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Meeting Date:
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6/14/2022 - 5:00 PM
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Category:
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Business and Finance
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Type:
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Action
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Subject:
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13.1 Approval of Resolution #21-22:43, of the Board of Education of the Azusa Unified School District Authorizing the Execution and Delivery of a Ground Lease, A Lease Agreement, an Escrow Agreement, and A Placement Agent Agreement with Respect to the Assignment of such Ground Lease and Lease Agreement, and Authorizing the Execution of Necessary Documents and Certificates and Related Actions
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Strategic Goals:
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3. Fiscal Responsibility We manage our fiscal resources responsibly and align budget decisions with District goals and priorities.
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Enclosure
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File Attachment:
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Rationale:
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The District previously executed and delivered the Azusa Unified School District Certificates of Participation, Series 2015 (the “Prior Certificates”). The Prior Certificates evidence direct, fractional undivided interests of the owners thereof in the base rental payments to be made by the Azusa Unified School District (the “District”) under the Lease Agreement, dated as of May 1, 2015 (the “Prior Lease”), by and between the District and the Azusa Unified School District Facilities Corporation (the “Corporation”). The District desires to cause the base rental payments of the Prior Lease to be prepaid, thereby prepaying the Prior Certificates, and the Corporation desires to assist the District in such prepayment.
In order to accomplish such prepayment, the District and the Corporation propose to enter into (i) a Ground Lease, pursuant to which the District expects to lease to the Corporation certain real property owned by the District and the improvements thereto, consisting of the Henry Dalton Elementary School, and (ii) a Lease Agreement, pursuant to which the Corporation will sublease the property back to the District for continued use by the District.
The Corporation proposes to assign its right, title and interest in and to the Ground Lease and the Lease Agreement to an Assignee (as defined in the Resolution) through a private placement. The District has engaged Isom Advisors, a Division of Urban Futures, Inc., as municipal advisor. The District will be represented by Orrick, Herrington & Sutcliffe LLP, as special counsel. The District has engaged RBC Capital Markets, LLC as the exclusive placement agent. The District’s general counsel, Fagen Friedman & Fulfrost LLP will also be involved.
The Resolution approves the draft forms of legal documents necessary for this transaction, including:
1. Ground Lease
2. Lease Agreement
3. Assignment Agreement
4. Escrow Agreement
5. Placement Agent Agreement
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Budgetary Impact:
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Under the Lease Agreement, the District is obligated to pay base rental payments from any source of legally available funds of the District. The Lease Agreement is expected to result in savings to the District.
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Recommendation:
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It is recommended the Board of Education approve Resolution #21-22:43, of the Board of Education of the Azusa Unified School District Authorizing the Execution and Delivery of a Ground Lease, A Lease Agreement, an Escrow Agreement, and A Placement Agent Agreement with Respect to the Assignment of such Ground Lease and Lease Agreement, and Authorizing the Execution of Necessary Documents and Certificates and Related Actions.
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Approvals:
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Recommended By:
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Signed By:
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Melissa Vera - Secretary to Assistant Superintendent, Business Services
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Signed By:
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Latasha Jamal - Assistant Superintendent, Business Services
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Signed By:
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Arturo Ortega - Superintendent
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Vote Results:
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| Original Motion | | Member Yolanda Rodriguez-Peña Moved, Member Sabrina Bow, Ed.D. seconded to approve the Original motion 'It is recommended the Board of Education approve Resolution #21-22:43, of the Board of Education of the Azusa Unified School District Authorizing the Execution and Delivery of a Ground Lease, A Lease Agreement, an Escrow Agreement, and A Placement Agent Agreement with Respect to the Assignment of such Ground Lease and Lease Agreement, and Authorizing the Execution of Necessary Documents and Certificates and Related Actions.'. Upon a Roll-Call Vote being taken, the vote was: Aye: 4 Nay: 0. | | The motion Carried 4 - 0 | | | | | Xilonin Cruz-Gonzalez | Yes | | Yolanda Rodriguez-Peña | Yes | | Adrian Greer | Yes | | Sabrina Bow, Ed.D. | Yes | |
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