the foregoing Resolution was passed and adopted by the City Council of the City of Bakersfield at a regular meeting thereof held on February 22, 2006, by the following vote: __- L- ~- ~-- (....-- ~ CARSON, BENHAM, MAGGARD, COUCH, HANSON, SULLJV AN, SCRIVNER c ill$) NOES: ABSTAIN: ABSENT: COUNCILMEMBER COUNCILMEMBER COUNCILMEMBER COUNCILMEMBER ~~.OJ. j. rf\r/'~ City Clerk and Ex Officio Clerk of the Council of the City of Bakersfield APPROVED this 22nd day of February, 2006 HARVEY 1. HALL Mayor of the ity of Bakersfield APPROVED AS TO FORM: VIRGINIA G EjO City Attorney / ,// " By: - Page 7 of 7 Pages - 4832-0779·5456.3 ~ 'ò1>.!\t-1¿'p >- .,. ';::. iT '" r-- tc ORIOI"'^,