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HomeMy WebLinkAbout1989-482 1 2 3 4 5 6 7 8 RESOLUTION NUMBER 89-482 RESOLUTION OF THE CITY OF SAN BERNARDINO AUTHORIZING AND DIRECTING THE EXECUTION OF A SMALL BUSINESS LOAN AGREEMENT BETWEEN THE CITY OF SAN BERNARDINO AND SAMUEL'S AUTO WORKS. BE IT RESOLVED BY THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO AS FOLLOWS: section 1. (a) The Mayor of the City of San Bernardino is hereby authorized to execute, on behalf of the city of San Bernardino, a loan agreement with Samuel's Auto Works, which loan agreement is 9 10 reference as though fully set forth at length. 11 attached hereto as Exhibit "I" and is incorporated herein by The agreement provides for the loaning of funds from the small business loan 12 program in the amount of $50,000.00. 13 (b) The authorizations to execute the above referenced 14 agreement are rescinded if the parties to the agreement fail to 15 execute same within sixty (60) days of the passage of this 16 resolution. 17 I HEREBY CERTIFY that the foregoing resolution was duly 18 adopted by the Mayor and Common Council of the City of San 19 Bernardino at a rpQ'llliir 20 4th day of December 21 wit: 22 IIII 23 IIII IIII 24 IIII IIII 25 IIII IIII 26 IIII IIII 27 IIII IIII 28 11-28-89 meeting thereof, held on the , 1989, by the following vote to IIII 1 1 2 3 4 5 6 7 8 9 f 10 11 RESOLUTION OF THE CITY OF SAN BERNARDINO AUTHORIZING THE EXECUTION OF A SMALL BUSINESS LOAN AGREEMENT WITH SAMUEL'S AUTO WORKS AYES: Councilpersons Reillv. Flores. Maudslev Minor. PODe-Ludl~m Miller NAYES: None ABSENT: Nnnp A!h4m/A:;);~/ / CITY CLERK The foregoing resolution is hereby approved this ~C~ day December , 1988. 12 13 Approved as to form and legal content: 14 JAMES F. PENMAN 15 City Attorney 16 BY, }~- 11."",,-- 17 18 KJH1lab/0681 19 attachment 20 21 22 23 24 25 26 27 28 11-28-89 2 ,\.1."" . ,-+, " . ~. .. ~..'~~~.* ...,,-:,-',"<j;.',:~~~ ~'l."lm."" "'''^<~'''~ ,~..: ......,.,. ..~"'. - '-~ ',\.~..~ " " ,-;,-, "" ~'~:;"-:'7.. ~ -. . _ ."-,.,, : ~, "..~~~, ... Fr.1";l CITY or 8U BP1DRDllIO COJOrolfI'l'Y DBVBLOPXDI'f D8PARTJIBft "800nomio Development proqraan ( IDB-rinanoe4) BORROWER: PROJECT TITLE: Relocation and Installation of Eqai.-nt SAJmEL'S AUTO 1lOIlXS (Itr. S.....el JohnSOD)(Hrs. Joan V. Johnson) PROJECT ADDRESS: 2192 Vest Highland Avenue San Bernardino, California 92401 LOAN IS NUMBER CONTRACTS. 89-475 OF COMMUNITY DEVELOPMENT KJHjlabj0256 JaIIIBIT "I" S.CtiOD ~m~.r SBCTION I S10l. S102. S103. S104. S105. SBCTION II S20l. S202. 8203. 8204. SECTION III S301. 8302. 8303. 8ECTl:OH IV 8401. 8402. 8403. 8404. "" .~:t:..' ,',. 'lABLI 01' QQ_I.-I. Titl. PARTIBS, TBRN, COJIDITIONS PRECBDBft AJID IJlDBPBJlDBN'1' STATUS Parties to the Agreement Representatives of the Parties and Service of Notices Term of this Agreement Conditions Precedent Independent Contractor Status of the Borrower PURPOSB 01' AGREBMBNT AJID LOU, LOU TBRIIB, AJID PROMISSORY NOTB Purpose of the Agreement Purpose of the Loan Terms of the Loan Promissory Note REPRESBNTATIONS AJID COVBlfANTS 01' BORROWER, AJID DBFAULT Representations of the Borrower Covenants of the Borrower Default REPORTS, RECORDS AJID AUDITS Reporting Requirements Maintenance of Records Audits and Inspections Validity of Financial Documentation Submissions i ~ ~':~l ,_.~;,..... ",it: ',""~""""".. " ~-""_"ll'''~~~~' . ~ 2 2 3 3 3 4 4 4 5 6 7 8 10 10 11 11 i Seotion Nllm"ker 5405. 5406. SECTION V 5501. 5502. 5503. 5504. 5505. 5506. 5507. 5508. 5509. 5510. 8511. 8512. 8513. 5514. 8515. 5516. 5517. 5518. 5519. ,.... . c. . ~. .~. .:.<',+.,~ " 'k- ':;'t' . :~,' ,~'::)", - . .' ," - <. ... .-~,....., ,ABU OJ' CONTINT8 (Cont...) Title ZAgt Release of Funds from Escrow 11 Reconveyance Fee 12 GENERAL TERMS AND CONDITIONS Indemnification and Insurance Requirements Prohibition Against Assignment Limitation of Corporate Acts Amendments and Waivers 12 13 13 14 14 14 16 16 16 16 16 17 Plan Compliance with 5tatutes and Regulations Conflict of Interest Political Activity Prohibited Lobbying Prohibited Installation of Financial Assistance Sign Press Releases Discrimination Prohibited Nondiscrimination, Equal Employment Practices, and Affirmative Action Employment Opportunities for Business and Lower Income Persons 17 Participation of Minorities, Women and 5mall Businesses 18 Captions Effect of Legal JUdgment Choice of Law Governing this Agreement Prohibition of Legal Proceedings Rights and Remedies 18 18 19 19 19 11 " l . . . SeotiOD WlJM1\er SICTION VI 8601. S602. KJH/lab/0257 !'ABLI 01' OOIl'l'BIl'l"(CoDt...) '-' ,~ , 'f: i:'-~ fill.. BNTIRB AGREEMENT Complete Agreement Number of Pages and Attachments Execution (Signature) Page ATTACHKBN'l'S Attachment I -- Employment Action Plan Attachment II -- Insurance Requirements Hi >', '.- -,\r}_:\~, ~...' . <'t~';,:. ha 19 19 19 "~.,;~,'- 0,- --'~~, ;k.,..., "'~'~_,.'" ,',:::.h ..~,,~...::-' ',~:'!,H'"",.. ,..,,,..:-~~.' -'J":, AORE~N'l' HUJUl.. 89-475 (IDB-l'iDaDCled) BETWEEN THE CITY OF SAN BERNARDINO AND THE 8AKDU.' a ADrO WIlD (Mr. 8a.uel Johnaon) (Mrs. Joan V. Johnson) (RELATING TO) THE PROJECT Relocation and Inatallation of Equi~t ------------------------------------------------------------------ THIS AGREEMENT is made and entered into by and between the City of San Bernardino, a municipal cOfPoration, hereinafter call "City", and Mr. 8_1 Johnaon. elba. 8....,1 a Auto Worb and Joan V. Johnso,n hereinafter called the "Borrower". Jf.llH.lJlJl.l%B WHEREAS, the City has entered into a Grant Agreement with the United States Department of Housing and Urban Development, hereinafter called the Grantor, pursuant to Title I of the Housing and Community Development Act of 1974, as amended, hereinafter referred to as HCDBG, to address the community development needs of the City; and WHEREAS, the Community Development Department, hereinafter called the "COD", has been designated by the'City to provide for proper planning, coordination and administration of the City's pro- graas as described in the city's Grant Agreement with the Grantor, and of certain projects funded by the City; and WHEREAS, the COD cooperates with private individuals and organizations, other agencies of the city and agencies of other governmental jurisdictions in carrying out certain functions and programs which are its responsibility; and WHEREAS, the Small Business Revolving Loan Fund program has been established by the City as part of a City of San Bernardino Economic Development Program ("EDP"), and has been approved by the San Bernardino Mayor and Common Council; and WHEREAS, the project which is the subject of this agreement meets the requirements of the above described program; and WHEREAS, Borrower has applied to the City for a loan to help finance the project; and WHEREAS, the City is willing to lend monies to the Borrower on the terms and conditions set forth herein; NOW, THEREFORE, in consideration of and in reliance upon the foregoing and upon the covenants, agreements, representations and warranties herein contained, the City and the Borrower agree as follows: 1 fl"; '~"',.' ~~'~. "', ':l''''"-''~'' ',( .....0... 1fi. '. ,..,..~,~ ,.' '''''. '. -): .' '" '..~ 1."\.' '~y- . ". ........-- ,.'..."" . . .' _ . . .. . ,"., . S.~I:OH I. PAR~IES. TERM. CONDITIONS PRECEDE~. AND INDEPENDE~ STATUS S101. Partie. to the Aareement. The parties to this Agreement are: 1. The City of San Bernardino, a municipal corporation, having its principal office at 300 North "D" Street, San Bernardino, California 92418. Joan V. Johnson . The Borrower, S8Imel B. John80D, dba. S_l I Auto Workl , having its principal address at 2192 Velt Highland Avenue San Bernardino, California, 92411 2. The Borrower is ( a) lole proprietorship (fictitious name enterprise, individual, California Corporation/general partnerShip/limited partnership.) S102. ReDresentatives ot the Partie. and Serviae ot Hotiaes. The representatives of the respective parties who are authorized to administer this Agreement and to whom formal notices, demands and communications shall be given are as follows: 1. The representative of the City shall be, unless other- wise stated in the Agreement: Hr. Kenneth J. Henderson, Direator Community Development Department 300 Horth' "0" Street,- 1'1fth uJ'l'oor San Bernardino, CA '2418-0001 2. The representative of the Borrower shall be: 1Ir. S_el B. Johnson/Mrs. Joan V. Johnson dba. S_l's Auto Worka 2192 West HiRhland Avenue SaD Bernardino. California 92411 J. Formal notices, demands and communications to be given hereunder by either party shall be made in writing and may be effected by personal delivery or by registered or certified mail, postage prepaid, return receipt reques- ted and shall be deemed communicated as of the date of mailing. 4. If the name of the person designated to receive the notices, demands or communications or the address of such person is changed, written notice shall be given, in accord with this section, within five (5) working days of said change. 2 ,'" >' J-.--.1.-~?" -"--'-~-"'.r ..' """."'......, " , ,.". "'""... .~~ ',,","'-~', ..~~ .-7':,.:,'-.f>.'{"'7'-'._ ,_:" 8103. Term of this Aareement. Thi= Agreement shall remain in full force and effect from the date of execution by Borrower of the Promissory Note, until such time as said Promissory Note is paid according to its terms, subject to the provisions of S303 herein. 8104. Conditions Preoedent. A. Prior to the execution of this Agreement, the Borrower shall submit to the City for approval in writing an Affirmative Action Program Plan in accordance with Section 512 herein. B. In the event that Borrower is a corporation, then prior to the execution of this Agreement, the Borrower shall provide the City with copies of the following documents: 1. Borrower's Articles of Incorporation, and all amendments thereto, as filed with the Secretary of State. 2. Borrower's By-Laws, and all amendments thereto, as adop- ted by the Borrower and properly attested. 3. Resolutions or other corporate actions of the Borrower's Board of Directors, properly attested or certified, which specify the name(s) of the person(s) authorized to obligate the Borrower and execute contractual documents. 4. Certificate of Good Standing from California Secretary of State. C. In the event that Borrow.r~is a partnership, then prior to the execution of this Agreement, the Borrower shall provide the City with copies of the Borrower's Partnership Agree- ment, and evidence of filing thereof with appropriate filing official. D. In the event the Borrower is an individual doing business under fictitious name, a copy of the Fictitious Name state- ment and evidence of the proper filing thereof. 8105. Independent Contractor status of the Borrower. The parties agree that the Borrower is an independent con- tractor and that no employees of the Borrower have been, are, or shall be employees of the City by virtue of this Agreement, and the Borrower shall so inform each employee organization and each employee who is hired or retained by it. SECTION II. PURPOSE OF AGREEMENT AND LOAN. LOAN TERMS. AND PROMISSORY NOTB 3 '....., ::"!.." '-'f~,., "~ :"~. ~" ',~ '" '. . . ,~- .,.., .... .- . -.- '~'~"'!"'ii._' ~ '",,,,. '-'~" ~~ ...,,;.;' .... --' .,,','- 4"~" ,,-';_ -. .", __U~~ '.' -'. . >'_ t.,'. '_~.:.. ... .'-' . "', ~~._ .' '"',~ _e, F" 8201. Purtlo.. of the ]lar..m.nt. The purpose of this Agreement i. to provide FDnTrROU&Um ARB 00/100-----____________________________________________----~llar. ($50.000.00 ) ot EDP funds to be loaned by the City to the Borrower, hereinatter called the "Loan", tor the purpose and under the terms and conditions set forth herein. 8202. Purtlose ot the Loan. The purpose of the Loan is to provide tinancial assistance to enable the Borrower to: Finance the relocation and installation of heavy dnty eqnip.ent to the co.paDy's new facilities. 8203. Terms ot the Loan. A. The City agrees to lend the Borrower, and the Borrower agrees to borrow from the City, an amount not to exceed 1l'TVn' TROOSAlm AIIIl 001100-------------------- DOLLARS, ($ 50,000.00 ), such transaction hereinafter referred to as the "Loan". The Loan is to be evidenced by, and lIIade against delivery of a Promissory Note executed by the Borrower, hereinafter called the "Note" and by this reference incorporated herein. B. The Note shall (a) be dated as of the closing, (b) bear interest on the unpaid principal at the rate of eight percent ( !IX ) per annum, (c) be for a term of ten ---------- (10) years, and (d) provide for payment of the principal amount thereof and the interest thereon in ninty-six---------------- (96 ) equal monthly installments of SIX-mnmRKD, SIX IJULLAIlli 64 100------------------------------------_______________-DOLlJURS ($606.64 ), each including principal and nterest, and continuing until said principal and interest are paid in full. C. Each monthly installment shall be applied first to the payment of interest then accrued to the date the payment is 4 l , I T_.,;: . ~~~-~V"" ~\f< . '''''1>:'''.'' . , ....- ,.-- o. _.. . (':.:~ . .1\\, ..... ','" . ."';'\S'\ _. .,- . '. - , .<_~ ._'n .~- _ ' '-' "'. '," . -'" .. ~ ...."" ""M; V""':' "'''''~ ',~ ~. "'c. '~ .~;,_~~^,.i:~'),':?;--'.;' "'..')01!;T. ~. ,,_.'. - '. received, and the balance, if any, to the reduction of the principal. 8204. PromissorY Hote. A. The obligation of the City to make the Loan is subject to receipt by the City of the Note and, at the City'. 801e discretion, to the following additional condition. prece- dent: 2. Ilquip.ent (c.-ercial) _rket value eBt~ted at $85,000.00. C. Borrower shall have the right, without penalty, to prepay the Note together with the accrued interest thereon as of the date of such prepayment. D. The Borrower acknowledges and agrees that the amount being provided under this loan shall be for a total of FIFTY THOUSAND and 00/100------------------_____________________ DO~, ($ 50,000.00 ), and that no additional funds to cover addi- tional projects costs, anticipated or unanticipated, incur- red as a result of cost overruns or expenses in financing this project, are available under this Agreement. SECTION III. 5 r-:.-.,.~,.~:" '1J4~:. ,- ..-<:-.,-.... .~"". ,~:""" . .. . .-'.. ", . . . .' ;"S' 0 .; , -'~..",\' .. C'_";,,..L,',*, ~~4"'...;.h. ~~~~_ ;..~'.:' :-,--"_-.:-'i(:"':'~~_""'" __!~...r_ - RJ!PRB8BNTATION8 AIm COVBnNT8 OJ' BORRon.. AND DBP1UL'f 8301. ReDre.entation. of the Borrower. To induce City to enter into this Agreement, Borrower cove- nants and represents to City that: 1. The execution, delivery and performance of the Note and this Agreement by Borrower have been duly authorized by Borrower. This Agreement constitutes a legal, valid and binding obligation of Borrower, enforceable in accord- ance with its terms. The execution and delivery of this Agreement and the note, and consummation of the transac- tions herein contemplated, will not conflict with, or result in a breach of, any of the terms, provisions or conditions of any indenture, contract, instrument or agreement, including any partnership agreement, to which Borrower or any of its officers is a party. No appro- val, consent or authorization of any governmental authority is necessary for the execution, delivery or performance by the Borrower of this Agreement or of any of the terms and conditions. 2. Borrower has good and marketable title to the real pro- perty identified in S204B of this Agreement, located at 12 !l Pico .\venue. San, BernardiDo, CA 92405 , San Bernard1no, Cal forn a, and t is free and clear from all liens except as set forth herein: T-rial Thrift 20812 Ventura Boulevard Woodland Bills, CA91634,-_ 3. Borrower is in compliance with all applicable statutes, laws, regulations, and executive orders of the United States of America and all states, foreign countries, other governmental bodies and agencies having jurisdic- tion over its business or properties, including (without limitation) all tax laws and Borrower has not received notice of any violation of such statutes, laws, regula- tions or orders which have not been remedied prior to the date of this Agreement. Borrower possesses all licenses, tradenames, trademarks, and permits as are required for conduct of its business without conflict with the rights of others. D. There is not pending or threatened against Borrower, or any of its officers, any actions, suits, proceedings or investi- gations at law or in equity or before or by any Federal, state, municipal or governmental department, commission, board, bureau, agency or instrumentality which, if deter- mined adversely, would be likely to have a materially ad- verse effect on the business or properties of Borrower. E. Each and every financial statement, document and record 6 ~'.::"'. -,.." .;t!ll~;~.. ,.- ,'- ."!"'".'...... '-,--'.., _~ ~*~ ,:~::.;~_'_.~- ':.0." ~'.":'V''''''''' '. ~f-._.,_~j '-",_ '~_~:'j~."'1"" . ""', \ . ;'.~~.*;.~,,~~-y~: }.~I: delivered by Borrower to the City in connection with thia Agreement and the proposed transaction hereunder is a true and complete copy of said financial statement, document or record, and fairly and accurately reflecta the information it purports to portray. There has been no change in the condition, financial or otherwise, of Borrower as shown in the tinancial statements dated JUDe 30. 1989 , except changes in the ordinary course of business, none of which, individually or in the aggregate, has been materially adverse. 8302. Additional Covenant. of the Borrower. Borrower covenants and agrees that, from the date hereof, until payment in full on the Note and the interest thereon, that it will: 1. Pay the principal and interest on the Note according to its terms. 2. Pay any other amounts that may be due or become due and owing to the city under or pursuant to the terms of this Agreement or the Note. 3. Execute and deliver all instruments, and perform such acts, as the City may reasonably deem necessary or de- sireable to confirm and secure to the City all rights and remedies conferred upon the City by the terms of this Agreement and Note. 4. In the event that Borrower shall grant the. CitY.lL.Se~. _.. curity interest inRea~-Property as collateral under S204 (B) herein, then. Borrower agrees to maintain at .. ----- - --. Borrower's sole expense a policy of title insurance coverage equal to the amount of the loan. 5. Give notice to the City of any event that constitutes an Event of Default as set forth in Section 303 of this Agreement or that would, with notice, or lapse of time or both, constitute an Event of Default under this Agreement. Notice shall specify the nature of such Event of Default. 6. Not enter into any agreement or other commitment the performance of which would constitute a breach of any of the covenants contained in this Agreement. 7. Use the Loan proceeds only for the purposes stated in this Agreement and for no other purpose or purposes. 8. Observe all applicable federal, state and local statutes and regulations as well as City of San Bernardino Ordi- nances as further defined and set forth in Section 505 of this Agreement. 7 -'K"'. . 1"::...___:- '.:',.7 "'..~'~-"^,.b ....;,.,...._..;0".,.../:<-._ ,..,~. ..... . {':':""'to: , .. ....-.~--"l>.!-.....~ f.,~,,: -Coo.-: .,.......,~~...~". " ..,~. i.;~i._~ ,.,,:~~~.~ 9. In the event that Borrower is a corporation, then Bor- rower shall do or cause to be done all things necessary to preserve and keep in full force and efrect its corpo- rat& existence, riqhts and franchises. 10. Not violate any laws, ordinances, qovernmental rules or regulations to which it is subject and not fail to ob- tain any licenses, permits, franchises or other qovern- mental authorization necessary to conduct its business, which violation or failure to obtain miqht have a mate- rial adverse effect on the business, prospects, profits or condition (financial or otherwise) of Borrower. 11. Submit an Annual Employment Report on or before the fif- teenth (15th) day of June for the year..(s) 1990-2000 . The Annual Employment Report shall de- tail Borrower's compliance with the Employment Action Plan, Attachment I attached hereto and by this reference incorporated herein, for the precedinq twelve (12) month period. 12. Maintain adequate insurance with respect to the col- lateral and the (proprietorship, partnership or cor- porate) business which is the subject of this Aqreement, with reputable insurance companies. The Borrower shall maintain insurance in such amounts and aqainst such risks as is customary with companies in the same or similar business: in addition, said insurance cover- aqes(s) shall be in accordance with the qeneral insur- ance provisions of this Aqreement as specified in S501B.5, includinq fire, hazard and qeneral comprehen- sive liability insurance, worker's compensation, con- struction/rehabilitation liability, to protect such business and-all-propeftyus8curihq thencity's loan. Said insurance shall be maintained throuqhout the term of this loan. The City shall be named as an additional insured, and the policy or policies shall not be subject to cancellation, reduction or nonrenewal without thirty (30) days prior written notification to the City Attor- ney by certified mail. 13. Pay all indebteness and obliqations promptly in accord- ance with normal terms and promptly pay and discharqe or cause to paid and discharqed all taxes, assessments and qovernmental charqes or levies imposed upon it or upon its income and profits or upon any of its property, real, personal or mixed, or upon any part thereof, re- spectively, before the same shall become in default. 8303. Default. A. The entire unpaid principal of the Note, and interest then accrued thereon, shall become and be forthwith due and pay- able upon written demand by the City or the City's assiqns, without any other notice or demand of any kind or any pre- 8 .."~~~~~'1 '$ .' ~f~":' ~..' ..,~. _, ,'" ...._ . . " "1.'::_ U' W,~;,?~:,!"",,~~~~ .. .'>C, J sentment or protest, if anyone of the followin9 events (herein called an "Event of Default") shall occur and be continuing at the time of such dem~nd, whether voluntarily or involuntarily, or, without limitation, occurring or brought about by operation of law or pursuant to or in compliance with any jUdgment, decree or order of any court of any order, rule or regulation or any governmental body, provided however that such sum shall not be payable if Borrower's payments have been expressly extended by the City or the City's assigns. "Events of Default" shall include: 1. Payment of any installment of principal or interest on the Note is not paid when due and such payment remains unpaid for thirty (30) days. 2. Borrower fails to pay when due, or declared due, the obligations secured under this Agreement. 3. Borrower fails to perform or comply with any terms, conditions, or covenants as provided in this Agreement or in any instruments securing or related to this Agree- ment. 4. If any representation or warranty made by the Borrower in this Agreement shall prove to be untrue in any mate- rial respect, or if any report, financial statement or financial schedule or other instrument delivered under or pursuant to this Agreement or the transactions con- templated herein, to the City or to any other holder of the Note shall prove to be untrue in any material re- spect as of the date as of which made. 5. A court-enters a decree or order for relief in respect of the Borrower in an involuntary case under any appli- cable bankruptcy, insolvency or other similar law now or hereafter in effect, or appoints a receiver, liquidator, assignee, custodian, trustee, sequestrator (or similar official) of the Borrower or for any substantial part of its property, or orders the winding up or liquidation of its affairs and such decree or order remains unstayed and in effect for a period of sixty (60) consecutive days. 6. The occur~ence (i) of Borrower's becoming insolvent or bankrupt, or ceasing, being unable, or admitting in writing its inability to pay its debts as they mature, or making a general assignment for the benefit of, or entering into any composition or arrangement with credi- tors; (ii) of proceedings for the appointment of a re- ceiver, trustee or liquidator of Debtor, or of a sub- stantial part of its assets, being authorized or insti- tuted by or against it; or (iii) of proceedings under any bankruptcy, reorganization, readjustment of debt, insolvency, dissolution, liquidation or other similar law of any jurisdiction being authorized or instituted 9 -'~l"_ . :;o.;y,' .. - . . ..,.,;"'...., ....,~;.. '.- .r ,1:' _~t~_. "-.4-i:1':;:>'.:..c - _ ~~ '. . . _ .'I", _ ..-' by or against the Borrower. 7. A ce~sation or substwntial reduction ot operations in the business which is the subject ot this Agreement under circumstances indicative to the City ot a lack ot intention or ability to provide continuing employment and economic benefits for the area in which the business is located. 8. Failure to submit the Annual Employment Report referred to in 8302(12) within ninety (90) days ot the scheduled due date for said Report. 9. The loss, theft, substantial damage, destruction, aban- donment, sale or encumbrance to or of any ot the colla- teral securing payment of the Note, in any manner not fully covered by insurance, or the making ot any levy, seizure or attachment thereof or thereon. B. If Borrower shall at any time default in making any payment of principal or interest on the Note, Borrower shall to the full extent permitted by law, pay to the city or other holder of the Note, in addition to any other amounts that may be due from Borrower to such holder, an amount equal to the reasonable costs and expenses incurred by such holder, in its efforts to protect its collateral, secure payment, or otherwise defend its interests hereunder in any judicial or administrative proceeding. SBC'rION IV. REPORTS. RBCORDS AND AUDITS .- S401. ReDortina Reauirements. A. At such times and in such forms as the City may require, there shall be furnished to the City such statements, records, reports, data and information as the City may request pertaining to matters covered by this Agreement. B. Borrower will provide its financial and accounting state- ments to the City for the periOd ending Decesber 31. 1990 and annually thereafter during term of this Agreement, but not later than three (3) months following the expiration of any such periOd, and at each other time and in such form as the City may prescribe. 8402. Maintenance ot Records. A. Records, in their original form, shall be maintained in accordance with the requirements prescribed by the Grantor and the city with respect to all matters covered by this Agreement. Such records shall be retained for a period of six (6) years after termination of this Agreement and after all other pending matters are closed. "Pending Matters" in- 10 S403. S404. .~:..""..,. ',.i~'~v.., "'~: <,.,:, ~",', ,"" _<A '. '~ !~~-'-~;, '-,. ~.'"- :~./~' '~~~:'.,j- j,..,'r"': :'~;- .. B. elude, but are not limited to, an audit, litigation, or other action. involving record.. The city aay, at it. di.- cretion, take possession of and retain said records. Records in their original form pertaining to matter. covered by this Agreement shall at all times be retained within the City of San Bernardino, or some other location specifically authorizing in writing by the Director of Community Develop- ment, unless authorization to remove them is granted in writing by the city. AUdits and InsDections. A. At any time during normal business hours and as often as the Grantor, the U.S. Comptroller General, Auditor General of the State of California or the City may deem necessary, the Borrower shall make available to the City for examination, all of its records with respect to all matters covered by this Agreement. The city, AUditor General of the state of California, Grantor, and the U.S. Comptroller General shall have the authority to audit, examine and make excerpts or transcripts from records, including all contracts, invoices, materials, payrolls, records of personnel, conditions of employment and other data relating to all matters covered by this Agreement. B. The city shall have the authority to make physical inspec- tions and to require such physical safeguarding devices as locks, alarms, safes, fire extinguishers, sprinkler system, etc., to safeguard property and/or equipment funded or secu- red by this Agreement. N.otwithstanding such. -inspection authority, BQrrower ..J.s.soleY:--Xespon.i-bl~~ -t:he--pl'OV.ls-ion ~"-- c:.--- of security-and .foX'. the safe guarding of the business and its property. Validitv of Pinancial Documentation SUbmissions. Financial reports required to be prepared and sUbmitted by the Borrower to the City shall be accurate and correct in all respects. S405. Release of Punds from Escrow. A. All loan proceeds shall be deposited into an escrow account with an escrow company designated by the city. DiSbursement of funds shall be jointly authorized by the Borrower and the City. Each disbursement shall be in accordance with 8202 "Purpose of the Loan" and shall be properly supported by invoices, vouchers, executed payrolls, time records or other documentation evidencing an expenditure and/or encumbrance of funds. B. The costs associated with the loan such as escrow fees, credit reports (TRW), Title Reports, or other similar costs shall be delineated in the escrow instructions and disbursed 11 .~,,,,~.l!~" \;...,..~ .4~~~~",;,~,,_~~ from the loan proceed. upon opening of the e.orow aocount. 8406. ~onv.vance ~ee In the event that real property i. used to .ecure this Loan, then Borrower agrees to pay any costs incident to title re- conveyance, including, if applicable, trustee'. tee., attor- ney fees, document preparation fees, recording te.. or any other related expenses. 8BCTION V. GBNERAL TBRM8 AND CONDITION8 8501. Indemnification and Insurance Reauirement.. A. Indemnification: The Borrower undertakes and agrees to defend, indemnify and hold harmless the City and any and all of the City's offi- cers, agents, employees, assigns, and successora in interest from and against all suits and causes of action, claims, cost of litigation, damage or liability of any nature what- soever, for death or injury to any person, including Bor- rower's employees and agents, or damage or destruction to any property of either party hereto or third persons in any manner arising by reason of or incident to the performance of this Agreement on the part of the Borrower or subborrower any tier whether or not contributed to by any act or ommis- sion, active or passive, negligent or otherwise, except for the sole negligence of the City, or the sole negligence of any of the City's officers, agents or employeelLo~_~ity ap- proval of the Borrower..!..s pertormance,~or failure to object, shall be no defense to Borrower concerning its undertaking herein to defend and indemnify city and others. B. Insurance: 1. The Borrower shall provide and maintain at its own ex- pense throughout the term of this agreement the insur- ance requirements specified herein. EVidence of insur- ance shall be submitted for approval by the City. The City special endorsement forms, referenced hereto and incorporated by reference, are the preferred form of evidence of insurance. Alternatively, Borrower may submit two (2) certified copies of the full policy con- taining the appropriate cancellation notice language and additional insured/loss payee language as specified. 2. No release of funds from the Escrow Account shall be made to the Borrower until such time as the Borrower has complied with all insurance and bonding requirements under this Agreement. The City's Additional Insured Endorsement form, or a form approved by the City, stat- ing that the Borrower is so insured, must accompany any 12 . "".~., ........'-,...... :k wt:~ ~.. ......... "......,.... ~>,../:.;.."..t.. "', _,~, tt~~.'c"'". _ '~'i~ "~ ,'_,:?~":..:':'.. ,. 0..) _ _. ",-...,-, ..', demand for funds unless said form has been previously submitted and approved by the City. (Certification of insurance shall be procured, filed and approved in strict compliance with City rules and regulations.) 3. With respect to the interests of the City, such in surance shall not be cancelled, reduced in coverage or limited or non-renewed, except after thirty (30) days written notice by receipted delivery has been given to the Office of the City Attorney, city Ball, 300 North "0" Street, San Bernardino, CA 92418-0001. Policie. of insurance and fidelity bonds, except for policies cover- ing Worker's Compensation and Employees' and Volunteer's OWned and/or Leased Vehicles, shall name the city as an Additional Insured and said endorsements or other evi- dence of insurance shall so indicate. Fidelity bonds shall name the City as loss payee or additional insured. In the event of any cancellation, non-renewal, reduction or limitation of coverage, or notice that such will be effected, City may, but is not required to, obtain insu- rance to protect its interests, in which event the cost thereof shall be reimbursed by Borrower forthwith. Any failure to forthwith reimburse such expense shall con- stitute an Event of Default. 4. The City reserves the right at any time during the term of this Agreement to change the amounts and types of insurance required hereunder by giving Borrower ninety (90) days written notice. 5. The Borrower shall maintain minimum insurance coverages prescribed in Attachment II of this Agreement, which by this' reference is incorporatedHherein~-----~"~~-" 8502. PrOhibition Aaainst Assianment. A. The Borrower shall not assign this Agreement, nor assign or transfer any interest or obligation in this Agreement (Whe- ther by assignment or novation) without prior written con- sent of the City. No part of the property securing this Agreement shall be assigned or transferred (except sales of inventory in the ordinary course of business), nor shall such property be pledged, without the prior written consent of City. B. The Borrower shall not enter into any agreement with any other party under which such other party shall become the recipient of claims due or to become due to the Borrower from the City without prior written consent of the City. 8503. Limitation of Coroorate Acts. In the event that Borrower is a corporation then the Bor- rower shall not amend its ArtiCles of Incorporation or By- Laws, move to dissolve, transfer any assets derived from 13 ,.;-~,;k!"","~'''. . -"~'. ,-. ".~!f] .'~ ~,'" ~._,.<:.." "~.~~;"i-~~'_ "" ':-'7 _ _'~<);~.~~'_ .".;-. .",.;..~~.._~..._' funds provided under this Agreement, or take any other steps which may materially affect its operations within the per- formance of this Agreement without first notifyinq the City in writing. The Borrower shall notify the City immediately in writing of any change in the Borrower'. corporate name. 8504. Amendment. and Waiver.. This Agreement may not be changed or amended orally, and no waiver hereunder may be oral, but any change or amendment hereto or any waiver hereunder must be in writing and signed by the party or parties against whom such change, amendment, or waiver is sought to be enforced. 8505. ComDlianoe with 8tatute. and Reoulation.. A. The Borrower warrants and certifies that in the performance of this Agreement, it shall comply with all applicable staa- tutes, rules, regulations and orders of the United State., the State of California, the County and City of San Bernar- dino, including laws and regulations pertaining to labor, wages, hours and other condition. of employment and the City's anti-discrimination provisions and Affirmative Action Plan which by this reference is incorporated herein. Bor- rower further warrants and certifies that it shall comply with new, amended, or revised laws, regulations, and/or procedures that apply to the performance of this Agreement, upon being provided notice thereof. Borrower covenants that the DaviS-Bacon Act as amended, the Contract Work Hours and Safety Standards Act, and the Cope- land "Anti-Kickback Act" shall be a part of all construction' contracts awarded by the Borrower -pursuant -';0 - this .Agreement and all sub contracts thereto. ~ ~ 850&. Confliot of Interest. A. The Borrower covenants that none of its directors, officers, employees, or agents shall participate in selecting subcon- tractors, or administerinq subcontracts supported (in whole or in part) by Federal funds where such person is a direc- tor, officer, employee or agent of the subcontractor, or where such person knows or should have known that: 1. A member of such person's immediate family , or partner, or organization has a financial interest in the subcon- tract; 2. The subcontractor is someone with whom such person has negotiated or is negotiating any prospective employment, or; 3. The participation of such persons would be prohibited by the California POlitical Reform Act, California Govern- ment Code Section 87100 et seq., if such person were a 14 .... ..... '.~..rj:1O: "~~:P 'a:'N,~~;'~";i:t,f.~t:... "'_'''.\'~..J:t;~:l.fj.''(.'.''~<-~'''>"";::,,,~~_ -.: public otticer, because such person would have a .tinan- cial or other interest. in the subcontract. B. Detinitions: 1. The term "immediate tamily. includes, but is not limited to, those persons related by blood or marriage, such as husband, wite, father, mother, brother, sister, son, daughter, father-in-law, motherin-law, brother-in-law, son-in-law and daughter-in-law. 2. The term "tinancial or other interest" includes, but is not limited to: a. Any direct or indirect financial interest in the specific contract, including a commission or fee, a share of the proceeds, prospect of a promotion or future employment, a profit, or any other torm of financial reward. b. Any of the following interests in the subcontracting entity: partnership interest or other beneticial interest of five percent (5') or more of the stock; employment in a managerial capacity; or membership on the board of directors or governing body. This pro- vision shall not apply to serving on the board or governing body of a non-profit corporation for which no salary is paid or other compensation. C. The Borrower further covenants that no officer, director, employee or agent shall solicit or accept gratuities, fa- vors, or anything of monetary value, from an actual or po- tential subcontractor-,suppU.J.".,~=T.party tg... Bubaqreementi- ~ (or persons who are otherwise in a position to benefit from the actions of any officer, employee or agent). D. The Borrower shall not subcontract with a former director, officer, or employee within a one (1) year period following the termination of the relationship between said person and the Borrower. E. Prior to obtaining the City'S approval of any subcontract, the Borrower shall disclose to the City any relationship, financial or otherwise, direct or indirect, of the Borrower or any of its officers, directors or employees of their im- mediate family with the proposed subcontractor and its offi- cers, directors or employees. F. For further clarification of the meaning of any of the terms used herein, the parties agree that references shall be made to the guidelines, rules and laws of the city of San Bernar- dino, State of California, and Federal regulation regarding conflict of interest. G. The Borrower warrants that it has not paid or given and will 15 .,.-........-..~ ~.;.~~' . ,;~~,,' ~~~-~.:,'....\ .~~.-. . . . .'~(~. not payor give to any third person any money'or other con- sideration tor obtaining this Aqreement. H. The Borrower covenants that no member, officer, employee of Borrower shall have any interest, direct or indirect, in any contract or subcontract of the proceeds thereof for work to be performed in connection with this project durinq his/her tenure as such employee, member or officer or tor one (1) year thereafter. I. The Borrower shall incorporate the foregoing subsections of this section into every agreement that it enters into in connection with this project and shall substitute the tera "subcontractor" for the term "Borrower" and -Sub-contractor- for "Subcontractor". 8507. POlitical Activitv Prohibited. None of the funds, materials, property or services provided directly or indirectly under this Agreement shall be used for any partisan political activity, or to further the elec- tion or defeat of any candidate for public office. 8508. Lobbvincr Prohibited. None of the funds provided under this Agreement shall be used for any purpose desiqned to support or defeat any pend- ing legislation or administrative requlation. 850'. Installation of Pinancial Assistance Plan. The Borrower shall install, or cause.to be.installed, for public display.upon the projectiPremises asiqn, with desiqn approved by City, identifying the Borrower as receiving financial assistance from the City, if such a siqn is re- quested by the Director of Community Development Department. 8510. Press Releases. In all communications with the press, television, radio or any other means of communicatinq with the qeneral community, the Borrower shall make specific reference to the City of San Bernardino Community Development Department as the spon- soring agency of the project. 8511. Discrimination Prohibited. No person shall on the grounds of race, religion, ancestry, color, national origin, sex, age, or physical handicap, be excluded from participation in, be denied the benefit of, or be subjected to discrimination under this program/project. For purposes of this Section, title 24, Code of Federal Re- gulations Section 570.601(b) defines specific discriminatory actions which are prohibited and correction action which shall be taken in situations as defined therein. 16 ~-.- -." .-:-..... ,.,.... .'\, , ,~......, ,. . .... .,,-~ ..0<(,.. ~, ... 1,..:: 8512. Nondisorimination. Baual BaDlovmant Praotioa. and Affirma- tive Action Proaram. The Borrower shall comply with the nondi.crimination and affirmativa action provision. of the laws of tha United States of America, the State of california, and the city. In performing this Agreement, the Borrower shall not discri- minate in its employment practices against any employea, or applicant for employment because of person's race, religion, ancestry, color, national origin, sex, age or physical handicap. Any subcontract entered into by the Borrower re- lating to this Agreement, to the extent allowed hereunder, shall be subject to the provisions of this paragraph. 8513. BmDlovment ODDortunities for Business and Lowar rnooma Persons. Any project/program funded in part or in whole with Com- munity Development funds shall comply with the following provisions (referred to as a Section 3 clause:) 1. The work to be performed under this contract (Agreement) is on a project assisted under a program providing di- rect Federal financing assistance from the Department of Housing and Urban Development and is subject to the re- quirements of Section 3 of the Housing and Urban Deve- lopment Act of 1968, as amended, 12 USC l701u. Section 3 requires that to the greatest extent feasible, oppor- tunities for training and employment be given to lower income residents of the project area and contracts (agreements) for work in connection with the project be awarded to business concerns which are located-1n,-er---- _ owned -In .substantial part .by persons residing in the-. area of the project. 2. The parties to this contract (Agreement) will comply with the provisions of said Section 3 and the regula- tions issued pursuant thereto by the Secretary of Hous- ing and Urban Development set forth in Title 24 CFR, Part 135, and all applicable rules and orders of the Department issued thereunder prior to the execution of this contract (Agreement) certify and agree that they are under no contractual or other diSability which would prevent them from complying with these requirements. J. The Borrower will send to each labor organization or representative of workers with which he has a collective bargaining agreement or other contract or understanding, if any, a notice advising the said labor organization or worker's representative of its commitments under this Section J clause and shall post copies of the notice in conspicuous places available to employees and applicants for employment and training. 4. The Borrower will include this Section J clause in every 17 r<4~' -=~. "'~~~~/!,;'d.r j.-\.."" - 'l ..";f~:,<;~~,~,, ". ,.' .., ~- .' subcontract tor work" in connection with the project and will, at the direction of the applicant for or recipient of Federal tinancial assistance, take appropriate action pursuant to the subcontract upon a findin; that the sub- contractor is in violation of regulation. i.sued by the Secretary ot Housing and Urban Development, 24 CFR, Part 135. The Borrower will not subcontract with any subcon- tractor where it has notice of knowledge that the latter has been found in violation of regulations under Title 24, CFR 135 and will not let any subcontract unless the subcontractor has first provided it with a preliminary statement of ability to comply with the requirements of these regulations. 5. Compliance with the provisions of Section 3, the regula- tions set forth in Title 24 CFR, Part 135, and all ap- plicable rules and order of the Department issued there- under prior to the execution of the contract (aqreement) shall be a condition of the Federal financial assistance provided to the project, binding upon the applicant or recipient for such assistance, its successors, and as- signs. Failure to fulfill these requirements shall subject the applicant or recipient, its Contractors and subcontractors, its successors and assigns to those sanctions specified by the grant or loan agreement or contract through which Federal ass is tance is provided, and to such sanctions as are specified by Title 24 CFR, Part 135. 851.. ParticiDatioD of MiDorities. WomeD aDd 8mall BusiDesse.. To the fullest extent possible in the administration-of-this Agreement, Borrower agrees to provide opportunities for minorities, women and small businesses to participate in procurements under this Agreement. 8515. CaDtioDS. The section headings appearing herein shall not be deemed to govern, limit, modify or in any way affect the scope, mean- ing or intent of these conditions. 8516. Effect of Leaal JudameDt. Should any covenant, condition or provision herein contained be held to be invalid by final judgment in any court of com- petent jurisdiction, the invalidity of such covenant, condi- tion or provision shall not in any way affect any other co- venant, condition or provision herein contained. 8517. Choice of Law Governina this Aareement. This Agreement shall be governed by and construed in accord- ance with the laws of the state of California. 18 ,.,"..-..- -.~>>.:.-i";'. 8518. prohibitioB of L.a.l Proc..diBas. The Borrower is prohibited from using Grant funds received under this Agreement, or tunds realized a. a re.ult ot this Agreement, tor the purpose ot instituting legal proceeding. against the City or its otticial representative. 8519. Riaht. and Rem.di... In the event any party tails to perform, in whole or in part, any promise, covenant, or agreement heren, or should any representation made by it be untrue, any aggrieved party may avail itself to all rights and remedies, at law or equity, in the courts of law. Said rights and remedies are in addition to those provided for herein. 8B~1:0. VI. BN'1'IRB AGREEMENT. 8601. ComDlet. AareemeBt. This Agreement contains the full and complete Agreement bet- ween the two parties. No verbal agreement or conversation with any officer or employee of either party shall effect or modify any ot the terms and conditions of this Agreement. 8602. Nl1111her ot Paaes and Attachments. IIII IIII IIII IIII IIII IIII IIII IIII IIII IIII IIII IIII IIII IIII IIII IIII IIII IIII IIII This Agreement is executed in three (3) duplicate originals, each of which is deemed to be an original. This Agreement includes, TWENTY (__mooJ pages and TWO (2 ) attachments which constitute the entire-understanding and agreement of the parties. 19 " , , '1 IN WITNESS WHEREOF, the city of San Bernardino and thee Borrower have caused thi. Agreement to be executed by their duly authorized representatives en thia .,20f-/] day of -if ff.e rx. f/'(A..-J , 19 n. - ~ff'/?/h;6/'-;/ / C tl' Clerk AT'l'BSTI CITY O~ S~ BBRKlRDI ( CORPORA'l'IOB) BY~~~ Co ra Pre. dent ATTEST I BY Corporate Seoretary Approved a. to fora an4 legal oontentl (.itne..) JAMES F. PENMAN City Attorney ~ 20 ATTACHMENT II INSURANCE REQUIREMENTS (Instructions for completing, executing and submitting Evidence of Insurance to the City of San Bernardino.) Insured: SAMUEL H. JOHNSON AND JOAN V. JOHNSON (dba: SAMUEL'S AUTO WORKS) (Contractor, Lessee, Permittee, Borrower, Etc.) Agreement/Reference No. 89-475 Date: DECEMBER 20, 1989 A. INSURED 1. To expedite completion of the insurance requirements, please give your insurance agent or broker a copy of the Insurance Requirements Sheet along with these instructions and en- dorsement forms. 2. If your agreement requires Workers' Compensation coverage and you have been authorized by the State of California to Self-insure Workers' Compensation, then a copy of the certificate from the State consenting to self-insurance will meet the evidence requirements. 3. All questions relating to insurance should be directed to the person or office responsible for your contract, lease, permit, or other agreement. (See items 9 and 10 below.) B. INSURANCE AGENi'ORBROKER> ,-:-.::>.,.,:-. ......~-_.,....-~ .-- ,--"--'- -- --- 1. Acceptable Evidence -- The appropriate City special Endorse- ments are the preferred form of evidence. No modifications to the form are permitted. Alternatively, certified copies of the full policy containing additional insured and thirty (30) day cancellation notice language will be accepted subject to review by the City Attorney. Certificates, Verifications, Memoranda of Insurance and other non-binding documents submitted along are not acceptable as evidence of insurance. Binders are acceptable as interim evidence until policies are available. 2. Multiple Policies -- More than one (1) insurance policy may be required to comply with the insurance requirements. Endorsement forms appropriate to your insured's agreement, contract, lease or permit have been provided. 3. Signature -- Please have an authorized representative of the insurance company manually sign completed endorsement forms. Signatures must be originals as the City Attorney will not accept facsimile (rubber stamp, photocopy, etc.) or ini- tialed signatures. 1 INSURANCE REQUIREMENTS 'Attachment II continued... Page -2- 4. Underwriter -- The name and address of the insurance company underwriting the coverage must be noted on the endorsement form. In the case of syndicates or subscription policies, indicate lead underwriters or managing agent and attach a schedule of subscribers, including their percent participa- tion. 5. Document Reference -- Include reference to either the specific City agreement (bid, contract, lease, etc.) or indicate that all such agreements are covered. C. INSURANCE REQUIREMENTS 1. Coverage and Limits -- The coverages and limits for each type of insurance are specified on the insurance requirement sheet. When coverage is on a scheduled basis, a separate sheet may be attached to the endorsement listing such scheduled locations, vehicles, etc., so covered. 2. Excess Insurance -- Endorsements to excess policies will be required when primary insurance is insufficient to comply with the requirements. 3. Additional Pages -- If there is insufficient space on the reverse side of the form to note pertinent information, such as inclusions, exclusions or specific provisions, etc., attach separate sheets and note this on the endorsement form. 4. Person to Contact -- Completed endorsements ,- t:'orrespondenee; and questions relating to the required insurance are to be directed to the following representatives: 5. Technical Assistance -- Improperly completed endorsements will be returned to your insured for correction. 6. Delay in submitting properly completed endorsement forms may delay your insured's intended occupancy or operation. 7. Renewals -- For extensions or renewals of insurance policies which have the city's endorsement form(s) attached, we will accept a renewal endorsement or a certificate (with an original signature) as evidence of continued coverage if it includes the statement that the insurance protection afforded the city of San Bernardino has been renewed under the same terms and conditions as previously approved. 2 INSURANCE REQUIREMENTS 'Attachment II continued... Page -3- (dba: SAMUEL'S AUTO WORKS) NAME SAMUEL H. JOHNSON AND JOAN V. JOHNSON AGREEMENT/REFERENCE NUMBER 89-475 DATE 12/20/89 The following coverages noted with an "X" are required with the Combined Single Limits (CSL) as noted on the right. Unless written exception is allowed by Risk Managment. All coverages must add the City as additional insured. Worker's Compensation Employers Liability ( ) commercial General Liability ( ) Broad Form Property Damage ( ) Personal Injury ( ) Broad Form Liability Endorsement ( ) Fire Legal Liability ( ) Garagekeepers Legal Liability ( ) Owned Automobiles ( ) Nonowned Automobiles ( ) Hired Automobiles ( ) Automobile Liability (if auto is used for this contract.) Professional Liability (if applicable) Property Insurance ( ) Extended Coverage ( ) Vandalism and Malicious Mischief ( ) Business Interruption (90 days minimun) ( ) Crime (inside and outside) ( ) Sprinkler Leakage ( ) Other 3 Limits Statutory $ 100,000 $1.000,000 $ $1,000.000 90% value of buildinq (Contents at 100% of value) $ (All fixed costs plus payroll ) $ INSURANCE REQUIREMENTS Attachment "II Continued... Page -4- Inland Marine: $ (total cost of goods in transit at anyone time) Comments: flab 0255 4