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HomeMy WebLinkAboutCDC/2003-14 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 RESOLUTION NO. CDC/2003-14 RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF SAN BERNARDINO, CALIFORNIA, APPROVING AMENDMENT NO.1 TO THE LOAN AGREEMENT, AND AUTHORIZING EXECUTION THEREOF, BETWEEN THE REDEVELOPMENT AGENCY AND THE SAN BERNARDINO SYMPHONY. WHERAS, the Community Development Commission ("Commission") on April 19, 1999 entered into a Loan Agreement with the San Bernardino Symphony ("Symphony") in an amount not to exceed $175,000, at an interest rate of 9%, with interest only payments due monthly, and with principal payments of $35,000 due annually on May 15th of each year, but in any event all principal is due and payable in full no later than April 20, 2004; and WHERAS, the Symphony has drawn a total of $161,299.74 against the Loan Agreement and has made prompt interest only monthly payments for a total of $47,509.49 interest paid through March 2003; and WHEREAS, the Community Development Commission ("Commission") now desires to enter into an Amendment No. 1 to that Loan Agreement with the Symphony; and WHEREAS, the Commission desires to amend the Loan Agreement to (i) restructure the terms of repayment of the Loan, (ii) dispense with the Letters of Credit Requirement, (iii) provide a principal reduction of $12,312.63 under the Loan Agreement, (iv) reduce the interest rate on the outstanding Loan balance to 3% per annum commencing with the May 1,2003 payment, (v) fully amortize the Loan over a fifteen (15) year period, (vi) provide that there shall be no further draws by the Symphony at any time of unexpended funds under the Loan Agreement, and, 1 1 2 3 4 5 6 7 3 9 10 11 12 13 14 15 16 17 13 19 20 21 22 23 24 25 26 27 23 CDC/2003-14 RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF SAN BERNARDINO, CALIFORNIA, APPROVING AMENDMENT NO.1 TO THE LOAN AGREEMENT, AND AUTHORIZING EXECUTION THEREOF, BETWEEN THE REDEVELOPMENT AGENCY AND THE SAN BERNARDINO SYMPHONY. (vii) require that the Symphony shall fIrst provide a written request of the Mayor and Common Council and the Commission in the event that the Symphony seeks to change its name; and WHEREAS, the Commission further amends the Loan Agreement that in the Event of Default interest shall be payable on the full outstanding principal balance of the Loan at the rate of 9% per annum from April l, 2003 to the date of the repayment of the Loan, and if the Event of the Default continues, the Agency may declare the Loan to be due and payable immediately. NOW, THEREFORE, BE IT RESOLVED BY THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF SAN BERNARDINO, AS FOLLOWS: Section 1. The Commission hereby approves and authorizes the Executive Director of the Redevelopment Agency to execute an Amendment No. 1 to the Loan Agreement as attached hereto. Section 2. This Resolution shall take effect upon the date of its adoption. II II II II II II 2 I 2 3 4 5 6 7 8 9 10 II 12 13 14 15 16 17 18 19 20 CDC/2003-14 RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF SAN BERNARDINO, CALIFORNIA, APPROVING AMENDMENT NO.1 TO THE LOAN AGREEMENT, AND AUTHORIZING EXECUTION THEREOF, BETWEEN THE REDEVELOPMENT AGENCY AND THE SAN BERNARDINO SYMPHONY. I HEREBY CERTIFY that the forgoing Resolution was duly adopted by the Community Development Commission of the City of San Bernardino at a jt. reg. meetingthereof,heldonthe 21stdayof April , 2003, by the following vote, to wit: Commission Members Ayes Nays Abstain Absent ESTRADA x LONGVILLE x MCGINNIS x - DERRY x SUAREZ x - ANDERSON --1L MCCAMMACK x / 21 The foregoing Resolution is hereby approved thisd~ifay of April ,2003. 22 23 24 25 26 27 28 '2L 'irperson, Community evelopment Commission of the City of San Bernardino By: 3 CDC/2003-14 AMENDMENT NO.1 TO LOAN AGREEMENT (San Bernardino Symphony Association) THIS AMENDMENT NO.1 is entered into as of Apri121, 2003, by and between the San Bernardino Symphony Association, a California nonprofit corporation (the "Symphony") and the Redevelopment Agency of the City of San Bernardino, a public body corporate and politic (the "Agency"). WHEREAS, the Agency entered into a Loan Agreement dated as of April 20, 1999 with the San Bernardino Symphony Orchestra, the performing group of the Symphony (the "Loan Agreement") pursuant to which the Agency agreed to lend to the Symphony an amount not to exceed One Hundred Seventy-Five Thousand Dollars ($175,000.00); and WHEREAS, prior to the date hereof the Symphony has drawn down the amount of One Hundred Sixty-One Thousand Two Hundred Ninety-Nine Dollars and Seventy-Four Cents ($161,299.74) under the Loan Agreement (the "Loan"); and WHEREAS, pursuant to the Loan Agreement, the Symphony has executed a promissory note setting forth, among other things, the terms of repayment of the Loan (the "Promissory Note"); and WHEREAS, the Loan Agreement requires that the Loan be secured by certain irrevocable standby letters of credit (the "Letters of Credit Requirement") provided by four separate individuals in their personal capacity; and WHEREAS, the Loan Agreement provides that the Loan shall bear interest at the rate of nine percent (9%) payable in monthly installments commencing May 15, 1999; and WHEREAS, the Loan Agreement further provides that principal of the Loan shall be payable on May 15 of each year, commencing May 15, 2000, in installments of Thirty Five Thousand Dollars ($35,000.00) or such other amount necessary to make yearly equal principal payments on the outstanding balance of the Loan over the remaining term of the Loan through and including the final maturity date of April 20, 2004; and WHEREAS, as of April 1,2003, the Symphony has paid interest on the Loan in the amount of Forty Seven Thousand Five Hundred Nine Dollars and Forty-Nine Cents ($47,509.49) pursuant to the payment terms of the Loan Agreement; and WHEREAS, based upon the actual amounts of the draws requested by the Symphony under the Loan, the outstanding principal amount of the Loan as of April 1, 2003, is One Hundred Sixty One Thousand Two Hundred Ninety-Nine Dollars and Seventy-Four Cents ($161,299.74), and from the total interest payments remitted by the Symphony to the Agency, the Agency has determined that it has received from the Symphony, net of the Agency's costs of 1 CDC/2003-14 funds which were used to fund the Loan, an amount equal to Twelve Thousand Three Hundred Twelve Dollars and Sixty-Three Cents ($12,312.63); and WHEREAS, the Symphony and the Agency desire at this time to (i) restructure the terms of repayment of the Loan, (ii) dispense with the Letters of Credit Requirement, (iii) reduce the interest rate on the Loan, (iv) provide for amortized payments of principal and interest, (v) extend the maturity date for the Loan, (vi) provide a principal reduction of $12,312.63 under the Loan Agreement, taking into consideration the net funds received by the Agency from interest payments remitted by the Symphony, and (vii) require that the Symphony shall first provide a written request of the Mayor and Common Council and the Commission in the event that the Symphony seeks to change its name; and WHEREAS, the Symphony recognizes that the City of San Bernardino ("City") and the Agency have been financial benefactors on behalf of the Symphony in efforts to continue the musical heritage of the Symphony within the City of San Bernardino and the City and the Agency have sought to promote the balance of the various attributes of the City for purposes of furthering the prosperity and development of the City; and WHEREAS, the City desires to assure that the Symphony will maintain a presence within the City of San Bernardino to provide musical performances and to promote the name of the City of San Bernardino in all performing organizations sponsored by the Symphony; and WHEREAS, the Symphony desires to recognize the financial assistance that has been provided to the Symphony and the other support demonstrated by the City as to the activities and programming of the Symphony; and WHEREAS, the Symphony and the Agency desire to amend the Loan Agreement to effectuate the foregoing. NOW, THEREFORE, in consideration of the premises and such other good and valuable consideration, receipt of which is acknowledged by the parties, the parties hereto agree as follows: Section 1. (a) Except as hereby amended, the Loan Agreement and the Promissory Note are in all respects ratified and confirmed and all of the terms, provisions and conditions of each of the Loan Agreement and the Promissory Note shall be and remain in full force and effect. The Symphony expressly ratifies and confirms that it is a party to the Loan Agreement and the obligor on the Promissory Note. (b) The parties recognize that it is the expectation of the Agency, as additional consideration for the approval and execution of this Amendment to the Loan Agreement, to assure that the Symphony continues to make full use of the name "San Bernardino" in the corporate name of the non-profit corporation that constitutes the Symphony and in each 2 CDC/2003-14 performing entity offered to the public in all presentations and concerts sponsored, produced or otherwise supported by the Symphony. Additionally, each support entity and all affiliate organizations that in any manner offer support, funding or staffing for the Symphony shall likewise include the name "San Bernardino" in all such names of such entities and organizations. The Agency anticipates that the Symphony will continue to maintain a regular season concert program to be performed within the City and that the Symphony will not merge with any other orchestra or symphonic organization that would have the effect of diminishing the presence of the Symphony within the City. It is expected that the Symphony will continue to maintain all corporate offices, including a headquarters location, within the City. It is the representation of the Symphony that individuals who either reside in or have business interests within the City shall be primarily solicited for participation on the Board of Directors of the Symphony, and if after having undertaken good faith efforts in such regard there remain unfilled seats on the Board of Directors, then the Symphony may seek other participants for such unfilled seats. The Symphony recognizes that both the City and Agency have been substantial financial benefactors in support of the Symphony for numerous years and the Symphony desires to maintain its cooperative and supportive relationship with the City and the Agency. (c) In the event the Symphony seeks to change the name of the Symphony or otherwise seek relief from any of the provisions of this section, the Symphony shall first provide a written request to the Mayor and Common Council of the City and the governing board of the Agency. Neither the Mayor and Common Council nor the governing board of the Agency shall be required to grant such request under any circumstances and such relief, if any, shall be at the sole discretion of said governing bodies. In the event the Symphony elects to proceed to change the name or otherwise deviate from the provisions of this section, such actions shall be deemed to be a default under this Amendment No. 1 and the Loan Agreement and shall be an Event of Default pursuant to the Loan Agreement. Section 2. Except as otherwise provided herein, all terms not otherwise defined in this Amendment No. 1 shall have the same meanings in this Amendment No. 1 as those terms are given in the Loan Agreement. Section 3. read as follows: Section 1.02 of the Loan Agreement is amended in its entirety to "Section 1.02. Draws on Loan; Principal Reduction. There shall be no further draws by the Symphony at any time of any unexpended Loan funds under the Loan Agreement. As of April 1, 2003, the outstanding principal balance of the Loan was One Hundred Sixty One Thousand Two Hundred Ninety-Nine Dollars and Seventy-Four Cents ($161,299.74). The Agency hereby agrees that the outstanding principal balance of the Loan shall be reduced by Twelve Thousand Three Hundred Twelve Dollars and Sixty-Three Cents ($12,312.63), so 3 as follows: CDC/2003-14 that the outstanding principal balance of the Loan as of the date of this Amendment No. 1 shall be One Hundred Forty Eight Thousand Nine Hundred Eighty-Seven Dollars and Eleven Cents ($148,987.11). The Agency and the Symphony recognize that said principal reduction amount represents the moneys paid by the Symphony to the Agency prior to the date of this Amendment No.1, net of the cost of funds incurred by the Agency to initially fund the Loan." Section 4. Section 1.03 of the Loan Agreement is amended in its entirety to read "Section 1.03. Repayment. If no Event of Default has occurred and is continuing, (i) commencing April 1, 2003, the Loan shall bear interest at the rate of three percent (3%) per annum; (ii) principal of and interest on the Loan shall be payable monthly on the first day of the month, commencing May 1, 2003, through and including April 1, 2018, in installments of One Thousand Twenty-Eight Dollars and Eighty-Eight Cents ($1,028.88), provided, however, that the installment payable on April 1, 2018 shall be in the amount of One Thousand Twenty-Eight Dollars and Thirty-Three Cents ($1,028.33); and (iii) the full principal balance outstanding on the Loan shall be paid in full no later than April 1, 2018. If an Event of Default has occurred and is continuing, (i) interest shall be payable on the full amount of the outstanding principal balance of the Loan at the rate of nine percent (9%) per annum from the date of this Amendment No.1 to the date of repayment ofthe Loan and (ii) the Loan may be subject to mandatory prepayment, as more fully set forth in Section 3.02 hereof. Principal of and interest on the Loan shall be payable to the Agency in immediately available funds which constitute lawful money of the United States of America. The Loan is and shall be pre-payable on any date at the option of the Symphony without penalty. In the event that any payments due hereunder are not made by the Symphony within ten (10) days of the due date, the Symphony shall pay the Agency a late charge of ten percent (10%) per month on the amount past due and 4 CDC/2003-14 remaining unpaid. In no event shall interest, if any, and late charges payable hereunder exceed the maximum amount of interest allowable under the usury laws of the State of California." Section 5. Section 3.01, Events of Default, of the Loan Agreement shall be amended to add (d) to read as follows: "Section 3.01 (d) Failure by the Symphony to provide a written request to the Mayor and Common Council of the City and the governing board of the Agency in the event the Symphony seeks to change its name or otherwise seeks relief from any of the provisions of Section 1 hereof." Section 6. Section 3.02 of the Loan Agreement shall be amended in its entirety to read as follows: "Section 3.02. Remedies. If an Event of Default has occurred and is continuing, interest shall be payable on the full outstanding principal balance of the Loan at the rate of nine percent (9%) per annum from the date of Amendment No.1 to the date of repayment of the Loan. If an Event of Default has occurred and is continuing, the Agency may declare the Loan to be due and payable immediately, together with interest as set forth in the preceding sentence, and upon such declaration the same shall become immediately due and payable, anything in this Loan Agreement to the contrary notwithstanding. In addition, the Agency may exercise any of its rights or remedies under the Promissory Note. Immediately upon becoming aware of the occurrence of an Event of Default, the Agency shall give notice of such Event of Default to the Symphony by any method set forth in Section 4.04 hereof." Section 7. The Promissory Note is amended in its entirety to read as set forth in Exhibit "A" to this Amendment No.1, which is by this reference incorporated herein. Section 8. This Amendment No. 1 may be executed in counterparts, each of which shall be an original, and all of which shall constitute but one and the same instrument. 5 CDC/2003-14 IN WITNESS WHEREOF, the parties hereto have duly executed this Amendment No. I as of the date first above written. A1TEST~ rn~ Agency Secretary. ~ / APPROVED AS TO FORM AND LEGAL CONTENT: l &~<71 Agency Speci Counsel SAN BERNARDINO SYMPHONY ASSOCIATION ,/ 6 CDC/2003-14 EXHIBIT "A" PROMISSORY NOTE $148,987.11 Date: May 1, 2003 FOR VALUE RECEIVED, the undersigned promises to pay to the Redevelopment Agency of the City of San Bernardino (the "Agency") or its successors the sum of One Hundred Forty Eight Thousand Nine Hundred Eighty Seven Dollars and Eleven Cents ($148,987.11), which is the amount drawn by the undersigned pursuant to Section 1.02 of the Loan Agreement (as hereinafter defined), as adjusted by certain credits and principal reductions granted by the Agency (the "Loan"), and to pay interest on the unpaid principal amount of this Note at the rate of three percent (3%) per annum to be calculated commencing as of April 1, 2003 until paid in full; provided, however, that if an Event of Default has occurred and is continuing, interest shall be payable on the full principal amount hereof at the rate of nine percent (9%) per annum from the date hereof through the date of repayment of the Loan. All capitalized terms not otherwise defined herein shall have the meaning given in that certain Loan Agreement dated as of April 20, 1999 between the Agency and the undersigned, as amended by that certain Amendment No.1 (the "Loan Agreement"). Payments hereunder shall be made as follows: 1. On or before the first day of the month, commencing May 1, 2003, through and including April 1, 2018, the undersigned shall pay installments of principal and interest in the amount of One Thousand Twenty Eight Dollars and Eighty-Eight Cents ($1,028.88); provided, however, that the installment payable on April 1, 2018 shall be in the amount of One Thousand Twenty Eight Dollars and Thirty-Three Cents ($1,028.33). 2. The full principal balance outstanding on the Loan shall be paid in full no later than April 1, 2018. 3. A failure to pay any sum provided for in this Note when due or a material breach of the Loan Agreement shall constitute a breach hereof. Upon such breach, (i) interest shall be payable on the full principal amount hereof at the rate of nine percent (9%) per annum from the date hereof until the date ofrepayment of the Loan; (ii) the Agency shall be entitled to declare the Loan due and payable immediately, together with interest as set forth in (i) above; and (iii) the Agency shall be entitled to pursue all remedies available under this Note and the Loan Agreement. All payments due under this Note shall be made in lawful money of the United States in the name of the Agency at the principal office of the Agency, 201 North "E" Street, Suite 301, San Bernardino, California 92401, Attn. Finance, or at such other place as may from time to time be designated by the Agency in writing. 7 CDC/2003-14 The undersigned reserves the right to prepay at any time all or any part of the principal amount of this Note without the payment of penalties or premiums. All payments and optional prepayments on this Note shall be applied first to the principal due on the Note, and the remaining balance shall be applied to late charges, if any, as described below. IN THE EVENT the undersigned shall fail to pay the payments when due, and if such failure continues for thirty (30) days thereafter, the unpaid principal amount of this Note shall become due and payable, at the option of the Agency, without notice to the undersigned, together with (i) interest on the total principal amount of this Note at the rate of nine percent (9%) per annum from the date hereof to the date of such mandatory prepayment and (ii) late charges at the rate as set forth below. Failure of the Agency to exercise such option shall not constitute a waiver of such default. If the payments on this Note are not paid within ten (10) days of the due date, the undersigned shall pay to the Agency a late charge often percent (10%) per month on the amount past due and remaining unpaid. In no event shall the total interest and late charges which may be payable hereunder exceed the maximum amount of interest permitted under the usury laws of the State of California. If suit is instituted by the Agency to recover on this Note, the non-prevailing party agrees to pay all costs of such collection, including reasonable attorneys' fees and court costs. The costs, salaries and expenses of the City Attorney and members of said office in enforcing this Note on behalf of the Agency shall be considered "attorneys' fees" for purposes of this Note. DEMAND, protest and notice of demand and protest are hereby waived and the undersigned hereby waives, to the extent authorized by law, any and all exemption rights which otherwise would apply to the debt evidenced by this Note. IN WITNESS WHEREOF, THIS NOTE has been duly executed by the undersigned, as of its date. SAN BERNARDINO SYMPHONY ASSOCIATION By: L---- Authorized Symphony Official 8