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HomeMy WebLinkAboutagenda item 2015 0626 rda 03d( Department of Community Investment Memorandum June 24, 2015 TO: South Bend Redevelopment Authority FROM: Brock Zeeb/ David Relos, Economic Resources SUBJECT: Annual Financial Information -2008 Eddy Street Commons Bonds Annually the Redevelopment Commission and Redevelopment Authority are required to certify certain financial information under the bond's Continuing Disclosure Undertaking Agreement. This information is: • The City's audited financial statements, as prepared and examined by the State Board of Accounts, within 60 days of receipt therefrom • Unaudited financial statements from the City if audited financial statements are not yet available, and the following operating data: o Direct and overlapping debt o Direct debt issuance limitation o Tota I tax rates o Net assessed valuation o Property taxes levied and collected o Ten largest city taxpayers Additionally, the following material events must be disclosed: • Principal and interest payment delinquencies • Nonpayment defaults • Unscheduled draws on debt service reserves reflecting financial difficulties • Unscheduled draws on credit enhancements reflecting financial difficulties • Substitution of credit or liquidity providers, or their failure to perform • Adverse tax opinions or events affecting the tax exempt status of bonds • Modifications to the rights of bondholders • Bond calls • Defeasances • Release, substitution or sale of property securing repayment of the bonds • Rating changes This information is compiled and verified by the City Controller. Staff requests Authority certification of this annual information. 227 W. JEFFERSON BLVD. SOUTH BEND, IN 46601 I P: 574-235-9371 I FAX: 574-235-9021 I SOUTH BEN DIN.GOV ITEM: 3.D. ~bank, · · · Global Corporate Trust Services 60 Livingston Avenue, EP-MN-WS3C St. Paul, MN 55107-2292 June 1, 2015 Mr. Brock Zeeb South Bend Redevelopment Authority 1200 County-City Building 227 W. Jefferson South Bend, IN 46601 Re: South Bend Redevelopment Authority Lease Rental Revenue Bond of 2008' (Eddy Street Commons Project) Dear Mr. Zeeb: This letter is being sent in advance of the due date of the following items to assist you in providing us with the required documentation in a timely manner. Item Annual Financial Information and Exhibit B Document Reference Continuing Disclosure Agreement 11 If the requested item(s) has been sent, you may disregard this letter. Due Date 06/29/2015 Pursuant to the terms of the above agreement, the above item must be filed with the Municipal Securities Rulemaking Board (MSRB) and made available via the Electronic Municipal Market Access System (EMMA) in a word-searchable portable document format (pdf). If the item is not submitted in a word-searchable portable document format, extraordinary fees may be assessed. If the required item is not received timely, U.S. Bank may be required to submit a "Failure to File Disclosure Document" notice via the MSRB EMMA system. We appreciate your attention to this matter. Please contact me at the telephone number or email address below to discuss any questions or concerns you may have regarding th~ content of this letter. You may also contact your Account Manager, T. Scott Fesler, at 317-264-2501. ~,1~v Assistant Vice President Telephone: 651-466-6291 Facsimile: 651-466-7427 Email: jennifer.edwards2@usbank.com ,- Account Number: 122418000 Tickler Number(s): 1068465 us bank.com EXHIBITB CERTIFICATERE: ANNUALFINANCIALINFORMATIONDISCLOSURE The undeisiglled, on· behalf of the South Bend Redevelopment Authority and the South Bend Redevelopment Commission~ as the collective Obligor under the Con.tinning Disclosure Undertak.ip.g A_greement dated March 1, 2008 (the nAgreem~nt1 f), between the . Obligor and U.S. Bank National Association, as Cqunterparty> hereby ce111.fies that the infonnation enclosed herewith constitutes the Annual Information (as defined in the Agreement) which is required 1 to be provided pursmwt to Section 4( a)(2) of the .Agreement By: .ATTEST: By:~~~~~~~~~~­ S ecretazy .. Treasurer By: ATTEST: By:~~~~~~~~~~~~ Secretary BDDi.301 S102fl24v2- SOUTHBENDREDEVELOPlvlENT AUTHORITY · President SOUTH B~ REDEVELOPMENT COMMISSION - · President 1·- 1 T I 1· j· 1' i· /. I· I CONTINUING DISCLOSURE UNDERTAKING AGREEMENT . . Thi~ UNDERTAKING 4-GREE:MENl (the 1 1 ~greemenf1 ) is made as of March 1, 2008, between the Soui:h Bend Redevefopnient Authority, a pµblic bod.y corpo;rate and politic~ organized and existing under LC. 36 .. 7-14,5 (the 11Authorify11)> the South Bend-Redevelopment Comnlission, the governing body. of the .Department of R-edevelopment and the Redevelopment District of th.e City of South Bend> Indiana (the 11Commission1 9 (b~th the Autbo~icy and the Commission are collectively referred to h~!dn fJ.S .the 110bligor11) an4 U.S. Bank National Association, a ban.Icing and :financial institution organized under the laws of the United· States of Amer.lea (the 11Counterparty11 ), for the purpose of permitting City Securities Corporation (the 11 Uri.derwritern), to purchase the South Bend Redevelopment Authority L~ase .Rental Revenue Bonds of 2008 (Eddy Street Commons Ptoject), dated March 18,. 200& (the l1Bon<ls 11), issu.e<l pursuant to a Trust Agreement dated as of March 1, 2008, betw~en the Antlmrity and U: S. Bank National Association, as trustee (the t 1Trust Agreement")!< in co.tnpliance with the 8ecmit~es and Exchange Commission CSEC 11) Rule 15c2-12 (the "SEC Rule11 ) as published in the Federal Register on November 17., 1994. . WHEREAS, the Authority has iss1J.ed its Bonds pursuant to the Trost Agreement; and WHEREAS~ pursuant to a Lease Agreement~ between the Authority~ as lessorj and the Commission, as ·lessee, date-d as of October 15, 2007> as amended by an Addendum to.. Lease dated as ofMaroh 17, 2008 (collectively, the 11L~ase 11 ), the Commission is reqmred to pay lease rentals, which rentals will be used to pay the principal and. interest due on the Bonds; and . WHEREAS, the Commission ls an Obligated Person (as defined in the-SEC Rule) . b~ca.UBe the lease rental payments due under the Lease· are the· only source of funds (other than bond proceeds held under the Trust Agreement) pledged to pay the principal and lutere:.st due on the Bonds; · NOW, THEREFORE~ it is agrood by the parties hereto as follows: Section 1. ·Definitions, The words and terms defined :in this Agreement shall have the meanings herein specified. Those words and terms not expressly-defined lierein .shall have the mecµrings assigned to them in the SEC Rule. BDDBOl .5102824v2· (1) 11 Bondholder 11 or 11h0Jder" or any similar 'term, when used with reference to a bond or Bonds) mea.ns any person w.ho shall be the registered owner of any outstanding Bond~ including the .holders of beneficial interests in the Bonds. (2) 11Final Official Statementtt means the Official Statement, dated as of Mfilch S!J 2008,. relating fo the Bonds, including any document W,cluded by specific reference to such document previously pr~wided to each NRlvfSlR and to the Indiana state information I· I, j:· I I . i- l 1 ! I i i 1 · l ·1 i r. I I·. l L l l· •' /-I I J '. I :· i I I , I J . 'I depository then in existence.., if any (1 1 srn.n);> or filed 'With th~ Mu:ofoipal Sec~tles Rulemakjng BDard (11MSRB 11 ). (3) 11NR}4SIR11 means a nationally recognized municipal securities information repository whloh is designated as such at any point in time by the SEC. The current NRMSIRs are listed on Exhibit A · attached hereto. ( 4) 110bligated Person" means any person, including an is$lle:t of municipal securities, who is either generally or through W1 enterprise, :fun~ or account of such person committed by contract or other arrangement ·to support payment of all or part of the obligations on the Bonds (other than providers of municipal'bond insurance, letters of credit, or other credit or liquidity facilities). _All Obligated Persons with respect to the Bonds currently are- .identified herein. S-ection 2. Obligated Persons. The Obligor hereby warrants and represents as of the date hereof that the Obligor is the only Obligated Person -with respect to the Bonds. If the. 0 bligor is no longer committed by contract or other ai:rangement ·to support payment of the obligations on the Bonds~ the Obliger s11~ no longer be considered mi Obligated Person within the meaning of the SEC RuJe and the continuing obligation under this Agreement to provide anriual financial information and notices of events shall terminate with respect to tbei Obligor. If the Obligor is i10 longer considered an Obligated P~tson within the meaning of the SEC Rule, the Obligor shall file:-or cause to be filed \v.ith ea¢h NRMSIR, the SID and the MSRB a written notice fb.at it is no l<;)nger an Obligated Person. In the event that any entity subsequently becomes an Obligated Person wi* respect to the Bonds, the Ob1igor agrees to use its best effo:rts (so long as it continues to be an Obligated Person with respect to the Bonds) to cause such other" entity to enter into a vqitten undertaking to comply with th~ disclo.sUte requirements of the Obligated Person set forth herein. · · Section 3. Te.rm. The term of this Agreement is from ilif' date hereof to the earlier of(i) the date ofihe fast-payment-0fprindp.al of mid intexest on the Bonds, or (il) the date the Bond$ are defeased under the Trtist Agreement, or (iii) the date of resciSsion as described in Section 12. · infonnation: Section 4. Provision of Financial Infonnation. (a) The Obligor hereby ?Tidertak~s to provide the ·following · financial · (1) · To each NRMSIR and to the SID, when &id if availabfo~ the audited financial ·statements of the City pf Svuth Bend, Indiana (the llCity 11 ) as _prepared atid examined· ·by the State Board of Accounts for . each fiscal y9a.r, beginning vr.ith the .fiscal year ending December 3t 2-008~ together .with the opinion of such · BDDBOI 5102824~.2. ... 2 - I- I· I ·l ! ·.f J. /. l" /.; I· I. 1· l i i l I I l I·· l i l' i l ~ I' j, !'' I [ ~ ' I I ··' ~. accountants and all notes thereto~ within sixty ( 60) days of reodpt ·· from the State Board or Accounts; and _ (2) To each NRMSIR arid to the SID~ within 180-·days of the close of each fiscal yeat of the City1 beginning with the calendar year en.ding December 31, 2008,. unaudited annual .fmancial information fot the City for such calendar year incIUding (i) unaudited financial statements of the City if audited financial statements ary not then available; and (ii} operating data Qf the type included under the following headings in Appendix B to the Final Offieicl. Statement (collectively, the "Annual Itlfomlai:ionn): . APPBNDlXB. · Direct and Overlapping Debt Dir~ct Debt Issuance Linrltation Total Tax Rates Net Assessed Valuation. Property Taxes Levied and Collected Ten Largest City Taxp~yers (b) To the extent the Annual Infonnation or audited financial statements :relating io the City referred to ·in paragraph (a) of thls Section 4 is included in a :final Dfficial statement (as tbat term is defiu.edin paragraph (f)(3) of the SEC Rule) dated within one hundted twenty (120) days :prior to the due date for suoh infonnation for any fisoal year and filed with each NRMSIR~ the SID:i and the MSRB, the Obligor shall have been deemed to have provided that infonnation. as of the due date for th.e :immediately preceding fiscal year as required by paragraphs (a)(l) and (2) of this Section 4. . ( c) If any Annual Irrforraation or audited financial statements relating to the City referred to in paragraph (a) of this Section 4 no longer can be generated because thB operations to which they related have been materially changed or discontµmed~ a statement to th!1t effe~t, pr_oytded by 'the Obligor to each NRMSIR and. to the ·SID~ along with any other Annual Info.rru.ation or audited financial statements reqmred tQ" be·· provided. under. this Agreement~ shall satisfy the underlaking to provide such Annual Information or audited :fip.ancial statemenis. To the extent available, the Obligor shall cause to be filed along with the· other_ · Annual Info:rmation or audited financial statements operating ddta similar to that which can no longer pe provided. · .(d) The discloswe shall be accompanie-d ·by a certificate of an authorized representative. of the Obligor in the form of Exhlb~t B attached hereto. . ( e) Annual Information or audited fmancial statements required to. be provided pursuant to tills Section 4 may be provided by a specific reference to such Annual Information or audited financial statements already prepared and previously provided to each NRMSIR and the SID)-or filed with the SEC; however.'.! if such document is a final official statement, it must also be availabfo frQm the MSRR .BDDB015102&24v2 .. 3 ~ . I t: F L I I l I l I I 1 ~. 1 l. J- l i I ! ; i /· I 1· I Section 5. Accounting Princinles. The financial i:pf onnation will be prepared on a cash. basis as prescribed by the State Board of Accounts, as in effect from time to time, as described in the auditors' report and notes accompanying the audit~d finan.cial statements of the· Gity or those mandated by state law from time to time. The audited financial 13tatements of the City, as· described in Section 4(a)(l) hereo~ will be prepared in .accordance with generally accepted· accounting principles and Gove.tnnlent Auditing Standards issued .by the C01pptroller General of the United States. Section 6. Material Events. The Obligor undertake.s to disclose in a timely mmmer the occurrence of on1y th~ follo-\:v.ing events~ if material (whi<.;h deter.mination of materiality shall be made by the Obligor in accordance with the standards established by federal securities laws), to each NRMSIB. or to the MSRB, and to the SID: (1) (2) (3) (4) {5) (6) (7) (8) (9) (HJ) (11) principal and interest payment delinquencies; non-payment r~lated defaults~ unscheduled draws on. di'.'.bt service l'eserves reflecting financial difficulties; · unscheduled draws on credit enhancements reflecting fi:tianc:ial difficulties; substitution of credit or liquidity providers~ or theiI failure to perform; adverse tax op:ini.o~s or events affecting the tax .. exempt status of the Bo:nds; modiflcatlons to the righ_ts·of Bondholders; B<?n4 calls (other than schedule mandatory sinking fund . redemptions fo:r which notice is given ·m accordance with the Trust Agreement); defeasances; release, substitution or sale of property securing repayment of the Bonds; and · rating changes. . The disdosure. shall be. accompanied .by a certificate of an authorized representative of the Obliger :in the form of Exhibit C attached hereto. Section 7. Notice to Counte:n:m+:tY· The ObligDr hereby agrees to provide to the Counterparty a copy of any_ Annual. Information, audited :financial statements~ mate.rial event notfoe.? or notice of failure fo disclose Annual Infonnation which it files or causes to be :filed under Sections 4; 6 and 9 hereof: respectively, concurrently with or prior to such .filing. Bxcepf as provided :in Section 11 hereo~ the Counterparty's receipt of any infonnation.!> statements or notic.es pursuant to this Section 7 shall impose on the Counterparty no duties of disclosure or disse:mfna~on with respect to such information or notices. · · Section 8. Use of Agent The Obligor may~ at its sole discretion, 'utilize Err1 agent (the "Dissemination Agent1i) ill connection with ihe dissemination of any .infoJ.TIJ.ation required to BDDBOl 5102824V2 ~4- I I ! I· l, I· I ·J I I I I· 1· /' i. I I I·. 1 be provided by the Obliger pursuant to the terms of this Agreement If a. Dis~emination Agent is selected for these purposes, the Obligor shall pro-vide PJ.-for written notice theteof-(as well as notice of replacement or dismiss.al of sueh agent) to the Counterparty and t~ each NRlviSIR_, the SID, and the MSRB. Further, the Obligor .may~ at itS sole disortjtion> .rewm counsel or others with expertise in securities matters for tlw pw_pose of assisting the Obligm in making judgments with respect to the scope of its obl~gations herei.mder and compliance therewithJ all in or~er to ~~r the purpo~es of this Agreement.· . . Section 9, Failure to Disclose. If, for any :reason> the Obligor fails to provide the audited financial statements· or AnnuaI Information as required by this Agreement~ the Obligor shall provide notice of ~ucb. failure in a timely manner to each NRMSIR or to the MSRB, and to the SID. Section 10. Remedies. (a) The purpose of tltls Agreement is to enable the Underwriter to purchase the Bonds by providing for an und_ertaking by the Obligor "in satisfaction of the SEC Rule. This Agreementis solely for the benefit of the holders of the J?onds and creates no new coritraotual or other rights for, nor can it be relied upon by.., the SEC, Underwrlter, brokers, dealers, municipal securities dealers, potential customers, other Obligated Persons or any other third party. The sole remedy against the Obligor for any failure to cany ou.t .any provision of this Agreement shall be for specific performance of the Oblig.ors disclosure ob.ligations hetelU1.det and not for money ·damages of any kind or in any amount or for any other ;remedy. The Obliger's failure to honor its. covenants hereunder shall ·not c.onstitu.fo a breach or defawt of the Bonds, the Trust Agreement or any other agreement to which the ObHgor is a party. (b) Subject to paragraph (e) of this Section 10, irt the event the Ob1igor fails to provide any information. required of it by the terms o:f this Agreement. any holder of Bonds may pursue the remedy set forth in the. preceding pm:agra_ph in any court of competent jurisdiction in the county in. which the Obligor is located. An affidavit to the effect that such person fa a holder of Bonds supported by reasonable docum,entation of such claim ~hall be sUfficient to ev!den-0e standing to pursue this remedy. · ( c) Subject to paragraph ( e) of this Section 10, any challenge to the adequacy of t11e information provided by the Obligor by the tyrms of this Agreement may be pursued-only py holders of not less tM.11. 25% fu prmoipal amoUtlt of Bonds then outstanding in any court of competent jurisdiction in the county In whlQh .the ObligDr is located, An affidavit to the effect that such persons are holders of Bonds supported by reasonable documentation of such claim Shall be suffici~nt .to evidence standing to pmsue the remedy set fo~ in the preceding paragiaph. ( d) The Counterparty, upon indemnification ~~ti.sfactory to it and demand by those persons it reasonably believes to be.holders of Bonds) 1?1ay also pursue the remedies set forth .:in paragraph (b) above in any court of coci_petent jurisdiction in the county in which the BDDBOl 5 HJ2824v2 J 1· r i. f :· I l l· i. I J j. l I. '•' I i I l~ I r }· i i f I . r ... I i ! 1. l r 1· Obligor is located~ The Counterparty shall hav~ no obligation to pursue any remedial action in the absence of_a valid demandfro-!11 holders of Bonds and indemnification sati.sfactoryio it. . . ( e) Prior to pursuing any remedy under :this Sec.tion~ a holder of J3Gnds or the Co~terparty ·shall give notice to the Obligor and tb.e Counte1party, via· registered or certified mail~ of such br~acb. and its intmt to pursue such remedy. Fifteen (15) days after mailing of such notfoe, and not before, a ho1der of Bonds or the Counterparty may pursue such remedy undet this Section. The Obligor1 s failure to honor its covenants hereunder shall not constitute a 'breach or default of the Bonds, the Trust" Agreement, the Lease or any other agreement to which the Obliger is a party, . Section 11. Counterpartv's Obligations. The Counte.t:party hewfo shall _have no . obligation to take any action whatsoever with respect t<;> information provided or required to be provided by the Obligor under this Agreement,· except (:i) as set forth in this Section 11 and (ii) any -obligations misi:hg from the Counterparty serving as a Dissemination Agent, and JJ.O implied covenants or obligations shall be read into this. Agreement against the Counterparty. Further:r except as ·set forth in this Section 11, the Counterparty hereto shaU have no responsibility to ascertain: the truth, completeness, accuraoy or timeliness of the information provided as required hereunder by the Obligor or the City, Dr otherwise to determine whether any such information 01· notices are ot have been provided in compliance with the SEC Rule or the :requirements of this Agreement. T.he Counferparty may~ at its sole discretion, retain counsel -or others with e}...-_pertise in ·continuing disclosure matte.rs for the purp.ose. of assisting the Counterparty in making judgments with respect to the scope of its obligations hereunder and compliance th.erew:ith. If the Counterparty has not receive-cl.the Annua.1 Jnformatfon by the date which is ten (10) days before the date set forth in Section 4(a)(2} Qf thls Agreement, tb.e Couuterparty shall notify the Obligor, via registered or certifled mail, that it ha.snot :received such Annual Iliformation. However, a failrire by the Counterparty to provide (or any delay in providing) any notice required by this paragraph shall not: (i) operate t-0 relieve fue Obligor of its obligatlo.t;i to provide the Annllal Information in the manner and within the time specified in this Agreement; or (ii) constitute a defense. for the Obligor~ or the basis for any claim, countercl~, cross-claim or tbi:rd-party olaim by the Obligor, in any actfon brought pursuant to Section 10 -0f this Agreement or otherwise, Nothing contained in this paragraph shall operate to grant any additional rights o! remedies to any holder of Bonds. · The Co1mterparty hereto shall be obligated to, and hereby .agrees that it will> within five (5) busine.ss days· after the date requited by Se-ction 4(a)(2) of tpi.s Agreeme:nt, forward to those persons . or entities scheduled to receive Annual Infonnation · a nDtice · substantially in ~e form of Exhibit D attached hereto in the event that the Counterparty has not . received a copy of such .Apnua1 Information; provided, howiwer, that the Counterparty shall not give :such notices as described in this p~·agraph and the immediately preceding paragraph if the Obligo:r has pr.oyided the Counterparty with notice· tl1at the. DbHgor has issued notice pursuant to Section 9 hereof. BDDB015102824VZ ... 6- l I• f ., I I· l I l I . I. I i 1- l I·. I f j• J 1 r :· ... f" Section 12." Resfanation and Removal of Countetparty. The Counterparty may resign in its capacity under this Agreement at any time by givilig written notice thereof to the Obligor. So long as the Obligor has not failed to honor its obligations as set forth in Sectlons-4, 6 and 9 hereof: the Obligor may remove the Counterpmiy in its capacity under this Agreement at any time by giving written notice thereof to the Counterparty. Upon such resignation or removal, ~l.e Obligot shall promptly appoint a successor Counterparty. Section 13~ . Indemnification. To the extent permitted by law, the Obligor 1·eleases the CoUn.terparty" from, agrees that the Counterparty shall not be liable for) and agrees to indemnify and hold the Counterparty harmless :from, any liabilify for, or expense {includmg but 1,'lot limited to reasonable attorney fees) resulting from, _or any lo~s or damage that may .be oc.casioned by, any cause whatsoever pertai:oing to this Agreement or the actions taken or to be talcen by any Obligated Person or the Counterparty under this Agreement:-except the gross negligence or willful misconduct of the Counterparty. The obligations -0f the Ob1igor underthls Section 13 shall survive the resignati<?n or removal of the Counterparty and payment of the Bonds~ Section ·14. Modification of Agreemen:t· The Obligor ~d"the Counterparty :may~ from ti.me to time~ amend or modify this Agreement without the consent of or notice to the holders of the B9nds if either (a)(i) such _amendment or modification is JJJ.{J.de in connection with a ~hange in circumstances that arises from a <'hange in legal requirements:) change in law or change in the identity, nature or status of the Obligor~ or type of business conducted, (ii) this Agree:r.o.en4 as so amended· o:r modified, would have com.plied with the requirements of the SEC Rule on the date hereof, after taking into account any amendments or interpretations of the SEC Rule,. as well as any change in circumstances, and (ill) such arnen~ent or modification does not . . materially impair the· interests of the holders of the Bonds; as determined either by (A) the· Counterparty_, the trustee under the Trust Agr~ment or nationally recognized bond counsel or (B) an approving vote of the holders of the Bonds pursuant to the tenns of the Trust Agreement at the tlm.e of such amendment or modification; or (b) .suQh amendment or moclific.ation (including ari amendment ot moilification which rescinds this Agreement) is permitted by the SEC Rule, as then in effect. · Section 15. Intemretation Under Indiana Law, it fa ilie intention of the parties heti;ito that tl:rls Agreement and the rights artd obligations of the partfos hereunder shall be governed hy and construed and enforced fo accordance with~ the law of the State of Indiaria1 Section 16. Severability Clause~ In case any provision in this Agreement shall be invalid:. illegal or unenforceable~ the valjdity~ legality and enforceability of the remaining provi~o~ shall not in any_ way be affected or-impaired thereby. S~tion 17. Successors and Assi01s. All c0venants and agreements in this Agreement. made by the Obligor and the Counterpaify shall bind their successors, whether so expressed or not.. Section 18. Notic.eS .. All notices required to be given under this Agree111ent shall be made at the following addresses; · · BDDBD1 5102824v2 -7 ·- I )' I 1· r-. r f i j [. / r I I 1·- 1 I. L 1 1. 1·: 1: I If to the Obligor; South Bend Redevelop1)1ent Commission 1200 County-City Building South BencL Indiana 466.01 · BDDB-015102824\12 If to the Co~te:r_party: U ... S. Baclt National Association 10 WestMarket StreetJ Suite 1150 Indianapolis, fudiana 46204 ***** -8" i I i i j. l.-I I r, 1. ,,