HomeMy WebLinkAboutCDC/2005-10
RESOLUTION NO. CDC/2005-10
I 'I
I RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY
OF SAN BER.cllolARDINO, CALIFORNIA, APPROVING THE FORBEARANCE OF
2 PAYMENTS PURSUANT TO THE LOAN AGREEMENT BETWEEN THE
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO AND THE SAN
3 BERNARDINO SYMPHONY.
4 WHEREAS, the Community Development Commission ("Commission") on April 19,
5 1999, entered into a Loan Agreement with the San Bernardino Symphony ("Symphony") in an
6 amount not to exceed $175.000, at an interest rate of 9% per annum, with interest only payments
7 due and payable monthly, and with principal payments of $35,000 due and payable annually on
8 May 15th of each year, but in any event all principal was due and payable in full no later than April
9 20, 2004; and
10 WHEREAS, the Commission on April 21, 2003, approved Amendment No.1 to the Loan
II Agreement which reduced the Loan interest rate to 3 % per annum, credited $11,475.21 towards
12 the reduction of the principal balance of the Loan, and established an amortization schedule for
13 the Loan extending for a fifteen (15) year period of time with monthly payments of$1 ,028.33, and
] 4 with the Loan scheduled to mature on April 1, 2018; and
]5 WHEREAS, the Symphony has been a foundation of the culturai heritage of the City of
16 San Bernardino for over 75 years and continues to provide a valuable cultural resource to the City
17 of San Bernardino, its residents and the region; and
18 WHEREAS, the Symphony through its season ticket sales and marketing efforts promotes
19 the economic revitalization goals of the Agency through the use of Symphony financial resources,
20 and the Symphony through its concert series encourages visitors and concert goers to attend the
21 cultural events held at the California Theater which is owned by the Agency, and the furtherance
22 of such events has a direct beneficial financial impact upon the Agency by reducing the net
23 operating costs to be paid by the Agency for the continued ownership and operation of the I
24 California Theater; and
25 WHEREAS, the Agency receives direct benefits through the presence of the Symphony as
26 illustrated in the marketing efforts of the Agency (I) to artract new businesses to the City of San
27 Bernardino, (ii) to encourage relocation of businesses to the City of San Bernardino, and (iii) to
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DHCljs [Symphony2.Res]
I
1 RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY
OF SAN BERNARDINO, CALIFORNIA, APPROVING THE FORBEARANCE OF
2 PAYMENTS PURSUANT TO THE LOAN AGREEMENT BETWEEN THE
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO AND THE SAN
3 BERNARDINO SYMPHONY.
4 foster expansion and retention of existing City businesses by including within marketing materials
5 of the Agency those cultural amenities available to residents and business owners within the City
6 through a financially viable symphonic orchestra such as the Symphony and its presence within
7 the City of San Bernardino; and
8 WHEREAS, the Symphony has in recent years achieved international acclaim and
9 recognition due to a large extent to the hiring of the current conductor and music director and his
10 visibility and name recognition on the international music scene; and
11 WHEREAS, the Community Development Commission ("Commission") as hereinafter
12 provided in this Resolution desires to enter into a forbearance agreement subject to the terms and
13 conditions as further provided in Section 1 hereof and to forbear the timely receipt of monthly
14 payments from the Symphony until April 1, 2025 pursuant to the terms of the Forbearance
15 Agreement as herein authorized, and, upon the Symphony not having defaulted in the other
16 requirements as set forth in the Forbearance Agreement, at the conclusion of the Forbearance
17 Period or 90 days prior to said conclusion, the Agency may initiate discussions to forgive and
18 discharge the then outstanding balance of the Indebtedness as defined in the Forbearance
19 Agreement or renegotiate the terms and conditions of the Loan Documents and the Forbearance
20 Agreement. As of March 1, 2005, the principal due and owing on the loan is $134,160.57; no
21 interest shall accrue during the Forbearance Period.
22 NOW, THEREFORE, THE COMMUNITY DEVELOPMENT COMMISSION OF THE
23 CITY OF SAN BERNARDINO DOES HEREBY RESOLVE, DETERMINE AND ORDER, AS
24 FOLLOWS:
25 Section 1. The Commission hereby finds and determines that the Recitals as set forth
26 above are accurate and correct in all respects and further finds and determines that the interests
27 of the Agency will be enhanced and fostered in its revitalization efforts within the City of San
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DHC/js [Symphony2.Res]
2
. .
1 RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY
OF SAN BERNARDINO, CALIFORNIA, APPROVING THE FORBEARANCE OF
2 PAYMENTS PURSUANT TO THE LOAN AGREEMENT BETWEEN THE
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO AND THE SAN
3 BERNARDINO SYMPHONY.
4 Bernardino if the request of the Symphony as set forth in the Recitals hereto is granted by the
5 Commission.
6 The Agency and the Symphony shall execute and deliver within thirty (30) days after the
7 adoption of this Resolution a Forbearance Agreement and in such final form as is reasonably
8 necessary to evidence the forbearance of monthly payments as herein approved and such
9 Forbearance Agreement shall provide that at the conclusion of the Forbearance Period or 90 days
10 prior to said conclusion, the Agency may initiate discussions to forgive and discharge the then
11 outstanding balance of the Indebtedness as defined in the Forbearance Agreement or renegotiate
12 the terms and conditions of the Loan Documents and the Forbearance Agreement. As of March
13 1,2005, the principal due and owing on the loan is $134,160.57; no interest shall accrue during
14 the Forbearance Period. The execution of such Forbearance Agreement is hereby authorized to
15 be executed by the Chairperson of the Commission on behalf of the Agency in such final form as
16 shall be subject to the approval of the Executive Director of the Agency and the City Attorney as
17 the Agency General Counsel.
18 Section 2. This Resolution shall take effect upon the date of its adoption.
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DHC/js [Symphony2.Res]
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CDC/2005-10
1 RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY
OF SAN BERNARDINO, CALIFORNIA, APPROVING THE FORBEARANCE OF
2 PAYMENTS PURSUANT TO THE LOAN AGREEMENT BETWEEN THE
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO AND THE SAN
3 BERNARDINO SYMPHONY.
4 I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Community
5 Development Commission of the City of San Bernardino at a joint regular
6 meeting thereof, held on the 7th day of March
7 vote, to wit:
8 COMMISSION MEMBERS:
AYES
, 2005, by the following
NAYS ABSTAIN ABSENT
9 ESTRADA
10 LONGVILLE
11 MCGINNIS
12 DERRY
13 KELLEY
14 JOHNSON
15 MCCAMMACK
16
17
x
x
x
x
x
x
18
x
1-0
19 IlL
The foregoing Resolution is hereby approved this I
20
21
22
23
24 Approved as to form and
legal content:
25
AJ,~fD!I(Mb;j
27 By: Agency nsel
26
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DHC/js [Symphony2.Res]
March
,2005.
Val es, Chairperson
unity Development Commission
City of San Bernardino
4
CDC/2005-10
FORBEARANCE AGREEMENT
THIS AGREEMENT is entered into this the 7th day of March, 2005, by and between
Redevelopment Agency of the City of San Bernardino, a public body corporate and politic
("Agency") and San Bernardino Symphony Association, a California nonprofit corporation
("Symphony").
The parties stipulate as follows:
A. To evidence and secure Symphony's indebtedness to Agency, Symphony executed and
delivered to Agency the following documents and instruments (the "Loan Documents"):
1) Loan Agreement by and between San Bernardino Symphony Orchestra a California
nonprofit corporation dated as of April 20, 1999 (the "Note")
2) Promissory Note dated April 20, 1999
3) Amendment to Loan Agreement dated April 21, 2003
B. Under the Note and the other Loan Documents, Symphony is justly indebted to Agency in
the amount of$134,160.57 as ofthe date of this Agreement (the "Indebtedness").
C. The Indebtedness is fully enforceable and is not subj ect to any defense or counterclaim or any
claim of setoff or recoupment.
D. Symphony represents that, because of its financial condition, at this time it is unable to pay
the full amount of the Indebtedness. The parties are entering into this Agreement because
of Symphony's representations concerning its financial condition.
NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties agree as follows:
1. Forbearance Period.
Subject to the express provisions of this Forbearance Agreement, Agency hereby agrees to
forbear from exercising its remedies under the Note and the other Loan Documents until the earlier
of (i) April 1, 2025, or (ii) the occurrence of a Termination Event, as defined in Section 3 of this
Agreement. This period of forbearance is hereinafter referred to as the "Forbearance Period."
During the Forbearance Period, Symphony shall not be required to make any principal or interest
payments as provided for in the Loan Documents, and no interest shall accrue on the principal
during such Forbearance Period.
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2. Conditions of Forbearance.
Agency's agreement to forbear is conditioned upon and subject to timely satisfaction of each
of the following conditions ("Conditions of Forbearance"):
(a) Retention of Name
At all times during the term ofthis Forbearance Agreement Symphony shall retain the name
"San Bernardino Symphony Orchestra and Association (Guild)."
(b) Good Faith Benefactor
At all times during the term ofthis Forbearance Agreement, Symphony shall make good faith
efforts to secure a major financial benefactor to donate funds to Symphony for the purpose of
satisfying its indebtedness to Agency.
(c) Financial Statements
As of the 151 day of each month during the Forbearance Period, Symphony shall deliver to
Agency its financial statements for the immediately preceding month. During the Forbearance
Period, within ninety (90) days after each of Symphony's fiscal years, Symphony shall deliver to
Agency audited financial statements for Symphony's immediately preceding fiscal year on an annual
basis, certified by a reputable accounting firm, or other independent certified public accountants
agreed upon by Agency.
(d) No Default to Third Parties
During the Forbearance Period, Symphony shall not be in default of any of its obligations to
any other party.
(e) Correctness of Representations and Warranties
All representations and warranties made by Symphony to Agency under this Agreement shall
remain true and correct throughout the Forbearance Period.
(1) No Defaults Under Loan Documents
During the Forbearance Period, Symphony's obligation to make payments to Agency shall
be governed by this Agreement. Symphony shall perform under and satisfy all other obligations,
covenants, representations and warranties contained in the Loan Documents. With respect to all such
obligations, covenants, representations and warranties, an Event of Default under any of the Loan
Documents shall constitute a Termination Event under this Agreement.
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(g) No Defaults Hereunder
During the Forbearance Period, Symphony shall not breach any promise or covenant
contained in this Agreement and shall not be in default under any provision of this Agreement.
3. Termination Events.
Each of the following shall constitute a Termination Event and an Event of Default under this
Agreement:
(a) Symphony fails to comply in a timely manner with any of the Conditions of
Forbearance set forth above.
(b) Symphony becomes a debtor in bankruptcy by means of either a voluntary or
involuntary petition.
(c) Any kind of receivership or insolvency proceeding is commenced by or against
Symphony.
4. Termination of Forbearance Period.
Symphony agrees that the Forbearance Period automatically, and without notice, shall be
terminated upon the earlier of:
(a) April!. 2025;
(b) The occurrence of any Termination Event, as defined above; or,
(c) During the Forbearance Period, Symphony may pay Agency a single payment equal
to the outstanding balance of the forbearance amount. Symphony shall not be
entitled to any pre-payment discount or other benefit or entitlement as a result of the
payment.
5. Foreiveness of Indebtedness.
Provided that throughout the Forbearance Period Symphony satisfies all ofthe Conditions
of Forbearance set forth above and perform under and satisfy all other obligations, covenants,
representations contained in the Loan Documents, and provided further that no Termination Event
occurs during the Forbearance Period, then at the conclusion of the Forbearance Period or 90 days
prior to said conclusion, Agency may initiate discussions to forgive and discharge the then remaining
outstanding balance of the Indebtedness or renegotiate the terms and conditions of the Loan
Documents and this Forbearance Agreement. If, however, there shall ever occur a Termination
Event, Agency shall be under no obligation to forgive or discharge any portion of the Indebtedness.
D HC/js[ AgreementsISymphony4.Agr]
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6. Representations. Warranties and Covenants.
In order to induce Agency to enter into this Agreement, Symphony makes the following
representations, warranties and covenants:
(a) Symphony is a validly existing California non-profit corporation in good standing
under the laws of the State of California;
(b) Symphony is duly authorized and empowered to enter into and perform under this
Agreement;
(c) No defaults have occurred or will occur under any of the Loan Documents;
(d) The execution and performance of this Agreement by Symphony does not and will
not violate any agreement to which Symphony is a party;
(e) All financial and other information given by Symphony or any of its agents or
representatives to Agency is and shall be true and accurate;
(t) During the Forbearance Period, Symphony will not dispose of any of its property
outside of the ordinary course of business;
(g) During the Forbearance Period, Symphony will not incur any additional debt except
for trade debt incurred in the ordinary course of business;
(h) Symphony shall take no action which would impair Symphony's ability to perform
its obligations hereunder or to satisfy any ofthe Conditions of Forbearance.
7. Effectiveness of the Loan Documents.
THIS AGREEMENT shall not constitute a novation of the Note or any of the other Loan
Documents, and the Note and other Loan Documents shall remain in full force and effect subject
only to Agency's agreement to forbear as set forth herein.
8. Release and Waiver.
Symphony hereby acknowledges and stipulates that it has no claims or causes of action
against Agency of any kind whatsoever. Symphony hereby releases Agency from any and all claims,
causes of action, demands and liabilities of any kind whatsoever whether direct or indirect, fixed or
contingent, liquidated or non-liquidated, disputed or undisputed, known or unknown, which
Symphony has or may acquire in the future relating in any way to any event, circumstance, action
or failure to act from the beginning of time to the date of this Agreement.
o HC/j s[ Agreements\S ymphony4.Agr]
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9. Costs and Expenses.
Symphony agrees to pay on demand all out-of-pocket costs and expenses of Agency,
including the fees and out-of-pocket expenses of counsel for Agency, in connection with the
administration, enforcement, or protection of Agency's rights under this Forbearance Agreement
andlor the Note and other Loan Documents.
10. No Oblie:ation to Extend Future Forbearances: No Waiver.
Symphony acknowledges and agrees that Agency is not obligated and does not agree to
extend any other or future forbearances except as expressly set forth herein. This Agreement shall
not constitute a waiver by Agency of any of Symphony's defaults under the Note and other Loan
Documents. Except as expressly provided herein, Agency reserves all of its rights and remedies
under the other Loan Documents. No action or course of dealing on the part of Agency, its officers,
employees, consultants, or agents, nor any failure or delay by Agency with respect to exercising any
right, power or privilege of Agency under the Loan Documents or this Agreement, shall operate as
a waiver thereof, except to the extent expressly provided herein.
11. No Oblie:ation to Make Further Advances.
Symphony acknowledges and agrees that Agency is under no obligation to advance any
additional credit to Symphony.
12. Governin~ Law.
This Agreement shall be governed by and construed in accordance with the laws of the State
of California.
13. Amendments.
This Agreement cannot be amended, rescinded, supplemented or modified except in writing
signed by the parties hereto.
14. Complete A~reement.
THIS AGREEMENT contains the entire agreement of the parties and supersedes any other
discussions or agreements relating to the subject of this Agreement.
/II
/II
D HC/js[ AgreementslS ymphony4.Agr ]
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15. Time of the Essence.
TIME IS OF THE ESSENCE OF THIS AGREEMENT.
IN WITNESS WHEREOF, the parties hereto have executed this agreement on the day and
date first shown above.
AZ"
7'&~ ~,/
By: Syetary
Approved as to form
and legal content:
l)~!/~
Agency C sel
D HC/js[ AgreementslSymphony4 .Agr]
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alles, Chairperson
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