2001/11/27 City Council Resolution (13)RESOLUTION NO. 01- 256
RESOLUTION APPROVING FORM AND SUBSTANCE OF PRELIMINARY
OFFICIAL STATEMENT, BOND PURCHASE AGREEMENT, AND
CONTINUING DISCLOSURE CERTIFICATE; AUTHORIZING
MODIFICATIONS THERETO AND EXECUTION THEREOF;
AUTHORIZING AMENDMENTS TO THE REASSESSMENT; APPROVING
AGREEMENTS FOR BOND COUNSEL AND FOR DISCLOSURE COUNSEL
SERVICES; AND AUTHORIZING RELATED DOCUMENTS AND ACTIONS
TO IMPLEMENT PROPOSED REFUNDING PROGRAM
2001 CONSOLIDATED REASSESSMENT DISTRICT
The City Council of the City of Rohnert Park resolves as follows:
Section 1. Recitals.
(a) In connection with the proposed issuance, sale and delivery of the City of
Rohnert Park Series 2001 Limited Obligation Refunding Bonds (the "Refunding Bonds ") of its
2001. Consolidated Reassessment District (the "Reassessment District "), this City Council (the
"Council") has selected Orrick, Herrington & Sutcliffe LLP as Bond Counsel ( "Bond Counsel "),
Jones Hall, as Disclosure Counsel ( "Disclosure Counsel "), and IBIS Securities, LLC, as
Underwriter ( "Underwriter ") to the City of Rohnert Park (the "City "), to perform the function
customarily performed by such parties in connection with the structuring and implementation of a
proposed refunding program for the refunding of the remaining outstanding limited obligation
refunding bonds (the "Prior Bonds ") of the City's 1993 Consolidated Refunding District (the
"Prior Assessment District ").
(b) Disclosure Counsel has prepared and filed with the City Clerk of this City
(the "City Clerk ") a proposed Preliminary Official Statement for approval by the Council and
following such approval for use and distribution by the Underwriter in connection with issuance,
sale and distribution to the public of the Refunding Bonds. The Council, acting upon the
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recommendation of Disclosure Counsel, hereby finds and determines that it is in the public interest
and for the public benefit that the Preliminary Official Statement be approved.
(c) Disclosure Counsel has also prepared and filed with the City Clerk (1) a
proposed Continuing Disclosure Certificate and (2) a Bond Purchase Agreement.
(d) Bond Counsel has prepared and filed with the City Clerk (1) a Refunding
Escrow Agreement and (2) the several resolutions (including this resolution) to be adopted by the
Council on this date to establish and implement the proposed refunding of the Prior Bonds
through the levy of reassessments upon the parcels within the Reassessment District and the
issuance, sale and delivery of the Refunding Bonds.
(e) The Council hereby finds and determines and hereby declares that the facts
contained in the Preliminary Official Statement as presented to the Council on the date hereof are
true and correct in all material respects, and the Preliminary Official Statement neither contains
any untrue statement of a material fact nor omits to state any material fact necessary to make any
statement therein not misleading in light of the circumstances under which it was made.
(f) The Preliminary Official Statement shall be deemed "nearly final" for
purposes of compliance with Securities and Exchange Commission Rule 15c(2) -12, and the City
Manager, as the City officer authorized and directed to execute the Official Statement, is
authorized to execute and deliver a certificate in the customary form respecting such finality.
Section 2. Approval of Preliminarv_fLtcial �ment. The Council hereby
approves the form and substance of the Preliminary Official Statement on file with the City Clerk.
The Council authorizes such modifications thereto, whether by corrections or additions thereto
or by supplement or amendment thereof, as shall be approved by Disclosure Counsel and by the
City Manager, such approval to be conclusively established by delivery thereof to the
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Underwriter. The Underwriter is authorized to distribute said Preliminary Official Statement in
connection with its public offering of the Refunding Bonds, and the City Manager, in coordination
with Disclosure Counsel, shall cause sufficient copies of the Preliminary Official Statement and
the Official Statement to be substantially derived therefrom to be printed and made available to
the Underwriter for use by the Underwriter in connection with reoffering of the Refunding Bonds
to the public.
fiection 3. Authorization to Prepare, Execute and Deliver Official Statement. The
Council hereby authorizes the preparation, execution by the City Manager and delivery to the
Underwriter of an Official Statement to be substantially derived from the Preliminary Official
Statement, following insertion of the information respecting the Bonds to be established by
execution of the Bond Purchase Agreement.
Section 4, Approval of Bond Purchase Agreement. The form and substance of
the proposed Bond Purchase Agreement on file with the City Clerk is hereby approved. The
Council hereby authorizes the making of modifications to said Bond Purchase Agreement, subject
to the prior approval of Bond Counsel, such approval to be conclusively established by the
execution thereof. The City Manager is authorized to execute and deliver said Bond Purchase
Agreement, as modified and subject to the prior attachment thereto of a completed Exhibit A,
setting forth the maturity schedule and interest rates for the Refunding Bonds and provisions for
redemption of any Refunding Bonds in advance of maturity; provided that the total discount
(consisting of combined Underwriter's discount and original issue discount) shall not exceed
2.50 %, the average interest rate for the Refunding Bonds shall not exceed 5.50 %, and the
principal amount thereof shall not exceed the amount of remaining unpaid reassessments; and
provided further that the terms of sale of the Refunding Bonds shall be such as to assure
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compliance with the conditions specified by Section 9525 of the Streets and Highways Code for
summary reassessment proceedings.
Section 5.. Approval- of •n •• pi%cloqnrc. Certificate.. • •
substance of the proposed Continuing Disclosure Certificate on file with the City Clerk is hereby
approved. The Council authorizes the making of modifications to said Continuing Disclosure
Certificate, subject to the prior approval of Disclosure Counsel, such approval to be conclusively
established by the execution thereof. The City Manager is authorized to execute and deliver said
Continuing Disclosure Certificate
Section 6. Approval of Refmding Escrow Agreement.. The form and substance of
the Refunding Escrow Agreement on file with the City Clerk is hereby approved. The Council
authorizes the making of modifications to said Refunding Escrow Agreement, subject to the prior
approval of Bond Counsel, such approval to be conclusively established by the execution thereof.
The City Manager is authorized to execute and deliver said Refunding Escrow Agreement.
Section . Related Action-, Authorized The Council hereby authorizes any officer
or employee of the City to execute such further document and to take such further actions as are
reasonably and customarily required to accomplish issuance, sale and delivery of the Refunding
Bonds and the redemption of the Prior Bonds on March 2, 2002.
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I HEREBY CERTIFY that the foregoing is a full, true and correct copy of a
resolution duly passed and adopted by the City Council of the City of Rohnert Park, Sonoma
County, California, at a meeting thereof, held on the 27th day of November, 2001, by the
following vote of the members thereof:
AYES: (4) Councilmembers Flores, Reilly, Vidak Martinez & Mayor Mackenzie
NOES: (0) Councilmembers
ABSENT: (1) Councilmembers Spiro
ABSTAIN: (0) Councilmembers
APPROVED:
JAKE MACKENZIE, MAYOR
Per Resol tion No. 2001 -256 adopted by the
Rohn t rk City Council on November 27, 2001
ATTEST:
TnrDDU T-% ATRTTRT? OTTV CT 'PRY CITY
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REFUNDING ESCROW AGREEMENT
(Limited Obligation Refunding Bonds, 1993 Consolidated Refunding District)
This REFUNDING ESCROW AGREEMENT (the "Refunding Escrow
Agreement "), made and entered into as of December 1, 2001, by and between the City of
Rohnert Park (the "City "), and Union Bank of California, N.A. (the "Escrow Agent "), a national
banking association organized and existing under the laws of the United States and having a
corporate trust office in San Francisco, California, and being qualified to accept and administer
the escrow hereby created,
WITNESSETH:
WHEREAS, pursuant to its Resolution No. 93 -65, a resolution authorizing
issuance of bonds (the "Prior Resolution "), adopted by the City Council of the City on June 22,
1993, the City has heretofore issued Limited Obligation Refunding Bonds (the "Prior Bonds ")
for the City's 1993 Consolidated Refunding District (the "Prior District "); and
WHEREAS, County Treasurer of the County of Sonoma is the fiscal agent for the
Prior Bonds (the "Prior Fiscal Agent "); and
WHEREAS, the City has established its 2001 Consolidated Reassessment District
(the "Reassessment District "), levied reassessments upon the parcels of land within the
Reassessment District (the "2001 Reassessments "), and authorized the issuance and sale of its
limited obligation refunding bonds (the "Refunding Bonds ") upon the security of the unpaid
2001 Reassessments, for the purpose of providing moneys to the Prior Fiscal Agent which will
be sufficient (when combined with moneys to be provided from other sources and with the
interest earnings on the combined moneys) to provide for the payment when due of the principal
of and interest and redemption premiums (collectively, the "Redemption Price ") on the Prior
Bonds so as to accomplish the redemption in full of the Prior Bonds on March 2, 2002; and
WHEREAS, a prescribed portion of the proceeds of the Refunding Bonds,
together with moneys pertaining to the Prior Bonds which are available for such purpose, will be
set aside by the City with the Escrow Agent in order to provide for the payment of the
Redemption Price of the Prior Bonds, such proceeds to be deposited in a special escrow fund to
be created hereunder to be known as the Refunding Escrow to be maintained by the Escrow
Agent (the "Refunding Escrow "); and
WHEREAS, the City has taken action to cause to be delivered to the Escrow
Agent for credit to the Refunding Escrow certain securities consisting of direct obligations of, or
obligations, the timely payment of the principal of and interest on which are fully and
unconditionally guaranteed by, the United States of America (the "Investment Securities "), all as
listed on Schedule I attached hereto and made a part hereof, in an amount which, together with
income or increment to accrue on such securities, have been certified by
to be sufficient to pay when and as due the Redemption Price of the Prior Bonds;
NOW, THEREFORE, the City and the Escrow Agent hereby agree as follows:
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Section 1. Establishment and Maintenance of Refunding Escrow. The
Escrow Agent agrees to establish and maintain, until the Prior Bonds have been paid in full, a
fund designated as the "Refunding Escrow," and to hold the securities, investments and moneys
therein at all times as a special and separate escrow fund (wholly segregated from all other
securities, investments or moneys on deposit with the Escrow Agent). All securities, investments
and moneys in the Refunding Escrow are hereby irrevocably pledged, subject to the provisions of
Section 2 hereof, to secure the payment when due of the Redemption Price of the Prior Bonds.
Section 2. Funding and Investment of the Refunding Escrow.
(a) To establish funding of the Refunding Escrow, the City agrees that not
later than December 19, 2001 (the "Closing Date "), the City will cause the following moneys, in
the total amount of $ , to be transferred to the Escrow Agent from the sources
specified for deposit in the Refunding Escrow:
(i) from IBIS Securities, LLC, as original purchaser of the Refunding
Bonds, the amount of $ ; and
(ii) from funds held by the Prior Fiscal Agent for the account of the
City with respect to the Prior Bonds, the amount of $
(b) The City hereby directs the Escrow Agent to purchase, for the account of
the Refunding Escrow, the Investment Securities listed on Schedule I hereto. Except as
otherwise provided in this section, the Escrow Agent shall not reinvest any remaining portion of
the Refunding Escrow and shall hold such portion uninvested in the Refunding Escrow. The
Escrow Agent is hereby authorized and empowered to deposit uninvested monies held hereunder
from time to time in demand deposit accounts, without payment for interest thereon as provided
hereunder, established at commercial banks that are corporate affiliates of the Escrow Agent.
(c) Upon the written direction of the City, but subject to the conditions and
limitations herein set forth, the Escrow Agent shall purchase substitute Investment Securities
with the proceeds derived from the sale, transfer, redemption or other disposition of Investment
Securities then on deposit in the Refunding Escrow in accordance with the provisions of this
Section 2(c). Such sale, transfer, redemption or other disposition of such Investment Securities
then on deposit in the Refunding Escrow and substitution of other Investment Securities of the
City are permitted hereunder but only by a simultaneous transaction and only if: (1) a nationally
recognized firm of Independent Certified Public Accountants shall certify that (a) the Investment
Securities to be substituted, together with the Investment Securities which will continue to be
held in the Refunding Escrow, will mature in such principal amounts and earn interest in such
amounts and, in each case, at such times so that sufficient moneys will be available from
maturing principal and interest on such Investment Securities held in the Refunding Escrow
together with any uninvested moneys, to make all payments required by Section 3 hereof which
have not previously been made, and (b) the amounts and dates of the anticipated payments by the
Escrow Agent of the Redemption Price will not be diminished or postponed thereby, and (ii) the
Escrow Agent shall receive an unqualified opinion of nationally recognized bond counsel to the
effect that the sale, transfer, redemption or other disposition and substitution of Investment
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Securities will not adversely affect the exclusion of interest on the Prior Bonds from gross
income for federal income tax purposes.
(d) Upon the written direction of the City, but subject to the conditions and
limitations herein set forth, the Escrow Agent will apply any moneys received from the maturing
principal of or interest or other investment income on any Investment Securities held in the
Refunding Escrow, or the proceeds from any sale, transfer, redemption or other disposition of
Investment Securities pursuant to Section 2(c) not required for the purposes of said Section, as
follows: (A) to the extent such moneys will not be required at any time for the purpose of
making a payment required by Section 3 hereof, as shall be certified to the Escrow Agent by a
nationally recognized firm of Independent Certified Public Accountants, such moneys shall be
paid over to the City upon the written direction of the City as received by the Escrow Agent, free
and clear of any trust, lien, pledge or assignment securing the Prior Bonds or otherwise existing
hereunder or under the Prior Resolutions after provision for payment of amounts due to the Prior
Fiscal Agent and the Escrow Agent pursuant to Section 5 and I1 hereof, and (B) to the extent
such moneys will be required for such purpose at a later date, shall, to the extent practicable, be
invested or reinvested in Investment Securities maturing at times and in amounts sufficient to
pay when due the Redemption Price (provided that (1) the amount of the funds to be realized
from time to time from such investment or reinvestment shall be certified by a nationally
recognized firm of Independent Certified Public Accountants and (ii) the City shall deliver to the
Escrow Agent an opinion of nationally recognized bond counsel to the effect that such
investment or reinvestment will not adversely affect the exclusion of interest on the Prior Bonds
from gross income for federal income tax purposes).
(e) The Escrow Agent shall not be liable or responsible for any loss resulting
from any reinvestment made pursuant to this Agreement and in full compliance with the
provisions hereof.
Section 3. Payment and Prepayment of the Prior Bonds. Except as otherwise
provided in Section 2, the City hereby requests and irrevocably instructs the Escrow Agent to
deposit in the Refunding Escrow the principal of and interest on the Investment Securities held
for the account of the Refunding Escrow promptly as such principal and interest become due, and
to transfer, subject to the provisions of Section 2 hereof, such principal and interest, together with
any other moneys and the principal of and interest on any other securities deposited in the
Refunding Escrow, to the Prior Fiscal Agent for the redemption of the remaining outstanding
Prior Bonds (including the redemption premium thereon) on March 2, 2002. Upon payment in
full of the Prior Bonds, the Escrow Agent shall transfer any moneys or securities remaining in
the Refunding Escrow to the City and, after provision for payment of amounts due the Prior
Fiscal Agent under the Prior Resolutions and the Escrow Agent pursuant to Section 5 and 11
hereof, this Agreement shall terminate. The Refunding Escrow cash flow is set forth in
Schedule II attached hereto.
Section 4. Notice of Possible Deficiencies. If at any time the Escrow Agent
has actual knowledge that the moneys in the Refunding Escrow, including the anticipated
proceeds of the Investment Securities, will not be sufficient to make all payments required by
Section 3 hereof, the Escrow Agent shall notify the City in writing as soon as is reasonably
practicable, of such fact, the amount of such deficiency and if known, the reason therefor, and the
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City shall take all reasonable steps to transfer to the Escrow Agent, from any source of funds
lawfully available for the purpose, sufficient moneys to overcome such deficiency.
Section 5. Fees and Costs.
(a) The City shall pay to the Escrow Agent from time to time reasonable
compensation for all services rendered under this Agreement. The parties hereto agree that the
duties and obligations of the Escrow Agent shall be as expressly provided herein, and no implied
duties or obligations shall be read into this Agreement against the Escrow Agent.
(b) The Escrow Agent shall also be entitled to additional fees and
reimbursements for costs incurred, including but not limited to legal and accountants' services,
involving this Agreement.
(c) The fees of and the costs incurred by the Escrow Agent shall in no event
be deducted or payable from, or constitute a lien against, the Refunding Escrow.
Section 6. Merger or Consolidation. Any company into which the Escrow
Agent may be merged or converted or with which it may be consolidated or any company
resulting from any merger, conversion or consolidation to which it shall be a party or any
company to which the Escrow Agent may sell or transfer all or substantially all of its corporate
trust business, provided such company shall be eligible under this Agreement, shall be the
successor of such Escrow Agent without the execution or filing of any paper or any further act,
notwithstanding anything herein to the contrary.
Section 7. Resignation of Escrow Agent. The Escrow Agent may at any time
resign by giving written notice to the City of such resignation. The City shall promptly appoint a
successor Escrow Agent. Resignation of the Escrow Agent will be effective only upon
acceptance of appointment of a successor Escrow Agent. If the City does not appoint a successor
within 30 days after receiving notice from the Escrow Agent, the Escrow Agent may petition any
court of competent jurisdiction for the appointment of a successor Escrow Agent, which court
may thereupon, after such notice, if required by law, appoint a successor Escrow Agent. After
receiving a notice of resignation of an Escrow Agent, the City may appoint a temporary Escrow
Agent to replace the resigning Escrow Agent until the City appoints a successor Escrow Agent.
Any such temporary Escrow Agent so appointed by the City shall immediately and without
further act be superseded by the successor Escrow Agent so appointed.
Section 8. Severability. If any section, paragraph, sentence, clause or
provision of this Agreement shall for any reason be held to be invalid or unenforceable, the
invalidity or unenforceability of such section, paragraph, sentence, clause or provisions shall not
affect any of the remaining provisions of this Agreement.
Section 9. Execution of Counterparts. This Agreement may be executed in
any number of counterparts, each of which shall for all purposes be deemed to be an original and
all of which shall together constitute but one and the same instrument.
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Section 10. Applicable Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of California.
Section 11. Indemnification. The City agrees to indemnify, hold harmless and
defend the Escrow Agent to the maximum extent permitted by law against any and all losses,
damages, claims, actions, liabilities, costs and expenses of whatever nature, kind or character
(including, without limitation, attorneys' fees, litigation and court costs, amounts paid in
settlement and amounts paid to discharge judgments) which may be imposed on, or incurred by
or asserted against the Escrow Agent directly or indirectly arising out of or related to any claim,
suit, investigation, proceeding or action commenced or threatened as a result the execution by the
Escrow Agent of this Agreement, the performance of its obligations hereunder, or of the payment
of the Prior Bonds. This indemnification shall apply whether any such claim, suit, investigation,
proceeding or action is based upon (i) the interference with or breach of or alleged interference
with or alleged breach of any existing contract in connection with the Prior Bonds, (ii) any untrue
statement or alleged untrue statement of a material fact or omission required to be stated in any
offering document with respect to the Prior Bonds necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading, or (iii) any other
wrongful act or alleged wrongful act of the City related to the payment of the Prior Bonds;
provided, however, that this indemnification shall not cover any losses or expenses incurred by
the Escrow Agent as a result of its gross negligence or willful misconduct. In addition to the
foregoing, the prevailing party in any lawsuit shall be entitled to attorneys' fees and costs
incurred in any judgment proceeding to collect or enforce the judgment. This provision is
separate and severable and shall survive the merger of this Agreement into any judgment on this
Agreement.
The agreements of the City hereunder shall survive the discharge of the Prior
Resolutions and the delivery of and payment for the Refunding Bonds.
Section 13. Immunities and Liability of Escrow Agent.
(a) The Escrow Agent undertakes to perform only such duties as are expressly
and specifically set forth in this Refunding Escrow Agreement, and no implied duties or
obligations shall be read into this Refunding Escrow Agreement against Escrow Agent.
(b) The Escrow Agent shall not have any liability hereunder except to the
extent of its own gross negligence or willful misconduct. In no event shall the Escrow Agent be
liable for any special, indirect or consequential damages, even if the Escrow Agent or the City
knows of the possibility of such damages. The Escrow Agent shall have no duty or
responsibility under this Refunding Escrow Agreement in the case of any default in the
performance of the covenants or agreements contained in the Prior Resolutions. The Escrow
Agent is not required to resolve conflicting demands to money or property in its possession under
this Refunding Escrow Agreement.
(c) The Escrow Agent may consult with counsel of its own choice, and the
opinion of such counsel shall be full and complete authorization to take or suffer in good faith
any action hereunder in accordance with such opinion of counsel.
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(d) The Escrow Agent shall not be responsible for any of the recitals or
representations contained herein or in the Prior Resolutions.
(e) The Escrow Agent may become the owner of, or acquire any interest in,
any of the Prior Bonds with the same rights that it would have if it were not the Escrow Agent
and may engage or be interested in any financial or other transaction with the City.
(f) The Escrow Agent shall not be liable for the accuracy of any calculations
provided as to the sufficiency of the moneys or securities deposited with it to pay the prescribed
Prior Bonds.
(g) The Escrow Agent shall not be liable for any action or omission of the
City under this Refunding Escrow Agreement or the Prior Resolutions.
(h) Whenever in the administration of this Refunding Escrow Agreement the
Escrow Agent shall deem it necessary or desirable that a matter be proved or established prior to
taking or suffering any action hereunder, such matter (unless other evidence in respect thereof be
herein specifically prescribed) may, in the absence of negligence or willful misconduct on the
part of the Escrow Agent, be deemed to be conclusively proved and established by a certificate of
any authorized representative of the City, and such certificate shall, in the absence of negligence
or willful misconduct on the part of the Escrow Agent, be full warrant to the Escrow Agent for
any action taken or suffered in good faith by it under the provisions of this Refunding Escrow
Agreement.
(i) The Escrow Agent may conclusively rely, as to the truth and accuracy of
the statements and correctness of the opinions and the calculations provided to it in connection
with this Refunding Escrow Agreement and shall be protected in acting, or refraining from
acting, upon any written notice, instruction, request, certificate, document or opinion furnished to
the Escrow Agent in compliance with this Refunding Escrow Agreement and reasonably
believed by the Escrow Agent to have been signed or presented by the proper party, and it need
not investigate any fact or matter stated in such notice, instruction, request, certificate or opinion.
Section 14. Termination and Modification of Agreement. Upon final payment
in full of the principal of and interest on the Prior Bonds pursuant to this Refunding Escrow
Agreement and all of the fees and expenses of the Escrow Agent as described above, all
obligations of the Escrow Agent under this Agreement shall cease and terminate, except for the
obligation of the Escrow Agent to pay or cause to be paid to the owners of the Prior Bonds not
presented for payment all sums due thereon and the obligation of the City to pay to the Escrow
Agent any amounts due and owing to the Escrow Agent hereunder; provided, however, the
obligations of the Escrow Agent with respect to the payment of the Prior Bonds shall cease and
terminate two (2) years after the date on which the same shall have become due as described
hereunder. This Agreement may not be amended or modified without the unanimous prior
written consent of the Owners of the Prior Bonds.
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IN WITNESS WHEREOF, the City of Rohnert Park and Union Bank of
California, N.A., as Escrow Agent, have caused this Agreement to be executed each on its behalf
by duly authorized officers as of the day and year first above written.
CITY OF ROHNERT PARK
Joseph D. Netter, City Manager
UNION BANK OF CALIFORNIA, N.A.
as Escrow Agent
By
Authorized Officer
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SCHEDULEI
Investment Securities
United States Treasury Certificate of Indebtedness - State and Local Government
Series, as follows:
$ Principal Amount of United States Treasury Certificates of
Indebtedness, dated , 2001, maturing on March 2, 2002, and bearing interest at
% per annum to maturity.
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SCHEDULEII
Refunding Escrow Cash Flow
[To Come]
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