HomeMy WebLinkAbout1989-183
1
RESOLUTION NO. 89-183
2 RESOLUTION OF THE CITY OF SAN BERNARDINO AUTHORIZING THE
EXECUTION OF AN AGREEMENT FOR INVESTMENT BANKING SERVICES
3 BETWEEN THE CITY OF SAN BERNARDINO, THE COMMUNITY DEVELOPMENT
COMMISSION OF THE CITY OF SAN BERNARDINO ON BEHALF OF THE
4 REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO AND MILLER AND
SCHROEDER FINANCIAL, INC.
5
BE IT RESOLVED BY THE MAYOR AND COMMON COUNCIL OF THE CITY
6 OF SAN BERNARDINO AS FOLLOWS:
7
SECTION 1.
The Mayor of the City of San Bernardino is
8 hereby authorized and directed to execute an Agreement for
9 Investment Banking Services between the City of San Bernardino,
10 the Community Development Commission of the City of San
11 Bernardino on behalf of the Redevelopment Agency of the City of
12 San Bernardino and Miller and Schroeder Financial, Inc., in the
..".."
13 form of a copy of said agreement attached hereto as Exhibit "A".
14
SECTION 2.
Said Agreement shall not take effect until
15 fully signed and executed by all parties. The City shall not be
16 obligated hereunder unless and until the Agreement is fully
17 executed and no oral agreement relating thereto shall be implied
18 or authorized.
19
SECTION 3. This resolution is rescinded if the parties to
20 the agreement fail to execute it within sixty (60) days of the
21 passage of this resolution.
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28 1
DAB:br
June 15, 1989
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18
1 RESO. OF THE CITY OF SAN BERNARDINO AUTHORIZING THE EXECUTION OF
INVESTMENT BANKING SERVICES AGREEMENT BETWEEN CITY OF SAN
2 BERNARDINO, THE COMMUNITY.DEVEL.COMMISSION OF THE CITY OF SAN
BERNARDINO ON BEHALF OF THE REDEVELOPMENT AGENCY OF THE CITY OF
3 SAN BERNARDINO AND MILLER AND SCHROEDER FINANCIAL, INC.
4 I HEREBY CERTIFY that the foregoing resolution was duly
5 adopted by the Mayor and Common Council of the City of San
6
Bernardino at a
regular
meeting thereof, held on the
7
19th
day of
June
, 1989, by the following vote,
8 to wit:
9
AYES:
Council Members Estrada, Reilly, Flores,
10
Pope-Ludlam, Miller
11
NAYS:
Council Members Maudsley, Minor
12
ABSENT:
None
13
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14
15
The foregoing resolution
16
day of
, 1989.
June
Approved as to form
19 and Legal Content:
21
20 JAMES F. PENMAN
City Attorney
22
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25
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28
B~J
2
DAB:br
June 15, 1989
AGREEMENT FOR INVESTMENT BANKING SERVICES
Agreement No.
THIS AGREEMENT made and entered into this ~ day of !\J{/'J(, ,
1989, by and between THE CITY OF SAN BERNARDINO, A MUNICIPAL CORPORATION,
duly organized under the laws of the State of California ("City"), the
COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF SAN BERNARDINO, on
behalf of the REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO, a
public agency, ("Agency"), and Miller and Schroeder Financial, Inc.
("Investment Banker"):
WITNESSETH:
WHEREAS, City and Agency propose to initiate proceedings for the
following "Proposed Transaction":
a) a restructuring of City and Agency's Single Family Residential
Mortgage Revenue Bonds, 1980 and 1979 Series Bonds with
Collateralized Mortgage Obligations;
b) a refunding of five of Agency's outstanding bond issues;
c) the issuance of additional tax increment bonds in the
approximate amount of $20,000,000; and
WHEREAS, City and Agency require assistance in the development of a
sound, equitable and practical financing plan to implement the project by
taking into consideration sources of capital funds, financial
feasibility, annual costs, the allocation of those costs, statutory
requirements and restrictions, and alternate methods of financing, if
applicable; and
'VHEREAS, City and Agency require the services of a municipal
investment banker experienced in financial consulting for and
underwriting of such Collateralized Mortgage Obligation Refunding Bonds
and tax increment bonds to assist in such financial planning and to
purchase City's and Agency's obligations at negotiated sale, where
permitted by law, and to coordinate the sale and distribution of
obligations required to be sold at public sale; and
WHEREAS, Investment Banker asserts and affirms that it is qualified
by training and experience to perform said services;
NOW, THEREFORE, it is mutually agreed as follows:
TERMS AND CONDITIONS
1. Mission
City and Agency hereby retain Investment Banker in the capacity as
Investment Banker for provision of services described in Attachment
I. Investment Banker hereby accepts such responsibility as
described herein.
2. Terms
This Agreement shall commence as of the day and year first above
shown and shall remain in full force and effect for a period of one
year unless sooner terminated as provided herein.
4. Investment Banker Responsibilities
Investment Banker shall complete the work program described in
Attachment I. Investment Banker commits the principal personnel
listed below to the project for its duration:
Principal Personnel:
James Iverson
Robin Thomas
Rhonda Connolly
5. Replacement of Named Personnel
It has been determined that the individual(s) named in this
Agreement are necessary for the successful performance of this
Agreement. No diversion or replacement of these individual(s) shall
be made by Investment Banker without written consent of City and
Agency, provided that City and Agency may ratify, in writing, within
ten (10) days of diversion or replacement and such ratification
shall constitute the consent of City and Agency required by this
clause. If City and Agency fail to respond to Investment Banker
within ten (10) days of notification by Investment Banker, said
personnel diversion or replacement shall be deemed approved.
6. Release of News Information
No news release, including photographs, public announcements or
confirmation of same, of any part of the subject matter of this
Agreement or any phase of any program hereunder shall be made
without prior joint written approval of City, Agency and Investment
Banker.
13478
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7. Confidentiality of Reports
Investment Banker shall keep confidential all reports, information
and data received, prepared or assembled pursuant to performance
hereunder and that City and Agency designate in writing as
confidential. Such information shall not be made available to any
person, firm, corporation or entity without the prior written
consent of City and Agency.
8. Sale of Bonds, Compensation
Unless the negotiated sale of the obligations is prohibited by law,
City or Agency and Investment Banker shall enter into a bond
purchase agreement for the sale of the obligations to Investment
Banker bearing interest at rates and at such discount as may be
mutually agreeable to City, Agency and Investment Banker. The
purchase of such obligations shall be subject to the standard and
customary conditions of such obligations of a similar nature
including the unqualified legal opinion of nationally recognized
bond counsel with respect to the validity and tax-exempt status of
such obligations.
For issues of the obligations which are sold to Investment Banker at
negotiated sale, the bond discount shall represent Investment
Banker's compensation and City or Agency shall not be liable to
Investment Banker for any additional fees whatsoever. If no issues
of City's or Agency's obligations are sold to Investment Banker at
negotiated sale, Investment Banker shall not be entitled to any fees
whatsoever. It is understood that Investment Banker's compensation
may be greater than the discount to the extent that market
conditions allow the obligations to be resold at a price in excess
of their par value. The reasonable expectation of such premium, if
any, may be taken into account in determining the interest rate or
rates and discount on the obligations.
Investment Banker shall from the bond discount on obligations sold
at negotiated sale, bear all out-of-pocket costs and expenses,
including without limitation, travel, telephone, telegraph,
stenographic work, and the like, incurred by Investment Banker in
performing Investment Banker's duties and obligations, unless the
incurring of such costs and expenses is specifically authorized in
writing by City or Agency. Investment Banker is not responsible for
and shall not be held liable for any other expense or expenditure in
connection with the financing program.
l347S
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City and Agency shall bear all costs of issuance of bonds, note or
other obligations including the costs of printing the official
statement, negotiated placement memorandum, the securities or other
legal documents, fees of bond counsel, costs of any required
publications, and costs of mailing and distributing the official
statement. Investment Banker shall bear all fees of underwriter's
counsel.
9. Right to Audit
City and Agency or any of their duly authorized representatives
shall have access to any books, documents, papers and records of
Investment Banker and/or its subcontractors which are pertinent to
the specific Proposed Transaction hereunder for the purpose of
making an audit, an examination, excerpts and transcriptions. All
books, records and supporting detail shall be retained for a period
of five (5) years after the expiration of the term of this
Agreement, or any extension thereof, or for any longer period of
time as required by law.
10. Agency Support
City and Agency shall provide Investment Banker with any plans,
publications, reports, statistics, records or other data or
information pertinent to the services to be provided hereunder which
are reasonably available to City and Agency.
11. Independent Contractor
Investment Banker shall perform the services as contained herein as
an independent contractor and shall not be considered an employee of
City and Agency or under City and Agency supervision or control.
This Agreement is by and between Investment Banker and City and
Agency, and is not intended, and shall not be construed, to create
the relationship of agent, servant, employee, partnership, joint
venture, or association, between City and Agency and Investment
Banker.
12. Conflict of Interest
Investment Banker represents, warrants and agrees that it does not
presently have, nor will it acquire during the term of this
Agreement, any interest direct or indirect, by contract, employment
or otherwise, or as a partner, joint venturer or shareholder (other
than as a shareholder holding a one percent (1%) or less interest in
publicly traded companies) or affiliate with any business or
business entity that has entered into any contract, subcontract or
arrangement with City and Agency. After execution of this Agreement
and during its term, as appropriate, upon written request by City or
Agency with regard to specific individuals or entities, Investment
13478
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. .
Banker shall disclose in writing to City and Agency any contractual
or employment arrangement relative to such individuals or entities
from which it receives compensation. Investment Banker agrees not
to knowingly accept any employment during the term of this Agreement
by any other person, business or corporation which employment will
or may reasonably develop a conflict of interest between City's and
Agency's interests and the interests of third parties. Investment
Banker further agrees that it will avoid all other applicable
statutory conflicts of interest including, but not limited to, those
specified in California Government Code Section 1090, et seq.,
California Government Code Section 87100 to 87103; California
Government Code Section 1126, California Health and Safety Code
Section 33130 and the common law doctrine of conflicts of interest.
13. Successor and Assignment
The services as contained herein are to be rendered by Investment
Banker whose name is as appears first above written and said
Investment Banker shall not assign nor transfer any interest in
this Agreement without the prior written consent of City and Agency.
14. Indemnification
Investment Banker agrees to indemnify, defend (upon request by City
and Agency) and save harmless City and Agency, their agents,
officers and employees from and against any and all liability,
expense, including defense costs and legal fees, and claims for
damages of any nature whatsoever, including, but not limited to,
bodily injury, death, personal injury or property damage arising
from or connected with Investment Banker's operations, or its
services hereunder, including any workers' compensation suit,
liability or expense, arising from or connected with the services
performed by or on behalf of Investment Banker by any person
pursuant to this Agreement.
15. Insurance
Without limiting Investment Banker's indemnification of City and
Agency, Investment Banker shall provide and maintain at its own
expense during the term of this Agreement the following program(s)
of insurance covering its operation hereunder. Such insurance shall
be provided by insurer(s) satisfactory to City and Agency and
evidence of such programs satisfactory to City and Agency shall be
delivered to the City Administrator and the Executive Director of
Agency or their designees within ten (10) days of the effective date
of this Agreement.
l347S
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General Liability: A program including, but not limited to,
comprehensive general liability including automobile coverage
with a combined single limit of not less than $300,000.00 per
occurrence. Such insurance shall be primary to and not
contributing with any other insurance maintained by City and
Agency, and shall name City and Agency as an additional insured.
Workers' Compensation: A program including workers'
compensation insurance, where necessary, with statutory limits.
Failure on the part of Investment Banker to procure or maintain
required insurance shall constitute a material breach of this
Agreement upon which City and Agency may immediately terminate this
Agreement.
16. Compliance with Laws
The parties agree to be bound by applicable federal, state and local
laws, regulations and directives as they pertain to the performance
of this Agreement.
17. Non-Discrimination
In the fulfillment of the program established under this Agreement,
either as to employment, upgrading, demotion, transfer, recruitment
or recruitment advertising, layoff or termination, rates of payor
other terms of compensation, selection for training, including
apprenticeship or participation in the program or the receiving of
any benefits under the program, Investment Banker agrees not to
discriminate nor to allow any subcontractor to discriminate on the
basis of race, color, creed, religion, natural origin, ancestry,
sex, marital status or physical handicap.
18. Severability
In the event that any provision herein contained is held to be
invalid, void or illegal by any court of competent jurisdiction, the
same shall be deemed severable from the remainder of this Agreement
and shall in no way affect, impair or invalidate any other provision
contained herein. If any such provision shall be deemed invalid due
to its scope or breadth, such provision shall be deemed valid to the
extent of the scope or breadth permitted by law.
19. Interpretation
l347S
No provision of this Agreement is to be interpreted for or against
either party because that party or that party's legal representative
drafted such provision, but this Agreement is to be construed as if
it were drafted by both parties hereto. This Agreement shall be
construed according to the laws of the State of California.
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. . .
20. Entire Agreement
This Agreement supersedes any and all other agreements, either oral
or in writing, between the parties hereto with respect to the
retention of Investment Banker by City and Agency and contains all
the covenants and agreements between the parties with respect to
such retention.
21. Waiver
No breach of any provision hereof can be waived unless in writing.
Waiver of anyone breach of any provision shall not be deemed to be
a waiver of any other breach of the same or any other provision
hereof.
22. Contract Evaluation and Review
The ongoing assessment and monitoring of this Agreement is the
responsibility of the City Administrator and the Agency's Executive
Director or their designees.
23. Termination
This Agreement may be terminated by either party by glvlng written
notice at least five (5) days prior to the effective termination
date in the written notice.
24. Notice
Notices, herein shall be presented in person or by certified or
registered U. S. mail, as follows:
To Investment Banker:
Miller & Schroeder Financial, Inc.
505 Lomas Santa Fe nrive
Solana Beach, California 92075
To Agency:
Executive Director
Redevelopment Agency of the
City of San Bernardino
300 North "n" Street, Fourth Floor
San Bernardino, California 92418
To City:
City Administrator
City of San Bernardino
300 North "n" Street, Sixth Floor
San Bernardino, California 92418
Nothing in this paragraph shall be construed to prevent the giving
of notice by personal service.
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. .
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed as of the day and year first above shown.
Approved as to form and
legal content:
CITY #BERNARDINO
i ....;2,
./J. 7ft: cI.L:2~. .V . I
/ ,: -R2-
By ~ / /
(// Mayor .~p...fJof<.-e..-
Attest:
COMMUNITY DEVELOPMENT COMMISSION OF
THE CITY OF SAN BERNARDINO, on behalf
of the REDEVELOPMENT AGENCY OF THE
CITY OF S~ BERNARDINO
/ J
By: ~ liU
44~ 'Jt:j~ ilt1
Approved as to form
and legal content:
By:
./
Ti~:
1347S
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. .
Attachment I
WORK PROGRAM
Services to be Performed by Investment Banker:
Investment Banker shall perform in a diligent manner the following
services:
1. Assemble, review and analyze available financial and economic
data and information which may have a general bearing on a program for
financing of the Proposed Transactions.
2. Assemble and review a description of the Proposed Transactions
and outline the possible methods of financing such projects, the
advantages and disadvantages of each method as applied to a given
transaction, the general legal and practical requirements or restrictions
applicable to each method and their attendant costs.
3. When City and Agency have approved the plan for implementation,
the estimated costs and method of financing of which have been
sufficiently well established to permit the preparation of a final
financing plan, Investment Banker shall prepare such plan containing, in
addition to other information, the following:
A. A description of the transaction, including the purpose,
benefits, estimated costs and other pertinent information.
B. Details relating to the proposed method of financing,
including tentative bond amortization schedules, call
features, sources and amounts of funds to be used in
amortizing the costs and other related data.
C. Recommendations as to further procedures.
4. Assist Bond Counselor Special Counsel with the preparation of
necessary resolutions and other legal documents and make recommendations
as to the exact terms and conditions under which bonds are to be issued
and sold or privately placed, including timing and method of sale, final
amortization or repayment schedules, call and redemption features,
provisions governing the issuance of additional bonds, covenants and
other provisions in order to secure the best possible rating on the bonds.
5. Prepare the text and other material for an official statement
desribing the transactions, the bonds, their security, and the economic
and financial information on the participating entity.
6. If it is appropriate or desirable for any other public entity or
Authority to participate in accomplishing the financing for any
transaction or transactions, Investment Banker, in order to achieve
maximum coordination of the proposed financing, shall also serve as the
Investment Banker for such public entity or authority under the terms and
conditions hereof.
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Attachment I
7. Investment Banker shall be available at reasonable times by
telephone or at the offices of City or Agency to discuss on a continuing
basis the results of studies and analyses and generate such additional
information as desired or requested and consult with City or Agency as to
the financial aspects of any specific transaction then being considered.
13488
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AGREEMENT FOR PAYMENT OF LEGAL COSTS
OF FSLIC APPEALS AND
FOR REIMBURSEMENT OF LOSSES
THIS AGREEMENT, made this 20th day of June , 1989, between
the San Bernardino Redevelopment Agency for South East Industrial Project (the
"South East Agency"), the San Bernardino Redevelopment Agency for Central City
North Project (the "Central City Agency"), Astor Wood Financial, a California
corporation ("Astor Wood"), and Miller & Schroeder Financial, Inc. ("Miller &
Schroeder").
WHEREAS, with the assistance of Astor Wood, the South East Agency held
$96,110.90 in a certificate of deposit issued by the North America Savings and Loan
Association and approximately $95,306.44 in a certificate of deposit issued by
American Diversified Savings Bank; and
WHEREAS, with the assistance of Astor Wood, the Central City Agency held
$96,110.90 in a certificate of deposit issued by North America Savings and Loan
Association and $95,306.44 in a certificate of deposit issued by American Diversified
Savings Bank; and
WHEREAS, it was the understanding of Astor Wood that each of the above
described accounts would be insured up to $100,000 by the Federal Savings and Loan
Insurance Corporation (the "FSLIC"); and
WHEREAS, on June 6, 1988, the FSLIC placed North America Savings and Loan
Association and American Diversified Savings Bank in liquidation; and
WHEREAS, on January 12, 1989, the FSLIC issued its formal determination that
the Southeast Agency and the Central City Agency did not qualify as separate political
subdivisions for FSLIC insurance coverage provisions but that both were one political
subdivision entitled to maximum insurance of $100,000 for their accounts at North
America Savings and Loan Association (the "North America FSLIC Decision"); and
WHEREAS, on February 10, 1989, the FSLIC issued its formal determination that
the Southeast Agency and the Central City Agency did not qualify as separate political
subdivisions for FSLIC insurance coverage provisions but that both were one political
subdivision entitled to maximum insurance of $100,000 for their accounts at American
Diversified Savings Bank (the "American Diversified FSLIC Decision); and
WHEREAS, these FSLIC determinations mean that $92,221.80 is uninsured in the
North America Savings and Loan Association accounts and that $90,612.88 is uninsured
in the American Diversified Savings Bank accounts, resulting in an aggregate uninsured
balance of $182,834.68; and
WHEREAS, these determinations by FSLIC could result in a loss of up to $89,000
for each agency, depending on whether the agencies receive any money for the claims
in the liquidation of each association; and
1
WHEREAS, on March 13, 1989, the South East Agency and the Central City
Agency appealed the FSLIC determinations by submitting a written Request for
Reconsideration of the Initial Determination Full Coverage under Certificate Nos. 185
and 186 dated January 12, 1989 concerning North America Savings and Loan Account
Nos. 18-1152380 and 18-1152398, and Certificate Nos. 344 and 345 dated February 10,
1989 concerning American Diversified Savings Account Nos. SY-002-40010386514 and
SY-002-40010386522; and
WHEREAS, Strandling, Y occa, Carlson & Rauth, of Newport Beach, California,
was retained by both Agencies to assist in the appeal of the FSLIC determinations; and
WHEREAS, Holmes & Graven, Chartered, Minneapolis, Minnesota, was retained
by Miller & Schroeder and Astor Wood to also assist in the appeals; and
WHEREAS, Astor Wood and Miller & Schroeder believe they have no obligation
to reimburse the Agencies, but are desirous of protecting both Agencies, agree to
reimburse the South East Agency and the Central City Agency for up to $91,417.34
each for their losses if the FSLIC determinations are upheld on appeal; and
WHEREAS, Astor Wood and Miller & Schroeder have agreed to pay all legal fees,
costs, and expenses in connection with the FSLIC appeals.
NOW, THEREFORE, in consideration of the premises and agreements set forth
herein, the parties hereto agree as follows:
1. The South East Agency and the Central City Agency hereby agree to
promptly and diligently appeal the official decision of FSLIC for North America
Savings and Loan Association and for American Diversified Savings Bank to its
final determination. For purposes of this agreement, final determination shall
mean a determination on reconsideration issued by the Director of FSLIC
pursuant to 12 CFR S564.1(d)(4), unless, within thirty days after the
determination on reconsideration by the Director of FSLIC, the parties to this
agreement decide to pursue judicial review of the determination on
reconsideration by the Director of FSLIC. If judicial review is sought, then
"final determination" is defined by a decision by a judgment, decree or other
order by any court of competent jurisdiction which has become final and the
time to appeal therefrom has expired.
2. Miller & Schroeder and Astor Wood hereby approve the retention by the
Agencies of Strandling, Y occa, Carlson & Rauth as the attorneys to assist in the
FSLIC appeals and agree to pay all legal fees, costs and expenses arising out of
such appeal from the North American FSLIC Decision and the American
Diversified FSLIC Decision. Strandling, Y occa, Carlson & Rauth's fees are
estimated to be $20,000. Miller & Schroeder and Astor Wood agree to equally
divide these legal fees, costs and expenses. The parties understand and
acknowledge that Holmes & Graven, Chartered have been retained by Miller &
Schroeder and Astor Wood to assist Stradling, Yocca, Carlson & Rauth in the
appeal.
3. The Central City Agency and the South East Agency hereby agree to fully
cooperate and to assist counsel in appealing the North America FSLIC Decision
and the American Diversified FSLIC decision.
2
4. It is understood and agreed that by paying the legal fees, expenses, costs,
and any losses incurred by the South East Agency and the Central City Agency
under this Agreement, this is not to be construed as an admission of liability on
the part of Miller & Schroeder or Astor Wood.
5. In the event of adverse rulings on the appeal of the North American FSLIC
Decision and the American Diversified FSLIC Decision, Miller & Schroeder and
Astor Wood each agree to pay $91,417.34 to be used to reimburse the agencies
for certain losses arising out of the adverse rulings. Each agency will be
reimbursed up to $45,700.67 plus interest at the rate of 7.20% for North
American Savings and Loan Association deposits from June 6, 1988 and up to
$45,700.67 plus interest at the rate of 7.20% for American Diversified Savings
Bank deposits from June 6, 1988, in the event of adverse rulings on the FSLIC
appeals.
6. In the event the North America FSLIC Decision and/or the American
Diversified FSLIC Decision are upheld on appeal, therefore resulting in the South
East Agency and the Central City Agency having aggregate uninsured deposits of
$182,834.68, and if each agency is reimbursed for its loss of $91,417.34 each,
then both agencies agree to equally distribute all money, if any, received, plus
interest at the respective rate set forth in paragraph 5 herein, from the date of
receipt to the date of payment, from its claims on the dissolution and liquidation
of the American Diversified Savings Bank and the North American Savings and
Loan Association to Astor Wood and Miller & Schroeder. The South East Agency
and the Central City Agency agree to diligently pursue its claims in the
liquidation proceedings of the A merican Diversified Savings Bank and the North
American Savings and Loan Association and to inform Astor Wood of the status
of such claims at regular intervals.
7. This agreement may be executed in counterparts.
IN WITNESS WHEREOF, the parties hereto have executed this agreement on the
date first written above.
,//.....:::;-..) .--..')
AS~~Ry~..'.//F ~A~
By. '--~ __
Its: Managing Director
MILLER & SCHROEDER FINANCIAL, INC.
By:
Its:
SAN BERNARDINO REDEVELOPMENT
AGENCY FOR SOUTH EAST INDUSTRIAL
PROJECT"-) . :/
l /'~ //.~ ..'0./'
By: / /ti/;'s,.-/p c~. j/..k:?c;-/;&;/'
Its: /Mavor Pro ~m~re
3
4. It is understood and agreed that by paying the legal fees, expenses, costs,
and any losses incurred by the South East Agency and the Central City Agency
under this Agreement, this is not to be construed as an admission of liability on
the part of Miller & Schroeder or Astor Wood.
5. In the event of adverse rulings on the appeal of the North American FSLIC
Decision and the A merican Diversified FSLIC Decision, Miller & Schroeder and
Astor Wood each agree to pay $91,417.34 to be used to reimburse the agencies
for certain losses arising out of the adverse rulings. Each agency will be
reimbursed up to $45,700.67 plus interest at the rate of 7.20% for North
American Savings and Loan Association deposits from June 6, 1988 and up to
$45,700.67 plus interest at the rate of 7.20% for A merican Diversified Savings
Bank deposits from June 6, 1988, in the event of adverse rulings on the FSLIC
appeals.
6. In the event the North America FSLIC Decision and/or the American
Diversified FSLIC Decision are upheld on appeal, therefore resulting in the South
East Agency and the Central City Agency having aggregate uninsured deposits of
$182,834.68, and if each agency is reimbursed for its loss of $91,417.34 each,
then both agencies agree to equally distribute all money, if any, received, plus
interest at the respective rate set forth in paragraph 5 herein, from the date of
receipt to the date of payment, from its claims on the dissolution and liquidation
of the American Diversified Savings Bank and the North American Savings and
Loan Association to Astor Wood and Miller & Schroeder. The South East Agency
and the Central City Agency agree to diligently pursue its claims in the
liquidation proceedings of the American Diversified Savings Bank and the North
American Savings and Loan Association and to inform Astor Wood of the status
of such claims at regular intervals.
7. This agreement may be executed in counterparts.
IN WITNESS WHEREOF, the parties hereto have executed this agreement on the
da te first written above.
ASTOR WOOD FINANCIAL
By:
Its:
By:
AN CIAL, IN C.
Its:
SAN BERNARDINO REDEVELOPMENT
AGENCY FOR SOUTH EAST INDUSTRIAL
PROJEC~ "', )
I J /
J~ /. q..~ .. '"
By: L~4//M0
/ / I
Its: t Mayor Pro Ta'lfipore
3
. .
SAN BERNARDINO REDEVELOPMENT AGENCY
FOR CENTRAL CITY NORTH PROJECT
'1 ) '-
'/ /*'1
If" .t;~' t/ . -;/ h-
r.... if ?
May?~pro Tempore ;I
By:
Its:
APPROVED AS TO FORM AND
LEGAL CONTENT:
~~~J
. Agency Coun -
4
~
JUN 19 '89 12:2~ HOL~ES & GRAVEN
, F'~:=:/'4
ESCROW AGREEMENT
THIS ESCROW AGREEMENT is made this ~ dayo.f June, 1989, between the
San BernardinQ Redevelopment Agency tor South East Industrial Project (the "South
East Agency"), the San Bernardino Redevelopment Agency tor Central City North
Project (the1tCentral City Agencytt), and Miller & Schroeder Financial, Ine.t a
Minnesota' corporation (Ute "Corporation").
WHEREAS, the South East Agency and the Central City Agency [collectively
referred to as the ."Agencies"] a.nd the Corporation entered into an Agreement for
Payment of Legal Costs of FSLIC Appeals and For Reimbursement ot Losses (the
"Agreement"), attached hereto as Exhibit A with all terms and definitions incorporated
herein; and
WHEREAS" the Corporation has agreed to deposit an irrevocable letter of credit
in an amount equal to $202,580.83 to be held by the Agencies pending the final.
determination or the FSLIC appeals and to establish this escrow as a source of
payment pursuant to the Agreement for the potential losses by the Agencies.
NOW, THEREFORE, in considera.tion of the premises and agreements set forth
herein, the parties hereto agree as follows:
1. ITEM TO BE PLACED IN ESCROW
On the date hereof, the Corporation shall deposit an irrev()cable letter of
credit (the "Irrevocable Letter of Credittt) in an amount of $202t580.83t which
amount is equal to $182'~834.68 plus 540 days simple interest cornm'encing on
June 6, 1988t at 7.296 per annum calculated on a 360 day year. The Irrevocable
Letter of Credit shall be designate both Agencies as the nam ed beneficiaries tor
the account of the corporation and it shall authorize the Agencies to draw upon
the Irrevocable Letter of Credit immediately upon the receipt of adverse final
determinations of the FSLIC appeals. The Irrevocable Letter ot Credit shall
have a term of one year. The Irrevocable Letter of Credit shall also authorize
the Agencies to draw upon it if the Corporation has not issued a new irrevocable
letter of credit with the same terms and conditions of the Irrevocable Letter of
Credit, except that the amount shall be increased to include any additional
interest owed to the Agencies pursuant to the Agreement, thirty days prior to
the expiration of the Irrevocable Letter of Credit. The Aieneies agree to
forward to the issuer of the Irrevocable Letter of Credit a copy ot the FSLIC
final determinations. The Irrevocable Letter of Credit shall contain such other
terms and conditions as are customary in the industry. The issuer of the
Irrevocable Letter of Credit will be a. bank which has long-term obligations rated
in one of the three highest rating categories by Standard & Poor's Corporation.
2. APPLICATION AND DISBURSEMENT OF ESCROW PUNDS
Pursuant to the Agreement, the Corporation has agreed to reimburse each
the South East Agency and the Central City Agency up to $91,417.34, plus
interest of 7.296 commencing on June 6~ 1988, in the event of an adverse
determination on the appeal of the FSLIC determinations. This Escrow is
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JUN 19 :89 12~24 HOLMES & GRAVEN
P.4/4
established tor the purpose of relmbursini the Aienoies tor any loss oaeasioned
by the toreeoing..
Upon a draw ot the Irrevocable Letter of Credit by the Ageneies,. the
Aiencies shall allocate the proceeds as follows:
$91,417.34, plus interest as determined in accordance with the Agreement
and to the extent provided tor in the Irrevocable Letter of Credit, shall be
payable to the South East Agency for reimbursement of certain losses
arising out ot an adverse ruling on the appeal from the North American
FSLIC Decision and the American Diversified FSLIC Decision.
$91,411.34, plus interest as determined in accordance with the Agreement
and to the extent provided tor in the Inevocable Letter of Credit, shall be
payable to the Central City Ageney for reimbursement of certain losses
arising out of an adverse ruling on the. FSLIC appeal from the North
American FSLIC Decision and the American Diversified FSLIC Decision.
In the event of a favorable ruling on appeal of these FSLIC . decisions, this
agreement shall terminate and there shall be no draw on the Irrevocable Letter
of Credit.
3. BINDING AGREEMENT AND SUBSTITUTION OF ESCROW AGENT
The terms and conditions Ol this Escrow Agreement shall be binding upon
the assigns, creditors, transf erees, or successors in interest, whether by
operation of law or otherwise, of the parties hereto.
4. NOTICES
All notices, disbursements and other communications hereunder shall be
deemed to be properly given if delivered to the following address:
if to Corporation: Miller << Schroeder Financial, Inc.
505 Lomas Santa Fe Drive
Suite 100
Solana Beach, California 92075-0819
if to South East Aiency: San Bernardino Redevelopment Agency for
East Industrial Project
300 North D Street
San Bernardino, CA 92401
it to Central City Agency: San Bet'nardino Redevelopment Agency for
Central City North Project
300 North D Street
San Bernardino, CA 92401
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F' ,::"
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IN WITNESS WHEREOF, the parties hereto have executed this Escrow
Agreement, on the date first above written.
SAN BERNARDINO REDEVELOPMENT
AGENCY FOR SOUTH EAST
INDU PROJEC -;/
tf .- ;tid
Its: l
By:
t~~--?tts:
Approved as to form
and Legal content:
Agency Counsel
SAN BERNARDINO REDEVELOPMENT
::~~$i;~~CITY
Its:" Mayor Pro ~mpore
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