4865-6073-9568.4
RESOLUTION NO. 2024-67
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF GONZALES
APPROVING A CONVEYANCE AGREEMENT AND AN INSTALLMENT PURCHASE CONTRACT, MAKING CERTAIN DETERMINATIONS RELATING THERETO; AND
AUTHORIZING CERTAIN OTHER ACTIONS IN CONNECTION THEREWITH WHEREAS, the City of Gonzales (the “City”), a municipal corporation and general law city in Monterey County, California, desires to finance certain capital improvements for and provide working capital for its Industrial Wastewater System (the “Project”), pending delays in receiving reimbursements from the State of California under a State Revolving Fund loan; and WHEREAS, the City is authorized to sell and purchase its property to finance public capital improvements, including those improvements constituting the Project; and WHEREAS, to finance the Project, the City desires to enter into a Conveyance Agreement, between the City and Banner Bank (the “Lender”), pursuant to which the City will sell the Project to the Lender in return for certain funds, which the City will use to acquire, construct and install the Project; and
WHEREAS, to finance the Project, the City has determined to enter into an Installment Purchase Contract, between the City and the Lender, pursuant to which the City will repurchase the Project from the Lender; and
WHEREAS, under and pursuant to such Installment Purchase Contract, the City will be obligated to make certain installment payments to the Lender; and WHEREAS, the City Council has been presented with the form of each document that is referred to herein relating to the financing that is contemplated hereby, and the City Council has examined and approved each document and desires to authorize and direct the execution of such documents and the consummation of such financing; and
WHEREAS, all acts, conditions and things that are required by the laws of the State of California to exist, to have happened and to have been performed precedent to and in connection with the consummation of the financing that are authorized hereby do exist, have happened and have been performed in regular and due time, form and manner as required by law, and the City is now duly authorized and empowered, pursuant to each and every requirement of law, to consummate such financing for the purpose, in the manner and upon the terms herein provided.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Gonzales, as follows:
Section 1. Recitals True and Correct. The foregoing recitals are true and correct and are a substantive part of this Resolution.
Section 2. Approval of Conveyance Agreement. The form of Conveyance Agreement attached hereto as Exhibit A and incorporated herein by this reference is hereby approved. The Mayor of the City, the City Manager of the City, the Finance Director of the City and the Public Works Director/City Engineer of the City, or any other officers duly designated by the City (each, an “Officer” and collectively, the “Officers”) are hereby authorized and directed, for and on behalf of the City, to execute, acknowledge and deliver the Conveyance Agreement, in substantially the form attached hereto, with such changes therein as such Officers may require or approve, with the advice and approval of the City Attorney and Kutak Rock LLP (“Special Counsel”), such approval to be conclusively evidenced by the execution and delivery thereof.
Section 3. Approval of Installment Purchase Contract. The form of Installment Purchase Contract attached hereto as Exhibit B and incorporated herein by this reference is hereby approved.
The Officers are hereby authorized and directed, for and on behalf of the City, to execute, acknowledge and deliver the Installment Purchase Contract, in substantially the form attached hereto, with such changes therein as such Officers may require or approve, with the advice and approval of the City Attorney and Special Counsel, such approval to be conclusively evidenced by the execution and delivery thereof. In connection therewith, the City approves the execution and delivery of the Installment Purchase Contract so long as the maturity does not exceed December 31, 2027 (including a 6-month extension subject to approval by the Lender), the interest rate with respect to the Installment Payments does not initially exceed 4.34% per annum (except in the event of default or taxability), and the total principal amount outstanding at any one time does not exceed $10,000,000.
Section 4. Approval of Placement Agent Agreement. The form of Placement Agent Agreement with Hilltop Securities Inc. attached hereto as Exhibit C and incorporated herein by this reference is hereby approved. The Officers are hereby authorized and directed, for and on behalf of the City, to execute, acknowledge and deliver the Placement Agent Agreement, in substantially the form attached hereto, with such changes therein as such Officers may require or approve, with the advice and approval of the City Attorney and Special Counsel, such approval to be conclusively evidenced by the execution and delivery thereof.
Section 5. Other Acts. The Officers and staff of the City are hereby authorized, empowered and directed, individually, to do any and all things, to execute and deliver any and all documents, including but not limited to a term sheet with the Lender (provided that the limitations set forth in Section 3 are not exceeded), funds control agreement or other agreement related to the establishment and maintenance of the Acquisition Fund (as defined in the Installment Purchase Contract), which in consultation with the City Attorney and Special Counsel, they may deem necessary or advisable in order to effectuate the purposes of this Resolution, and any and all such actions previously taken by such Officers or staff members are hereby ratified and confirmed.
Section 6. Special Services. Kutak Rock LLP is hereby appointed to serve as Special Counsel with respect to the Bonds, Hilltop Securities Inc. is hereby appointed to serve as Placement Agent and NHA Advisors, LLC, will serve as the City’s Municipal Advisor per its previously approved contract. Each of the Authorized Officers is further authorized to provide for payment for all other services, including a facility origination fee payable to the Lender and a fee payable to the Lender’s counsel, that are necessary to effect the matters that are described in this Resolution. Any one of the Authorized Officers is authorized to pay for the cost of such services and to enter into agreements as needed to engage such consultants.
PASSED AND ADOPTED by the City Council of the City of Gonzales at a regular meeting duly held on the 18th day of November 2024 by the following vote:
AYES: COUNCIL MEMBERS:
NOES: COUNCIL MEMBERS:
ABSTAIN: COUNCIL MEMBERS:
ABSENT: COUNCIL MEMBERS:
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Jose L. Rios, The Honorable Mayor
ATTEST:
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Mary Villegas, Deputy City Clerk