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HomeMy WebLinkAboutResolution 1992 - 0147RESOLUTION NO.92-147-1 APPROVING:REFUNDING CERTIFICATES OF PARTICIPATION FINANCING PURSUANT TO DISTRICTS’ADOPTED LONG-RANGE FINANCIAL PLAN,AND AGREEMENTS RELATED THERETO A RESOLUTION OF THE BOARD OF DIRECTORS OF COUNTY SANITATION DISTRICT NO.1 OF ORANGE COUNTY,CALIFORNIA, AUTHORIZING THE PREPARATION,EXECUTION AND DELIVERY OF REFUNDING CERTIFICATES OF PARTICIPATION,1992 SERIES, APPROVING A TRUST AGREEMENT,AGREEMENT FOR ACQUISITION AND CONSTRUCTION,ASSIGNMENT AGREEMENT,ESCROW AGREEMENT, SWAP AGREEMENT,MUTUAL BENEFIT ADVANCES AGREEMENT, LIQUIDITY FACILITY,LIQUIDITY GUARANTY AGREEMENT, REMARKETING AGREEMENT,PRELIMINARY OFFICIAL STATEMENT AND THE DISTRIBUTION THEREOF,PURCHASE CONTRACT,AND CERTAIN ACTIONS IN CONNECTION THEREWITH WHEREAS,County Sanitation District Nos.1,2 and 3 of Orange County,California (“District Nos.1,2 and 3”)have entered into an Agreement for the Acquisition and Construction of Joint Facilities,dated as of August 1,1986 (the “1986 Agreement for Acquisition and Construction”);and WHEREAS,District Nos.1,2 and 3 have caused to be delivered pursuant to a Trust Agreement,dated as of August 1, 1986,the Certificates of Participation,County Sanitation Districts Nos.1,2 and 3 of Orange County,Californja Joint Facilities Project (the “1986 Certificates”);and WHEREAS,District Nos.1,2 and 3,together with County Sanitation District Nos.5,6,7 and 11 (collectively,the “Participating Districts”)have entered into an Agreement for Acquisition and Construction,dated as of May 1,1991 (the “1991 Agreement for Acquisition and Construction”);and WHEREAS,the Participating Districts have caused to be delivered pursuant to a Trust Agreement,dated as of May 1,1991, the County Sanitation District Nos.1,2,3,5,6,7 and 1].of Orange County,California,Certificates of Participation (Capital Improvement Program,1990-92 Series B)maturing AuTgust 1,2013 (the “1991 Certificates”);and WHEREAS,it has been proposed that this District authorize,pursuant to a Trust Agreement,dated as of October 1, 1992,among State Street Bank and Trust Company of California, N.A.,as Trustee (the “Trustee”)and the Participating Districts (the “New Trust Agreement”),the proposed form of which has been presented to this Board of Directors,the preparation,execution and delivery by the Trustee of refunding Certificates of Participation (the “New Certificates”),which New Certificates evidence and represent direct and proportionate interests in the Principal Components and Interest Components of the New Installment Payments,to provide funds sufficient,together with earnings thereon,to pay (i)interest and principal with respect to all outstanding 1986 Certificates to and including August 1,1996 and to prepay the then remaining outstanding 1986 Certificates on August 1,1996 and providing for the prepayment of the related installment payments and (ii)interest and principal with respect to all outstanding 1991 Certificates to and including August 1, 2001 and to prepay the then outstanding 1991 Certificates on August 1,2001,and providing for the prepayment of the related installment payments;and WHEREAS,District Nos.1,2 and 3 propose to acquire certain improvements to joint facilities and certain other public improvements constituting the project described in Appendix B to the 1986 Agreement for Acquisition and Construction (the “1986 Project”)individually and in conjunction with District Nos.1,2 and 3;and WHEREAS,this District proposes to acquire certain improvements to joint facilities and certain other public improvements constituting.a portion of the project described in Exhibit A to the 1991 Agreement for Acquisition and Construction (the “1991 Project”)individually and in conjunction with the Participating Districts (the 1986 Project and the 1991 Project shall be referred to herein as the “Project”);and WHEREAS,the Participating Districts propose to finance the acquisition of the Project;and WHEREAS,it has been proposed that the District in concert with the other Participating Districts acquire the Project pursuant to an Agreement for Acquisition and Construction,dated as of October 1,1992,by and among the Participating Districts (the “New Acquisition Agreement”),the proposed form of which has been presented to this Board of Directors,pursuant to which the Participating Districts will agree to make certain installment payments (the “New Installment Payments”)in connection therewith; and WHEREAS,it has been proposed that the District grant, assign and transfer all of its rights to receive the New Installment Payments from Net Enterprise Revenues,including,to 2 the fullest extent permitted by law,ad valorein property taxes pledged to the payment of such New Installment Payments)to the Trustee pursuant to an Assignment Agreement,dated as of October 1, 1992,by and among the Participating Districts and the Trustee (the “Assignment Agreement”),the proposed form of which has been presented to this Board of Directors;and WHEREAS,it has been proposed that certain proceeds received from the sale of the New Certificates and certain other moneys be deposited in an escrow fund to be held by the Trustee pursuant to an Escrow Agreement,dated as of October 1,1992,by and among the Participating Districts and the Trustee,as Escrow Agent (the “Escrow Agreement”),the proposed form of which has been presented to this Board of Directors;and WHEREAS,it has been proposed that the District,in concert with the other Participating Districts,enter into an Interest Rate Swap Agreement among AIG Financial Products Corporation (“AIG-FP”)and the Participating Districts (the “Swap Agreement”),pursuant to which the Participating Districts will pay a fixed rate to AIG-FP and AIG-FP will pay the variable interest rate on the New Certificates to the Participating Districts,the proposed form of which Swap Agreement has been presented to this Board of Directors;and WHEREAS,it has been proposed that this District,in concert with the Participating Districts,enter into a Mutual Benefit Advances Agreement,dated as of October 1,1992,by and among the Participating Districts (the “Advances Agreement”) (sometimes referred to as a “cross—collateralization agreement”), pursuant’to which the Participating Districts agree to make certain advances of funds as needed to meet payment obligations of the other Participating Districts in connection with the delivery of the New Certificates,the proposed form of which Advances Agreement has been presented to this Board of Directors;and WHEREAS,there has been presented to this Board of Directors a Preliminary Official Statement relating to the New Certificates (the “Preliminary Official Statement”);and WHEREAS,in order to secure the payment under certain circumstances of the purchase price of the New Certificates,the Participating Districts may enter into a letter of credit, liquidity facility or similar arrangement (the “Liquidity Facility”)to be issued by one or more liquidity providers (the “Liquidity Provider”),the proposed form of which Liquidity Facility has been presented to this Board of Directors;and WHEREAS,it has been proposed that the District,in concert with the Participating Districts,enter into a Liquidity Guaranty Agreement among AIG-FP and the Participating Districts (the “Liquidity Guaranty”),pursuant to which AIG-FP will provide 3 assurance as to the liquidity support for the New Certificates after the expiration of the initial Liquidity Facility,the proposed form of which Liquidity Guaranty has been presented to this Board of Directors;and WHEREAS,in order to secure the payment of principal and interest with respect to the New Certificates,the Participating Districts may obtain municipal bond insurance;and WHEREAS,to facilitate the remarketing of the New Certificates,the Participating Districts may enter into a Remarketing Agreement,dated as of October 1,1992 by and among the Participating Districts and PaineWebber Incorporated as Remarketing Agent (the “Remarketing Agent”)(the “Remarketing Agreement”),the proposed form of which has been presented to this Board of Directors;and WHEREAS,it has been proposed that PaineWebber Incorporated (the “Underwriter”)purchase the New Certificates pursuant to a Certificate Purchase Agreement among the Underwriter and the Participating Districts (the “Purchase Contract”),the proposed form of which has been presented to this Board of Directors;and WHEREAS,it is proposed that the terms of the financing contemplated by the foregoing shall be subject to the limitations set forth in Section 3 hereof;and WHEREAS,this District has determined that it is in the best interest of this District and the residents within the District to approve the Preliminary Official Statement and authorize and approve the transactions contemplated thereby;and NOW,THEREFORE,the Board of Directors of District No.1 does hereby resolve as follows: Section 1 That the New Trust Agreement,the New Acquisition Agreement,the Assignment Agreement,the Escrow Agreement,the Swap Agreement,the Advances Agreement,the Liquidity Facility,the Liquidity Guaranty,the Purchase Contract and the Remarketing Agreement,in the forms presented to this Board of Directors,are hereby approved.The Chairman or Chairman pro tempore and the Board Secretary or a Deputy Board Secretary are authorized for and in the name of the District to execute and deliver said agreements.The agreements shall be executed in the forms hereby approved,with such additions thereto and changes therein as are (i)approved in accordance with Section 3 hereof, such approval to be conclusively evidenced by the execution and delivery thereof or (ii)recommended by Special Counsel to the Participating Districts and approved by such officers,such approval to be conclusively evidenced by the execution and delivery thereof.S 4 Section 2 That this Board of Directors hereby authorizes the preparation,execution and delivery of the New Certificates in accordance with the terms and provisions of the New Trust Agreement (as executed and delivered). Section 3 (a)The agreements referred to in Section 1 and of this Resolution shall,when executed and delivered pursuant hereto,contain such additions and changes as shall have been approved by the General Manager of the Participating Districts (or, in the absence of the General Manager,the Director of Finance) (the “Manager”),subject to the following limitations: (i)the aggregate principal amount of the New Certificates executed and delivered by the Participating Districts pursuant hereto shall not exceed $170,000,000; (ii)the initial interest rate with respect to the New Certificates shall not exceed 5.00%and the fixed rate payable by the Participating Districts with respect to the Swap Agreement shall not exceed 6.00%; (iii)the annual fee to the Remarketing Agent shall not exceed 0.075%per annum; (iv)the annual fee to the Liquidity Provider,which provider shall be selected by the Manager,shall not exceed 0.25%per annum of the stated amount of such Liquidity Facility; (v)the final New Installment Payment of the District under the New Acquisition Agreement shall be due and payable not later than December 2013; (vi)the Underwriter’s discount (excluding any original issue discount)•under the Purchase Contract shall not exceed 0.35%of the aggregate principal amount of the New Certificates; (vii)if the Manager shall decide to obtain municipal bond insurance with respect to all or any portion of the financing,the premium for such insurance shall not exceed 0.27%of the payments insured; and (viii)the annual fee payable to AIG-FP under the Liquidity Guaranty in the event the Liquidity Facility is terminated shall not exceed 0.25%. 5 (b)The terms approved in paragraph (a)of this Section 3 shall produce for the Participating Districts a present value savings from the advance refunding of the 1986 Certificates and the 1991 Certificates (after reduction for projected potential reserve fund earnings losses)of not less than 2.00%of the principal amount (production)of the New Certificates. Section 4 The Preliminary Official Statement presented to this Board of Directors is hereby approved,and the distribution of said Preliminary Official Statement (with such additions and changes as are consistent with this Resolution and the limits prescribed herein and approved by the Manager)to prospective purchasers of the New Certificates is hereby approved. Section 5 The Chairman or Chairman pro tempore is authorized to execute and deliver a final Official Statement in accordance with the Purchase Contract in substantially the form of the Preliminary Official Statement,with such additions thereto and changes therein as are consistent with this Resolution and the limits prescribed herein or recommended by Special Counsel to the Districts and approved by such officers,such approval to be conclusively evidenced by the execution and delivery thereof. Section 6 That this Board of Directors hereby appoints State Street Bank and Trust Company of California,N.A.as the Trustee under the New Trust Agreement. Section 7 The revenues of this District,pursuant to the Resolution of the District Dedicating its Revenues for the Payment of Obligations adopted May 13,1992,are dedicated to the payment of all obligations of the District under the agreements referred to in Section 1 of this Resolution,in accordance with such Resolution. Section 8 The Chairman,Chairman pro tempore,Board Secretary and any other officer,official or member of the staff of the District is each 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 and advisable in order to effectuate the purposes of this Resolution,and such actions previously taken by such officers are hereby ratified and confirmed. 6 a Section 9 This Resolution shall take effect immediately upon its adoption. PASSED AND ADOPTED at a regular meeting held October 14,1992. 7 STATE OF CALIFORNIA) )SS. COUNTY OF ORANGE ) I,PENNY KYLE,Assistant Secretary of the Board of Directors of County Sanitation District No.1 of Orange County,California,do hereby certify that the foregoing Resolution No.92-147—1 was passed and adopted at a regular meeting of said Board on the 14th day of October,1992,by the following vote, to wit: AYES:Dan Griset,Chairman,Fred Barrera,Thomas Saltarelli, Roger R.Stanton,James A.Wahner NOES:None ABSENT:None IN WITNESS WHEREOF,I have hereunto set my hand and affixed the official seal of County Sanitation District No.1 of Orange County,California,this 14th day of October,1992. Secretary Board of ire ors of County Sanitation District No.1 of Orange County,California