Resolution 2021-31770 RESOLUTION NO. 2021-31770
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE
CITY OF MIAMI BEACH, FLORIDA, AUTHORIZING THE EXTENSION
OF THE FINAL ADVANCE DATE ' UNDER THE LOAN IN AN
AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $15,000,000
FROM RAYMOND JAMES CAPITAL FUNDING, INC.; AUTHORIZING
THE EXECUTION AND DELIVERY OF A SECOND AMENDMENT TO
LOAN AGREEMENT AND AN ALLONGE TO PROMISSORY NOTE IN
CONNECTION WITH SUCH EXTENSION; AUTHORIZING OTHER
ACTIONS IN CONNECTION WITH THE EXTENSION AND THE
FINANCING PROGRAM; AND PROVIDING FOR AN EFFECTIVE DATE.
WHEREAS, the City of Miami Beach, Florida (the "City") is duly authorized,
pursuant to the Constitution of the State of Florida, Chapter 166, Part II, Florida
Statutes, as amended, and the Charter of the City (collectively, the "Act"), to borrow
money to finance vehicles and equipment; and
WHEREAS, in connection with the City's financing of vehicles and equipment
(the "Financing Program"), on December 5, 2018, the City and Raymond James Capital
Funding, Inc. (the "Lender"), entered into a loan through a line of credit in an aggregate
principal amount not to exceed $15,000,000 (the "Loan"); and
WHEREAS, in connection with the Loan, the City and the Lender executed a
Loan Agreement dated as of December 5, 2018, as amended by a First Amendment
dated as of August 3, 2020 (collectively, the "Loan Agreement"), and the City executed
and delivered to the Lender a Promissory Note dated December 5, 2018 (the "Note");
and
WHEREAS, the parties have now determined to extend the "Final Advance Date"
(as defined in the Loan Agreement)for an additional one year period and in connection
with such extension, amend the definition of "U.S. Treasury Index" in the Note
(collectively, the"Extension"); and
WHEREAS, in connection with the Extension, the City and the Lender will
execute a Second Amendment to Loan Agreement(the "Second Amendment") and the
City will execute and deliver to the Lender an Allonge to Promissory Note (the
"Allonge").
NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND CITY
COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA:
SECTION 1. DEFINITIONS.
Terms defined in the preambles shall have the meanings set forth in such
preambles. All capitalized terms used in this resolution (the "Resolution") which are
Page 394 of 2012
defined in the Loan Agreement shall have the meanings assigned in the Loan
Agreement, unless the context affirmatively requires otherwise.
SECTION 2. FINDINGS.
The preambles are incorporated as findings. In addition, it is found, determined
and declared that the Financing Program and the Extension are permitted under the
Act, are necessary and desirable, are in the public interest and will serve a proper public
purpose.
SECTION 3. EXTENSION AUTHORIZED.
The Extension as described in this Resolution and under the terms provided in
the Second Amendment and the Allonge is authorized and approved.
SECTION 4. AUTHORIZATION OF EXECUTION AND DELIVERY OF
SECOND AMENDMENT.
The Second Amendment, in substantially the form attached as Exhibit "A" to this
Resolution, with such changes, alterations and corrections as may be approved by the
City Manager of the City (the "City Manager"), after consultation with the Chief Financial
Officer of the City (the "Chief Financial Officer") and the City Attorney of the City (the
"City Attorney"), such approval to be presumed by the execution by the Mayor of the
City (the "Mayor") of the Second Amendment, is approved by the City. The City
authorizes and directs the Mayor to execute and the City Clerk or Deputy City Clerk of
the City (the "City Clerk") to attest under the seal of the City the Second Amendment
and to deliver the same to the Lender.
SECTION 5. ALLONGE.
The Allonge, in substantially the form attached as Exhibit "B" to this Resolution,
with such changes, alterations and corrections as may be approved by the City
Manager, after consultation with the Chief Financial Officer and the City Attorney, such
approval to be presumed by the execution by the Mayor of the Allonge, are approved by
the City. The City authorizes and directs the Mayor to execute the Allonge and to
deliver the Allonge to the Lender.
SECTION 6. GENERAL AUTHORITY.
The City's officials, officers, attorneys, agents and employees are authorized to
do all acts and things and execute and deliver any and all documents necessary by this
Resolution, the Second Amendment or the Allonge, or desirable or consistent with the
requirements of this Resolution, the Second Amendment or the Allonge, in order to
obtain the Extension, accomplish the Financing Program and provide for the full,
punctual and complete performance of all the terms, covenants and agreements
contained in the Second Amendment, the Allonge and this Resolution, including the
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Page 395 of 2012
execution of any necessary Tax Compliance Certificate and the execution and filing of
any necessary form or other document with the Internal Revenue Service with respect
to any Advances under the Note.
SECTION 7. SEVERABILITY OF INVALID PROVISIONS.
If any one or more of the provisions contained in this Resolution shall be held
contrary to any express provisions of law or contrary to the policy of express law,
though not expressly prohibited, or against public policy, or shall for any reason
whatsoever be held invalid, then such covenants, agreements or provisions shall be null
and void and shall be deemed separable from the remaining covenants, agreements or
provisions and shall in no way affect the validity of any of the other provisions of this
Resolution or of the Second Amendment or the Allonge.
SECTION 8. REPEALING CLAUSE.
All resolutions or parts of such resolutions of the City in conflict with the
provisions contained in this Resolution are, to the extent of such conflict, superseded
and repealed.
SECTION 9. EFFECTIVE DATE.
This Resolution shall become effective immediately upon adoption.
PASSED AND ADOPTED this 2 day of JUS , 2021.
Attest:
s
Dan Gelber, Mayor
Rafael E. Granado, City/Clerk APPROVED AS TO
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Page 396 of 2012
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Resolutions -C7 J
MIAMI BEACH
COMMISSION MEMORANDUM
TO: Honorable Mayor and Members of the City Commission
FROM: Alina T. Hudak, City Manager
DATE: July 28,2021
SUBJECT:A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY
OF MIAMI BEACH, FLORIDA, AUTHORIZING THE EXTENSION OF THE
FINAL ADVANCE DATE UNDER THE LOAN IN AN AGGREGATE
PRINCIPAL AMOUNT NOT TO EXCEED $15,000,000 FROM RAYMOND
JAMES CAPITAL FUNDING, INC.; AUTHORIZING THE EXECUTION AND
DELIVERY OF A SECOND AMENDMENT TO LOAN AGREEMENT AND AN
ALLONGE TO PROMISSORY NOTE IN CONNECTION WITH SUCH
EXTENSION; AUTHORIZING OTHER ACTIONS IN CONNECTION WITH
THE EXTENSION AND THE FINANCING PROGRAM; AND PROVIDING
FOR AN EFFECTIVE DATE.
RECOMMENDATION
The Administration recommends that the Mayor and City Commission adopt the Resolution.
BACKGROUND/HISTORY
The City previously had a $37.5 million equipment lease line of credit with SunTrust which provided
short term financing for the City's equipment needs such as fleet vehicles. Under the prior line of
credit, which was in place from 2008 — 2015, the City made draws in an amount required for
equipment under the capital budget. When drawn, the amount would be amortized at a fixed interest
rate based on a formula and was amortized as level principal and interest payments for a period of up
to 10 years. The City made 21 draws under this line totaling $37.4 million. The outstanding amounts
mature in 2021 —2025.
On June 6, 2018, the Mayor and City Commission adopted a resolution accepting the
recommendation of the Finance and City wide Projects Committee from its May 18, 2018 meeting to
authorize the issuance of an RFP through the City's Financial Advisor, RBC Capital Markets
("Financial Advisor"), on behalf of the City, for an equipment line of credit in an amount not to exceed
$15 million, with the selection of the lender and final terms for the Loan subject to approval of the
Mayor and City Commission.
On November 14, 2018, the City Commission approved a resolution, loan agreement and other
related documents which authorized the City to execute the Loan with Raymond James Capital
Funding, Inc. in an amount up to $15,000,000 to make draws for vehicles and equipment through
September 30, 2021.
ANALYSIS
Page 391 of 2012
The City regularly has equipment capital needs that it wishes to finance over a multi-year period. An
equipment line of credit provides a cost-effective and efficient financing mechanism for smaller, short-
term loans. The draws convert to a fixed rate loan based on a formula which reflects market
conditions at the time of the draw.
The City has the legal authority to obtain a line of credit pursuant to the Constitution of the State of
Florida, Chapter 166, Part II, Florida Statutes, as amended, and the Charter of the City (collectively,
the"Act"),to borrow money to finance capital projects.
The Loan is secured,by a covenant to budget and appropriate from legally available non-ad valorem
revenues. In recommending the use of an equipment line of credit versus other financing options, the
City's CFO worked in conjunction with the City's Financial Advisor, who concurred on the
appropriateness and cost-effectiveness of this type of financing. An equipment line of credit provides
efficient access to funds for small and shorter-term financings to the extent that the equipment cannot
be paid for with cash on hand.
Pursuant to the City's Professional Services Agreement with the City's Financial Advisor dated April
24, 2017, the Financial Advisor conducted, on behalf of the City, an RFP process with banks and
other lending institutions for the Loan. On August 23, 2018, the Financial Advisor distributed an RFP
for an Equipment Line of Credit or Equipment Master Lease on behalf of the City to over 40 financial
institutions. On September 6, 2018, the City received 6 proposals for an equipment line of credit or
master lease from the following institutions:
1) Bank of America Public Capital Corp
2) JP Morgan Chase Bank
3) PNC Equipment Finance
4) Raymond James
5) SunTrust Equipment Finance &Leasing
6) TD Equipment Finance
Based on the proposals received, the City determined that Raymond James had the most favorable
combination of interest rate formula and documentation flexibility. The resolution and loan agreement
approved by the City Commission on November 14, 2018 authorized the City to borrow up to
$15,000,000 for vehicles and equipment at fixed interest rates based on market conditions and the
formula for the desired term at the time of draw with maturities of 5, 7 or 9 years through September
30, 2021. The draws have level annual debt service for the selected term.
The City has drawn approximately $6.5 million on the Loan as of July 12, 2021 and has
approximately $8.5 million undrawn. Because the City anticipates additional capital needs and the
Loan has a final advance date on September 30, 2021, the City would like to extend the Loan for
another year. The extended equipment LOC would expire on September 30, 2022, and would
include a minimum floor of 0.75% for the U.S. Treasury Index utilized for the calculation of the
interest rate on any draws.
SUPPORTING SURVEY DATA
n/a
CONCLUSION
The Administration requests that the Mayor and City Commission of the City of Miami Beach,
Florida, adopt the Resolution related to the loan in an aggregate principal amount not to exceed
$15,000,000 from Raymond James Capital Funding, Inc., to pay costs of vehicles and equipment,
authorizing the execution and delivery of an amendment to the loan agreement extending the loan for
an additional year and allonge to the promissory note which provides a minimum floor of 0.75% for
Page 392 of 2012
the U.S. Treasury Index, authorizing other actions in connection with the loan and providing for an
effective date.
Applicable Area
Not Applicable
Is this a "Residents Right Does this item utilize G.O.
to Know" item, pursuant to Bond Funds?
City Code Section 2-14?
No No •
Legislative Tracking
Finance
ATTACHMENTS:
Description
❑ Resolution
❑ Allonge to Promissory Note
❑ Second Amendment to Loan Agreement
Page 393 of 2012
EXHIBIT"A"
SECOND AMENDMENT
Page 397 of 2012
9
EXHIBIT"B"
ALLONGE
I
Page 398 of 2012
ALLONGE TO PROMISSORY NOTE
The Promissory Note dated December 5, 2018 (the "Note") of the City of Miami Beach,
Florida(the "Borrower") is modified in the following respect, effective , 2021
(the "Effective Date"):
1. As of the Effective Date,the definition of"U.S.Treasury Index"is amended and restated in its
entirety as follows:
(4) "U.S.Treasury Index"means the applicable constant maturity United States Treasury
Bond rate as reported on the United States Department of the Treasury Daily Treasury Yield Curve
Table website (https://www.treasury.gov/resource-center/data-chart-center/interest-rates/Pages/
TextView.aspx?data=yield) (i) with respect to any Advance, five Business Days prior to the
applicable Advance, and (ii) with respect to the Taxable Rate, on the date of computation of the
Taxable Rate;provided,however,that in no event shall the U.S.Treasury Index in connection with
Advances made on and after , 2021 be less than 0.75%.
2. Except as otherwise set forth herein,all capitalized terms not otherwise defined herein shall
have the meanings ascribed thereto in the Note. Except as set forth above, there are no other
amendments to the Note and the terms of the Note remain in full force and effect. This Allonge shall
be stapled or otherwise affixed to the Note by the holder thereof. All references to the term"Note"in
the Note,the Loan Agreement dated as of December 5,2018,as amended by the First Amendment
dated as of August 3, 2020 and the Second Amendment dated as of , 2021,
between the Borrower and the Lender, or any other documents related to the Note shall mean the
Note as amended by this Allonge.
3. This Allonge shall be construed pursuant to and governed by the substantive laws of the State
of Florida.
IN WITNESS WHEREOF,the Borrower has caused this Allonge to be executed in its name
as of the Effective Date.
CITY OF MIAMI BEACH, FLORIDA
By:
Name: Dan Gelber
Title: Mayor
Acknowledged and Accepted:
RAYMOND JAMES CAPITAL FUNDING, INC.
By:
Name: Chad E. Colby
Title: Senior Vice President and Managing Director
010-9231-9514/1/AMERICAS Page 399 of 2012
SECOND AMENDMENT TO LOAN AGREEMENT
SECOND AMENDMENT (this "Second Amendment") dated as of
, 2021 to the LOAN AGREEMENT dated as of December 5, 2018, as
amended by the First Amendment dated as of August 3, 2020 (collectively, the "Loan
Agreement") by and between the City of Miami Beach, Florida, a municipal corporation in the
State of Florida, and its successors and assigns (the "Borrower"), and Raymond James Capital
Funding, Inc., and its successors and assigns(the"Lender").
The parties hereto, intending to be legally bound hereby and in consideration of the
mutual covenants hereinafter contained,DO HEREBY AGREE as follows:
ARTICLE I
AMENDMENT
Section 1.01. Definitions. Capitalized terms used in this Second Amendment shall have
the meanings as set forth in the Loan Agreement.
Section 1.02. Amendment. The definition of"Final Advance Date" in Section 1.01 of
the Loan Agreement is hereby amended and restated to read as follows:
"Final Advance Date"means September 30,2022.
ARTICLE II
MISCELLANEOUS
Section 2.01. Effect of Second Amendment. Except as specifically amended by this
Second Amendment, the Loan Agreement shall remain in full force and effect and is hereby
ratified and affirmed by the Borrower and the Lender. The Borrower hereby reaffirms its
agreement to observe and perform each covenant and obligation of the Borrower contained in the
Loan Agreement. In order to induce the Lender to execute and deliver this Second Amendment,
the Borrower hereby makes each of the representations and warranties contained in the Loan
Agreement as of the date hereof, except those made as of a specific date. [The Borrower shall
pay the fees and expenses of, or incurred by counsel to, the Lender in connection with the review
and delivery of this Second Amendment.]
Section 2.02. Governing Law. This Second Amendment is a contract made under the
laws of the State of Florida and shall be governed and construed in accordance with such laws.
Section 2.03. Counterparts. This Second Amendment may be executed in several
counterparts, each of which shall be an original and all of which shall constitute one instrument.
Section 2.04. Binding Effect. This instrument shall inure to the benefit of and shall be
binding upon the parties hereto and their respective successors and assigns subject to the
limitations contained herein.
010-9231-9460/1/AMERICAS Page 400 of 2012
Section 2.05. Section Headings. Section headings in this Second Amendment are for
convenience of reference only, shall not constitute part of this Second Amendment and shall not
be used to continue the meaning or intent of the provisions hereof.
IN WITNESS WHEREOF, the parties have executed this Second Amendment to be
effective between them as of the date set forth above.
CITY OF MIAMI BEACH, FLORIDA
By:
Name: Dan Gelber
Title: Mayor
Attest -
By:
Name: Rafael E. Granado
Title: City Clerk
RAYMOND JAMES CAPITAL
FUNDING, INC.
By:
Name: Chad E. Colby
Title: Senior Vice President and
Managing Director
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010-9231-946011/AMERICAS Page 401 of 2012