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HomeMy WebLinkAbout1996-02-22 - Resolution No. 96-03• • RESOLUTION NO. 96-03 RESOLUTION OF THE BOARD OF DIRECTORS OF YORBA LINDA WATER DISTRICT APPROVING AN AMENDED AND RESTATED SUBLEASE WITH MUNICIPAL WATER DISTRICT OF ORANGE COUNTY RELATING TO THE ALLEN-MCCOLLOCH PIPELINE AND AUTHORIZING USE OF INFORMATION IN AN OFFICIAL STA'T'EMENT WHEREAS, the Yorba Linda Water District (the "District") and other participating water districts and cities (the "Part icipants") entered into an Agreement dated January 13, 1978 entitled "Agreement for Construction, Operation and Maintenance of Pipeline and to Enter into Subleases Concerning the Diemer Filtration Plant/Santiago Aqueduct Intertie and certain amendments thereto and associated agreements hereinafter collectively referred to as the "Diemer Agreements" pursuant to which the Participants, the Municipal Water District of Orange County ("MWDOC") and the Municipal Water District of Orange County Water Facilities Corporation (the "Corporation") caused to be constructed and currently operate and maintain the Allen-McColloch Pipeline (then known as the "Diemer Intertie"), hereinafter referred to as the "AMP" or the "Project"; and WHEREAS, the Corporation was formed by a group of public-spirited citizens for the purpose of constructing public improvements for the benefit of the Participants, and upon the completion thereof, to lease those improvements to MWDOC and to provide water capacity to the District and the other Participants and WHEREAS, MWDOC and the Corporation entered into that certain Municipal Water District of Orange County Water Facilities Corporation Master Lease dated as of March 1, 1979 for the construction of the AMP (the "1979 Master Lease"); and WHEREAS, MWDOC and the Corporation also entered into that certain Indenture of Mortgage and Deed of Trust dated as of March 1, 1979 to provide for the issuance of the $79,400,000 Leasehold Mortgage Bonds, Issue of 1979 (the "1979 Bonds"), to finance the costs of construction of the AMP; and WHEREAS, concurrently therewith, the District and the other Participants each entered into those certain Diemer Intertie Subleases, each dated as of March 1, 1979 (the "1979 Sublease"), pursuant to which the Participants leased capacity in the AMP from MWDOC; and WHEREAS, the Corporation, MWDOC and the Participants refinanced the original construction costs of the AMP by defeasing and refunding the 1979 Bonds by the issuance of Adjustable/Fixed Rate Refunding Certificates of Participation (Allen-McColloch Pipeline Project), Series A and B (the "1992 Refunding Certificates") in a principal amount of $61,900,000 pursuant to that certain Trust Agreement between First Trust National Association, a national banking association, as Trustee (the "1992 Trustee") and the Corporation and MWDOC, dated as of August 1, 1992 (the "1992 Trust Agreement"); and I • • WHEREAS, the Corporation and MWDOC entered into that certain Amended and Restated Allen-McColloch Pipeline Master Lease dated as of August 1, 1992 (the "1992 Amended Lease"), to amend and restate the 1979 Master Lease providing for the lease of the AMP by the Corporation to MWDOC and to provide for the payment by MWDOC of Base Rental Payments (as defined in the 1992 Amended Lease) sufficient in timing and amount to pay the principal, premium, if any, and interest components in respect of the 1992 Refunding Certificates; and WHEREAS, pursuant to the 1992 Amended Lease, MWDOC leased the AMP from the Corporation and concurrently with the execution of the 1992 Amended Lease leased certain capacity in the AMP to each of the Participants pursuant to certain Subleases, each dated as of August 1, 1992 (the "1992 Subleases"), which replaced the 1979 Subleases in return for Base Rent payments to be made by each Participant in accordance with the provisions thereof; and WHEREAS, the Corporation, MWDOC, and the Participants entered into an agreement dated as of June 7, 1989 entitled "Fifth Amendment to Agreement for Construction, Operation and Maintenance of Pipeline And To Enter Into Sublease Concerning the Diemer Filtration Plant/Santiago Aqueduct Intertie (AMP Flow Augmentation Project)" and that certain "Memorandum of Understanding Concerning Deferral of the Diemer Pump Station and Agreement for Interim License and Lease of Capacity in the Allen-McColloch Pipeline" dated on or about July, 1992 (such agreements being herein referred to collectively as the "Fifth Amendment") whereby the Participants have agreed to reallocate capacities in the AMP and allocate the additional capacity to be created by the AMP Flow Augmentation Project constructed in 1989; and WHEREAS, MWDOC and the Corporation entered into the Allen-McColloch Pipeline Flow Augmentation Project Master Lease, dated as of August 1, 1989 (the "1989 Master Lease") for the lease of the AMP Flow Augmentation Project; and WHEREAS, concurrently therewith, MWDOC and each of the Participants entered into certain Allen-McColloch Pipeline Flow Augmentation Project Subleases, each dated as of August 1, 1989 (the "1989 Subleases") for the sublease of the AMP Flow Augmentation Project; and WHEREAS, MWDOC, the Corporation and State Street Bank and Trust Company of California, N.A., entered into a Trust Agreement, dated as of August 1, 1989 relating to $20,695,000 Municipal Water District of Orange County Water Facilities Corporation, 1989 Adjustable/Fixed Rate Certificates of Participation (Allen-McColloch Pipeline Flow Augmentation Project), Series A (the "1989 Series A Certificates"), $11,440,000 Municipal Water District of Orange County Water Facilities Corporation, 1989 Adjustable/Fixed Rate Certificates of Participation (Allen-McColloch Pipeline Flow Augmentation Project), Series B (the "1989 Series B Certificates"), $1,645,000 Municipal Water District of Orange County Water Facilities Corporation, 1989 Certificates of Participation (Allen-McColloch Pipeline Flow Augmentation Project), Series C (the "1989 Series C Certificates"), and $715,000 Municipal Water District of Orange County Water Facilities Corporation, 1989 Certificates of Participation (Allen-McColloch Pipeline Flow Augmentation Project), Series D (the "1989 0 0 1 Series D Certificates") to finance the costs of constructing the Flow Augmentation Project (the "1989 Trust Agreement"); and WHEREAS, MWDOC, the Corporation and The Metropolitan Water District of Southern California ("Metropolitan") entered into an agreement titled "Agreement for Sale and Purchase of Allen-McColloch Pipeline (Metropolitan Agreement No. 4623) by and among the Metropolitan Water District of Southern California, MWDOC, the Corporation and the Participants," (the "Metropolitan Agreement") whereby MWDOC as lessee under the 1989 Master Lease and the 1992 Amended Lease (collectively sometimes referred to as the "Master Leases") assigned to Metropolitan all of its rights and interests and delegated to Metropolitan all of its duties under the Master Leases and provided for the sale of the System to Metropolitan with title to the Real Property being presently transferred to Metropolitan, however, the ownership of the remaining System is being retained by the Corporation, as lessor, until title is to be transferred to Metropolitan as provided in Section 4.05 of the Metropolitan Agreement, provided that Metropolitan fulfills all of its obligations under the Metropolitan Agreement; and WHEREAS, MWDOC and Metropolitan entered into an Administrative Agreement, dated as of July 1, 1994 relating to the administration of the 1989 Certificates; and WHEREAS, the Participants and MWDOC entered into an Agreement for Allocation of Proceeds of Sale of Allen-McColloch Pipeline, dated as of July 1, 1994 relating to the obligations of each of the Participants under the 1989 Subleases and the 1992 Subleases (the "Proceeds Agreement"); and WHEREAS, as provided in the Metropolitan Agreement, unless otherwise terminated, the Master Leases, the 1989 Subleases and the 1992 Subleases will remain in full force and effect, except as suspended pursuant to the Proceeds Agreement and the Metropolitan Agreement, until all payments and other obligations of Metropolitan under the Metropolitan Agreement are met and the 1992 Certificates are paid or defeased as provided in Article X of the Trust Agreement; and WHEREAS, pursuant to Section 4.04 of the Metropolitan Agreement, MWDOC has the right to convert the interest rate relating to the 1992 Refunding Certificates that are Adjustable Rate Certificates to an alternate interest rate mode, including a fixed rate mode, provided that the maturity of the 1992 Certificates does not extend beyond July 1, 2006; and WHEREAS, MWDOC and the Participants desire to provide that the balance of the debt owing on the 1992 Refunding Certificates bear interest at a fixed rate and that it is more economical for all parties that instead of converting to a fixed rate mode, as provided in the 1992 Trust Agreement, the 1992 Refunding Certificates be redeemed and in lieu thereof MWDOC, the Participants and the 1992 Trustee provide for the issuance of refunding certificates of participation; and 0 0 WHEREAS, MWDOC, the Corporation and the Participants desire to refund the 1992 Refunding Certificates by the issuance of not to exceed $54,000,000 1996 Refunding Certificates of Participation (the "1996 Refunding Certificates") to be issued pursuant to that certain Trust Agreement by and among MWDOC, the Corporation and First Trust National Association, as trustee (the "Trust Agreement"); and WHEREAS, pursuant to the terms of the Metropolitan Agreement, Metropolitan assumed the debt service on the 1989 Series A Certificates, the 1989 Series B Certificates, the 1989 Series C Certificates and the 1989 Series D Certificates, however the 1989 Master Lease and the 1989 Subleases remained in full force and effect; and WHEREAS, Metropolitan paid the outstanding principal and interest on the 1989 Series A Certificates and 1989 Series B Certificates and will prior to the issuance of the 1996 Refunding Certificates, hereafter described, provide for the prepayment on Judy 1, 1996 of the 1989 Series C Certificates and the 1989 Series D Certificates and defease the 1989 Trust Agreement and the 1989 Master Lease and the 1989 Subleases will be suspended subject to the terms and conditions of the Metropolitan Agreement; and WHEREAS, MWDOC desires to enter into the 1996 Amended and Restated Allen- McColloch Pipeline Master Lease (the "Amended Lease") with the Corporation and concurrently herewith, will enter into with the Participants 1996 Amended and Restated Allen-McColloch Pipeline Amended Subleases (the "Amended Subleases"), subject to the terms and conditions of the Metropolitan Agreement, to provide modification of the terms and conditions of the 1992 Amended Lease to reflect the terms and conditions of the Metropolitan Agreement, the 1996 Refunding Certificates and to establish revised Base Rental Payments in amounts sufficient to pay the principal of and interest on the 1996 Refunding Certificates; and WHEREAS, the Corporation and MWDOC acknowledge that as long as Metropolitan's obligations under the Metropolitan Agreement are met, the AMP will be operated as a utility pipeline and the capacities of MWDOC and of the Participants in the Project as described in the Proceeds Agreement and Exhibit A of the Amended Sublease shall be suspended, however, the Participant's Project Capacities shall be utilized in determining each Participant's Base Rent payments and Additional Rental to be made by the Participant to MWDOC; and 4 0 0 WHEREAS, the Corporation is entering into a 1996 Assignment Agreement, dated as of March I, 1996, with First Trust National Association, as Trustee (the "Assignment Agreement"), that pursuant to said Assignment Agreement, the Corporation is assigning and transferring to the Trustee all of its rights under the 1996 Amended and Restated Allen-McColloch Pipeline Master Lease, including, among others, its rights to exercise its remedies to enforce the receipt of the Base Rental Payments, as such rights and remedies are provided by the 1996 Amended and Restated Allen McColloch Pipeline Master Lease, and that the Trustee constitutes the assignee of the Corporation. The Assignment of Master Lease and Agreement, dated as of August 1, 1989 by and between the Corporation and State Street Bank and Trust Company of California, N.A. shall terminate on the payment of or the provision for the payment of the 1989 Series C Certificates and the 1989 Series D Certificates; and WHEREAS, the Assignment Agreement, dated as of August 1, 1992, by and between the Corporation and First Trust National Association shall terminate on the Delivery Date (as defined in the Trust Agreement); and WHEREAS, pursuant to the Amended Lease, MWDOC has leased the Project from the Corporation and MWDOC will lease and provide capacity in the Project to the District pursuant to the 1996 Amended and Restated Allen-McColloch Pipeline Sublease, dated March 1, 1996 (the "Amended Sublease") and to the other Participants pursuant to subleases substantially in the form of the Amended Sublease to be entered into by each Participant in return for Base Rent payments to be made by each Participant in accordance with the provisions thereof; and WHEREAS, the Amended Sublease shall wholly amend and supersede the 1992 Sublease between the District and MWDOC, and from and after the Delivery Date the capacity rights of the District in the AMP shall be governed solely by the Proceeds Agreement and the Amended Sublease, as supplemented or modified from time to tirne, and the payment obligations of the District as to the AMP and the 1996 Refunding Certificates shall be as provided in the Amended Sublease; and WHEREAS, in connection with the sale of the 1996 Refunding Certificates, a form of Preliminary Official Statement relating thereto has been prepared and has been presented at this meeting, which includes information relating to the District; and WHEREAS, there has been presented to this Board of Directors a Continuing Disclosure Agreement by and among the District, MWDOC and First Trust National Association, the Dissemination Agent, dated as of March 1, 1996, to comply with Securities and Exchange Commission Rule 15c2-12; and WHEREAS, all acts, conditions and things required by law to exist, to have happened and to have been performed precedent to and in connection with the execution and entering into of the Amended Sublease do exist, have happened and have been performed in regular and due time, form and manner as required by law, and the District is duly authorized upon adoption of this Resolution by the Board of Directors to execute and enter into the Amended Sublease; 5 0 0 NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Yorba Linda Water District to order and determine as follows: SECTION 1. The recitals hereof are true and correct, and are incorporated herein by reference for all purposes. SECTION 2. The proposed form of the Amended Sublease referred to in the recitals hereof presented at this meeting is hereby approved. The President is hereby authorized and directed, for and in the name of the District, to execute the Amended Sublease with MWDOC, and the Secretary is authorized and directed to attest to said Amended Sublease. Said Amended Sublease shall be executed in substantially the form hereby approved, but with such additions to said Amended Sublease and changes therein as are approved by the President of the District, or his designee, such approval to be conclusively evidenced by the execution and delivery thereof. SECTION 3. The proposed text of that section pertaining to the District of the Preliminary Official Statement relating to the 1996 Refunding Certificates, presented at this meeting, is hereby approved and the District hereby authorizes and ratifies the use of said information regarding the District in the Preliminary and final Official Statements relating to the 1996 Refunding Certificates. The District hereby authorizes and directs the General Manager and staff of the District to provide updated information regarding the District to MWDOC and its designated consultants and representatives for the underwriting period required by applicable law and, thereafter, upon request of MWDOC. SECTION 4. The proposed form of the Continuing Disclosure Agreement referred to in the recitals hereof presented at this meeting is hereby approved. The President is hereby authorized and directed, for and in the name of the District, to execute the Continuing Disclosure Agreement with MWDOC, and the Secretary is authorized and directed to attest to said Continuing Disclosure Agreement. Said Continuing Disclosure Agreement shall be executed in substantially the form hereby approved, but with such additions to said Continuing Disclosure Agreement and changes therein as are approved by the President of the District, or his designee, such approval to be conclusively evidenced by the execution and delivery thereof. SECTION 5. The officers of the District, including but not limited to the President and Secretary of the District and the General Manager and the Treasurer of the District, are hereby authorized and directed, jointly and severally, to do any and all things and to execute and deliver any and all docurnents and certificates (including, but not limited to, a Certificate with regard to the final Official Statement relating to the 1996 Refunding Certificates, which certificate shall be signed by the President of the Board of Directors, or his designee, on behalf of the District) which are necessary or advisable in order to consummate the issuance, participation, and otherwise to effectuate the purposes of this Resolution. Such actions previously taken by such officers in connection with the issuance of the 1996 Refunding Certificates, and otherwise, with respect to the matters referred to herein, are hereby ratified, confirmed and accepted by the District. 6 s • SECTION 6. This Resolution shall take effect immediately upon its adoption. r1 ICI PASSED AND ADOPTED, this 22 day of February 1996, by the following called vote: AYES: Armstrong, Fox and Scanlin NOES: Beverage and Korn ABSENT: None ABSTAIN: None ATTEST: Seretvi ry\W;Ahn?)'Robertson Yorba Linda Water District >i President Mi el J. Beverages/ Yorba Linda ater District