Title
Resolution - Approval of Authorization for Additional Long-Term Debt Financing for the Cooperative on a Delayed Funding Basis - R Kruger
Other Info
Submitted By: Randy Kruger
Department: Chief Financial Officer
Financial Impact and Cost/Benefit Considerations: As discussed in Executive Session.
Discussion
The Cooperative has various existing long-term and short-term debt (secured and unsecured) to finance the operations and expenses of the Cooperative. In November 2020 the Board authorized up to $200,000,000 in long-term debt with NYL Investors LLC and/or one or more affiliates. In December 2020, the Board authorized up to $400,000,000 in long-term debt with BofA Securities Inc. and/or one or more affiliates (“BofA”) as placement agent.
To continue to fund its capital improvement budget and operating budget, the Cooperative is assessing its ongoing financial structure and options available in consideration of the financial health of the Cooperative and in the best interests of the Cooperative.
The Cooperative has obtained or expects to issue or incur additional long-term debt in an amount up to $150,000,000, which debt will be secured under the Master Indenture of Trust dated as of January 1, 1993 (as amended, the “Indenture”) by substantially all the assets of the Cooperative. Such debt may be issued no more than 13 months after the date such debt has been priced or committed.
Body
WHEREAS, to continue to fund its capital improvement budget and operating budget in the next five years and in the best interests of the Cooperative, the Cooperative requires commitments for long-term debt financings; and
NOW THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE COOPERATIVE, that the Cooperative authorizes the issuance or incurrence of long-term debt in the aggregate principal amount up to $150,000,000, which debt will be secured under the Indenture by substantially all the assets of the Cooperative and may be issued no more than 13 months after the pricing or commitment date thereof; and
BE IT FURTHER RESOLVED BY THE BOARD OF DIRECTORS OF THE COOPERATIVE, that the Authorized Officers (as defined below) are hereby authorized to engage BofA to serve as the placement agent for such long-term debt and authorize payment of any fees; and
BE IT FURTHER RESOLVED BY THE BOARD OF DIRECTORS OF THE COOPERATIVE, that the long-term debt authorized herein may include the issuance of bonds, notes or other obligations in one or more series or tranches on behalf the Cooperative (the issuance of which bonds, notes or other obligations is hereby approved) through limited offerings or private placements to accredited investors or qualified institutional buyers with the delivery of one or more offering memoranda, investor presentations or other offering materials (the form, terms, provisions, and delivery of which offering materials are hereby approved), and may require obtaining a rating by a rating agency and certain documentation with The Depository Trust Company, each of which is hereby approved; and
BE IT FURTHER RESOLVED BY THE BOARD OF DIRECTORS OF THE COOPERATIVE, that such bonds, notes or other obligations will be secured under the Indenture and require the execution and delivery by the Cooperative of one or more Supplemental Indentures of Trust (each a "Supplement") to the Indenture, and the performance by the Cooperative of the transactions contemplated by each Supplement, and the form, terms, and provisions of each Supplement are hereby approved in all respects, and any one or more of the Authorized Officers are hereby authorized to execute and deliver such Supplements on behalf of the Cooperative; and
BE IT FURTHER RESOLVED BY THE BOARD OF DIRECTORS OF THE COOPERATIVE, that the form, terms and provisions of one or more loan agreements, credit agreements, bond purchase agreements, note purchase agreements or other agreements providing for (or necessary in connection with) the issuance or incurrence of long-term debt are hereby approved in all respects, and any one or more Authorized Officers of the Cooperative are hereby authorized to negotiate the final form, terms and provisions of such agreements and to execute and deliver such agreements on behalf of the Cooperative; and
BE IT FURTHER RESOLVED BY THE BOARD OF DIRECTORS OF THE COOPERATIVE, that the Chief Executive Officer and the Chief Financial Officer of the Cooperative or any person designated in writing for such purpose by either of such officers (the “Authorized Officers”), are each hereby authorized (whether acting together or alone) as a duly authorized officer or agent of the Cooperative, for and in the name and on behalf of the Cooperative, to negotiate, execute and deliver or acknowledge the aforementioned documents and any other agreements that may be required with a credit bank, placement agent, purchaser, investor, trustee, or depository institution, and any other agreements, certificates, consents, affidavits, opinions, and other instruments of any nature necessary or appropriate to give effect to such documents or agreements or the long-term financings described in this resolution, in each case in such form and containing such terms and conditions as such Authorized Officer may in her or his reasonable discretion deem necessary, appropriate, or desirable; and
BE IT FURTHER RESOLVED BY THE BOARD OF DIRECTORS OF THE COOPERATIVE, that the Authorized Officers (whether acting together or alone) shall be authorized from time to time to negotiate, execute, and deliver renewals, extensions, supplements and/or amendments to any of the aforementioned documents, in each case as such Authorized Officer may in her or his reasonable discretion deem necessary, appropriate, or desirable; and
BE IT FURTHER RESOLVED BY THE BOARD OF DIRECTORS OF THE COOPERATIVE, that the Authorized Officers are each hereby authorized as a duly authorized officer or agent of the Cooperative, for and in the name and on behalf of the Cooperative, to do any and all acts deemed by such Authorized Officer in such Authorized Officer’s judgment to be necessary or appropriate in the best interests of the Cooperative to give effect to the foregoing resolutions; and
BE IT FURTHER RESOLVED BY THE BOARD OF DIRECTORS OF THE COOPERATIVE, that all actions taken prior to the effective date hereof by the officers and duly authorized agents of the Cooperative in connection with the subject of the foregoing resolutions be and are hereby ratified, confirmed, and approved.