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HomeMy WebLinkAboutRES 07-15RESOLUTION NO. 07-15 A RESOLUTION OF THE MAYOR AND CITY COUNCIL OF THE CITY OF APACHE JUNCTION, ARIZONA, APPROVING THE FORM AND AUTHORIZING THE EXECUTION AND DELIVERY OF A SECOND LOAN REPAYMENT AGREEMENT, A FINANCIAL GUARANTY AGREEMENT AND A CONTINUING DISCLOSURE UNDERTAKING; ACCEPTING A LOAN FROM THE GREATER ARIZONA DEVELOPMENT AUTHORITY PURSUANT TO SUCH LOAN REPAYMENT AGREEMENT IN AN AMOUNT NOT TO EXCEED $4,000,000; AUTHORIZING THE APPROVAL OF THE PORTIONS OF AN OFFICIAL STATEMENT DESCRIBING THE CITY AND THE DISTRIBUTION THEREOF; DELEGATING TO THE CITY MANAGER THE AUTHORITY TO DESIGNATE THE FINAL INTEREST RATE, MATURITY DATE, PRINCIPAL AMOUNT, PREPAYMENT PROVISIONS, AND OTHER MATTERS WITH RESPECT TO SUCH LOAN REPAYMENT AGREEMENT; AUTHORIZING THE TAKING OF ALL OTHER ACTIONS NECESSARY TO CONSUMMATE THE TRANSACTIONS CONTEMPLATED BY THIS RESOLUTION; AND DECLARING AN EMERGENCY. WHEREAS,the Council of the City of Apache .Junction, Arizona (the "City) has determined that it will be beneficial to its citizens to finance the costs of expansion and renovation of the City's Public Library (collectively, the "Project"); and WHEREAS, in order to finance the costs of the Project, the Mayor and dity Council deems it necessary and desirable to borrow (an amount not to exceed $4,000,000:00) from the Greater Arizona Development Authority ("GADA"); and WHEREAS, a First Loan Repayment Agreement between City and GADA was entered into on February 19,2004 in the amount of $6,665,000.00 for the construction of Apache Junction City Hall and Multigenerational Center, and has a final maturity date of August 1, 2010; and WHEREAS,in connection the Project,City and GADA shall enter into a Second Loan Repayment Agreement to be dated as of the date determined as provided herein (the "Loan Agreement"); and WHEREAS,in order to obtain the funds with which it will fund the Loan Agreement,GADA will issue and sell its Infrastructure Revenue Bonds, Series 2007A (the "Bonds"); and RESOLUTION NO. 07-15 PAGE 1 OF 5 WHEREAS, in connection with the issuance of GADA Bonds, the City may be required to provide a surety bond or insurance policy for deposit into the "GADA Loan Reserve Fund" established pursuant to the Loan Agreement, and in connection therewith may be required to execute and deliver a financial guaranty or similar agreement,to be dated as of the date of the Loan Agreement (the "Financial Guaranty Agreement"),with a bond insurance or surety bond company; and WHEREAS,with respect to GADA Bonds,the City will be either an obligated person or a contingent obligated person for purposes of Securities and Exchange Commission Rule 15(c)2-12 and will be required to execute and deliver a Continuing Disclosure Undertaking, to be dated the date of initial delivery of GADA Bonds (the "Undertaking"); and WHEREAS,there have been placed on file with the Clerk of the City and presented at the meeting at which this Resolution was adopted:(1)the proposed form of the Loan Agreement;(2) the proposed form of the Undertaking; and (3) the proposed form :of the Preliminary Official Statement relating to GADA Bonds (the "Preliminary Official Statement"). NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND CITY COUNCIL OF THE CITY OF APACHE JUNCTION, ARIZONA AS FOLLOWS: SECTION I.PUBLIC INTEREST AFFIRMATION The financing of the Project pursuant to the Loan Agreement is in furtherance of the purposes of the City and in the public interest. SECTION II.LOAN AND PRINCIPAL AND INTEREST TERMS The loan pursuant to the Loan Agreement (the "Loan") is hereby accepted from GADA in an amount not to exceed $4,000,000.00. The principal amount of the Loan shall bear interest from the date the Loan Agreement is dated until the Loan is paid as provided in the Loan Agreement.Such principal amount shall be due and payable in installments on July 1 on the dates determined as provided herein.Such interest shall be payable on the interest payment dates (as such term is hereinafter defined) and commencing on the date, in each case, determined as provided herein. RESOLUTION NO. 07-15 PAGE 2 OF 5 SECTION III.CITY MANAGER LOAN TERM AUTHORITY The City Manager of the City is hereby authorized and directed to determine on behalf of the City:(1) the dated date and total principal amount of the Loan (but not to exceed the amount indicated hereinabove); (2) the final maturity schedule of the Loan; (3) the interest rate on the Loan and the dates for payment of such interest (the "interest payment dates"); (4) the provisions for prepayment of the Loan; and (5) the provision for credit enhancement, if any, for the Loan (as well as in each case the related provisions of the Loan Agreement and the Financial Guaranty Agreement), provided, however, that such determinations must result in a yield as calculated for federal income tax purposes with respect to the Loan of not in excess of seven percent (7.00%). SECTION IV.LOAN AGREEMENT APPROVAL The form, terms and provisions of the Loan, including the provisions for the payment, shall be set forth in the Loan Agreement and are hereby approved. SECTION V.RATIFICATION AND APPROVAL .The forms, terms and provisions of the Loan Agreement and the Undertaking, in substantially the forms of such documents (including the exhibits thereto) presented at the meeting at which this Resolution was adopted, as well as, if necessary, the Financial Guaranty Agreement in a form and with provisions acceptable to the City Manager, are hereby, as applicable, ratified and approved, with such insertions, omissions, and changes as are not inconsistent herewith and as shall be approved by the Mayor of the City, the execution of such documents being conclusive evidence of such approval, and the Mayor and Clerk of the City are hereby authorized and directed, for and on behalf of the City, to sign and attest and deliver, respectively, the Loan Agreement, the Financial Guaranty Agreement (if necessary) and the Undertaking as well as any other documents necessary in connection therewith to provide for the Loan. SECTION VI.PRELIMINARY OFFICIAL STATEMENT The portions of the Preliminary Official Statement describing the City are hereby "deemed final" for purposes of Securities RESOLUTION NO. 07-15 PAGE 3 OF 5 and Exchange Commission Rule 15(c) 2-12, the distribution and use of the Preliminary Official Statement by GADA is in all respects hereby authorized and directed to approve on behalf of the City the portions of a Final Official Statement for use in connection with the offering and sale of GADA Bonds (the "Official Statement") describing the City. SECTION VII.PLEDGE OF REVENUES As further described in the Loan Agreement and Arizona Revised Statutes ("A.R.S") Section 41-1554.06(D)(6)(a), the City hereby pledges to the amounts to come due under the Loan Agreement (and, as necessary, the Financial Guaranty Agreement) pursuant to, and with the limitations described in the Loan Agreement, among other revenues, its moneys now or hereafter contributed, allocated and paid over to the City by the State of Arizona pursuant to A.R.S. Sections 42-5029 and 43-206 (the "State Shared Revenues"), and the "Excise Taxes" (as such terms are defined in the Loan Agreement).The obligation of the City to make the payments under the Loan Agreement does not constitute an obligation of the City or the State of Arizona, or any of its political subdivisions, for which the City or the State of Arizona, or any of its political subdivisions, is obligated to levy or pledge any form of property taxation nor does the obligation to make payments under the Loan Agreement constitute an indebtedness of the City or of the State of Arizona, or any of its political subdivisions, within the meaning of the Constitution of the State of Arizona or otherwise.The pledge of revenues from the State Shared Revenues and Excise Taxes is subordinate to the existing pledge of the State Shared Revenues and Excise Taxes as described in the Loan Agreement. SECTION VIII.REPEALABILITY OF RESOLUTION After the proceeds of the Loan are advanced to the City, this Resolution shall be and remain irrepealable until the Bonds and the interest thereon shall have been fully paid, cancelled and discharged. SECTION IX.SEVERABILITY If any section, paragraph, clause or provision of this Resolution shall for any reason be held to be invalid or - unenforceable, the invalidity or unenforceability of such RESOLUTION NO. 07-15 PAGE 4 OF 5 section, paragraph, clause or provision shall not affect any of the remaining provisions of this Resolution. SECTION X.INCONSISTENT PROVISIONS AND WAIVER All orders and resolutions or parts thereof inconsistent herewith, are hereby waived to the extent only of such inconsistency.This waiver shall not be construed as reviving any order or resolution or any part thereof. SECTION XI.DECLARING AN EMERGENCY The immediate operation of this Resolution is necessary for financing the Project on the most attractive terms available to the City and for the preservation of the public health and welfare; an emergency is hereby declared to exist; this Resolution shall be in full force and effect from and after its passage and approval by the Mayor and City Council, as required by law, and this Resolution is hereby exempt from the referendum provisions of the constitution and laws of the State of Arizona. PASSED AND ADOPTED BY THE MAYOR AND CITY COUNCIL OF THE CITY OF APACHE JUNCTION, ARIZONA, THIS 3RD DAY OF APRIL , 2007. SIGNED AND ATTESTED TO THIS 3RD DAY OF ATTEST: KATHLEEN CONNELLY City Clerk APPROVED AS TO FORM: R. JOEL STERN City Attorney RESOLUTION NO. 07-15 PAGE 5 OF 5 APRIL ,2007. DOUGLAS tOLEMAN Mayor