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Home My Public Portal About15-8984 Accept a Revolving Line of Credit from City National Bank to Provide Temporary Bridge FinancingSponsored by: City Manager RESOLUTION NO. 15-8984 A RESOLUTION OF THE CITY COMMISSION OF THE CITY OPA- LOCKA; AUTHORIZING THE CITY MANAGER TO ACCEPT A REVOLVING LINE OF CREDIT FROM CITY NATIONAL BANK TO PROVIDE TEMPORARY BRIDGE FINANCING FOR THE CITY'S ONGOING AND FUTURE DRINK WATER, SEWER WATER AND WASTE WATER IMPROVEMENT PROJECTS; PROVIDING FOR INCORPORATION OF RECITALS; PROVIDING FOR AN EFFECTIVE DATE. WHEREAS, the City Commission of the City of Opa -locka passed Resolution 15 -8918, authorizing the City Manager to negotiate a revolving line of credit with City National Bank; and WHEREAS, City Manager has completed the negotiations with City National Bank pursuant to Resolution 15 -8918; and WHEREAS, the terms of the negotiations are set forth in EXHIBIT "A ". NOW, THEREFORE, BE IT DULY RESOLVED THAT THE CITY COMMISSION FOR THE CITY OF OPA LOCAK, FLORIDA: Section 1. The recitals to the preamble herein are incorporated by reference. Section 2. The City Commission the City of Opa- locka, Florida, hereby authorize the City Manager to execute the term -sheet attached as EXHIBIT "A" and any other documents necessary to accomplish the purpose stated therein. Section 3. This resolution shall take effect immediately upon adoption. PASSED AND ADOPTED this 27th day of April, 2015. Resolution No. 15 -8984 Attest to: i� Joanna Flores City Clerk Moved by: Seconded by: Commission Vote: Commissioner Kelley: Commissioner Pinder: Commissioner Santiago: Vice -Mayor Holmes: Mayor Taylor: i r MyCa Taylor Mayor Approved as to form and legal sufficiency: Vincent T. Brown, Esq. The Brown Law Group, LLC City Attorney Commissioner Pinder Commissioner Santiago 5 -0 YES YES YES YES YES City ofOpa-Lockc; Florida 0 City National Bank April 23d, 2015 Ms. Susan Gooding - Liburd The City of Opa- Locka, FL 3400 NW 135th Street Bldg B Opa- Locka, FL 33054 Dear Ms. Gooding - Liburd, City National Bank of Florida ( "Bank") is pleased to provide you with the following Term Sheet which outlines the basic terms and conditions currently being contemplated for the proposed extension of credit to the below - referenced Borrower's). The following is not a commitment to lend, but rather an expression of Interest on behalf of the Bank. A final approval will be conditional on the Bank completing its full underwriting and usual and customary due diligence processes. The terms and conditions outlined here are subject to change in whole or in part, and any formal conveyance of a final approval would be detailed in a formal commitment letter. We look forward to the opportunity to review this with you and to building a long term relationship between our firms. FOR DISCUSSION PURPOSES ONLY BORROWER: The City of Opa- Locka, FL ( "Borrower") LOAN AMOUNT: $6,000,000.00 LOAN TYPE & PURPOSE: Direct placement bank qualified non tax exempt revolving line of credit to provide temporary bridge financing for the Borrower's ongoing and future Drinking Water, Sewer Water, and Waste Water improvement projects ( "the Projects ") contemplated herein. 11Page City of Opa -Lock Florida 6 CRY National Bank INTEREST RATE: The interest rate shall be 300 basis points above the 30 -day LIBOR rate with a floor rate of 3.50 %, floating. TERM: Two [2] years from date of note REPAYMENT: INTERES T - Payments of all accrued interest shall be due quarterly. PRINCIPAL — Principal advances shall be due 60 days from the date of each Individual advance. All outstanding principal plus accrued interest shall be due at maturity. BANK LOAN FEE: 0.50% of Loan amount ($30,000.00). A deposit In the amount of $20,000.00 for incidental fees shall be payable upon issuance and acceptance of this term sheet. PREPAYMENT PENALTY: Waived out of courtesy COLLATERAL: The Loan will be collateralized by the following: - First Lien on the gross revenues from the City's Water & Sewer Systems operations in parity with the Florida Department of Environmental Protection as contemplated for the Project. CONDITIONS PRECEDENT: - Receipt and review of audited financial statements of Borrower for the fiscal year ended 9 /30/2013 - Receipt and review of "unaudited" financial statements of Borrower for the fiscal year ended 09 /30/2014. - Receipt and review of the City's 2015 commission approved annual Budget Receipt and review of all Loan Agreement documents between the State of Florida and Borrower in regard to loans and /or grants specifically related to the Project. 21Page 43 City National Sam City of Cpa Locka, Florida Receipt and review of all costs and associated funding sources for all phases of the Project contemplated. - Formal Loan Commitment and Approval shall be subject to the Bank completing a full underwriting of the Borrower's financial position and due diligence. Borrower shall continue to maintain their primary deposit relationship, including operating accounts and cash management relationship, with City National Bank during the life of the loan. OTHER TERMS & REQUIREMENTS: 1) Loan and closing documents will be drafted by Bank's attorney, at Borrower's expense. Bank's attorney will work in conjunction with Borrower's attorney for review of loan closing documents. 2) The Line of Credit is to be set up on automatic debit for both interest and principal payments. 3) The Bank shall be the depository for any and all Loan Debt Service Accounts of the Borrower as specified in Borrower's Loan Agreements with the State of Florida for the Project. 4) Opinion of Borrower's Counsel attesting to City's full authority to enter into the subject credit facility. ADVANCES: Individual advances shall be available only after the submission of a complete disbursement request including, but not limited to, the following: 1. Copies of invoices /vouchers to be paid 2. Certification and approval that the work pertaining to the invoices /vouchers being presented has been completed. Such certification must be approved by the City Engineer, the City Manager or Assistant City Manager's office, and the City's Finance Department. 31 Page City of 6pa Locka, Florida Ii City National Bank 3. Certification from the City Manager or Assistant City Manager and the Finance Department that the requested advances are eligible for reimbursement by the FDEP under the corresponding $tate Financial Assistance Agreement. 4. All required documentation necessary for the Department to provide funding, as stipulated in the request for funding guidelines set forth by the FDEP. FINANCIAL COVENANTS 1) Water and Sewer Pledged Revenue shall exceed annual Interest coverage requirement of this loan facility with a coverage of no less than 1.15x, which shall be tested annually. 2) Borrower shall not begin to make any loan repayments of principal to the State of Florida, of the debt incurred for this project financing program, until all outstanding principal and interest obligations of this loan facility are paid in full. REPORTING REQUIREMENTS: 1.) CPA unqualified fiscal year -end Financial Statements of the Borrower to be provided within 180 days of fiscal year end, commencing with fiscal year -end statement dated September 30, 2014. 2.) Annual Commission Approved Budget of Borrower, submitted within 30 days from date of approval by the City Commission. 3.) Semi - Annual Financial Statements to be submitted within 90 days of semi - annual anniversary date. EXPENSES: Borrower agrees to pay all normal disbursements, costs and fees of the Bank and the Borrower involved in this transaction which are reasonable and customary and have actually been Incurred, 41Page City National Bank City of Opa -LockQ Florida including but not limited to, recording costs, documentary stamps, Intangible tax, attorney fees for closing this loan, field audits and any and all other additional expenses or additional requirements reasonably imposed by the Bank or the Bank's counsel. Bank hereby notifies you that pursuant to the requirements of the USA Patriot Act (the "Act"), it is required to obtain, verify and record information that identifies you in accordance with the Act. City National Bank is pleased to provide this term sheet for your review. If the foregoing meets with your approval, please sign where indicated below and provide the fee as described herein along with a signed copy of the term sheet. This term sheet and the provisions herein shall expire 5 business days from the date of this letter. After acceptance, should the Bank decline your request, the application fee will be refunded; otherwise, the fee will be credited to your costs at closing. Should you elect not to close; the fee will be retained by the Bank. Sincerely ♦ L Hugo Carrefio Vice - President 51Page 001 ofOPa -Lock Florida W City National Bank Acknowledgment to proceed must be received on or before April 3e, 2015. ACCEPTED on this day of 2015 The City of Opa- Locka, FL By: title This term sheet is confidential and proprietary In nature between the Bank and the Borrower. This term sheet, and the contents thereof, shall not be shared, distributed or disseminated in any form to any third party (including to any other potential lenders) without the express written consent of the Bank. 61Page Sponsored by: City Manager RESOLUTION NO. 15 -8918 A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF OPA- LOCKA, FLORIDA AUTHORIZING THE CITY MANAGER TO NEGOIATE A REVOLVING LINE OF CREDIT NOT TO EXCEED SIX MILLION DOLLARS WITH CITY NATIONAL BANK IN ORDER TO INSURE SOUND FISCAL STABILITY FOR THE CITY; PROVIDING FOR INCORPORATION OF RECITALS; PROVIDING FOR AN EFFECTIVE DATE WHEREAS, the City Commission of the City of Opa -locka desires to maintain a sound, fiscally responsible budget; and WHEREAS, in order for the City to provide proper departmental spending in accord with the adopted FY 2014 -2015 budget, the City Manager has advised that a revolving line of credit should be obtained by the City. NOW, THEREFORE, BE IT DULY RESOLVED BY THE CITY COMMISSION OF THE CITY OF OPA- LOCKA, FLORIDA: Section 1. The recitals to the preamble herein are incorporated by reference. Section 2. The City Commission of the City of Opa -locks hereby authorizes the City Manager to negotiate with City National Bank for a revolving line of credit not to exceed six million dollars to insure the City having available funds to maintain sound fiscal budgetary responsibilities for all City departments. Section 3. This resolution shall take effect immediately upon adoption. PASSED AND ADOPTED this 28th day of January, 2015. Resolution No. 15 -8918 Attest to: PIanna Flores ty Clerk Moved by: Seconded by: Commission Vote: Commissioner Kelley: Commissioner Pinder: Commissioner Santiago: Vice -Mayor Holmes: Mayor Taylor: �1 4*114 TAYLOR MAYOR Approved as to form and legal sufficiency VICE MAYOR HOLMES COMMISSIONER PINDER 5 -0 YES YES YES YES YES 1i S. Feller / John C. Della :NS OON MARDER PA City Attorney