HomeMy WebLinkAboutR07-Economic Development Agency
.
.
.
.
- -- ---- ..,.
.
.
IIr9BIDRIINr IZPARDIBNl' ~ 'DIB
cr.rr ~ SIB ~
".I~.'IDR ~UJUI"I".I."""""'"
Fran: mHm1H J. JmlIERSCIl'
'/l!vaoIltive Dimctor
SUbject: c-.maL cr.rr ~
fJIa-.,_2TU ~
Date: FeI::lruaIy 12, 1991
8yDclpIIIis of Pnvious ~ -~""""l/OlIIIIIittee Iaticm:
on Dec-.l.er 17, 1985, the Mayor and ()o ..... '. 0r:A.lncil a,w..wed and adcpted Resolution
Number 84-547 prcvidiJJ] for the i_JanCe of Irdlstrial Devel............,L Revenue Bonis,
Series 1984A, Oeld.uu. City Pl:'aIIanBde project.
on NoveaIi:ler 30, 1989, the Mayor and ()o......\ 0r:A.lncil ~ AJeudlllelll Number "1"
to the lam ..................L and SUl:PlBDent Number "1" to the In:Jenture.
on Februa%y 19, 1990, the Mayer and n......, 0r:A.lncil ~ J\mBI.dlu...,L Number "2"
to the lam .................,L and SUl:PlBDent Number "2" to the In:Jenture.
on August 23, 1990, the Mayer and l"l_._..~ 0r:A.lncil ~ J\mBI.dlu....L Number "3" to
the lam .................L and SUl:PlBDent Number "3" to the In:Jenture.
~Lo --"-5 Ibtian:
OIInDr .",. n -.-.-"" nr....,..-I1)
RBSOIDrIttI ~ 'DIB IIUOR MID CXIIII:B ~ ~ 'DIB cr.rr ~ SIB ~ lmlB:lRXZ-
IH3 'DIB ~r.LU.f ~ IIII!RICBN1' ~ "4" m 'DIB ItlIN ~ RIla1mIlI3 CBNl'RAL
cr.rr l'lDII!lNNlB.
RBSOIDrIttI ~ 'DIB IIUOR MID CDIDI ~ ~ 'DIB cr.rr ~ SIB ~ lmlB:lRXZ-
IH3 'DIB ~.I:.LU.f ~ 8lJP1'IBal' ....... "4" m 'DIB .uuur"'wa5 IlBLaTDIJ m CBNl'RAL
cr.rr P1DIBNI\IlE.
-:-~---
DlMtl _ .
Contact Person:
Ken ~1Ro_...... T.inr'l_h
Rx:ae:
5065: 5081
Project Area: All
~ Data A'tt.actled:
!tlNDIl<<; ~:
Ward(s) :
1 thraJah 7
Sbof'f' ~ ort: -""'1utia'lS
Amount: S MIA
Sam:le:
aJdget Authority:
e Ol:IIIIIiIllliClll/~""""l 1Iotes:
~ Itsn No: +-
KlH: BL: lab: 4246
.
.
.
.
.
----...------- -
-- -
-
.
.
DBVBLOPMDr DBPAa.uma.r
STAFF REPORT
Central City P"---de/SclInram Deve10maent
On December 17, 1984, the Mayor and Common Council approved Resolution 84-547
providing for the issuance of Industrial Development Revenue Bonds, Series 1984A,
Central City Promenade Project, along with approving the Trust Indenture, the Loan
Agreement, the Bond Purchase Agreement and other related documents.
In December 1984, the Central City Promenade Bonds were issued in the BJDount of
$7,200,000 with a maturity date of December 1, 2024 to assist the Best/Marshall
development. Chase Manhattan Bank, the sole purchaser of the Bonds, exercised its
right to cause a mandatory redemption of the Bonds on December 1, 1989, pursuant
to Section 3.01 (d) of the Trust Indenture dated December 15, 1984.
On November 7, 1989, Mr. Arlen Gunner, the attorney for Central City Promenade,
contacted Stradling, Yocca, Carlson and Rauth, at that time, the Agency's Special
Counsel, and stated that Chase Manhattan Bank was willing to extend the due date
on the Bonds past the mandatory redemption date of December 1, 1989. Mr. Gunner
also believed that the City need not be a part of this extension, but the opinion
of the Development Department's Special Counsel was that the City must approve
changes to the Trust Indenture and amend the Loan Agreement. Late on November 20,
1989, the Development Department's Special Counsel informed staff that to extend
the due date on the Bonds, a City Council action must take place prior to December
1, 1989.
On November 30, 1989, Amendment Number One to the Loan Agreement and Supplement
Number One to the Indenture extending the December 1, 1989 date to February 1,
1990 to provide Central City Promenade the necessary time to discuss, negotiate
and further BJDend the Loan Agreement were approved by the Mayor'and Common Council.
On February 19, 1990, Amendment Number Two to the Loan Agreement and Supplement
Number Two to the Indenture were approved by the Mayor and Common Council extended
the February 1, 1990 date to September 1, 1990.
On August 23, 1990, Amendment Number Three to the Loan Agreement and approval of
Supplement Number Three to the Indenture were approved by the Mayor and Common
Council to extend the Loan Agreement to March 1, 1991.
Central City Promenade is now seeking approval of Amendment Number Four to the
Loan Agreement and approval of Supplement Number Four to the Indenture to extend
the Loan Agreement to July 1, 1991 to provide additional time to negotiate with
Chase Manhattan Bank.
COtIfiSSIOII IlBETING
Meeting Date: February 18, 1991
.
.
..
.
-
.
.
COIMISSIOB IIBBTIlIG
Central City Praaenadel
Schurgin Deve1o~ent
February 12, 1991
Page - 2-
Currently, Schurgin Development Corporation is in default on its notes payable
to the Development Department. The terms on these notes are as follows:
Amount
Date of Note
Interest Rate
Payments Start
Monthly Payment
All Due
$150,000
March 19, 1985
lOX
April 5, 1990
$1,611. 91
April 5, 1995
$540,000
September 16, 1985
lOX
September 16, 1990
$5,802.88
September 16, 1995
Additionally, no interest accrued for the first two years and interest accrued
for years three through five at the rate of lOX to be paid upon the maturity
date.
The extension of the bonds will allow the Chairman of the CODlDission and the
staff of the Development Department additional time to negotiate with Chase
Manhattan Bank to protect the interest of the Department concerning the notes
receivable from Schurgin Development.
COMMISSIOB IIBBTIlIG
Meeting Date: February 18, 1991
e
e
.
e
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
..
...
.
.
1
RESOLUTION NO.
RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF
SAN BERNARDINO AUTHORIZING THE EXECUTION OF AMENDMENT NO. FOUR TO
THE LOAN AGREEMENT RELATING TO CENTRAL CITY PROMENADE.
2
3
4 NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND COMMON
COUNCIL OF THE CITY OF SAN BERNARDINO AS FOLLOWS:
5
6
SECTION 1.
The Mayor of the City of San Bernardino is
7
hereby authorized and directed to execute Amendment No. Four to
8
9
the Loan Agreement between the City of San Bernardino and Central
City Promenade, in the form of a copy of said Amendment attached
hereto as Exhibit "A".
10
11
12
SECTION 2.
Said Supplement shall not take effect until
fully signed and executed by all parties. The City shall not be
obligated hereunder unless and until the Amendment is fully
executed and no oral agreement relating thereto shall be implied
13
or authorized.
SECTION 3. This resolution is rescinded if the parties to
the Amendment fail to execute it within Sixty (60) days of the
passage of this resolution.
/
/
/
/
/
/
/
/
/
/
/
/
/
/
/
/
/
/
/
/
/
/
/
/
/
/
/
/
/
/
DAB/ses/Cen-City.res
February 13, 1991
1
.
e
~
.
12
13
14
15
16
17
18
19
20
-
.
.
1
RESOLUTION...AUTHORIZING THE EXECUTION...RELATING TO
CENTRAL CITY PROMENADE.
2
3
4
I HEREBY CERTIFY that the foregoing resolution was duly
5
adopted by the Mayor and Common Council of the City of San
Bernardino at a
day of
meeting thereof, held on the
, 1991, by the following vote, to wit:
6
7
8
9
10
Council Members:
AYES
NAYS
ABSTAIN
ESTRADA
REILLY
FLORES
11
MAUDSLEY
MINOR
POPE-LUDLAM
MILLER
City Clerk
The foregoing resolution is hereby approved this
day
of
, 1991.
w. R. Holcomb, Mayor
21 City of San Bernardino
22 Approved as to
form and legal content:
23
24
25
26
27
28
JAMES F. PENMAN,
City Attorney
~)
DAB/ses/Cen-City.res
February 13, 1991
2
.
.
.
e
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
----~
.
.
1
RESOLUTION NO.
RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF
SAN BERNARDINO AUTHORIZING THE EXECUTION OF SUPPLEMENT NO. FOUR
TO THE INDENTURE RELATING TO CENTRAL CITY PROMENADE.
2
3
4 NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND COMMON
COUNCIL OF THE CITY OF SAN BERNARDINO AS FOLLOWS:
5
6
7
8
9
SECTION 1. The Mayor of the City of San Bernardino is
hereby authorized and directed to execute Supplement No. Four
to the Indenture between the City of San Bernardino and Trust
Services of America, Inc., in the form of a copy of said
10
11
12
Supplement attached hereto as Exhibit "A".
SECTION 2. Said Supplement shall not take effect until
13
fully signed and executed by all parties. The City shall not be
obligated hereunder unless and until the Supplement is fully
executed and no oral agreement relating thereto shall be implied
or authorized.
SECTION 3. This resolution is rescinded if the parties to
the Supplement fail to execute it within Sixty (60) days of the
passage of this resolution.
/ / /
/ / /
/ / /
/ / /
/ / /
/ / /
/ / /
/ / /
/ / /
/ / /
DAB/ses/CenCity2.res
February 13, 1991
1
.
.
,
.
11
12
13
14
15
16
17
18
19
20
- ..
- ~
--
-
~
.
.
1
RESOLUTION...AUTHORIZING THE EXECUTION OF SUPPLEMENT...
RELATING TO CENTRAL CITY PROMENADE.
2
3
4
I HEREBY CERTIFY that the foregoing resolution was duly
adopted by the Mayor and Common Council of the City of San
5
6
Bernardino at a
meeting thereof, held on the
, 1991, by the following vote, to wit:
day of
7
Council Members:
AYES
NAYS
ABSTAIN
8
9
ESTRADA
REILLY
10
FLORES
MAUDSLEY
MINOR
POPE-LUDLAM
MILLER
City Clerk
The foregoing resolution is hereby approved this
day
of
, 1991.
w. R. HOlcomb, Mayor
21 City of San Bernardino
22 Approved as to
form and legal content:
23
24
25
26
27
28
JAMES F. PENMAN,
City Attorney
~~
DAB/ses/CenCity2.res
February 13, 1991
2
~
.
.
e
AMENDMENT NO. FOUR TO THE LOAN AGREEMENT
This Amendment No. Four to the Loan Agreement, as amended,
as of December 15, 1984 between the City of San Bernardino, a
chartered city duly organized and existing under the
Constitution of the State of California and its City Charter
(the "Issuer") and Central City Promenade, a California Limited
Partnership (the "Company"), (the "Loan Agreement") is made and
entered into as of February 1, 1991 between the Issuer and the
Company, with the consent of The Trust Services of America,
Inc. a California corporation (the "Trustee") and the Chase
Manhattan Bank, N.A. (the "Purchaser"),(the "Amendment").
Capitalized terms used in this Supplement and not otherwise
defined shall have the same meaning as in the Loan Agreement.
WIT N E SSE T H:
WHEREAS, Section 9.06 of the Loan Agreement provides that
the Issuer and the Company may supplement the Loan Agreement
with the consent of the Trustee; and
e
WHEREAS, Section 1202 of the Trust Indenture dated as of
December 15, 1984 between the Issuer and the Trustee (the
"Indenture") provides that "neither the Issuer nor the Trustee
shall consent to any . . .amendment of the Loan Agreement
. . . without publication of notice and mailing and the written
approval or consent of the Holder and Owners of not less than
one hundred percent (100\) in aggregate principal amount of the
Bonds .. ."; and
WHEREAS, the Purchaser is the "Holder or Owner of every
Bond"; and
.
.
WHEREAS, the Purchaser's consent to this Amendment as
indicated by its execution of this Amendment is sufficient to
meet the consent and notice requirements of Section 1202 of the
Indenture; and
WHEREAS, Section 6.03(c) of the Loan Agreement provides
that "prior to the Conversion Date, the Note is subject to
Mandatory Prepayment, in whole, on March 1, 1991 . . . unless
the Purchaser has given notice in writing evidencing its waiver
of such redemption at least forty-five (45) days, but no more
than sixty (60) days, prior to such Redemption Date to the
Issuer, the Trustee and the Company"; and
WHEREAS, the Company and the Purchaser desire to amend
Section 6.03(c) of the Loan Agreement to provide the necessary
time to amend possibly further the Loan Agreement.
e
e
e
.
e
-
.
.
NOW, THEREFORE, in consideration of the mutual covenants
and undertaking set forth herein. and other good and valuable
consideration. the receipt and sufficiency of which are hereby
aCknowledged, the Issuer and the Trustee hereby agree as
follows:
1. Section 6.03(c) of the Loan Agreement is amended and
restated as follows:
M(C) Mandatory Prepayment Upon Demand of
Purchaser. Prior to the Conversion Date. the
Note is subject to mandatory prepayment, in
whole, on July 1. 1991. and on December 1.
1995 and on each fifth December 1 thereafter
until maturity. at a price equal to the
principal amount of Outstanding Bonds plus
accrued interest to the date of prepayment.
without premium. unless the Purchaser shall
have given notice in writing evidencing its
waiver of such redemption. at least forty-five
(45) days, but no more than sixty (60) days,
prior to each such Redemption Date to the
Issuer. the Trustee and the Company.M
2. This Amendment may be executed in several
counterparts. each of which shall be an original and all of
which shall constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to the Loan Agreement to be executed on their behalf
by their duly authorized Officers. and. if applicable, their
corporate seal to be affixed and duly attested all as of the
day first above written.
CITY OF SAN BERNARDINO
By:
Its: Mayor
ATTEST:
By:
Its: City Clerk
3522u/2266/03
e
e
~
e
ATTEST:
By:
Its:
.
Assistant Secretary
3522u/2266/03
.
CENTRAL CITY PROMENADE, a
California limited partnership
By:
Mark Shurgin,
General Partner
By:
Rosaland Jonas Shurgin,
General Partner
CONSENT OF THE TRUSTEE AS
REQUIRED BY SECTION 9.06 OF THE
LOAN AGREEMENT:
TRUST SERVICES OF AMERICA, INC.
By:
Its: Authorized Representative
CONSENT OF THE HOLDER OF EACH
BOND AS REQUIRED BY SECTION 1102
OF THE INDENTURE:
THE CHASE MANHATTAN BANK, N.A.
By:
Its: Authorized Representative
.
.
.
.
.
-----
.
.
February , 1991
City of San Bernardino
San Bernardino, California
Trust Services of America, Inc.
Los Angeles, California
Re: City of San Bernardino, Industrial Development
Revenue Bonds (Central City Promenade Project)
(the "Bonds")
Ladies and Gentlemen:
We have acted as counsel for the City of San Bernardino, a
chartered city duly organized and existing under the
Constitution of the State of California and its City Charter,
(the "Issuer"), in connection with the supplementing and
amending of the Indenture and Loan Agreement, as defined below.
In that connection, we have examined originals or copies
certified or otherwise identified to our satisfaction of
(1) the Trust Indenture dated as of December 15, 1984 between
the Issuer and Trust Services of America, Inc., a California
corporation (the "Trustee"), as supplemented (the "Indenture");
(2) the Loan Agreement dated as of December 15, 1984 between
the Issuer and Central City Promenade, a California limited
partnership (the "Company"), as amended (the "Loan Agreement");
.
.
.
.
.
.
City of San Bernardino
Trust Services of America, Inc.
February , 1991
Page Two
(4) Supplement No. Four to the Indenture dated as of February
I, 1991 between the Issuer and the Trustee (the .Supp1ement No.
Four"); (5) Amendment No. Four to the Loan Agreement dated as
of February I, 1991 between the Issuer and the Company (the
.Amendment No. Four.); and (6) the Internal Revenue Code of
1954 and 1986, as amended, and such regulations, revenue
rulings and private letter rulings promulgated or issued
thereunder (the .Code.) and predecessor statutes as we have
deemed relevant to the rendering of this opinion.
Based upon our examination of the foregoing, and in
reliance thereon, and on allegations of fact as we deem
relevant under the circumstances, we are of the opinion that:
1.
The execution and delivery of the Amendment No. Four
and the Supplement No. Four have been authorized by
the Issuer and, assuming proper authorization,
execution and delivery by the respective other parties
thereto, including parties consenting thereto, are
valid and binding obligations of the Issuer
enforceable in accordance with their terms, except to
the extent that enforceability may be limited by
moratorium, bankruptcy, reorganization, insolvency or
other laws affecting creditors' rights generally or by
the exercise of judicial discretion in accordance with
general principles of equity.
Assuming that interest on the Bonds is exempt from
federal income taxation currently, the Supplement No.
Four and the Amendment No. Four will not cause
interest on the Bonds to cease to be exempt from gross
income for purposes of federal income taxation or from
personal income taxes imposed by the State of
California.
2.
We note that this office did not serve as bond counsel in
connection with the original issuance of the Bonds and has at
.
.
.
City of San Bernardino
Trust Services of America, Inc.
February ,1991
Page Three
.
no time rendered an opInIon regarding the exemption from
federal or State income taxation of interest on the Bonds. We
have not reviewed the documents or any underlying facts or
circumstances relative to the tax exempt status of interest on
the Bonds either at the date of original issuance of the Bonds
or at any time since such date. Moreover, in order for
interest on the Bonds to remain exempt from federal income
taxation subsequent to the bond issuance date, it is necessary
that the provisions of Section l03(b)(6)(D), among others, of
the Internal Revenue Code of 1954, as amended, be complied with
on a continuous basis. Because we have made no independent
investigation as to whether there has been such compliance in
the present case, for purposes of this opinion, we have assumed
that interest on the Bonds is exempt from federal income
taxation and State of California personal income taxation as of
the date of this opinion and express no opinion as to whether
interest on the Bonds is presently exempt from federal income
taxation or State of California personal income taxation. We
have not undertaken to verify through independent investigation
the accuracy of the representations made to us or of the
foregoing assumptions made by us in rendering this opinion.
The opinions expressed herein may be relied upon by the
addressee of this opinion and may not be relied upon by any
other party.
Respectfully submitted,
~
.
3524u
e
e
.
e
.
.
SUPPLEMENT NO. FOUR TO THE INDENTURE
This Supplement No. Four to the Trust Indenture, as
supplemented, dated as of December IS, 1984 between the City of
San Bernardino, a chartered city duly organized and existing
under the Constitution of the State of California and its City
Charter (the -Issuer-) and Trust Services of America, Inc., a
California corporation (the -Trustee-) (the -Indenture-) is
made and entered into as of February 1, 1991 between the Issuer
and the Trustee, with the consent of The Chase Manhattan Bank,
N.A. (the -Purchaser-), and Central City Promenade, a
California Limited Partnership (the -Company-), (the
-Supplement-). Capitalized terms used in this Supplement and
not otherwise defined shall have the same meaning as in the
Indenture.
WIT N E SSE T H:
WHEREAS, Section 1102 of the Indenture provides that the
Issuer and the Trustee may supplement the Indenture -as shall
be deemed necessary and desirable by the Issuer or the Trustee
for the purpose of modifying, altering, amending, adding to or
rescinding, in any particular, any of the terms or provisions
contained. . .[therein] or in any supplemental indenture;
provided, however, that nothing contained in . . .
Section [1102] shall permit, or be construed as permitting,
without the consent of the Holder or Owner of every bond,
(i) an exte~sion of the maturity of the principal of or the
interest thereon or of any redemption dates from the Bond Fund
. . .-; and
WHEREAS, the Purchaser is the -Holder or Owner of every
Bond-; and
WHEREAS. the Trustee or Issuer has deemed it -necessary and
desirable- to modify the Indenture; and
WHEREAS, Section 1102 of the Indenture provides further
that -a supplemental indenture . . . which affects the rights
of the Company shall not become effective unless and until the
Company shall have consented to the adoption of such
supplemental indenture-; and
WHEREAS, this Supplement -affects the rights of the
Company-; and
WHEREAS. Section 301(d) of the Indenture provides that
-prior to the Conversion Date, the Bonds are subject to
mandatory redemption, in whole, on March 1, 1991. . . unless
the Purchaser shall have given notice in writing to the
.
.
.
Issuer, the Trustee and the Company, stating that such
redemption shall be waived, at least forty-five (45) but no
more than sizty (60) days prior to each such redemption dateN;
and
WHEREAS, the Purchaser and the Company desire to further
amend Section 30l(d} of the Indenture to provide the necessary
time to supplement possibly further the Indenture.
NOW, THEREFORE, in consideration of the mutual covenants
and undertaking set forth herein, and other good and valuable
consideration, the receipt and sUfficiency of which hereby are
acknowledged, the Issuer and the Trustee hereby agree as
follows:
1. Section 301(d) of the Indenture is amended and
restated as follows:
~
Wed) Redemption Upon Demand Of
Purchaser. Prior to the Conversion Date, the
Bonds are subject to mandatory redemption, in
whole, on July 1, 1991, and on December 1,
1995 and on each fifth December 1 thereafter
until maturity, at a price equal to the
principal amount of Outstanding Bonds plus
accrued interest to the Redemption Date,
without premium, unless the Purchaser shall
have given notice in writing to the Issuer,
the Trustee and the Company, stating that such
redemption shall be waived, at least
forty~five (45) but no more than sixty (60)
days prior to each such redemption date.-
2. This Supplement may be executed in several
counterparts, each of which shall be an original and all of
which shall constitute but one and the same instrument.
.
IN WITNESS WHEREOF, the parties hereto have caused this
Supplement to the Indenture to be executed on their behalf by
their duly authorized officers, and, if applicable, their
corporate seal to be affixed and duly attested all as of the
day first above written.
CITY OF SAN BERNARDINO
By:
Its: Mayor
. ATTEST:
By:
Its: City Clerk
35l8u/2266/03
.
.
~
e
----- -----....--
ATTEST:
.
By:
Its: Assistant Secretary
351Bu/2266/03
.
TRUST SERVICES OF AMERICA, INC.
By:
Its: Authorized Representative
CONSENT OF THE HOLDER OF EACH
BOND AS REQUIRED BY SECTION 1102
OF THE INDENTURE:
THE CHASE MANHATTAN BANK, N.A.
By:
Its: Authorized Representative
CONSENT OF THE COMPANY AS
REQUIRED BY SECTION 1102 OF THE
INDENTURE:
CENTRAL CITY PROMENADE, a
California Limited Partnership
By:
Mark Shurgin,
General Partner
By:
Rosiland Jonas Shurgin,
General Partner
.
.
.
.
-
.
.
CITY OF SAN BERNARDINO
INDUSTRIAL DEVELOPMENT REVENUE BONDS,
SERIES 1984A (CENTRAL CITY PROMENADE PROJECT)
CERTIFICATE OF THE COMPANY
The undersigned as the sole general partners of Central
City Promenade, a California Limited Partnership (the
.Company.) hereby certifies that the Company has complied in
all material respects as of the date hereof with the terms and
conditions of the Indenture, as supplemented, the Loan
Agreement, as amended and the Regulatory Agreement, as amended,
and no event of default thereunder has been declared as of the
date hereof. All capitalized terms used herein and not
otherwise defined shall have the meaning given them in the
Indenture relating to the above-referenced financing.
Dated:
February , 1991
CENTRAL CITY PROMENADE, a
California limited partnership
By:
Mark Shurgin,
General Partner
By:
Rosaland Jonas Shurgin,
General Partner
3522u/2266/03