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HomeMy WebLinkAbout1986-509 SBE077-13/1813S/nb 11/20/86 RESOLUTION NO. 86-509 RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO, CALIFORNIA, APPROVING AN ESCROW AGREEMENT WITH FIRST INTERSTATE BANK OF CALIFORNIA WHEREAS, the City of San Bernardino, California (the "City"), is a municipal corporation and a charter city, duly organized and existing pursuant to the Constitution and the laws of the State of California, and the powers of the City include the power to issue improvement bonds to represent and be secured by the assessments which shall be made to pay the cost of any work or improvement which is charged or assessed upon real property as provided in Part 3 of Division 10 (Improvement Bond Act of 1915) of the California Streets and Highways Code (the "1915 Act") and the power to issue improvement refunding bonds for the purpose of paying or retiring improvement bonds previously issued by it as provided in the Refunding Act of 1984 for 1915 Improvement Act Bonds (California Streets and Highways Code Section 9500, et ~.) (the "1984 Act"); and WHEREAS, pursuant to the adoption of Resolution No. 84-551 (the "1985 Bonds Resolution of Intention"), improvement proceedings for Assessment District No. 961 (the "District") were initiated by the Mayor and Common Council of the City of San Bernardino, California (the "Mayor and Common Council"), on December 17, 1984, - 1 - f and such proceedings were conducted pursuant to Division 12 (Municipal Bond Improvement Act of 1913) of the California Streets and Highways Code (the "1913 Act") and the 1915 Act; and WHEREAS, the Mayor and Common Counci 1 have adopted Ordinance No. 3902 on January 21, 1980, as amended by Ordinance No. MC-426, adopted on January 7, 1985, and Ordinance No. MC-442, adopted on March 19, 1985 (collectively, the "Ordinance"), which Ordinance modified certain provisions of and procedures prescribed by the 1913 Act and the 1915 Act as applicable to the City insofar as such provisions and procedures relate to assessment district formation, assessment proceedings and the issuance of improvement bonds by the City; and WHEREAS, the Mayor and Common Council have heretofore adopted Resolution No. 85-116, on March 19, 1985, providing for the issuance of the "$13,400,000 City of San Bernardino, Improvement Bonds, Assessment District No. 961, Series 1985 (Park Centre)" (the "1985 Bonds"); and WHEREAS, pursuant to the 1984 Act, the City may, at any time, determine by resolution that the public interest and necessity requires the refunding of any outstanding 1985 Bonds issued pursuant to the 1915 Act and the Ordinance and may declare its intention to refund the 1985 Bonds and to levy reassessments as security for the refunding bonds; and - 2 - WHEREAS, the Mayor and Common Council have approved Resolution No. 86-421, adopted on October 23, 1986 (the "Resolution of Intention"), pursuant to which the City declared its intention to refund all outstanding 1985 Bonds and initiated certain proceedings in connection with said refunding as provided by the 1984 Act; and WHEREAS, the Mayor and Common Council deem it necessary to issue at this time an aggregate principal amount equal to $12,450,000 of the improvement refunding bonds and to use a portion of the proceeds of such bonds to refund the outstanding balance of the 1985 Bonds; and WHEREAS, the purposes stated above will be accomplished by issuing an aggregate principal amount equal to $12,450,000 of improvement refunding bonds pursuant to the Resolution of Issuance, to be known as the "City of San Bernardino, California, Improvement Refunding Bonds, Assessment District No. 961, Series 1986" (the "Bonds"), a portion of the proceeds of which will be set apart and irrevocably segregated in a special trust fund (to be invested in Federal Securities, as defined in Section 13 thereof) in such principal amounts which, together with the interest earnings thereon, will be sufficient to defease the liens and covenants created by Resolution No. 85-116 by ensuring the payment of the principal of and interest and redemption premiums, if any, on the 1985 Bonds as they become due or at designated dates prior to maturity (in connection with which the Mayor and Common Council have - 3 - exercised or obligated itself to exercise a redemption privilege on behalf of the City), all as permitted by the 1984 Act; and WHEREAS, it is deemed desirable to enter into an escrow agreement with First Interstate Bank of California for the purpose of paying the principal of and interest and redemption premiums, if any, on and otherwise provide for the refunding of the 1985 Bonds from certain funds of the City to be received from the proceeds of the sale of the Bonds. NOW, THEREFORE, THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO, CALIFORNIA, DO HEREBY FIND, RESOLVE, DETERMINE AND . ORDER AS FOLLOWS: Section 1. The above recitals are all true and correct. Section 2. The Mayor and Common Council hereby approve the form of the Escrow Agreement by and between the City and First Interstate Bank of California, as Escrow Bank (the "Escrow Agreement"), as attached hereto as Exhibit "A" and incorporated herein by this reference. Section 3. The Mayor and City Clerk of the City are hereby authorized and di rected to execute the Escrow Agreement on behalf of the City with such changes, additions, modifications or deletions- as requested and approved by the City Attorney and Bond counse~ 1ft(t UIJ.( - 4 - Section 4. The Mayor and Common Counci 1 further authorize the Treasurer of the Ci ty or the Escrow Bank, as applicable, to transfer funds as necessary and in the amounts as required to pay the principal of and interest and redemption premiums, if any, on the 1985 Bonds as they become due or at designated dates prior to maturity (in connection with which the Mayor and Common Council has exercised or obligated itself to exercise a redemption privilege on behalf of the City), and the designated costs of issuance of the Bonds, in the amounts as provided in the Escrow Agreement. - 5 - Section 5. This Resolution shall take effect upon adoption. I HEREBY adopted by the San Bernardino at held on the 8th the fOllowing vote, CERTIFY that the foregoing Mayor and Common Council a n adj ourned regular day of December to wit: resolution of the meeting was duly City of thereof, 1986, by AYES: Council Members Estrada. Reill~_ Ouiel. Strickler NAYS: Council Member Frazier ABSENT: Council Members Hernandez. Marks ~~~ Ci t1' Clerk day of The foregoing December resolution is , 1986. is 9'bv San Approved as to form: L~I(!+- A,..City Attorney - 6 - SBE077-19/2029S/nb 11/20/86 ESCROW AGREEMENT This Escrow Agreement, dated for convenience as of December 1, 1986, by and between the City of San Bernardino, California (the "City"), a municipal corporation and a charter city (a public body, corporate and politic), duly organized and existing under and pursuant to the Constitution and the laws of the State of California, and First Interstate Bank of California, in the City of Los Angeles, California (which, both in its capacity as Fiscal Agent under the Resolution (hereinafter defined) and as Escrow Bank pursuant to this Agreement, shall be hereinafter referred to as "Escrow Bank"), a bank having and exercising full and complete trust powers, duly organized and existing under the laws of the United States of America, being a member of the Federal Deposit Insurance Corporation, and having an office and a principal place of business in the City of Los Angeles, California. WIT N E SSE T H: WHEREAS, the City of San Bernardino, California (the "City"), is a municipal corporation and a charter city, duly organized and existing pursuant to the Constitution and the laws of the State of California, and the powers of the City include the power to issue improvement bonds to represent and be secured by the assessments which shall be made to pay the cost of any work or improvement which is charged or assessed upon real property as provided in Part 3 of Division 10 (Improvement Bond Act of 1915) of the California Streets and Highways Cod<' (the "1915 Act") and the power to issue improvement refunding bonds for the purpose of paying or retiring improvement bonds previously issued by it as provided in the Refunding Act of 1984 for 1915 Improvement Act Bonds (California Streets and Highways Code Section 9500, et seq.) (the "1984 Act"); and WHEREAS, pursuant to the adoption of Resolution No. 84-551 (the "1985 Bonds Resolution of Intention"), improvement proceedings for Assessment District No. 961 (the "District") were initiated by the Mayor and Common Council of the City of San Bernardino, California (the "Mayor and Common Council"), on December 17, 1984, and such proceedings were conducted pursuant to Division 12 (Municipal Bond Improvement Act of 1913) of the California Streets and Highways Code (the "1913 Act") and the 1915 Act; and WHEREAS, the Mayor and Common Council have adopted Ordinance No. 3902 on January 21, 1980, as amended by Ordinance No. MC-426, adopted on January 7, 1985, and Ordinance No. MC-442, adopted on March 19, 1985 (collectively, the "Ordinance"), which - ] - EXHIBIT A Ordinance modified certain provisions of and procedures prescribed by the 1913 Act and the 1915 Act as applicable to the City insofar as such provisions and procedures relate to assessment district formation, assessment proceedings and the issuance of improvement bonds by the City; and WHEREAS, the Mayor adopted Resolution No. 85-116, issuance of the "$13,400,000 Bonds, Assessment District No. "1985 Bonds"); and and Common Council have heretofore on March 19, 1985, providing for the City of San Bernardino, Improvement 961, Series 1985 (Park Centre)" (the WHEREAS, pursuant to the 1984 Act, the City may, at any time, determine by resolution that the public interest and necessity requires the refunding of any outstanding 1985 Bonds issued pursuant to the 1915 Act and the Ordinance and may declare its intention to refund the 1985 Bonds and to levy reassessments as security for the refunding bonds; and WHEREAS, the Mayor and Common Council have approved Resolution No. 86-421, adopted on October 23, 1986 (the "Resolution of Intention"), pursuant to which the City declared its intention to refund all outstanding 1985 Bonds and initiated certain proceedings in connection with said refunding as provided by the 1984 Act; and WHEREAS, the Mayor and Common Council deem it necessary to issue at this time an aggregate principal ar1'ount equal to $12,450,000 of the improvement refunding bonds and to use a portion of the proceeds of such bonds to refund the outstanding balance of the 1985 Bonds; and WHEREAS, the purposes stated above will be accomplished by issuing at this time an aggregate principal amount equal to $12,450,000 of improvement refunding bonds pursuant to the Resolution of Issuance (as hereinafter defined), to be known as the "City of San Bernardino, California, Improvement Refunding Bonds, Assessment District No. 961, Series 1986" (the "Bonds"), a portion of the proceeds of which will be set apart and irrevocably segregated in a special trust fund to be held by the Escrow Bank called the "Ci ty of San Bernardino, Ca li fornia, Improvement Refunding Bonds, Assessment District No. 961, Series 1986, Escrow Fund" (the "Escrow Fund") (to be invested in Federal Securities, as defined in Section 13 of the Resolution of Issuance) in such principal amounts which, together with the interest earnings thereon, will be sufficient (as determined by an Opinion of Counsel based upon a certificate or opinion of an Independent Financial Consultant) to defease the liens and covenants created by Resolution No. 85-116 (the "1985 Resolution") by ensuring the payment of the principal of and interest and redemption premiums, if any, on the 1985 Bonds as they become due or at designated dates prior to maturity (in connection with which the Mayor and Common Council has exercised or obligated itself to exercise a redemption privilege on behalf of the City) all as permitted by the 1984 Act; and - 2 - WHEREAS, the City has diligently made and verified prior that the proper amounts shall be immediately following the delivery shall have no responsibility calculations; and caused such calculations to be to the delivery of the Bonds so placed in the Escrow Fund on or of the Bonds and the Escrow Bank for the correctness of the WHEREAS, the maturity schedule of the 1985 Bonds is as set forth below and said 1985 Bonds shall be redeemed and paid (i) for those 1985 Bonds maturing after September 1, 1987, in advance of their maturities on the first available call date being March 1, 1987, which is the date on which such 1985 Bonds are to be paid in full, by payment of the principal amount thereof together with accrued interest and a redemption premium equal to five percent (5%) of the principal and (ii) for those 1985 Bonds maturing on September 1, 1987, on their maturity date of September 1, 1987, by payment of the principal amount thereof together with accrued interest thereon, without premium: - 3 - WHEREAS, the defeasance requirements for those 1985 Bonds maturing after September 1, 1987, for the call and redemption of said 1985 Bonds on March 1, 1987, is as set forth below: Premium 5% Interest Total Due on 3/1/87 Principal Amount $13,170,000 $658,500 $.00 $13,828,500 WHEREAS, the defeasance requirements for those 1985 Bonds maturing on September 1, 1987, for the payment of said 1985 Bonds on their maturity date of September 1, 1987, is as set forth below: Principa 1 Amount Interest Amount Total Due on 9/1/87 $230,000 $1,430,405 $1,660,405 WHEREAS, deposit of $ the Escrow Fund will be initially funded with a from the proceeds of the Bonds; and WHEREAS, the Escrow Bank has used initial deposit to the Escrow Fund to purchase the following described Federal Securities as Exhibit "A" attached hereto: $ of the on behalf of the City further described in Description Principal Amount Interest Rate Maturity Date $ % 3/01/87 WHEREAS, the remaining $ of the initial deposit to the Escrow Fund will remain as cash on deposit in the Escrow Fund. NOW, THEREFORE, in consideration of the foregoing and the mutual covenants hereinafter set forth, the parties hereto agree as follows: Section 1. Receipt of copies of the 1985 Resolution and "Resolution of the Mayor and Common Council of the City of San Bernardino, California, Authorizing the Issuance of an Aggregate Principa 1 Amount of $12,450,000 of Refunding Bonds of Said Ci ty to Refund Previously Issued $13,400,000 City of San Bernardino, Improvement Bonds, Assessment District No. 961, Series 1985 (Park Centre) (the "Bond Resolution"), certified to be true and correct by the City Clerk, is hereby acknowledged by the Escrow Bank and said documents shall be deemed to be incorporated as part hereof in the same manner and with the same effect as if it were fully set forth herein. - 4 - Section 2. The Escrow Bank hereby agrees to hold in escrow the Escrow Fund (created pursuant to the Bond Resolution) as a special trust fund separate and apart from any other funds of the Ci ty or the Escrow Bank and to use the moneys and investments deposited therein solely for those purposes required or permitted by the Bond Resolution and recited therein. The Escrow Fund will be established by the deposit with the Escrow Bank of certain funds of the City to be received from the proceeds of the sale of the Bonds. The Escrow Bank shall be under no obligation or responsibility to utilize any other moneys held in any of its other funds and accounts except for those moneys and investments on deposi t in the Escrow Fund. Section 3. The Escrow Bank shall withdraw moneys from the Escrow Fund in sufficient amounts and at the times to make the payment without default of the principal of the 1985 Bonds (i) upon call for redemption on March 1, 1987, prior to maturity of the 1985 Bonds maturing after September 1, 1986, together with accrued interest to such date for redemption and premium thereon and (ii) upon maturity on September 1, 1987, for the 1985 Bonds maturing on September 1, 1987, together with accrued interest thereon. On or before such redemption date and maturity date, as applicable, the Escrow Bank shall transmit such sums to the fiscal agent for the 1985 Bonds appointed under the 1985 Resolution. Section 4. The Escrow Bank hereby establishes the Escrow Fund and accepts the deposits made pursuant to this Agreement. The Escrow Bank shall invest the sums in the Escrow Fund in united States Treasury Obligations, State and Local Government Series, or in such manner as shall be in accordance with Section 103 of the Internal Revenue Code of 1954, as amended, and the regulations promulgated thereunder. Section 5. The Escrow Bank shall make with the fiscal agent for the 1985 Bonds as desirable for carrying out this Escrow Agreement. such arrangements are necessary or Section 6. The escrow created irrevocable and the holders of the 1985 Bonds lien on all moneys in trust in the Escrow Fund or applied in accordance with this Agreement. hereby shall be shall have an express until paid out, used Section 7. The Escrow Bank' s fees and costs in consideration of the services rendered and to be rendered by the Escrow Bank in carrying out the provisions of this Agreement shall be an amount which is to be paid to the Escrow Bank by the City at the time of delivery of the funds to the Escrow Bank for purposes of establishing the Escrow Fund, and the Escrow Bank will be compensated separately and in accordance with the Fiscal Agent Agreement dated December ,1986, by and between the City and the Fiscal Agent (the "FiscalAgent Agreement") for services rendered as the Fiscal Agent under the Bond Resolution. The Escrow Bank shall have no lien whatsoever upon any of the moneys, securities or - 5 - obligations in said Escrow Fund for the payment of such fees and expenses. The City hereby assumes liability for, and hereby agrees (whether or not any of the transactions contemplated hereby are consummated) to indemnify, protect, save and keep harmless the Escrow Bank and its respective successors, assigns, agents and servants from and against, any and all liabilities, obligations, losses, damages, penalties, claims, actions, suits, costs, expenses and disbursements (including legal fees and disbursements) of whatsoever kind and nature which may be imposed on, incurred by, or asserted against, at any time, the Escrow Bank (whether or not also indemnified against by the City or any other person under any other agreement or instrument) and in any way relating to or arising out of the execution and delivery of this Agreement, the establishment of the Escrow Fund, the retention of the moneys therein and any payment, transfer or other application of moneys or securities by the Escrow Bank in accordance with the provisions of this Escrow Agreement, or as may arise by reason of any act, omission or error of the Escrow Bank made in good faith in the conduct of its duties; provided, however, that the City shall not be required to indemnify the Escrow Bank against its own negligence, active or passive, or misconduct. In no event shall the City be liable to any person by reason of the transactions contemplated hereby other than to the Escrow Bank as set forth in this Section 7. The indemnities contained in this Section shall survive the termination of this Agreement. All moneys remaining in the Escrow Fund pursuant to this Agreement upon payment in full of the 1985 Bonds and interest thereon and after payment of any and all fees and expenses of the Escrow Bank due hereunder shall be remitted to the City and used and applied by the City in accordance with the laws of the State of California. Section 8. If anyone or more of the covenants or agreements provided in this Agreement on the part of the parties to be performed should be determined by a court of competent jurisdiction to be contrary to law, such covenant or agreement shall be deemed and construed to be severable from the remaining covenants and agreements herein contained and shall in no way affect the validity of the remaining provisions of this Agreement. Section 9. Whenever herein the City are named or are referred to, such provisions include any successor of the City or the Escrow immediate or intermediate, whether so expressed stipulations, obligations and agreements by or other provisions for the benefit of, the City contained herein: or the Escrow Bank shall be deemed to Bank, respectively, or not. All of the on behalf of, and or the Escrow Bank (1) Shall bind and inure to the benefit for any such successor, and (2) Shall bind and inure to the benefit of any officer, board, authority, agent or instrumentality to whom or to which there shall be transferred by or in accordance with law any right, power - 6 - or duty of the City or the Escrow Bank, respectively, or of its successor, the possession of which is necessary or appropriate to comply with any such stipulations, obligations, agreements or other provisions hereof. Section 10. counterparts, all or as an original and instrument. This Agreement may be executed in several any of which shall be regarded for all purposes shall constitute and be but one and the same - 7 - IN WITNESS WHEREOF, the parties hereto have each caused this Agreement to be executed by their duly authorized officers and their corporate seals to be hereunto affixed and attested as of this first (1st) day of December, 1986. CITY OF SAN BERNARDINO, CALIFORNIA By' i;ir/'r~~ (SEAL) Attest: By: ~.#P.t?~ e1ty Clerk FIRST INTERSTATE BANK OF CALIFORNIA "ESCROW BANK" By: Authorized Officer (BANK SEAL)