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Resolution 2018-020/CWS 2018-01 RESOLUTION 2018-90 /CWS RESOLUTION 2018-jj A RESOLUTION SUPPLEMENTING RESOLUTION NO. CWS-85-13 IN CERTAIN RESPECTS, WHICH RESOLUTION NO. CWS-85-13, AMONG OTHER THINGS, RESTATED RESOLUTION NO. CWS-85-5 IN ITS ENTIRETY AND AUTHORIZED THE ISSUANCE BY THE COLLIER COUNTY WATER-SEWER DISTRICT OF WATER AND SEWER REVENUE BONDS FROM TIME TO TIME; AUTHORIZING THE ISSUANCE OF NOT EXCEEDING $43,000,000 AGGREGATE PRINCIPAL AMOUNT OF A COLLIER COUNTY WATER-SEWER DISTRICT WATER AND SEWER REVENUE BOND, SERIES 2018 IN ORDER TO FINANCE THE ACQUISITION OF CERTAIN WATER AND WASTEWATER UTILITY FACILITIES WITHIN THE GOLDEN GATE COMMUNITY; AUTHORIZING A NEGOTIATED SALE OF SAID BOND PURSUANT TO THE PROPOSAL OF STI INSTITUTIONAL & GOVERNMENT, INC.; DELEGATING CERTAIN AUTHORITY TO THE CHAIRMAN IN CONNECTION WITH THE APPROVAL OF THE TERMS AND DETAILS OF SAID BOND; APPOINTING THE CLERK AS PAYING AGENT AND REGISTRAR FOR SAID BOND; AND PROVIDING AN EFFECTIVE DATE. BE IT RESOLVED BY THE BOARD OF COUNTY COMMISSIONERS OF COLLIER COUNTY, FLORIDA, ACTING AS THE EX-OFFICIO GOVERNING BOARD OF THE COLLIER COUNTY WATER-SEWER DISTRICT: SECTION 1. FINDINGS. It is hereby found and determined that: (A) On July 30, 1985, the Board of County Commissioners of Collier County, Florida (the "County"), acting as the ex-officio governing board (the "Governing Body") of the Collier County Water-Sewer District (the "Issuer") duly adopted Resolution No. CWS-85-5, as amended and restated by Resolution No. CWS-85-13 duly adopted on December 26, 1985, as amended and supplemented (collectively, the "Resolution"), for the purposes described therein. (B) On November 14, 2017, the Governing Body adopted Resolution No. 2017- 222, authorizing and directing the acquisition of certain water and wastewater utility system facilities and property currently owned by the Florida Governmental Utility Authority (the "FGUA") and located in the Golden Gate community of the County (the "Golden Gate System"), all as more particularly described in the Utility System Transition Agreement, dated as of November 14, 2017, between the Issuer and the FGUA (the "Transition Agreement"). (C) The Resolution allows for the issuance of Additional Bonds, payable on a parity with Bonds Outstanding (as such terms are defined in the Resolution) under the Resolution (the "Outstanding Parity Bonds"), for the purpose of financing improvements and additions to the System (as defined in the Resolution) upon meeting certain requirements set forth in the Resolution. (D) The Issuer deems it to be in its best interest to issue its Collier County Water-Sewer District Water and Sewer Revenue Bond, Series 2018 (the "Series 2018 Bond") as an Additional Bond pursuant to the Resolution for the principal purpose of financing the acquisition of the Golden Gate System which shall become part of the System upon its acquisition, which Series 2018 Bond shall be issued on parity in all respects with the Outstanding Parity Bonds pursuant to the terms of the Resolution. (E) PFM Financial Advisors LLC, financial advisor to the Issuer (the "Financial Advisor"), solicited proposals from various financial institutions to purchase the Series 2018 Bond from the Issuer to provide proceeds sufficient to acquire the Golden Gate System, fund the Reserve Account (as defined in the Resolution) in accordance with the Resolution and pay for costs of issuance related to the issuance of the Series 2018 Bond. (F) STI Institutional & Government, Inc. (including any successors and assigns, the "Purchaser") submitted its proposal to purchase the Series 2018 Bond (the "Proposal") in order to provide for the acquisition of the Golden Gate System, which Proposal was the most favorable proposal received by the Issuer and is attached hereto as Exhibit A. (G) Due to the potential volatility of the market for tax-exempt obligations such as the Series 2018 Bond and the complexity of the transactions relating to such Series 2018 Bond, it is in the best interest of the Issuer to sell the Series 2018 Bond by a negotiated sale to the Purchaser pursuant to the Proposal and the provisions hereof and of the Resolution, rather than at a specified advertised date, thereby permitting the Issuer to obtain the best possible price, terms and interest rate for the Series 2018 Bond. (H) The Issuer hereby certifies that it is current in all deposits into the various funds and accounts established by the Resolution and all payments theretofore required to have been deposited or made by the Issuer under the provisions of the Resolution have been deposited or made and the Issuer has complied with the covenants and agreements of the Resolution and is not currently in default under the Resolution. (I) The Resolution provides that the Series 2018 Bond shall mature on such dates and in such amounts, shall bear such rates of interest, shall be payable in such 2 places and shall be subject to such redemption provisions as shall be determined by Supplemental Resolution (as defined in the Resolution) adopted by the Issuer; and it is now appropriate that the Issuer determine certain of such provisions, terms and details and establish the mechanisms for determining the remaining provisions, terms and details. (J) The Series 2018 Bond shall not be or constitute a general obligation or indebtedness of the Issuer as a "bond" within the meaning of any constitutional or statutory provision but shall be a special obligation of the Issuer, payable solely from and secured by a lien upon and pledge of the Pledged Funds (as defined in the Resolution), in the manner and to the extent provided in the Resolution. (K) The covenants, pledges and conditions in the Resolution shall be applicable to the Series 2018 Bond herein authorized and said Series 2018 Bond shall be on a parity with and rank equally as to the lien on and source and security for payment from the Pledged Funds and in all other respects with the Outstanding Parity Bonds, and shall constitute a "Bond" within the meaning of the Resolution. SECTION 2. DEFINITIONS. When used in this Supplemental Resolution, the terms defined in the Resolution shall have the meanings therein stated, except as such definitions shall be hereinafter amended and defined. SECTION 3. AUTHORITY FOR THIS SUPPLEMENTAL RESOLUTION. This Supplemental Resolution is adopted pursuant to the provisions of the Act. SECTION 4. AUTHORIZATION OF THE ACQUISITION OF THE GOLDEN GATE SYSTEM; ACCEPTANCE OF PROPOSAL. (A) The Issuer hereby authorizes the acquisition of the Golden Gate System and the financing thereof with proceeds of the Series 2018 Bond. (B) The Issuer hereby accepts the Proposal of the Purchaser to purchase the Series 2018 Bond to finance the Issuer's acquisition of the Golden Gate System. The Chairman of the Governing Body is hereby authorized to execute and deliver any documents required to formally accept the Proposal and the terms thereof. All actions taken by officers of the Issuer and the County, the Financial Advisor and Bond Counsel with respect to the Proposal prior to the date hereof are hereby authorized and ratified. To the extent of any conflict between the provisions of the Resolution and the Proposal, the provisions of the Resolution, as supplemented by this Supplemental Resolution, shall prevail. SECTION 5. AUTHORIZATION AND DESCRIPTION OF THE SERIES 2018 BOND. The Issuer hereby authorizes the issuance of a Series of Bonds in the principal amount of not exceeding $43,000,000 to be known as the "Collier County Water-Sewer District Water and Sewer Revenue Bond, Series 2018" (or such other 3 designation as the Chairman may determine), for the principal purpose of financing the acquisition of the Golden Gate System. The specific principal amount of the Series 2018 Bond to be issued pursuant to the Resolution shall be determined by the Chairman, upon the advice of the Issuer's Financial Advisor, provided such principal amount does not exceed $43,000,000. The Series 2018 Bond shall be on parity in all respects and shall rank equally as to lien on and source and security for payment from the Pledged Funds with the Outstanding Parity Bonds. The Series 2018 Bond shall be dated as of its date of issuance, or such other date as the Chairman may determine, shall be issued in the form of one fully registered Bond in the denomination of its outstanding principal amount and shall be numbered "R-1." The Series 2018 Bond shall bear interest from its dated date at a fixed interest rate of 2.41% per annum (the "Interest Rate"). The Interest Rate is subject to adjustment as provided in Sections 9 and 10 hereof. The Interest Rate shall be calculated on the basis of a 360-day year consisting of twelve 30-day months. Interest on the Series 2018 Bond shall be payable semi-annually, on January 1 and July 1 of each year (the "Interest Payment Dates"), commencing on July 1, 2018. The Series 2018 Bond shall be issued as a single Term Bond with a final maturity of July 1, 2029 and shall be subject to mandatory sinking fund redemption in such Sinking Fund Installments commencing on July 1, 2018 and on each July 1 thereafter through the maturity date of the Series 2018 Bond, determined by the Chairman, upon the advice of the Issuer's Financial Advisor, and approved by the Purchaser prior to the issuance of the Series 2018 Bond. The Series 2018 Bond shall be sold on a negotiated basis to the Purchaser at a purchase price equal to 100% of the aggregate principal amount thereof. The Purchaser shall provide the Issuer with an executed Disclosure Letter and Truth-in-Bonding Statement as required by Section 218.385, Florida Statutes, prior to the issuance of the Series 2018 Bond. The Interest Rate on the Series 2018 Bond shall comply in all respects with Section 215.84, Florida Statutes. For purposes of the Resolution, "Bond Year" shall mean the period commencing on July 1 of each year and continuing through the next succeeding June 30. The Series 2018 Bond shall be payable as to principal and interest by, at the sole option of the Issuer, bank wire transfer or direct debit of a deposit account of the Issuer or in such other manner as is agreed to between the Issuer and the holder of the Series 2018 Bond in whose name the Series 2018 Bond shall be registered on the registration books maintained by the Issuer as of the close of business on the fifteenth day (whether or not a Business Day, as defined below) of the calendar month next preceding an Interest Payment Date; provided, that the registered owner of the Series 2018 Bond shall present and surrender the Series 2018 Bond to the Issuer for the final payment of the principal of the Series 2018 Bond or otherwise shall provide evidence that such Series 2018 Bond have been cancelled. Principal of and interest on the Series 2018 Bond shall be payable in any coin or currency of the United States of America, which at the time of payment, are legal tender for the payment of public and private debts. The Series 2018 Bond shall be substantially in the form set forth in Section 2.10 of the Resolution, with such changes, 4 amendments, modifications, omissions and additions as may be approved by the Chairman. Execution of the Series 2018 Bond by the Chairman shall be conclusive evidence of approval of any such changes. For purposes of this Supplemental Resolution, "Business Day" shall mean any day other than a Saturday, Sunday or day on which banking institutions within the State of Florida are authorized or required by law to remain closed. SECTION 6. REDEMPTION PROVISIONS. (A) The Series 2018 Bond may be redeemed in whole or in part on any Business Day subject to the terms hereof and of the Resolution and upon at least two Business Days' prior written notice to the Purchaser specifying the amount of redemption. The Issuer shall, at the time of any redemption, whether optional or at any other time the Series 2018 Bond is paid earlier than its scheduled maturity or scheduled Sinking Fund Installment, pay to the Purchaser the interest accrued to the date of redemption on the principal amount being redeemed plus an additional fee or redemption premium equal to the present value of the difference between (i) the amount that would have been realized by the Purchaser on the redemption amount for the remaining term of the Series 2018 Bond at the ICE Benchmark Administration ("IBA") rate for fixed-rate payers in U.S. Dollar interest rate swaps for a term corresponding to the term of the Series 2018 Bond, interpolated to the nearest month, if necessary, that was in effect three Business Days prior to the issuance date of the Series 2018 Bond, and (ii) the amount that would be realized by the Purchaser by reinvesting such redeemed funds for the remaining term of the Series 2018 Bond at the IBA Index for rates for fixed-rate payers in U.S. Dollar interest rate swaps, interpolated to the nearest month, that was in effect three Business Days prior to the redemption date; both discounted at the same interest rate utilized in determining the applicable amount in (ii). Should the present value have no value or a negative value, the Issuer may redeem the Series 2018 Bond or portion thereof with no additional fee or redemption premium. Should the IBA no longer release rates for fixed-rate payers in U. S. Dollar interest rate swaps, the Purchaser may substitute the IBA Index for rates for fixed-payers in U.S. Dollar interest rate swaps with another similar index as determined by SunTrust Bank (or affiliate thereof). The Purchaser shall provide the Issuer with a written statement explaining the calculation of the premium due, which statement shall, in absence of manifest error, be conclusive and binding. The application of such fee or prepayment premium is not intended to, and shall not be deemed to be, an increase in the Interest Rate. Principal redemptions shall be applied to the Series 2018 Bond in inverse order of the remaining maturities, treating mandatory Sinking Fund Installments as maturities. (B) Notwithstanding any other provision of the Resolution, the Issuer shall not be required to provide the Purchaser with any notice with respect to the payment of any scheduled Sinking Fund Installment. (C) No presentment or delivery shall be required for prepayment or principal installment payments on the Series 2018 Bond. 5 SECTION 7. APPLICATION OF SERIES 2018 BOND PROCEEDS. The proceeds derived from the sale of the Series 2018 Bond shall be applied by the Issuer simultaneously with the delivery thereof as follows: (A) A sufficient amount of Series 2018 Bond proceeds shall be distributed to FGUA, or its designee, to pay the acquisition price for the Golden Gate System as described in and required by the Transition Agreement. (B) A sufficient amount of the Series 2018 Bond proceeds, if any, shall be deposited to the Reserve Account to cause the amount on deposit therein to equal the Reserve Account Requirement for all Outstanding Parity Bonds, including the Series 2018 Bond. (C) A sufficient amount of the Series 2018 Bond proceeds shall be applied to the payment of costs and expenses relating to the issuance of the Series 2018 Bond. SECTION 8. APPOINTMENT OF PAYING AGENT AND REGISTRAR. The Clerk is hereby designated Registrar and Paying Agent for the Series 2018 Bond. SECTION 9. DETERMINATION OF TAXABILITY. (A) Upon the occurrence of a Determination of Taxability (as defined below) and for as long as the Series 2018 Bond remains Outstanding, the Interest Rate on the Series 2018 Bond shall be converted to the Taxable Rate (as defined below) and this adjustment shall survive payment on the Series 2018 Bond until such time as the federal statute of limitations under which the interest on the Series 2018 Bond could be declared taxable under the Code shall have expired. In addition, upon a Determination of Taxability, the Issuer shall, immediately upon demand, pay to the Purchaser (i) an additional amount equal to the difference between (a) the amount of interest actually paid on the Series 2018 Bond during the Taxable Period (as defined below) and (b) the amount of interest that would have been paid during the Taxable Period had the Series 2018 Bond borne interest at the Taxable Rate, and (ii) an amount equal to any interest, penalties on overdue interest and additions to tax (as referred to in Subchapter A of Chapter 68 of the Code) owed by the Purchaser as a result of the Determination of Taxability. (B) For purposes of this Section 9, the following terms shall have the definitions ascribed thereto: "Determination of Taxability" means a final decree or judgment of any Federal court or a final action of the Internal Revenue Service determining that, due to any action or inaction of the Issuer or the County, interest paid or payable on all or a portion of the Series 2018 Bond is or was includable in the gross income of the Purchaser for Federal income tax purposes; provided, that no such decree, judgment, or action will be considered final for this purpose, however, unless the Issuer has been given written notice and, if it is so desired and is legally allowed, has been afforded the opportunity to contest 6 the same, either directly or in the name of the Purchaser, and until the conclusion of any appellate review, if sought. A Determination of Taxability shall not include and is not triggered by a change in law by Congress that causes the interest to be includable in the Purchaser's gross income. "Taxable Period" shall mean the period of time between (i) the date that interest on the Series 2018 Bond is deemed to be includable in the gross income of the Purchaser for federal income tax purposes as a result of a Determination of Taxability, and (ii) the date of the Determination of Taxability and after which the Series 2018 Bond bears interest at the Taxable Rate. "Taxable Rate" shall mean the interest rate per annum that shall provide the Purchaser with the same after tax yield that the Purchaser would have otherwise received had the Determination of Taxability not occurred, taking into account the increased taxable income of the Purchaser as a result of such Determination of Taxability. The Purchaser shall provide the Issuer with a written statement explaining the calculation of the Taxable Rate, which statement shall, in the absence of manifest error, be conclusive and binding on the Issuer. SECTION 10. DEFAULT. After the occurrence of an Event of Default under Section 7.01 of the Resolution or a material breach or default of any covenant, warranty or agreement herein, notwithstanding any other terms hereof or of the Resolution, the Series 2018 Bond shall bear interest at the Default Rate (as defined below) until such Event of Default or such material breach or default of convenant, warranty or agreement is cured. Within 5 days of its actual knowledge, the Issuer shall notify the Purchaser of the occurrence of any Event of Default or a material breach or default of any covenant, warranty or agreement herein. For purposes of this Section 12, "Default Rate" means the lesser of (i) the Prime Rate (defined below) plus eight percent (8.00%) per annum, and (ii) the maximum lawful rate. "Prime Rate" means the per annum rate which the Purchaser's affiliate SunTrust Bank announces from time to time to be its prime rate, as in effect from time to time. The prime rate is a reference or benchmark rate, is purely discretionary and does not necessarily represent the lowest or best rate charged to borrowing customers. The Purchaser's affiliate SunTrust Bank may make commercial loans or other loans at rates of interest at, above or below the prime rate. Each change in the prime rate shall be effective from and including the date such change is announced as being effective. If the Issuer grants any holder of a Bond acceleration rights, it shall also provide such rights to the Purchaser with respect to the Series 2018 Bond. SECTION 11. REPORTING FINANCIAL INFORMATION. A copy of the audited financial statements for each Fiscal Year shall be provided to the Purchaser 7 within 270 days after the end of each Fiscal Year. A copy of the annual budget for each Fiscal Year will be provided to the Purchaser within 30 days of final approval by the Governing Body. The Issuer shall also provide the Purchaser with any other information, reports or schedules (financial or otherwise) in form satisfactory to the Purchaser as may be reasonably requested by the Purchaser. SECTION 12. TRANSFER. The Purchaser may sell, transfer or assign the Series 2018 Bond in whole only in accordance with the provisions of Section 2.08 of the Resolution to an "accredited investor" under Regulation D promulgated under the Securities Act of 1933, as amended, or a "qualified institutional buyer" under Rule 144A promulgated under the Securities Act of 1933, as amended; provided, however, the Purchaser of the Series 2018 Bond may transfer the Series 2018 Bond to an affiliate of the Purchaser without restriction. The Purchaser shall notify the Issuer and the Clerk of any sale, transfer or assignment of the Series 2018 Bond. Notwithstanding the foregoing, the Purchaser may sell participations in the Series 2018 Bond to any number of Participants as long as the Purchaser complies with all applicable securities laws. SECTION 13. WAIVER OF JURY TRIAL; APPLICABLE LAW AND JURISDICTION. (A) To the extent permitted by applicable law, the Issuer, knowingly, voluntarily and intentionally waives any right it may have to a trial by jury in respect of any litigation based on, or arising out of, under or in connection with this Supplemental Resolution, the Resolution, the Series 2018 Bond or any agreement contemplated to be executed in connection with this Supplemental Resolution or the Resolution, or any course of conduct, course of dealing, statements (whether verbal or written) or actions of the Issuer or the Purchaser. (B) The substantive laws of the State of Florida shall govern this Supplemental Resolution, the Resolution, the Series 2018 Bond or any agreement contemplated to be executed in connection therewith. The Issuer submits to the jurisdiction of Florida courts and federal courts and agrees that venue for any suit concerning this Supplemental Resolution or the Resolution or the Series 2018 Bond shall be in Collier County, Florida and the Middle District of Florida. SECTION 14. GENERAL AUTHORITY. The members of the Governing Body of the Issuer, the County Manager, the Clerk and the officers, attorneys and other agents or employees of the Issuer are hereby authorized to do all acts and things required of them by this Supplemental Resolution or the Resolution, or desirable or consistent with the requirements hereof or of the Resolution for the full punctual and complete performance of all the terms, covenants and agreements contained herein or in the Series 2018 Bond and the Resolution, and each member, employee, attorney and officer of the Issuer and the Clerk is hereby authorized and directed to execute and deliver any and all papers and instruments and to be and cause to be done any and all acts and things 8 necessary or proper for carrying out the transactions contemplated hereunder. In the event the Chairman is absent or unavailable to perform any function or duty hereunder the Vice-Chairman is hereby authorized to perform any and all of such functions or duties. Bond Counsel and the Issuer's Financial Advisor are hereby authorized and directed to take all action necessary and desirable to carryout the intent and purposes of this Supplemental Resolution and the Resolution. SECTION 15. MODIFICATION OR AMENDMENT OF THIS SUPPLEMENTAL RESOLUTION. No modification or amendment of this Supplemental Resolution or of any resolution amendatory thereof or supplemental thereto may be made without the consent in writing of the Purchaser. No modification or amendment of Section 5.04 or Section 6.02 of the Resolution may be made without the consent in writing of the Purchaser. SECTION 16. SEVERABILITY AND INVALID PROVISIONS. If any one or more of the covenants, agreements or provisions herein contained shall be held contrary to any express provision of law or contrary to the policy of express law, though not expressly prohibited or against public policy, or shall for any reason whatsoever be held invalid, then such covenants, agreements or provisions shall be null and void and shall be deemed separable from the remaining covenants, agreements or provisions and shall in no way affect the validity of any of the other provisions hereof or of the Series 2018 Bond. SECTION 17. NO ADVISORY OR FIDUCIARY RELATIONSHIP. In connection with all aspects of each transaction contemplated hereunder (including in connection with any amendment, waiver or other modification hereof or of any other documents related hereto), the Issuer acknowledges and agrees, that: (A) (i) it has consulted its own legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate, (ii) it is capable of evaluating, and understands and accepts, the terms, risks and conditions of the transactions contemplated hereby and any other related loan documents, (iii) the Purchaser is not acting as a municipal advisor or financial advisor to the Issuer and (v) the Purchaser has no fiduciary duty pursuant to Section 15B of the Securities Exchange Act to the Issuer with respect to the transactions contemplated hereby and the discussions, undertakings and procedures leading thereto (irrespective of whether the Purchaser has provided other services or is currently providing other services to the Issuer on other matters); (B) (i) the Purchaser is and has been acting solely as a principal and, except as expressly agreed in writing by the relevant parties, has not been, is not, and will not be acting as an advisor, agent or fiduciary, for the Issuer, or any other person and (ii) the Purchaser has no obligation to the Issuer, with respect to the transactions contemplated hereby except those obligations expressly set forth herein and in any other related loan documents; and (C) the Purchaser may be engaged in a broad range of transactions that involve interests that differ from those of the Issuer, and the Purchaser has no obligation to disclose any of such interests to the Issuer. If the Issuer would like a municipal advisor in this transaction that has legal fiduciary duties to the 9 Issuer, the Issuer is free to engage a municipal advisor to serve in that capacity. The transactions contemplated herein and the Series 2018 Bond is delivered, pursuant to and in reliance upon the bank exemption and/or the institutional buyer exemption provided under the municipal advisor rules of the Securities and Exchange Commission, Rule 15Bal-1 et seq, to the extent that such rules apply to the transactions contemplated hereunder. SECTION 18. PERMISSION TO USE INFORMATION. The Issuer agrees and consents that the Purchaser shall be permitted to use information related to the transaction contemplated hereby in connection with marketing, press releases or other transactional announcements or updates provided to investors or trade publications, including, but not limited to, the placement of the logo or other identifying name on marketing materials or of"tombstone" advertisements in publications of its choice at its own expense. SECTION 19. RESOLUTION TO CONTINUE IN FORCE. Except as herein expressly provided, the Resolution and all the terms and provisions thereof are and shall remain in full force and effect. SECTION 20. DATE. This Supplemental Resolution shall become effective immediately upon its adoption. DULY ADOPTED, in Regular Session this 23rd day of January 2015. ATTEST: BOARD OF COUNTY COMMISWNERS DWIGHT E. B Rp CK, CLERK COLLIER COUNTY, FLORIDA: THE EX- 4D THE U� OFFICIO CHAIRMAN OF GOVERNING BO' RD OE THE COLLIER a• COUNTY WA '-S WER T qA s w,` i tyi s t it `0\ By: ' �_ ek Johnssen, Deputy Clerk , Chaan Attest as to Chairman s Approved as to form signature only. and legality: Je y A. Klatzkow County Attorney 10 EXHIBIT A PROPOSAL OF THE PURCHASER