Backup Documents 06/23/2009 Item #14A
14A H.4.
MEMORANDUM
Date:
June 24, 2009
To:
David L. Jackson
Executive Director/CRA
4069 Bayshore Drive
Naples, Florida 34112
From:
Martha Vergara, Deputy Clerk
Minutes & Records Department
Re:
Term Loan for Bayshore Gateway Triangle Community
Redevelopment Agency with 5/3 Bank
Attached, for your records, please find two copies as referenced above
(Agenda Item #14A) approved by the Board of County Commissioners on
Tuesday, June 23, 2009.
The Minutes & Records Department has retained an original document for
the record.
If you should have any questions, please contact me at 252-7240.
Thank you,
Attachments
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FIFTH THIRD BANK'
June 15,2009
Mr. David Jackson
Executive Director
Bayshore Gateway Triangle
Community Redevelopment Agency
4069 Bayshore Drive
Naples, Florida 34112
Mr. Jackson:
Please find below an updated Term Sheet for Fifth Third Bank's proposal to provide a
$13,500,000 Term Loan to the Bayshore Gateway Triangle Community Redevelopment
Agency to refinance the existing Line of Credit with Wachovia Bank and finance the
acquisition of land associated with the Gateway triangle Project.
Updated Term SheeT
Borrower:
Bayshore Gateway Triangle Community Redevelopment Agency ("CRA")
Guarantor:
N/A
Request:
$13,500,000 Term Loan
Purpose:
(1)
(2)
Refinance existing revolving Line of Credit debt with Wachovia
Bank; and
Acquisition of land associated with the Gateway Triangle Project
Term: Five (5) Year Term
Amortization: Fifteen ( 15) Years
Rate:
(I)
Taxable Variable Rate Option
Taxable rate of30-Day LIBOR plus 3.75%; for illustrative purposes,
the rate as of June 15,2009, is 4.07%.
(2) Taxable Fixed Rate Alternative
Fifth Third Bank would be pleased to offer an interest rate hedged in
the form of an interest rate swap. As of June 15, 2009, the indicative
market rate of interest for a 5-year swap (including the Borrower's
option to cancel the swap at any month after the second year) would
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FIFTH THIRD BANK'
be an indicative all-in fixed rate of interest of 6.80%. This rate is
subject to changing market conditions until execution of a swap
agreement via a recorded phone line.
The CRA may hedge the rate of interest of the proposed credit facility
via the execution of an interest rate swap with a counterparty deemed
acceptable by Fifth Third Bank, Under the interest rate swap
agreement, the CRA would receive the proposed variable rate index
and pay a fixed rate to the swap provider. The variable rate received
by the CRA would offset the proposed credit facility's variable rate
index. The proposed effective all-in fixed rate of interest to be paid by
the Borrower would be the fixed rate paid under the swap agreement
plus the proposed credit spread over the variable rate index.
Repayment:
(1)
(2)
Monthly principal plus interest;
Monthly principal plus interest (similar to a IS-year mortgage
style amortization)
Fees:
$800 Loan Documentation Fee plus Borrower is responsible for all legal and
out of pocket expenses associated with the proposed financing. If the
Borrower elects to execute a swap agreement, there will be a $750 Swap
Documentation fee. All documents shall be prepared by CRA bond counsel
and documents and opinions shall be acceptable to the Bank and it's counsel.
Collateral:
The loans will be secured by tax increment revenues and a covenant to budget
and appropriate from all legally available CRA non-ad valorem revenues.
Prepayment: There are no prepayment penalties. However, if the Borrower fixes the
interest rate via the execution of a swap agreement, the BOlTower is subject to
a mark to market adjustment at the time the swap is terminated.
Contingencies
and
Covenants:
1) During the term of the facility, the eRA agrees to budget and appropriate
from tax incremental revenues an amount equal to or greater than the
projected Annual Debt Service on the respective credit facilities,
2) The CRA will maintain Debt Service Coverage equal to or greater than
1.25:1.0. The calculation shall be determined by using the average of
actual receipts and cash carried forward (reserves) for the prior fiscal year
based on the eRA's annual audit.
3) The eRA agrees to maintain a Debt Reserve Fund equal to or great than:
(J Annual principal and interest debt service for the Term Loan
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FIFTH THIRD BANK"
4) If any land is purchased by the CRA with Fifth Third Bank loan proceeds
and subsequently sold, the sale proceeds will be required to be applied
against the principal amount outstanding,
5) If any land already purchased by the CRA under the Wachovia Line of
Credit is sold, the sale proceeds will be required to be applied against the
principal amount outstanding.
6) Quarterly financial statements shall be submitted within 45-days of
quarter end.
7) Audited annual financial statements shall be submitted within 120-days of
year-end.
8) The opemting Budget for the eRA shall be submitted within 45 days of
adoption.
9) The CRA is prohibited from incurring any additional debt without the
written consent of Fifth Third Bank.
10) Final credit approval required by Fifth Third Bame
Representations and
Warranties:
Usual and customary for transactions of this type.
Events of Default:
Usual and customary for transactions of this type.
Indemnification:
Usual and customary for transactions of this type.
Governing Laws:
State of Florida
Documents:
Any potential transaction is subject to the eRA agreeing to execute
documents and provide any other documentation that the Bank deems
necessary to close the Loan facility and maintain its security interests
in the future.
Mr. Jackson, our entire Fifth Third Bank team is excited about the opportunity to partner
with the Bayshore Gateway Triangle Community Redevelopment Agency. If you have any
questions or require additional information, please feel free to contact me at 239.591.6461 or
via email atLorLDuhs@53.com.
Respectfully Submitted,
~
Lori T. Buhs
Vice President
Fifth Third Bank
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Financing Proposal Accepted on June 23, 2009 By:
ATTEST:
DWIGHT E. BROCK
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Approved as to form
and legal sufficiency
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Steven T. Williams
Assistant County Attorney
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