MARICOPA COPS 2016 - FIRST AMENDMENT TO LEASE-PURCHASE AGREEMENT (2).DOC

SQUIRE DRAFT 05/02/16
When recorded return to:
Timothy E. Pickrell, Esq.
Squire Patton Boggs (US) LLP
1 E. Washington Street, 27th Floor
Phoenix, Arizona 85004 Exemption Claimed:
(602) 528-4000 A.R.S. Section 42-1614.B.1.
FIRST AMENDMENT
TO LEASE-PURCHASE AGREEMENT
by and between
U.S. BANK NATIONAL ASSOCIATION, as trustee
as Lessor
and
MARICOPA COUNTY, ARIZONA,
as Lessee
Dated as of _______ 1, 2016
relating to
$___________
Maricopa County, Arizona
Certificates of Participation
Series 2016
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FIRST AMENDMENT
TO LEASE PURCHASE AGREEMENT
THIS FIRST AMENDMENT TO LEASE-PURCHASE AGREEMENT (this “First
Amendment”), dated as of _______ 1, 2016, by and between U.S. BANK NATIONAL
ASSOCIATION, as lessor (the “Lessor” or “Trustee”) and MARICOPA COUNTY, ARIZONA,
as lessee (the “Lessee” or the “County”);
WITNESSETH:
WHEREAS, the Lessor and the Lessee have previously entered into a Lease-Purchase
Agreement, dated as of June 1, 2015 (the “Original Lease-Purchase Agreement”), as amended by
this First Amendment (collectively, the “Lease” or “Lease-Purchase Agreement”) with respect to
the property described in Exhibit A to the Original Lease-Purchase Agreement; and
WHEREAS, in connection with the execution of the Original Lease-Purchase Agreement,
the County and the Trustee entered into a Trust Agreement, dated as of June 1, 2015 (the
“Original Trust Agreement” and, as subsequently supplemented and amended, the “Trust
Agreement”), pursuant to which the Trustee executed and delivered $185,580,000 principal
amount of Certificates of Participation, Series 2015 (the “2015 Certificates”); and
WHEREAS, there are currently outstanding $185,580,000 aggregate principal amount of
2015 Certificates; and
WHEREAS, the Trust Agreement permits the execution and delivery of “Additional
Certificates,” on a parity with the 2015 Certificates, and permits the supplementation and
amendment of the Trust Agreement and the Lease-Purchase Agreement to facilitate such an
execution and delivery; and
WHEREAS, in addition to the 2015 Certificates, the County has caused the Maricopa
County Public Finance Corporation, an Arizona nonprofit corporation (the “Corporation”) to
issue Lease Revenue Bonds, Series 2007A (the “Series 2007A Bonds”) pursuant to a Trust
Indenture, dated as of June 1, 2001, as supplemented (the “2001 Indenture”), between the
Corporation and The Bank of New York Mellon Trust Company, N.A., as successor trustee (the
“2001 Trustee”); and
WHEREAS, the County has determined that it is advisable to refund and redeem the
outstanding Series 2007A Bonds listed in Exhibit B attached to the First Supplement to Trust
Agreement described herein (the “Bonds to be Refunded”); and
WHEREAS, in consideration of the County’s agreement to amend and restructure the
term of its obligations under the Lease-Purchase Agreement, the Trustee is willing to execute
and deliver Additional Certificates in a principal amount of $__________ to be denominated
“Certificates of Participation, Series 2016” (the “2016 Certificates”) to refund and redeem the
Bonds to be Refunded and use the remainder of the net proceeds of the 2016 Certificates to pay
costs of executing and delivering the 2016 Certificates; and
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WHEREAS, in connection with the execution and delivery of the 2016 Certificates, it is
therefor necessary for the Lessor and the County to enter into this First Amendment; and
WHEREAS, upon execution and delivery of the 2016 Certificates, all the conditions for
execution and delivery of Additional Certificates under the Trust Agreement will have been met;
and
WHEREAS, the County and the Trustee have, simultaneously with the execution and
delivery of this First Amendment, entered into a First Supplement to Trust Agreement (the “First
Supplement to Trust Agreement”);
NOW, THEREFORE, THE PARTIES HERETO AGREE TO AMEND THE LEASE-
PURCHASE AGREEMENT AS FOLLOWS:
SECTION 1.1 Defined Terms. Capitalized terms used and not otherwise defined
herein shall the meanings set forth in the Original Lease-Purchase Agreement as previously
amended or, if not defined therein, in the Trust Agreement.
SECTION 1.2 Execution and Delivery of 2016 Certificates. In consideration of
the County’s agreement to restructure the term of its obligations under the Lease-Purchase
Agreement and to refund and redeem the Bonds to be Refunded, the parties agree that the 2016
Certificates shall be executed and delivered in a principal amount of $__________.
SECTION 1.3 Deposit of Monies. On the Closing Date for the 2016 Certificates,
there shall be deposited with the Trustee the net proceeds of sale of the 2016 Certificates, which
proceeds shall be deposited as provided in Sections 2.6 and 3.2 of the First Supplement to Trust
Agreement for disbursement pursuant thereto.
SECTION 1.4 Term. The Term of the Lease-Purchase Agreement extends to
December 1, 2035, subject to extension and earlier termination as provided in Section 4.2 thereof
and as otherwise provided in the Lease-Purchase Agreement.
SECTION 1.5 Lease Payments and Lease Payment Dates. Exhibit B of the Lease-
Purchase Agreement is hereby amended by substituting therefor Exhibit B attached to this First
Amendment, setting forth the Lease Payments and Lease Payment Dates under the Lease, and
representing the total of payments shown on Exhibit B-1 and Exhibit B-2 attached to this First
Amendment.
SECTION 1.6 Leased Property. The Leased Property consists of the properties
described in Exhibit A attached to this First Amendment.
SECTION 1.7 Certain References. The provisions in Sections 10.1 through 10.5 of
the Original Lease-Purchase Agreement, which refer to certain sections in the Original Trust
Agreement, regarding prepayment of the 2015 Certificates, shall hereafter be deemed to refer
also to the analogous prepayment provisions in the Trust Agreement regarding the 2016
Certificates.
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SECTION 1.8 Tax Covenants. The Lessee covenants (a) that it will take or cause to
be taken all actions that may be required of it for the interest on the 2016 Certificates to remain
excluded from gross income for federal income tax purposes, (b) that it will not take or authorize
to be taken any actions which would adversely affect such exclusion and (c) that it, or other
persons acting for it, will, among other acts of compliance, (i) apply the proceeds of the 2016
Certificates in compliance with Arizona law and the Trust Agreement, (ii) restrict the yield on
investment property, (iii) make or cause to be made timely and adequate payments to the federal
government as provided in Section 8.8 of the Trust Agreement, (iv) maintain books and records,
and (v) refrain from certain uses of proceeds and, as applicable, of property financed with such
proceeds, all in such manner and to the extent necessary to assure such exclusion of the interest
on the 2016 Certificates under the Code. An officer of the Lessee shall take any and all such
actions, make such rebate payments or potential payments and make or give such reports and
certifications as may be appropriate to assure such exclusion of the interest.
The Lessee covenants that it will use, and will restrict the use and investment of the
proceeds of the 2016 Certificates in such manner and to such extent, if any, as may be necessary,
so that (a) the 2016 Certificates will not (i) constitute an arbitrage bond, a private activity bond
or a hedge bond under Sections 141, 148 or 149 of the Code, or (ii) be treated other than as
bonds to which Section 103(a) of the Code applies, and (b) the interest on the 2016 Certificates
will not be treated as a preference item under Section 57 of the Code.
Any officer of the Lessee having responsibility with respect to the execution and delivery
of this First Amendment shall, alone or in conjunction with any other officer, employee or agent
of or consultant to the Lessee, be authorized (a) to make or affect any election, selection,
designation, choice, consent, approval, or waiver on behalf of the Lessee with respect to the
Lease-Purchase Agreement or the Certificates as the Lessee is permitted or required to make or
give under the federal income tax laws, including, without limitation thereto, any of the elections
provided for in Section 148(f)(4)(C) of the Code or available under Section 148 of the Code, for
the purpose of assuring, enhancing or protecting favorable tax treatment or status of the interest
on the 2016 Certificates or assisting compliance with requirements for that purpose, reducing the
burden or expense of such compliance, reducing the rebate amount or payments of penalties, or
making payments of special amounts in lieu of making computations to determine, or paying,
excess earnings as rebate, or obviating those amounts or payments, as determined by that officer,
which action will be in writing and signed by the officer, (b) to take any and all other actions,
make or obtain calculations, make payments, and make or give reports, covenants and
certifications of and on behalf of the Lessee, as may be appropriate to assure the exclusion of the
interest on the 2016 Certificates from gross income for federal income tax purposes, and (c) to
give one or more appropriate certificates of the Lessee, for inclusion in the transcript of
proceedings for setting forth the reasonable expectations of the Lessee regarding the amount and
use of all the proceeds relating to the 2016 Certificates and the property financed with such
proceeds, the facts, circumstances and estimates on which they are based, and other facts and
circumstances relevant to the tax treatment of the 2016 Certificates.
SECTION 1.9 Ratification of Original Lease-Purchase Agreement, as Amended.
The Original Lease-Purchase Agreement by this First Amendment, is hereby ratified and
confirmed in all respects.
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SECTION 1.10 Binding Effect. This First Amendment shall inure to the benefit of
and shall be binding upon the Lessor and the Lessee and their respective successors and assigns.
SECTION 1.11 Severability. In the event any provision of this First Amendment
shall be held invalid or unenforceable by any court of competent jurisdiction, such holding shall
not invalidate or render unenforceable any other provision hereof.
SECTION 1.12 Execution in Counterparts. This First Amendment may be executed
in several counterparts, each of which shall be an original and all of which shall constitute but
one and the same instrument.
SECTION 1.13 Applicable Law. This First Amendment shall be governed by and
construed in accordance with the laws of the State.
SECTION 1.14 Captions. The captions or headings in this First Amendment are for
convenience only and in no way define, limit or describe the scope or intent of any provisions or
Section of this First Amendment.
SECTION 1.15 Cancellation of Contracts. As required by the provisions of Arizona
Revised Statutes Section 38-511, as amended, notice is hereby given that the Lessee may cancel
any contract, without penalty or further obligation, made by the Lessee if any person
significantly involved in initiating, negotiating, securing, drafting or creating the contract on
behalf of the Lessee is, at any time while the contract or any extension of the contract is in effect,
an employee of any other party to the contract in any capacity or a consultant to any other party
of the contract with respect to the subject matter of the contract. The cancellation shall be
effective when written notice from the Lessee’s Board of Supervisors is received by all other
parties to the contract unless the notice specifies a later time. All parties represent that to the
best of their knowledge, no basis exists for the Lessee to cancel this First Amendment pursuant
to Arizona Revised Statutes Section 38-511 as of the date hereof. The Lessor covenants not to
employ as an employee, an agent or, with respect to the subject matter of this First Amendment,
a consultant, any person significantly involved in initiating, negotiating, securing, drafting or
creating this First Amendment on behalf of the Lessee within 3 years from execution of this First
Amendment, unless a waiver of Arizona Revised Statutes Section 38-511 is provided by the
Lessee’s Board of Supervisors.
SECTION 1.16 Certain Warranties and Certifications from the Lessor. To the
extent applicable under Arizona Revised Statutes (“A.R.S.”) § 41-4401, the Lessor, in its
capacity as Lessor under the Lease-Purchase Agreement and as Trustee under the Trust
Agreement, including its subcontractors who work on the Lease-Purchase Agreement or the
Trust Agreement, warrants compliance with all federal immigration laws and regulations that
relate to its employees and compliance with the E verify requirements under A.R.S. § 23-214(A).
The breach by the Lessor of the foregoing shall be deemed a material breach by the Lessor of the
Lease-Purchase Agreement and the Trust Agreement and may result in the termination of its role
as Trustee under the Trust Agreement and as Lessor under the Lease-Purchase Agreement and its
replacement with a successor in such capacities, to the extent permitted by the Trust Agreement.
The Lessee retains the legal right to randomly inspect the papers and records of the Lessor to
ensure that the Lessor is complying with the above-mentioned warranty. The Lessor shall keep
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such papers and records open for random inspection by the Lessee during normal business hours.
The Lessor shall cooperate with the random inspections by the Lessee, including granting the
Lessee entry rights onto its property to perform such random inspections and waiving its
respective rights to keep such papers and records confidential.
[Remainder of page left blank intentionally]
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IN WITNESS WHEREOF, the Lessor has caused this First Amendment to be executed in
its corporate name by its duly authorized officers, and the Lessee has caused this First
Amendment to be executed in its name by its duly authorized officers, as of the date first above
written.
U.S. BANK NATIONAL ASSOCIATION,
as Lessor
By:
Vice President
MARICOPA COUNTY, ARIZONA, as
Lessee
By:
Chair, Board of Supervisors
ATTEST:
By:
Clerk, Board of Supervisors
APPROVED AS TO FORM:
SQUIRE PATTON BOGGS (US) LLP,
Bond Counsel
By:
Timothy E. Pickrell
[Signature page of First Amendment to Lease-Purchase Agreement]
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STATE OF ARIZONA )
) ss.
County of Maricopa )
On this, the ______ day of ________, 2016, before me, the undersigned Notary Public,
personally appeared Keith Henselen, who acknowledged himself to be an Vice President of U.S.
Bank National Association, a national association, and that he, as such officer, being authorized
so to do, executed the foregoing First Amendment to Lease-Purchase Agreement for the
purposes therein contained by signing the name of the association by himself as such officer.
IN WITNESS WHEREOF, I have hereunto set my hand and official seal.
Notary Public
My Commission Expires:
_____________________
[Notarization page of First Amendment to Lease-Purchase Agreement]
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STATE OF ARIZONA )
) ss.
County of Maricopa )
On this, the ______ day of ________, 2016, before me, the undersigned Notary Public,
personally appeared Clint L. Hickman, who acknowledged himself to be Chair of the Maricopa
County, Arizona Board of Supervisors, and that he, as such officer, being authorized so to do,
executed the foregoing First Amendment to Lease-Purchase Agreement for the purposes therein
contained by signing the name of said county by himself as such officer.
IN WITNESS WHEREOF, I have hereunto set my hand and official seal.
Notary Public
My Commission Expires:
_____________________
[Notarization page of First Amendment to Lease-Purchase Agreement]
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EXHIBIT A
DESCRIPTION OF LEASED PROPERTY
General Description: South Court Tower
Legal Description:
THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE COUNTY OF
MARICOPA, STATE OF ARIZONA AND IS DESCRIBED AS FOLLOWS:
A boundary located over a portion of Madison Street between 1st and 2nd Avenues, 2nd Avenue
between Madison and Jackson Streets, and Block 62, all as described in the plat of the Original
Townsite of Phoenix, recorded in Book 2 of Maps, page 51, and a portion of that vacated right of
way of 2nd Avenue as described in Docket 11093, page 702, records of Maricopa County,
Arizona, situated in the Northwest quarter of Section 8, Township 1 North, Range 3 East of the
Gila and Salt River Base and Meridian, Maricopa County, Arizona, being more particularly
described as follows:
COMMENCING at a brass cap in handhole at the intersection of First Avenue and Madison
Street, from which a brass cap in handhole and the intersection of First Avenue and Jackson
Street bears South 00°12’21” East, a distance of 380.18 feet;
THENCE South 89°51’53” West, along the centerline of Madison Street a distance of 50.00 feet
to the POINT OF BEGINNING of the boundary herein described;
THENCE South 00°12’21” East, along the western right of way line of said 1st Avenue, a
distance of 340.17 feet to the northern right of way line of said Jackson Street;
THENCE South 89°52’42” West, along the northern right of way line of said Jackson Street, a
distance of 400.05 feet to the western right of way line of said 2nd Avenue;
THENCE North 00°11’50” West, along said western right of way line, a distance of 190.12 feet;
THENCE North 89°48’10” East, a distance of 38.90 feet;
THENCE North 00°11’50” West, a distance of 149.95 feet to said centerline of Madison Street;
THENCE North 89°42’57” East, a distance of 11.10 feet;
THENCE North 89°51’53” East, a distance of 350.00 feet to the POINT OF BEGINNING.
Prior to the closing of the lease transaction, the foregoing legal description may
become:
Lot 1, SOUTH COURT TOWER as such Final Plat is approved by the City of Phoenix and
recorded in Maricopa County Records.
A-1
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EXHIBIT B
AMENDED SCHEDULE OF LEASE PAYMENTS
RELATING TO 2015 AND 2016 CERTIFICATES
FOLLOWING EXECUTION AND DELIVERY
OF 2016 CERTIFICATES
Series 2015 Series 2016 Aggregate
Principal Interest Principal Interest Principal Interest
06/15/16 $ 4,289,500.00 $ $ $ $
12/15/16 4,289,500.00
06/15/17 $90,625,000 4,289,500.00
12/15/17 2,123,875.00
06/15/18 94,955,000 2,123,875.00
Total $185,580,000 $17,116,250.00 $ $ $ $
B-1
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EXHIBIT B-1
AMENDED SCHEDULE OF LEASE PAYMENTS
RELATING TO 2015 CERTIFICATES FOLLOWING
EXECUTION AND DELIVERY OF 2016 CERTIFICATES
The following are the Lease Payments to be paid pursuant to the Lease-Purchase
Agreement relating to:
Maricopa County, Arizona
Certificates of Participation
Series 2015
Principal Interest Total
Date Component Component Lease Payments
06/15/16 $4,289,500.00 $ 4,289,500.00
12/15/16 4,289,500.00 4,289,500.00
06/15/17 $90,625,000 4,289,500.00 94,914,500.00
12/15/17 2,123,875.00 2,123,875.00
06/15/18 94,955,000 2,123,875.00 97,078,875.00
Total $185,580,000 $17,116,250.00 $202,646,392.00
B-1-1
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EXHIBIT B-2
Maricopa County, Arizona
Certificates of Participation
Series 2016
Principal Interest Total
Date Amount Component Lease Payments
06/15/16 $ $ $
12/15/16
06/15/17
12/15/17
06/15/18
Total $ $ $
B-2
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