OFFICIAL NOTICE OF SALE CITY OF OAKLAND 2015-2016 TAX AND REVENUE ANTICIPATION NOTES, SERIES A NOTICE IS HEREBY GIVEN that bids will be received by the City of Oakland (the "City") for the purchase of all but not less than all of $49,365,000 aggregate principal amount of City of Oakland 2015-2016 Tax and Revenue Anticipation Notes, Series A (the "Notes"). Subject to the provisions of this Official Notice of Sale (the "Official Notice of Sale"), the Notes will be awarded to the bidder with the lowest true interest cost for the Notes. Bidders are required to bid on all of the Notes. Bids for the purchase of the Notes will be accepted only through Grant Street Group's MuniAuction website ("MuniAuction") as the approved electronic bidding system. The MuniAuction website is accessible via the auction link on the Grant Street Group Home Page at either www.grantstreet.com or www.muniauction.com. The bids will be received in the manner and up to the time described below under the captions "Time" and "Submission of Bids." TIME: Between 7:30 a.m. and 8:00 a.m. *, Pacific Daylight Time, on June 10, 2015 * (subject to the provisions described below under the caption "Submission of Bids") or at such later date and/or other time as shall be established by the City and communicated through MuniAuction. If no legal bid or bids are received for the Notes on June 10, 2015 * or if the sale date and/or time is postponed or rescheduled as is communicated by MuniAuction, bids will be received at such other time and/or date as shall be designated by the City and communicated through MuniAuction. See "Postponement" below. SUBMISSION OF BIDS: All bids must be submitted only on the MuniAuction website located at either www.grantstreet.com or www.muniauction.com. No other provider of internet bidding services and no other means of delivery (i.e. telephone, telefax or physical delivery) will be accepted. The auction for the Notes will begin at 7:30 a.m. and end at 8:00 a.m. *, Pacific Daylight Time, on June 10, 2015 *. To bid via the MuniAuction website, bidders must have both (1) completed the registration form on the MuniAuction website, and (2) requested and received admission to the City's auction, as described below. Only FINRA registered broker-dealer and dealer banks with DTC clearing arrangements will be eligible to bid. The use of MuniAuction shall be at the bidder's risk, and neither the City, Public Financial Management, Inc., Financial Advisor to the City (the "Financial Advisor"), Hawkins Delafield & Wood LLP, Bond Counsel to the City, nor Stradling Yocca Carlson & Rauth, P.C., Disclosure Counsel to the City, shall be responsible for, and each bidder expressly assumes the risk of, any incomplete, inaccurate or untimely bid submitted by such bidder, including, without limitation, incomplete, inaccurate or untimely bids caused by reason of garbled transmissions, mechanical failure, slow or engaged telephone or telecommunications lines or any other cause. The City is not bound by any advice and determination of MuniAuction to the effect that any particular bid complies with the terms of this Official Notice of Sale. All costs and expenses incurred by prospective bidders in connection with their submission of bids through MuniAuction are the sole responsibility of the bidders and the City is not responsible for any of such costs or expenses. Preliminary, subject to change.
The "Rules of MuniAuction" can be viewed on the MuniAuction website and are made a part hereof. Bidders must comply with the Rules of MuniAuction in addition to the requirements of this Official Notice of Sale. In the event the Rules of MuniAuction conflict with this Official Notice of Sale, this Official Notice of Sale shall prevail. Bidders may change and submit bids at any time during the auction, provided, however, that each bid submitted by such bidder must result in a lower true interest cost ("TIC") than such bidder's immediately preceding bid. During the bidding, no bidder will see any other bidder's bid, but each bidder will be able to see the rank of its bid relative to other bids. For purposes of the internet bidding process, the time as displayed on the MuniAuction Auction Page shall constitute the official time. All bids shall be deemed to incorporate the provisions of this Official Notice of Sale. See "Terms of Sale" below. Further information about Grant Street Group (Parent of MuniAuction), including registration requirements, may be obtained from: Grant Street Group (Parent of MuniAuction) 429 Forbes Avenue Pittsburgh, Pennsylvania 15219 (412) 391-5555, ex. 370 (for auction support) THE ISSUE: The City will use the proceeds of the Notes to finance its seasonal cash flow requirements during the Fiscal Year ending June 30, 2016. A cash flow deficit occurs because City General Fund expenditures tend to occur in relatively level amounts throughout the year while receipts have followed an uneven pattern. SHORT-TERM FINANCING PROGRAM: The City is issuing $49,365,000 aggregate principal amount of Notes to provide moneys to meet Fiscal Year 2015-16 General Fund expenditures, including current expenses, capital expenditures and the discharge of other obligations or indebtedness of the City. For short-term financing in Fiscal Year 2014-15, the City issued its 2014-15 Tax and Revenue Anticipation Notes (the "2014-15 Notes") in the principal amount of $55,000,000. The 2014-15 Notes mature on June 30, 2015. The City has deposited an amount into the City of Oakland 2014-15 Tax and Revenue Anticipation Notes Repayment Account sufficient to pay the principal of and interest on the 2014-15 Notes maturing on June 30, 2015. AUTHORITY FOR ISSUANCE: The Notes are issued under the authority of Article 7.6, Chapter 4, Part 1, Division 2, Title 5 (commencing with Section 53850) of the Government Code of the State of California (the "State") and pursuant to an Ordinance enacted by the City Council on May 19, 2015 (the "Ordinance"). SECURITY: The principal amount of the Notes, together with the interest thereon, will be payable from taxes, revenues, income, cash receipts and other moneys which are received by the City for the City's General Fund during or allocable to Fiscal Year 2015-2016 and which are available for the payment of current expenses and other obligations of the City (the "Unrestricted Moneys"). As Preliminary, subject to change. 2
security for the payment of the principal of and interest on the Notes, the City has agreed to set aside with its fiscal agent Pledged Moneys as described in the Official Statement. BOOK-ENTRY ONLY: The Notes will be issued in book-entry only form by appointing The Depository Trust Company ("DTC") to act as securities depository for the Notes. DESCRIPTION OF THE NOTES: The Notes will be dated the date of delivery and will mature on June 30, 2016. Interest will be computed on the basis of actual days elapsed based on a 360-day year composed of twelve 30-day calendar months at the rate per annum specified in the bid accepted. Principal of and interest with respect to the Notes is payable at maturity. The Notes are not subject to redemption prior to maturity. LEGAL OPINION: The legal opinion of Hawkins Delafield & Wood LLP, Bond Counsel to the City, approving the validity of the Notes, will be delivered with the Notes, and a reliance letter thereon will be furnished to the successful bidder without charge to the successful bidder. TERMS OF SALE PRINCIPAL AMOUNTS AND INTEREST RATE: Bidders may submit bids for all, but not less than all, of the Notes. The Notes shall bear interest from their issuance date to their stated maturity date at the interest rate specified in the bid. The interest rate specified in the bid shall be a single uniform rate expressed in an integral of one-hundredth (1/100) of one percent (1%). No bids will be accepted for less than the par amount of the Notes. The interest rate on the Notes shall not exceed three percent (3%) per annum. AWARD: The Treasurer of the City will award the Notes to the bidder offering the lowest true interest cost to the City, provided, however that the Treasurer of the City reserves the right to reject any and all bids and to waive any informality or irregularity in any and all bids. The Treasurer of the City reserves the further right, in her discretion, to adjourn the sale, in which event a notice will be given through MuniAuction. PRINCIPAL AMOUNTS SUBJECT TO CHANGE AFTER RECEIPT OF BIDS: The City reserves the right, following the receipt of bids and determination of the winning bid and at its sole discretion, to change the total principal amount of the Notes awarded by up to 10% based upon the interest rates and premiums submitted by the successful bidder. The successful bidder will be notified of the modification to the principal amount at the time of the award. A successful bidder may not withdraw its bid or change the interest rates bid or reject the Notes as a result of any changes made to the principal amount of the Notes. TRUE INTEREST COST CALCULATION: The true interest cost to the City of any bid shall be calculated on the basis of the present value of the principal and interest to be paid on the Notes based on the bid price, i.e., principal of the Notes, plus premium, if any, compounded annually. If two or more bids have the same TIC, the first one submitted, as determined by reference to the time displayed on MuniAuction's website, shall be the leading bid. DEPOSIT: The winning bidder shall deliver a good faith deposit (the "Deposit") in the form of a federal funds wire transfer payable in immediately available funds in the amount of one percent (1%) of the aggregate principal amount of the Notes to secure the City from any loss resulting from 3
the failure of the winning bidder to comply with the terms of its bid. Each bidder shall acknowledge as a condition precedent to the submission of its bid that the winning bidder is required to submit its Deposit to the City in the form of a federal funds wire transfer as instructed by the City not later than 12:00 p.m. (Pacific Time) on the next business day following the City's acceptance of the bid of the winning bidder. In the event the winning bidder fails to honor its accepted bid, the Deposit will be retained by the City. If the winning bidder completes its purchase of the Notes on the terms stated in its bid, its Deposit will be applied to the purchase of the Notes on the date of delivery of the Notes. No interest will be paid upon the Deposit made by any bidder. In the event of the City's inability to deliver the Notes at the closing, the City shall forthwith return the amount of the Deposit to the winning bidder immediately and such return shall constitute a full release and discharge of all claims by the winning bidder against the City arising out of the transactions contemplated by this Official Notice of Sale. PROMPT AWARD: The Treasurer of the City will take action awarding the Notes or rejecting all bids not later than 24 hours after the expiration of the time herein prescribed for the auction of the Notes, unless such time of award is waived by the successful bidder. Notice of award will be given promptly to the successful bidder. REOFFERING PRICE: The winning bidder shall, within one (1) hour after being notified of the award of the Notes, advise the Financial Advisor by electronic transmission or writing by facsimile transmission of the initial public offering price of the Notes. Each successful bidder also must submit to the City a certificate (the "Reoffering Price Certificate"), satisfactory to Bond Counsel, prior to the delivery of the Notes, which among other things states that: (a) (i) on the date of award, such successful bidder made a bona fide public offering of the Notes purchased by such successful bidder at initial offering price corresponding to the price or yield indicated in the information furnished in connection with the successful bid, and (ii) as of such date, the first price or yield at which an amount equal to at least ten percent (10%) of Notes purchased by such successful bidder was sold to the public was, respectively, a price not higher or a yield not lower than indicated in the information furnished with the successful bid (the "first price rule"), unless such certificate contains an explanation as to the reasons why the first price rule was not satisfied; OR (b) such successful bidder has purchased the Notes for its own account and not with a view to distribution or resale and not in the capacity of a bond house, broker or other intermediary, and the price or prices at which such purchase was made. For the purposes of the Reoffering Price Certificate, the "public" does not include bond houses, brokers or similar persons or organizations acting in the capacity of underwriters or wholesalers. In making such representations, the successful bidder must reflect the effect on the offering prices of any "derivative products" (e.g., a tender option) used by the bidder in connection with the initial sale of any of the Notes. CUSIP NUMBER: It is anticipated that a CUSIP number will be printed on the Notes, but neither the failure to print such number on any Note nor any error with respect thereto shall constitute cause for a failure or refusal by the successful bidder thereof to accept delivery of and pay for said 4
Notes in accordance herewith. All charges of the CUSIP Service Bureau for the assignment of CUSIP numbers for the Notes shall be paid by the successful bidder. LITIGATION: No litigation is pending, or, to the knowledge of the City, threatened concerning the validity of the Notes, and an opinion of the City Attorney to that effect will be furnished at the time of the original delivery of the Notes. The City is not aware of any litigation pending or threatened questioning the political existence of the City or contesting the City's ability to levy and collect ad valorem taxes or contesting the City's ability to issue or pay the Notes. OFFICIAL STATEMENT: The City has approved a Preliminary Official Statement dated June 3, 2015, which the City prepared with the assistance of Stradling Yocca Carlson & Rauth, P.C., Disclosure Counsel to the City. The City has "deemed final" said Preliminary Official Statement for purposes of Rule 15c2-12 (the "Rule") of the Securities and Exchange Commission although it is subject to revision, amendment and completion in the form of a Final Official Statement in conformance with such Rule. Up to 25 copies of the Final Official Statement will be supplied to the successful bidder without charge. BLUE SKY: The City has not taken any action relating to the requirements of the securities or "blue sky" laws of any jurisdiction with respect to the offer and sale of the Notes. Certain jurisdictions may have filing requirements which must be satisfied prior to any offer or sale of the Notes. Copies of the Preliminary Official Statement will be furnished by MuniAuction via electronic delivery and will also be available at: www.grantstreet.com and www.muniauction.com or by request made to the Financial Advisor, Public Financial Management, Inc., 50 California Street, Suite 2300, San Francisco, CA 94111, Phone: 415-982-5544, Fax: 415-982-4513, Email: hollenbecks@pfm.com, Attn: Sarah Hollenbeck. CERTIFICATE: The City will provide to the successful bidder of the Notes a certificate, signed by an authorized representative of the City, confirming to the successful bidder that, at the time of acceptance of its proposal for the Notes and at the time of delivery thereof, to the best of the knowledge of said authorized representative, the Preliminary Official Statement and the Final Official Statement did not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading. DELIVERY AND PAYMENT: Delivery of the Notes is expected to occur on, but not before, July 1, 2015. The Notes will be delivered to DTC through the Fast Automated Securities Transfer service. The successful bidder shall pay for the Notes on the date of delivery in Federal Reserve Bank funds or equivalent immediately available funds in Oakland, California. Payment on the delivery date shall be made in an amount equal to the price bid for the Notes, less the amount of the Deposit. TAX EXEMPT STATUS: In the event that prior to the delivery of the Notes (a) the income received by any private holder from notes of the same type and character as the Notes shall be declared to be taxable (either at the time of such declaration or at any future date) under any federal 5
income tax laws, either by the terms of such laws or by ruling of a federal income tax authority or official which is followed by the Internal Revenue Service, or by decision of any federal court, or (b) any federal income tax law is enacted which will have a substantial adverse tax effect on holders of the Notes as such, the successful bidder may, at its option, prior to the tender of the Notes by the City, be relieved of its obligation to purchase the Notes and in such case its Deposit will be returned. RIGHT OF REJECTION: The Treasurer of the City reserves the right, in her discretion, to reject any and all bids and to waive any irregularity or informality in any bid. RIGHT OF CANCELLATION BY CITY: The Treasurer of the City reserves the right, at any time prior to the date of the auction, to cancel the public sale of the Notes. In such event, the Treasurer of the City shall cause notice of the cancellation of this Official Notice of Sale of the Notes to be communicated through MuniAuction at www.grantstreet.com or www.muniauction.com, as promptly as practicable. However, no failure to post such notice, failure of any prospective bidder to receive such notice or any defect or omission therein shall affect the cancellation of the public sale of the Notes. RIGHT OF CANCELLATION BY BIDDER: The successful bidder shall have the right, at its option, to cancel its obligation to purchase the Notes if the City shall fail to execute the Notes and tender the same for delivery within 60 days from the date of sale thereof, and in such event the successful bidder shall be entitled to the return of its Deposit. POSTPONEMENT: The Treasurer of the City reserves the right to postpone, from time to time, the date and time established for the receipt of bids. Any such postponement will be announced via MuniAuction at www.grantstreet.com or www.muniauction.com, not later than 11:00 a.m., Pacific Daylight Time, on the business day prior to the announced date for the auction. If any date fixed for the auction and the sale of the Notes is postponed, an alternative sale date will be announced via MuniAuction at www.grantstreet.com or www.muniauction.com, at least 24 hours prior to such alternative sale date. On any such alternative sale date, any bidder may submit a bid for the purchase of the Notes in conformity in all respects with the provisions of this Official Notice of Sale except for the date of sale and except for the changes announced via MuniAuction at www.grantstreet.com or www.muniauction.com. ADDITIONAL INFORMATION: Copies of the Official Notice of Sale, Official Form of Bid for Notes, Rules of MuniAuction and the Preliminary Official Statement will be furnished to any potential bidder upon request made to the Financial Advisor, Public Financial Management, Inc., 50 California Street, Suite 2300, San Francisco, CA 94111, Phone: 415-982-5544, Fax: 415-982-4513. Dated: June 3, 2015 Ms. Katano Kasaine Treasurer City of Oakland 6
APPENDIX A OFFICIAL FORM OF BID FOR NOTES CITY OF OAKLAND, CALIFORNIA 2015-2016 TAX AND REVENUE ANTICIPATION NOTES SERIES A We hereby certify that we are an eligible bidder and submit our bid and commit to purchase not less than all of the City of Oakland, California 2015-2016 Tax and Revenue Anticipation Notes, Series A (the "Notes") subject to all the terms and conditions stated in the Official Notice of Sale. The submission of this bid is a representation that the bidder, with the intent of acting as Underwriter for the Notes, did not consult with any other potential underwriter, or agent thereof, about this bid and that the bid was determined without regard to any other formal or informal agreement that the bidder may have with the City of Oakland or any other person (whether or not in connection with the subject note issue). Per Annum Coupon: % Price: $ True Interest Cost: % Date: June, 2015 Firm/Syndicate: By Authorized Representative Accepted: CITY OF OAKLAND By Title: Date: June, 2015 A-1