AGENDA MEMORANDUM

Meeting Date:           December 10, 2007

From:                          Fred A. Morrison, City Attorney

Subject:                      Resolution authorizing transfer of the Plantation Purchase Money Note

Staff Recommendation:

Staff recommends approval of a resolution authorizing the transfer of the purchase money note given by the City in connection with the acquisition of the Plantation at Leesburg water and wastewater utilities, and issuance of a replacement note to the assignee.

Analysis:

When the City of Leesburg purchased the water and wastewater utilities at Plantation at Leesburg, part of the consideration paid was in the form of a promissory note in the amount of $8,000,000.00. The seller now wishes to transfer the note to the H. Smith Richardson Trust, which was at the time of the transaction in control of the seller entity. The transfer of the note requires City Commission approval, and issuance of a replacement note to the Trust. The resolution before you approves those two actions.

Options:        

1.   Approve the transfer of the note and issuance of a replacement note, or

 2.  Such other action as the City Commission deems appropriate.

Fiscal Impact: 

There is no fiscal impact to the City. The transfer will not affect the City’s obligations under the note and the H. Smith Richardson Trust has provided the funds to pay the legal fees incurred by the City with bond counsel for preparation of the resolution and replacement note.

Submission Date and Time:    12/6/07 11:01 AM____

Department: ___City Attorney_____ Prepared by:  Fred A. Morrison                   Attachments:  Yes____   No __X___ Advertised:   ____Not Required ______ Dates:   __________________________                      Newspapers: _________________________________                                                     _________________________________            Revised 6/10/04

Reviewed by: Dept. Head ________ Finance  Dept. __________________                                     Deputy C.M. ___________________                                          Submitted by: City Manager ___________________

Account No. _________________ Project No. ___________________ WF No. ______________________ Budget  ______________________ Available _____________________

RESOLUTION NO. ________

A RESOLUTION OF THE CITY OF LEESBURG, FLORIDA, AUTHORIZING THE TRANSFER OF THE CITY'S $8,000,000 SEPARATE UTILITY SYSTEM REVENUE BOND ANTICIPATION NOTE (PLANTATION ACQUISITION PROJECT), SERIES 2006, ORIGINALLY ISSUED IN CONNECTION WITH THE ACQUISITION OF THE SEPARATE UTILITY SYSTEM AS DEFINED IN SAID NOTE; AUTHORIZING CERTAIN OFFICIALS OF THE CITY TO EXECUTE ANY DOCUMENTS AND TAKE ANY ACTIONS REQUIRED IN CONNECTION WITH THE TRANSFER OF SAID NOTE TO THE H. SMITH RICHARDSON TESTAMENTARY TRUST; PROVIDING CERTAIN OTHER DETAILS WITH RESPECT THERETO; PROVIDING AN EFFECTIVE DATE FOR THIS RESOLUTION.

WHEREAS, the City of Leesburg, Florida (the “City”) entered into an Agreement for Purchase and Sale of Water and Wastewater Assets (the “Sale Agreement”) dated June 12, 2006 by and between the City and The Plantation at Leesburg Limited Partnership (the “Seller”); and

WHEREAS, as part of the consideration for the sale, the City issued to the Seller its Separate Utility System Revenue Bond Anticipation Note (Plantation Acquisition Project), Series 2006 (the “2006 Note”); and

WHEREAS, the Seller desires to transfer the 2006 Note to the H. Smith Richardson Testamentary Trust (the “Purchaser”), which is a related entity; and

WHEREAS, the City wishes to approve such transfer and authorize the issuance of a replacement Separate Utility System Revenue Bond Anticipation Note (Plantation Acquisition Project), Series 2006 (the “2007 Note”);

NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF LEESBURG, FLORIDA, that:

SECTION 1. Authority.

  This Resolution is adopted pursuant to Article VIII, Section 2, Constitution of the State of Florida, Chapter 166 and Section 215.431, Florida Statutes, and other applicable provisions of law (collectively, the “Act”).

SECTION 2. Definitions.

  All terms used herein in capitalized form, unless otherwise defined herein, shall have the same meanings as ascribed to them in the 2007 Note, unless the context otherwise requires.  All terms used herein in capitalized form and defined in the preamble hereto shall have the meanings ascribed thereto in such preamble.

SECTION 3. Findings.

(A)  The City is authorized under the Act and the 2006 Note to transfer and issue the 2007 Note to the Purchaser.

(B)  The 2006 Note was not and the 2007 Note will not  be issued under Resolution No. 7143, adopted by the City on June 14, 2004 (as amended or supplemented from time to time, the “Master Resolution”).  The 2006 Note was not and the 2007 Note will not be secured under or pursuant to the Master Resolution.  For purposes of the Master Resolution, the project financed with the proceeds of the 2006 Note constitutes a “Separately Financed Project.”

SECTION 4.    Authorization of 2007 Note; and Approval of Transfer of 2006 Note and Form of 2007 Note.

Subject and pursuant to the provisions hereof, the 2006 Note is hereby authorized to be transferred to the Purchaser provided that, as a condition to such transfer, the Purchaser shall first execute a letter, in form and substance satisfactory to the City Attorney and Holland & Knight LLP as Note Counsel (the "Purchaser's Certificate"),  to the effect that, among other things, Purchaser has conducted its own due diligence and is not relying on any disclosure from the City, that the Purchaser is an “accredited investor” as defined in Rule 501 of Regulation D promulgated by the Securities and Exchange Commission pursuant to the Securities Act of 1933 and that the Purchaser is acquiring the Note for its own account and not with a view to selling or disposing of it. 

SECTION 5. Authorization to Execute and Deliver.

The Mayor or the Mayor Pro Tem, and the Clerk or any Deputy Clerk (each an ("Authorized Representative"), are hereby authorized and directed on behalf of the City to execute the 2007 Note as provided in this Resolution, and any Authorized Representative, the City Manager and the Finance Director of the City is hereby authorized and directed upon the execution thereof to transfer and deliver the 2007 Note to the Purchaser upon satisfaction of the conditions set forth in the 2006 Note and herein, and to take all other actions as may be necessary to effectuate the foregoing.

SECTION 6. Effective Date.

  This Resolution shall take effect immediately upon its passage in the manner provided by law.

PASSED AND CERTIFIED AS TO PASSAGE this _10th_ day of _December _, 2007.

CITY COMMISSION OF THE CITY OF LEESBURG, FLORIDA

By

Mayor

(SEAL)

Attested:

By

            City Clerk

Approved as to Form and Correctness:

By:

City Attorney

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