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HomeMy Public PortalAbout2016_03_29_R047 Virginia Resources Authority Refunding Bond Issuance The Town of Leesburg, Virginia PRESENTED: March 29, 2016 RESOLUTION NO. 2016-047 ADOPTED: March 29, 2016 A RESOLUTION: PROVIDING FOR THE ISSUANCE AND SALE OF A GENERAL OBLIGATION AND REFUNDING BOND, SERIES 2016, OF THE TOWN OF LEESBURG, VIRGINIA, PROVIDING FOR THE FORM, DETAILS AND PAYMENT THEREOF, AND PROVIDING FOR THE REFUNDING OF CERTAIN OUTSTANDING BONDS WHEREAS, on August 10, 2011, the Town of Leesburg, Virginia (the "Town"), issued its General Obligation and Refunding Bonds, Series 2011A (the "2011 Bonds"); and WHEREAS, the Town's financial advisor has advised the Town that it may achieve debt service savings by refunding all or a portion of the outstanding principal amount of the 2011 Bonds; and WHEREAS, the Town desires to issue a refunding bond (the "Bond," as further described in Section 3 herein) to refund all or a portion of the 2011 Bonds, subject to the terms and conditions herein, including that (i) the refunding achieve an aggregate net present value debt service savings of not less than 3.00% of the refunded par amount of the 2011 Bonds (the "Targeted Savings") and (ii)the principal amount of the Bond not exceed $14,000,000; and WHEREAS, the Town has applied to Virginia Resources Authority ("VRA") for the purchase of the Bond, and VRA has indicated its willingness to purchase the Bond from the proceeds of one or more series of its Infrastructure and State Moral Obligation Revenue Bonds (Virginia Pooled Financing Program) (collectively, the "VRA Bonds"), in accordance with the terms of a Local Bond Sale and Financing Agreement (the "Financing Agreement"), between VRA and the Town, the form of which has been made available in the papers for this meeting of the Council of the Town (the "Council"); and -2- A RESOLUTION: PROVIDING FOR THE ISSUANCE AND SALE OF A GENERAL OBLIGATION AND REFUNDING BOND, SERIES 2016, OF THE TOWN OF LEESBURG, VIRGINIA, PROVIDING FOR THE FORM, DETAILS AND PAYMENT THEREOF, AND PROVIDING FOR THE REFUNDING OF CERTAIN OUTSTANDING BONDS WHEREAS, VRA has informed the Town that VRA's objective is to pay the Town a purchase price for the Bond (the "Purchase Price Objective")that, in VRA's judgment, reflects its market value taking into consideration such factors as the Targeted Savings, the purchase price received by VRA for the VRA Bonds, the issuance costs of the VRA Bonds (consisting of the underwriters' discount and other costs incurred by VRA) and other market conditions relating to the sale of the VRA Bonds; and WHEREAS, the Financing Agreement will provide that the terms of the Bond may not exceed the parameters set forth below in Section 3. NOW, THEREFORE, BE IT RESOLVED by the Council of the Town of Leesburg in Virginia as follows: 1. Issuance of Bond and Use of Proceeds. Pursuant to the Constitution and statutes of the Commonwealth of Virginia, including the Public Finance Act of 1991, there shall be issued and sold to VRA a General Obligation and Refunding Bond of the Town to provide funds to refund all or a portion of the 2011 Bonds and to pay the costs incurred in connection with such refunding and the issuance of the Bond. The Bond shall be delivered to or upon the order of VRA upon VRA's payment of the purchase price set forth in the Financing Agreement. Subject to the determination of the Town Manager of what will be in the Town's best interests, the Bond may be sold to VRA in connection with any sale date of the VRA Bonds occurring prior to December 31, 2016. 2. Authorization of Financing Agreement. The form of the Financing Agreement submitted to this meeting is hereby approved. The Town Manager is authorized to execute and deliver the Financing Agreement in substantially such form, with such completions, omissions, insertions and changes not inconsistent with this Resolution as may be approved by the Town Manager, whose approval shall be evidenced conclusively by the execution and delivery thereof. The issuance and sale of the Bond to VRA shall be upon the terms and conditions set forth in the Financing Agreement. The proceeds of the Bond shall be applied in the manner set forth in the Financing Agreement. All capitalized terms used but not otherwise defined herein shall have the same meanings as set forth in the Financing Agreement. -3- A RESOLUTION: PROVIDING FOR THE ISSUANCE AND SALE OF A GENERAL OBLIGATION AND REFUNDING BOND, SERIES 2016, OF THE TOWN OF LEESBURG, VIRGINIA, PROVIDING FOR THE FORM, DETAILS AND PAYMENT THEREOF, AND PROVIDING FOR THE REFUNDING OF CERTAIN OUTSTANDING BONDS 3. Bond Details. The Bond shall be issued as a single, registered bond, shall be designated "General Obligation and Refunding Bond, Series 2016," shall be numbered R- 1 and shall be dated the date that is 30 days prior to the closing date of the VRA Bonds. The Council authorizes the issuance and sale of the Bond to VRA on terms as shall be determined by VRA subject to VRA's Purchase Price Objective and market conditions described in the Recitals hereof; provided, however, that (i) the principal amount of the Bond shall not exceed $14,000,000, (ii) the Bond shall be payable in principal installments ending not later than December 31, 2040, and (iii) the refunding shall achieve at least the Targeted Savings. Subject to the preceding terms, the Council further authorizes the Town Manager to accept the final terms presented by VRA, including (a) the final principal amount of the Bond, (b) the amortization schedule (including the principal installment dates and amounts) for the Bond, (c) the optional and extraordinary redemption provisions, if any, of the Bond and (d) the portions, if any, of the 2011 Bonds to be refunded, all in such manner as the Town Manager shall determine to be in the best interests of the Town. As set forth in the Financing Agreement, the Town agrees to pay such Supplemental Interest and other charges as provided therein, including such amounts as may be necessary to maintain or replenish any VRA Reserve. The principal of and premium, if any, and interest on the Bond shall be payable in lawful money of the United States of America. The actions of the Town Manager in accepting the final terms of the Bond shall be conclusive, and no further action shall be necessary on the part of the Council. 4. Payment and Redemption Provisions of Bond. The principal of and premium, if any, and interest on the Bond shall be payable as set forth in the Bond and the Financing Agreement. The Town may, at its option, redeem, prepay or refund the Bond upon the terms set forth in the Financing Agreement. 5. Execution and Form of Bond. The Bond shall be signed by the Town Manager, and the Town's seal shall be affixed thereto and attested by the Clerk or Deputy Clerk of the Council. The Bond shall be issued as a typewritten bond in substantially the form of Exhibit A attached hereto, with such completions, omissions, insertions and changes not inconsistent with this Resolution as may be approved by the officers signing the Bond, whose approval shall be evidenced conclusively by the execution and delivery of the Bond. 6. Pledge of Full Faith and Credit. The full faith and credit of the Town are irrevocably pledged for the payment of principal of and premium, if any, and interest on the Bond. Unless other funds are lawfully available and appropriated for timely payment -4- A RESOLUTION: PROVIDING FOR THE ISSUANCE AND SALE OF A GENERAL OBLIGATION AND REFUNDING BOND, SERIES 2016, OF THE TOWN OF LEESBURG, VIRGINIA, PROVIDING FOR THE FORM, DETAILS AND PAYMENT THEREOF, AND PROVIDING FOR THE REFUNDING OF CERTAIN OUTSTANDING BONDS of the Bond, the Council shall levy and collect an annual ad valorem tax, over and above all other taxes authorized or limited by law and without limitation as to rate or amount, on all locally taxable property in the Town sufficient to pay when due the principal of and premium, if any, and interest on the Bond. 7. Preparation of Printed Bond. The Town shall initially issue the Bond in typewritten form. Upon request of the registered owner and upon presentation of the Bond at the office of the Registrar (as hereinafter defined), the Town shall arrange to have prepared, executed and delivered in exchange as soon as practicable the Bond in printed form in an aggregate principal amount equal to the unpaid principal of the Bond in typewritten form, in denominations of$5,000 and multiples thereof, of the same form and maturity and registered in such names as requested by the registered owner or its duly authorized attorney or legal representative. The printed Bond may be executed by manual or facsimile signature of the Town Manager, and the Town's seal is to be affixed thereto and attested by the Clerk or Deputy Clerk of the Council; provided, however, that if both such signatures are facsimiles, no Bond shall be valid until it has been authenticated by the manual signature of the Registrar and the date of authentication noted thereon. The typewritten Bond surrendered in any such exchange shall be canceled. 8. Registration, Transfer and Owner of Bond. The Council appoints the Director of Finance and Administrative Services as paying agent and registrar(the "Registrar") for the Bond. If deemed to be in its best interests, the Council may at any time appoint a qualified bank or trust company as successor Registrar. Upon surrender of the Bond at the office of the Registrar, together with an assignment duly executed by the registered owner or its duly authorized attorney or legal representative in such form as shall be satisfactory to the Registrar, the Town shall execute, and the Registrar shall authenticate and deliver in exchange, a new Bond or Bonds having an equal aggregate principal amount, of the same form and maturity, bearing interest at the same rate and registered in such name as requested by the then registered owner or its duly authorized attorney or legal representative. Any such exchange shall be at the expense of the Town, except that the Registrar may charge the person requesting such exchange the amount of any tax or other governmental charge required to be paid with respect thereto. The Registrar shall treat the registered owner as the person or entity exclusively entitled to payment of principal of and premium, if any, and interest on the Bond and the exercise of all other rights and powers of the owner, except that installments shall be paid to the person or entity shown as owner on the registration books on the 15th day of the month preceding each interest payment date. -5- A RESOLUTION: PROVIDING FOR THE ISSUANCE AND SALE OF A GENERAL OBLIGATION AND REFUNDING BOND, SERIES 2016, OF THE TOWN OF LEESBURG, VIRGINIA, PROVIDING FOR THE FORM, DETAILS AND PAYMENT THEREOF, AND PROVIDING FOR THE REFUNDING OF CERTAIN OUTSTANDING BONDS 9. Mutilated, Lost or Destroyed Bond. If the Bond has been mutilated, lost or destroyed, the Town shall execute and deliver a new Bond of like date and tenor in exchange and substitution for, and upon cancellation of, such mutilated Bond or in lieu of and in substitution for such lost or destroyed Bond; provided, however, that the Town shall so execute and deliver only if the registered owner has paid the reasonable expenses and charges of the Town in connection therewith and, in the case of a lost or destroyed Bond, (a) has filed with the Town evidence satisfactory to the Town that such Bond was lost or destroyed and (b) has furnished to the Town satisfactory indemnity. 10. Preparation and Delivery of Bond. The officers of the Town are authorized and directed to take all proper steps to have the Bond prepared and executed in accordance with its terms and to deliver it to VRA as the purchaser thereof upon receipt of the Purchase Price from VRA as set forth in the Financing Agreement. 11. Redemption of 2011 Bonds. The Town Manager is authorized and directed to take all proper steps to call for redemption such portions of the 2011 Bonds as shall be refunded on the date the Bond is issued and to prepare and deliver any such notices and correspondence necessary therefor. The Town Manager is authorized to affix the Town's seal on any such documents and attest the same. 12. Escrow Agreement. The Town Manager is authorized and directed to execute an escrow agreement (the "Escrow Agreement") between the Town and an escrow agent (and such other parties as may be necessary) for purposes of providing for the redemption and defeasance of the refunded portion of the 2011 Bonds. The Escrow Agreement shall be in a form approved by the Town Manager, in collaboration with the Town Attorney and the Town's bond counsel, the execution thereof by the Town Manager to constitute conclusive evidence of the Town Manager's approval of the Escrow Agreement. 13. Tax Compliance Agreement. Such officers of the Town as may be requested are authorized and directed to execute and deliver a nonarbitrage certificate and tax compliance agreement (the "Tax Compliance Agreement") in a form not inconsistent with this Resolution as may be approved by the officers of the Town executing such document, whose approval shall be evidenced conclusively by the execution and delivery thereof 14. Arbitrage Covenants. The Town covenants that it shall not take or omit to take any action the taking or omission of which will cause the VRA Bonds to be "arbitrage bonds" within the meaning of Section 148 of the Internal Revenue Code of 1986, as amended, and the regulations issued pursuant thereto (the "Code"), or otherwise cause interest on the VRA Bonds to be includable in the gross income of the registered owners thereof under existing law. Without limiting the generality of the foregoing, the Town -6- A RESOLUTION: PROVIDING FOR THE ISSUANCE AND SALE OF A GENERAL OBLIGATION AND REFUNDING BOND, SERIES 2016, OF THE TOWN OF LEESBURG, VIRGINIA, PROVIDING FOR THE FORM, DETAILS AND PAYMENT THEREOF, AND PROVIDING FOR THE REFUNDING OF CERTAIN OUTSTANDING BONDS shall comply with any provision of the Tax Compliance Agreement that may require the Town at any time to rebate to the United States any part of the earnings derived from the investment of the gross proceeds of the Bond, unless the Town receives an opinion of nationally recognized bond counsel that compliance with any such covenant is not required to prevent interest on the VRA Bonds from being included in the gross income for federal income tax purposes of the registered owners thereof under existing law. The Town shall pay any such required rebate from legally available funds. 15. Official Statement. The Town authorizes and consents to the inclusion of information with respect to the Town contained in VRA's Preliminary Official Statement and VRA's Official Statement in final form, both prepared in connection with the sale of the VRA Bonds. The Town Manager is authorized and directed to take whatever actions are necessary or appropriate to aid VRA in ensuring compliance with Securities and Exchange Commission Rule 15c2-12. 16. SNAP Investment Authorization. The Council has heretofore received and reviewed the Information Statement describing the State Non-Arbitrage Program of the Commonwealth of Virginia ("SNAP") and the Contract Creating the State Non-Arbitrage Program Pool I (the "Contract"), and the Council has determined to authorize the Director of Finance and Administrative Services to utilize SNAP in connection with the investment of the proceeds of the Bond, if the Director of Finance and Administrative Services determines that the utilization of SNAP is in the best interests of the Town. The Council acknowledges the Treasury Board of the Commonwealth of Virginia is not, and shall not be, in any way liable to the Town in connection with SNAP, except as otherwise provided in the Contract. 17. Other Actions. All other actions of officers of the Town in conformity with the purposes and intent of this Resolution and in furtherance of the issuance and sale of the Bond are hereby ratified, approved and confirmed. The officers of the Town are authorized and directed to execute and deliver all certificates and instruments and to take all such further action as may be considered necessary or desirable in connection with the issuance, sale and delivery of the Bond. 18. Repeal of Conflicting Resolutions. All resolutions or parts of resolutions in conflict herewith are repealed. 19. Public Finance Act. The Council hereby elects pursuant to Section 15.2-2601 of the Virginia Code to issue the Bond under the Public Finance Act of 1991, Chapter 26, Title 15.2 of the Virginia Code without regard to the requirements, restrictions or other provisions contained in any charter or special or local act. -7- A RESOLUTION: PROVIDING FOR THE ISSUANCE AND SALE OF A GENERAL OBLIGATION AND REFUNDING BOND, SERIES 2016, OF THE TOWN OF LEESBURG, VIRGINIA, PROVIDING FOR THE FORM, DETAILS AND PAYMENT THEREOF, AND PROVIDING FOR THE REFUNDING OF CERTAIN OUTSTANDING BONDS 20. Filing of Resolution. The appropriate officers or agents of the Town are authorized and directed to file or cause to be filed a certified copy of this Resolution with the Circuit Court of the County of Loudoun, Virginia pursuant to Sections 15.2-2607 and 15.2-2627 of the Virginia Code. 21. Effective Date. This Resolution shall take effect immediately. PASSED this 29th day of March, 2016. gaiv.v.. gap, David S. Butler, Mayor Town of Leesburg in Virginia ATTi.T. b1 ,4.L,_:_ -- Clerk of Co u P:\Resolutions\2016\0329 Issuance of Series 2016 General Obligation Refunding Bond.docx