HomeMy WebLinkAboutResolution 1992 - 0152RESOLUTION NO.92-152-7
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.7 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,California 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 11 of
Orange County,California,Certificates of Participation (Capital
Improvement Program,1990-92 Series B)maturing August 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 199].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 198.6 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 valorelu 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.7
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 (1)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.
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
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.7 of Orange County,California,do hereby certify that
the foregoing Resolution No.92-152-7 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:Charles E.Puckett,Chairman,Fred Barrera,John C.Cox,Jr.,
Barry Haninond,Don R.Roth,James A.Wahner
NOES:None
ABSENT:Robert Richardson
IN WITNESS WHEREOF,I have hereunto set my hand and affixed the official
seal of County Sanitation District No.7 of Orange County,California,this
14th day of October,1992.
Penny Kyle,~sisJ ’ht ecretary
Board of Dirètto~of County
Sanitation District No.7
of Orange County,California