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HomeMy WebLinkAboutR-2025-101 Issuance of Capital Imp. Revenue Note - TD Public Finance LLC RESOLUTION NO. 2025-101 A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF DANIA BEACH, FLORIDA AUTHORIZING THE ISSUANCE OF ITS CAPITAL IMPROVEMENT REVENUE NOTE, SERIES 2025 EVIDENCED BY A LOAN IN AN AMOUNT NOT TO EXCEED $3,100,000 FROM TD PUBLIC FINANCE LLC TO THE CITY TO ACQUIRE, CONSTRUCT, RENOVATE, AND EQUIP CERTAIN CAPITAL PROJECTS, AS DESCRIBED HEREIN; AUTHORIZING THE NEGOTIATED SALE OF SUCH NOTE TO TD PUBLIC FINANCE LLC PURSUANT TO THE TERMS AND CONDITIONS OF A LOAN AGREEMENT BY AND AMONG THE FLORIDA MUNICIPAL LOAN COUNCIL, CITY OF DANIA BEACH, FLORIDA, AND TD PUBLIC FINANCE LLC; APPROVING THE FORM OF AND AUTHORIZING THE EXECUTION AND DELIVERY OF THE LOAN AGREEMENT; MAKING CERTAIN OTHER COVENANTS AND AGREEMENTS IN CONNECTION WITH THE ISSUANCE OF SUCH NOTE; PROVIDING FOR SEVERABILITY; FURTHER, PROVIDING AN EFFECTIVE DATE. WHEREAS, participating governmental units have created the Florida Municipal Loan Council (the "Council") pursuant to a certain Interlocal Agreement and pursuant to Chapter 163, Part I, Florida Statutes, for the purpose of issuing its bonds to make loans to participating governmental units for qualified projects; and WHEREAS, the City of Dania Beach, Florida (the "Issuer”), a municipal corporation, is duly created and existing pursuant to the Constitution and laws of the State of Florida (the "State"); and WHEREAS, there is a substantial need for the continued preservation of the welfare and convenience of the Issuer and its citizens to finance the acquisition of approximately 0.43 acres of land located at 400 South Federal Highway, Dania Beach, Florida, along with a 4.052 square foot historically designated structure (collectively, the "Project"); and WHEREAS, the Issuer has determined that financing the Project through a financing program through the Council, which regularly undertakes projects requiring significant debt financing within the State, would provide for low-cost financing of the Project through administrative support and access to experience and knowledge in accessing the capital markets; and WHEREAS, the Issuer has determined that it is in the best interest of the Issuer and the citizens to issue its City of Dania Beach, Florida Capital Improvement Revenue Note, Series 2025 (the "Note"), pursuant to a Loan Agreement, by and among the Issuer, the Council, and TD 2 RESOLUTION #2025-101 Public Finance LLC (the "Lender"), in substantially the form attached hereto as Exhibit A (the "Loan Agreement"), to finance the costs of the Project and to pay the transaction costs associated with the issuance of the Note; and WHEREAS, debt service on the Note and any other amounts due under the Loan Agreement will be secured by a covenant to budget and appropriate legally available non-ad valorem revenues of the Issuer (the "Non-Ad Valorem Revenues"), as further described in this Resolution and in the Loan Agreement; and WHEREAS, the Non-Ad Valorem Revenues are estimated to be sufficient to pay all principal of and interest on the Note, as the same becomes due, and to make all other deposits or payments required by this Resolution and the Loan Agreement; and WHEREAS, the Issuer received proposals from a number of financial institutions in response to the Issuer's request for proposals, dated May 20, 2025; and WHEREAS, it is determined that it is necessary and desirable and in the best interest of the Issuer to authorize the Mayor, or his or her duly authorized designee, to accept the proposal from the Lender to extend credit to the Issuer by obtaining a loan evidenced by the Note upon the terms and conditions set forth in, this Resolution, the Loan Agreement, and in the term sheet, dated June 10, 2025, submitted by the Lender with respect to the Note, a copy of which is attached hereto as Exhibit B; and WHEREAS, due to the present volatility of the market for tax-exempt obligations such as the Note and the complexity of the transactions relating to the Note, including the duration of the Note and the relatively small size of the principal amount of the Note, it is in the best interest of the Issuer that the Note be issued on a negotiated basis to the Lender; and WHEREAS, the Issuer will be provided all applicable disclosure information by the Lender as required by Section 218.385, Florida Statutes; and WHEREAS, the Note shall not constitute a general obligation, or a pledge of the faith, credit, or taxing power of the Issuer, the State, or any political subdivision thereof, within the meaning of any constitutional or statutory provisions. Neither the State, nor any political subdivision thereof, nor the Issuer shall be obligated to (i) exercise its ad valorem taxing power in any form on any real or personal property of or in the Issuer to pay the principal of and interest on the Note, or any other amounts due under the Loan Agreement, or (ii) to pay the same from any other funds of the Issuer except from the Non-Ad Valorem Revenues budgeted and 3 RESOLUTION #2025-101 appropriated and deposited to the debt service fund established in the Loan Agreement, all in the manner provided in this Resolution and the Loan Agreement. The Note shall not constitute a lien on any property owned or situated within the limits of the Issuer. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF DANIA BEACH, FLORIDA: SECTION 1. ADOPTION OF REPRESENTATIONS. The foregoing Whereas paragraphs are hereby ratified and confirmed as being true, and the same are hereby made a specific part of this Resolution. SECTION 2. AUTHORITY. This Resolution is adopted pursuant to Chapter 166, Florida Statutes, the Charter of the Issuer, and other applicable provisions of law. SECTION 3. AUTHORIZATION OF THE PROJECT. The Issuer does hereby authorize the Project. SECTION 4. LOAN AMOUNT. The principal amount of the Loan to the Issuer evidenced by the Loan Agreement shall not exceed $3,100,000. The Loan shall be made as a tax-exempt borrowing, which shall include, but is not limited to, the costs of issuance incurred by the Issuer, the Lender and the Council, administrative fees of the Florida League of Cities, Inc., and other ongoing costs, and shall bear interest and shall be repayable according to the terms and conditions set forth in the Loan Agreement. SECTION 5. APPROVAL AND DELIVERY OF LOAN AGREEMENT. To provide for the security of the Note and to express the contract among the parties to the Loan Agreement, the Mayor, as attested by the City Clerk, and approved as to form and correctness by the City Attorney, or their duly authorized designee, are hereby authorized and directed to execute and deliver the Loan Agreement to evidence the Loan and to undertake all actions in respect to the Loan Agreement, which is in substantially the form attached hereto as Exhibit A with such changes, amendments, modifications, deletions, and additions as may be approved by the Mayor, the City Clerk, or their duly authorized designee, the execution thereof being conclusive evidence of such approval. SECTION 6. AUTHORIZATION OF THE NOTE. Subject and pursuant to the provisions of this Resolution, and the terms and provisions of the Loan Agreement, an obligation of the Issuer to be designated as "City of Dania Beach, Florida Capital Improvement Revenue Note, Series 2025" is hereby authorized to be issued, which Note shall evidence amounts 4 RESOLUTION #2025-101 outstanding under the Loan Agreement and will be repaid in accordance with the terms of the Loan Agreement. The proceeds of the Note shall be used for the principal purpose of financing all or a portion of the costs of the Project and financing certain costs of issuance incurred with respect to the Loan, which such costs shall include costs of issuance incurred by the Issuer, the Lender, and the Council. SECTION 7. DESCRIPTION OF THE NOTE. (A) The Note is to be issued as a single, fully registered note in a principal amount of $3,100,000; shall be dated its date of delivery and shall mature not later than October 1, 2035 (the "Maturity Date"). The Note shall bear a fixed interest rate of 4.07% per annum, subject to adjustment as provided therein, and interest shall be payable on each April 1 and October 1, commencing not earlier than October 1, 2025, and thereafter until the principal amount of the Note has been paid. Interest shall be calculated on the basis of a 360-day year consisting of 12 months of 30 days each. Principal shall be payable annually on October 1, commencing on October 1, 2026, and thereafter, through and including, the Maturity Date. (B) The Note shall be subject to optional prepayment as set forth in the Loan Agreement. SECTION 8. EXECUTION OF THE NOTE. The Note shall be executed in the name of the Issuer with the manual signature of the Mayor, and the official seal of the Issuer shall be imprinted thereon, attested, countersigned, and authenticated with the manual or facsimile signature of the City Clerk, and approved as to form and legal sufficiency by the City Attorney, if necessary. In case any one or more of the officers who shall have signed or sealed the Note shall cease to be such officer of the Issuer before the Note so signed and sealed has been actually sold and delivered, such Note may nevertheless be sold and delivered as herein provided and may be issued as if the person who signed or sealed such Note had not ceased to hold such office. The Note may be signed and sealed on behalf of the Issuer by such person who at the actual time of the execution of such Note shall hold the proper office of the Issuer, although, at the date of such Note, such person may not have held such office or may not have been so authorized. 5 RESOLUTION #2025-101 SECTION 9. FORM OF THE NOTE. The text of the Note shall be in substantially the form set forth on Exhibit C of the Loan Agreement with such changes, amendments, modifications, deletions, and additions as may be approved by the Mayor, upon consultation with the City Attorney, the execution thereof being conclusive evidence of such approval. SECTION 10. NEGOTIATED SALE OF THE NOTE. (A) Due to the present volatility of the market for tax-exempt obligations such as the Note and the complexity of the transactions relating to the Note, including the duration of the Note and the relatively small size of the principal amount of the Note, it is in the best interest of the Issuer that the Note be issued on a negotiated basis to the Lender. (B) Prior to the issuance of the Note, the Issuer shall receive from the Lender a Lender's Certificate, substantially in the form attached hereto as Exhibit C and a Disclosure Letter containing the information required by section 218.385, Florida Statutes, substantially in the form attached hereto as Exhibit D. SECTION 11. PAYMENT OF THE NOTE; LIMITED OBLIGATION. (A) The principal of and interest on the Note shall be secured by a covenant to budget and appropriate legally available Non-Ad Valorem Revenues in accordance with this Resolution and the Loan Agreement. (B) THE FULL FAITH AND CREDIT OF THE ISSUER, THE STATE, OR ANY POLITICAL SUBDIVISION THEREOF, ARE NOT PLEDGED TO THE PAYMENT OF THE PRINCIPAL OF AND INTEREST ON THE NOTE, AND ALL OTHER AMOUNTS DUE UNDER THE LOAN AGREEMENT, AND HOLDERS SHALL NEVER HAVE THE RIGHT TO REQUIRE OR COMPEL THE EXERCISE OF ANY TAXING POWER OF THE ISSUER, THE STATE, OR ANY POLITICAL SUBDIVISION THEREOF, TO THE PAYMENT OF SUCH PRINCIPAL OR INTEREST, OR ALL OTHER AMOUNTS DUE UNDER THE LOAN AGREEMENT. THE NOTE AND THE OBLIGATION EVIDENCED THEREBY SHALL NOT CONSTITUTE A LIEN UPON ANY PROPERTY OF THE ISSUER AND SHALL BE PAYABLE FROM AND SECURED SOLELY BY THE NON-AD VALOREM REVENUES ACTUALLY BUDGETED, APPROPRIATED, AND DEPOSITED INTO A DEBT SERVICE FUND ESTABLISHED FOR SUCH PURPOSE, ALL IN THE MANNER AND TO THE EXTENT DESCRIBED IN THIS RESOLUTION AND THE LOAN AGREEMENT. THE NOTE SHALL NOT BE OR CONSTITUTE A GENERAL OBLIGATION OR 6 RESOLUTION #2025-101 INDEBTEDNESS OF THE ISSUER AS "BONDS" WITHIN THE MEANING OF ANY CONSTITUTIONAL OR STATUTORY PROVISION. SECTION 12. OTHER INSTRUMENTS. The Mayor, the City Clerk, the City Manager, the City Chief Financial Officer, the City Attorney, and other officers, attorneys, and other agents and employees of the Issuer are hereby authorized to perform all acts and things required of them by this Resolution and the Loan Agreement or desirable or consistent with the requirements thereof and hereof, for the full, punctual, and complete performance of all of the terms, covenants, and agreements contained in the Note, this Resolution, and the Loan Agreement, and they are hereby authorized to execute and deliver all documents which shall be required by Note Counsel, the Financial Advisor, or the Council to effectuate the issuance of the Note. All action taken to date by the officers, attorneys, and any other agents and employees of the Issuer in furtherance of the issuance of the Note is hereby approved, confirmed, and ratified. SECTION 13. REPEAL OF RESOLUTIONS IN CONFLICT. All resolutions or parts of resolutions in conflict herewith are hereby repealed to the extent of such conflict. SECTION 14. SEVERABILITY CLAUSE. If any phrase, clause, sentence, paragraph, or section of this Resolution is for any reason held invalid or unconstitutional by the judgment or decree of a court of competent jurisdiction, such invalidity or unconstitutionality shall not affect the validity of the remaining phrases, clauses, sentences, paragraphs, or sections of this Resolution. SECTION 15. EFFECTIVE DATE. This Resolution shall take effect immediately upon its adoption. SIGNATURES ON THE FOLLOWING PAGE 7 RESOLUTION #2025-101 PASSED AND ADOPTED on July 8, 2025. Motion by Vice Mayor Salvino, second by Commissioner Lewellen. FINAL VOTE ON ADOPTION: Unanimous X Yes No Commissioner Lori Lewellen ____ ____ Commissioner Luis Rimoli ____ ____ Commissioner Archibald J. Ryan IV ____ ____ Vice Mayor Marco Salvino ____ ____ Mayor Joyce L. Davis ____ ____ ATTEST: ELORA RIERA, MMC JOYCE L. DAVIS CITY CLERK MAYOR APPROVED AS TO FORM AND CORRECTNESS: EVE A. BOUTSIS CITY ATTORNEY EXHIBIT A FORM OF LOAN AGREEMENT EXHIBIT B TERM SHEET C-1 EXHIBIT C FORM OF LENDER CERTIFICATE City of Dania Beach 100 W. Dania Beach Boulevard Dania Beach, Florida 33004 Re: $3,100,000 City of Dania Beach, Florida Capital Improvement Revenue Note, Series 2025, dated July 14, 2025 (the "Loan Obligation") Ladies and Gentlemen: TD Public Finance LLC (the "Lender") is extending credit to the City of Dania Beach, Florida (the "Issuer"), evidenced by the Loan Obligation to hold for its own account to maturity or earlier prepayment and has no present intent to distribute or sell any interest therein or portion thereof other than to an affiliate of the Lender, provided that the Lender retains the right at any time to dispose of the Loan Obligation or any interest therein or portion thereof, but agrees that any such sale, transfer, or distribution by the Lender shall be made in accordance with applicable law and the provisions of the Loan Obligation. The Lender acknowledges that no CUSIP numbers be obtained and that the Loan Obligation not be made DTC eligible. No inference should be drawn that the Lender, in the acceptance of the Loan Obligation, is relying on Bryant Miller Olive P.A., Note Counsel, or Eve A. Boutsis, Esq., City Attorney, as to any such matters other than the legal opinions rendered by Note Counsel and by the City Attorney. The Lender is a lender that regularly extends credit by making loans in the form of state and local government obligations; has knowledge and experience in financial and business matters that make it capable of evaluating the Issuer, the Loan Obligation, and the risks associated with the making of such loan; and has the ability to bear the economic risk of extending the credit evidenced by the Loan Obligation. The Lender acknowledges that it is (a) a "qualified institutional buyer" as defined in Rule 144A promulgated by the Securities and Exchange Commission pursuant to the Securities Act of 1933, as amended (the "Securities Act"), or (b) an "accredited investor" as defined in Section 501(a)(1), (2), (3) or (7) of Regulation D promulgated under the Securities Act. The Lender has conducted its own investigation of the financial condition of the Issuer and of the security for the payment of the principal of and interest on the Loan Obligation, and has obtained such information regarding the Loan Obligation, the Issuer, and its operations, financial condition, and financial prospects as the Lender deems necessary to make an informed credit decision with respect to the making of the loan evidenced by the Loan Obligation. The Lender acknowledges that (a) the Loan Obligation (i) has not been registered under the Securities Act of 1933, as amended, (ii) has not been registered or otherwise qualified for sale under the securities laws of any state, (iii) will not be listed on any securities exchange, and (iv) will carry no rating from any rating agency; and (b) there is no established market for the C-2 Loan Obligation and that none is likely to develop. The Lender acknowledges that Resolution No. 25-__, adopted by the Issuer on July 8, 2025, and the Loan Agreement, dated as of July 1, 2025, by and among the Florida Municipal Loan Council (the "Council"), the Issuer, and the Lender, are not being qualified under the Trust Indenture Act of 1939, as amended. The Lender acknowledges that (a) the making of the loan evidenced by the Loan Obligation is not intended to be subject to the requirements of Rule 15c2-12 promulgated under the Securities Exchange Act of 1934, as amended, and (b) the Issuer has not prepared or caused to be prepared, any official statement, private placement memorandum or other offering document, or other disclosure document. The Lender is not acting as a fiduciary for the Issuer or in the capacity of broker, dealer, placement agent, municipal securities underwriter, municipal advisor, or fiduciary in connection with its making of the loan evidenced by the Loan Obligation. The Lender has not acted as an agent or served as the Issuer's municipal advisor (as defined in Section 15B of the Securities and Exchange Act of 1934). The Lender has no fiduciary duty to the Issuer and is entering into an arm's length transaction involving extending credit to the Issuer evidenced by the Loan Obligation. The Lender has not provided, and will not provide, financial, legal (including securities law), tax, accounting, or other advice to or on behalf of the Issuer (including to any financial advisor or any placement agent engaged by the Issuer) with respect to the structuring, issuance, sale, or delivery of the Loan Obligation. The Lender expresses no view regarding the legal sufficiency of its representations for purposes of compliance with any legal requirements applicable to any other party, including but not limited to the Issuer or its financial advisor or placement agent. The Lender also acknowledges that neither the Council nor Public Resources Advisory Group (the "Financial Advisor"), are acting as a broker or dealer with respect to the Loan Obligation nor is the loan being distributed as a security or otherwise marketed by the Council. The Lender acknowledges that the Financial Advisor is relying on the representations contained herein for purposes of the Municipal Advisor's determination (i) that this transaction meets the requirements for being a qualified exception for purposes of MSRB Rule G-34, and (ii) that the Municipal Advisor is excepted and released from the requirement to request a CUSIP assignment on behalf of the Issuer pursuant to MSRB Rule G-34 for the Loan Obligation. [Remainder of page intentionally left blank] DATED this ______th day of July, 2025. TD PUBLIC FINANCE LLC By: Name: Lance Aylsworth Title: Vice President Senior Relationship Manager D-1 EXHIBIT D FORM OF DISCLOSURE LETTER The undersigned, on behalf of TD Public Finance LLC (the "Lender"), proposes to negotiate with the City of Dania Beach, Florida (the "Issuer") for the extension of credit to the Issuer through the private purchase of the Issuer's $3,100,000 City of Dania Beach, Florida Capital Improvement Revenue Note, Series 2025 (the "Note"). Prior to the award of the Note, the following information is hereby furnished to the Issuer: 1. Set forth below is an itemized list of the nature and estimated amounts of expenses to be incurred for services rendered to the Lender in connection with the issuance of the Note: Holland & Knight LLP, Lender's Counsel $8,500.00 2. (a) The Issuer shall pay an origination fee in the amount of $3,100 to the Lender. No other fee, bonus, or other compensation is estimated to be paid by the Lender in connection with the issuance of the Note to any person not regularly employed or retained by the Lender (including any "finder" as defined in Section 218.386(1)(a), Florida Statutes), except as specifically enumerated as expenses to be incurred by the Lender, as set forth in paragraph 1. above. (b) No person has entered into an understanding with the Lender, or to the knowledge of the Lender, with the Issuer, for any paid or promised compensation or valuable consideration, directly or indirectly, expressly or implied, to act solely as an intermediary between the Issuer and the Lender or to exercise or attempt to exercise any influence to effect any transaction in connection with the Note. 3. The amount of the underwriting spread expected to be realized by the Lender is $0.00. 4. The management fee to be charged by the Lender is $0.00. 5. The origination fee to be charged by the Lender is $3,100.00. 6. Truth-in-Bonding Statement: The Issuer is proposing to issue the Note in the principal amount of $3,100,000 to finance the costs of certain capital improvements as described in Resolution No. 25-___ (the "Resolution") and the Loan Agreement, dated as of July 1, 2025, by and among the Issuer, the Lender, and the Florida Municipal Loan Council (the "Loan Agreement"). Based solely on calculations provided by Public Resources Advisory Group, the Note is expected to be repaid over a period of approximately 10 years. At a forecasted interest rate of D-2 4.07%, total interest paid over the life of the Note is estimated to be approximately $762,335.78. The source of repayment or security for the Note is a covenant to budget and appropriate Non- Ad Valorem Revenues (as defined in the Loan Agreement). Issuance of the Note is estimated to result in an annual average of approximately $378,145.47 of the Non-Ad Valorem Revenues not being available to finance the other services of the Issuer during the life of the Note for approximately 10.21 years. This paragraph is provided pursuant to section 218.385, Florida Statutes, is for informational purposes only, and shall not affect or control the actual terms and conditions of the Note. 6. The name and address of the Lender is as follows: TD Public Finance LLC 255 Alhambra Circle Coral Gables, Florida 33134 Attention: ______________ This Disclosure Letter is provided for the sole purpose of complying with Section 218.385, Florida Statutes, as amended, and does not change the terms of and is not evidence of the terms of the Note. It is the understanding of the Lender that the Issuer has not requested any further disclosure from the Lender. IN WITNESS WHEREOF, the undersigned has executed this Disclosure Letter on behalf of the Lender this 14th day of July, 2025. TD PUBLIC FINANCE LLC By: Name: Lance Aylsworth Title: Vice President Senior Relationship Manager