Loading...
HomeMy WebLinkAbout1988-053 " SBE00031-74/2818S/km 02/03/88 RESOLUTION NO. 88-53 RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO, CALIFORNIA, APPROVING A CERTAIN AMENDMENT NO. 1 TO THE INDENTURE OF TRUST, A CERTAIN AMENDMENT NO. 1 TO THE LOAN AGREEMENT AND CERTAIN OTHER DOCUMENTS IN CONNECTION WITH ITS CITY OF SAN BERNARDINO, CALIFORNIA, FLOATING/FIXED RATE INDUSTRIAL DEVELOPMENT BONDS, SERIES 1985 (GATE CITY BEVERAGE DISTRIBUTORS PROJECT) WHEREAS, the City of San Bernardino, California (the "Ci ty") , is authorized and empowered by Ordinance No. 3815, as amended (the "Ordinance"), to make construction loans and mortgage loans to finance various types of projects, as defined In the Ordinance, and to issue its special revenue bonds for the purpose of enabling various developers to finance the cost of such projects, and has amended the same from time to time; and WHEREAS, said Ordinance is intended to finance the development of industry and commerce and to thereby broaden the employment opportunities and there is a consequent need to encourage the construction or development of industrial and commercial j facilities without any liability to the City whatsoever; and WHEREAS, Gate City Beverage Distributors, I nc . , a California corporation, or its successors or assigns (the "Company"), has previously submitted a certain application (the "Application"), to the Mayor and Common Council of the City of - 1 - I San Bernardino, California (the "Mayor and Common Council"), for tax-exempt financing for a certain Ordinance 3815, as amended, as more Application (the "Project"); and development pursuant to fully described In said WHEREAS, the Mayor and Common Council, pursuant to its Resolution No. 85-90, adopted on March 7, 1985, approved, among other items, the execution and delivery of a certain Trust Indenture by and between the Ci ty and Manufacturers Hanover Trust Company of California, as Trustee (the "Trustee"), dated as of March 1, 1985 (the "Indenture") and a certain Loan Agreement by and between the Ci ty and the Company dated as of March 1, 1985 (the "Loan Agreement"); and WHEREAS, the Indenture has provided for the issuance by the City of its $2,900,000 City of San Bernardino, California, Floating/Fixed Rate Industrial Development Bonds Series 1985 (Gate City Beverage Distributors Project) (the "Bonds"), for the purpose of providing funds to pay a portion of the cost of the Proj ect of the Company; and WHEREAS, as securi ty for the Bonds, The Bank of Tokyo, Los Angeles Agency, has issued to the Trustee for the benefi t of the Bondholders, an irrevocable standby letter of credit, which letter of credit expires on March 1, 1988; and - 2 - WHEREAS, Section 30l(i) of the Indenture provides for redemption of the Bonds if the Company does not provide a substitute letter of credit meeting the criteria set forth therein; and WHEREAS, the Mitsubishi Bank, Los Angeles Agency ("Mitsubishi"), has proposed to deliver to the Trustee its substi tute irrevocable standby letter of credi t in accordance wi th the provisions of Section 30l(i) of the Indenture as further security for the repayment of the obligation of the Company to the City pursuant to the Loan Agreement; and WHEREAS, Crocker National Bank has previously been appointed as Remarketing Agent in accordance with the provisions of Seetin 305 of the Indenture; and WHEREAS, the Company wishes to appoint Prudential-Bache Securities Inc. ("Prudential-Bache") as Remarketing Agent ln accordance with the provisions of Section 306 of the Indenture; and WHEREAS, Section 207 of the Indenture provides for the computation of the Variable Rate on the Bonds and the Company, Mitsubishi and Prudential-Bache have requested the City, the Trustee and the Bondholders to amend the Indenture to effect a substi tute computation of said Variable Rate; and WHEREAS, Section 11.02 of the Indenture provides that the City and the Trustee may modify or amend the Indenture at any time - 3 - by entering into an amendment with the consent of two-thirds of the Bondholders; and WHEREAS, Section 12.10 of the Loan Agreement and Section 12.01 of the Indenture provide that the City and the Company may enter into any amendment of the Loan Agreement with the consent of two-thirds of the Bondholders; and WHEREAS, it 1S now desirable for the City to approve a certain Amendment No. 1 to the Trust Indenture in the form as on file with the City Clerk ("Amendment No.1 to the Trust Indenture") and a certain Amendment No.1 to the Loan Agreement in the form as on file with the City Clerk ("Amendment No. 1 to the Loan Agreement"); and WHEREAS, the Company desires to utilize the services of Sabo & Deitsch, a Professional Corporation (the "Bond Counsel") to effect the amendment of said documents in connection with the Bonds and, pursuant thereto, a three party agreement for bond counsel services has been prepared, wherein the Company agrees that it shall pay the cost of any and all bond counsel services for the amendment of said documents; and WHEREAS, Ordinance, and by all all acts, conditions other laws of and things requi red by the the State of California, to exist, to have happened and to have been performed precedent to and in connection with the redelivery of the aforesaid industrial - 4 - " development bonds exist, have happened, and have been performed In regular and due time, form and manner as required by law, and the City has duly authorized, pursuant to each and every requirement of law, the redelivery of such industrial development bonds for the purpose, in the manner and upon the terms therein provided. NOW, THEREFORE, THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO DO HEREBY FIND, RESOLVE, DETERMINE AND ORDER AS FOLLOWS: Section 1. true and correct. The above reci tals, and each of them, are Section 2. The Mayor and Common Council hereby approves the form of Amendment No.1 to the Trust Indenture and the form of Amendment No.1 to the Loan Agreement. further authorizes the execution of No. 1 of the Trust Indenture and The Mayor and Common Council the final form of Amendment Amendment No. 1 to the Loan Agreement when the same shall be presented for execution by the Mayor and Ci ty Clerk of the Ci ty or such other appropriate Ci ty official, subject to such changes, additions or deletions as may be recommended by the Ci ty Attorney and Bond Counsel. The execution thereof by the Mayor and Ci ty Clerk of the Ci ty or such other appropriate City official shall be deemed to be conclusive as to the approval thereof by and on behalf of the City. - 5 - .. Section 3. This Resolution and the final version of the Amendment No. 1 of the Trust Indenture and Amendment No. 1 to the Loan Agreement will be subject to the approval of the City Attorney. Section 4. The Mayor and Common Counci 1 hereby approve the form and execution of the Agreement for Bond Counsel Services attached hereto as Exhbit "A on behalf of the City. The Mayor and City Clerk of the City, or such other appropriate City official, are hereby authorized and directed to execute the Agreement for and on behalf of the City. Section 5. The officers of the Ci ty are hereby authorized and directed, jointly and severally, to do any and all things to execute and deliver any and all documents, including the Bonds, which they may deem necessary or advisable in order to effectuate the purposes of this Resolution; and any such actions as previously taken by such officers in furtherance of the redelivery of the Bonds are hereby ratified and confirmed. Section 6. This Resolution shall take effect upon adoption. - 6 - day of to wit: n:~glllar Fehrllary resolution was duly of the Ci ty of meeting thereof, 19 8 8 , by I HEREBY adopted by the San Bernardino at held on the 15th the following vote, CERTIFY Mayor a that the foregoing and Common Counc i 1 AYES: Council Members Estrada, Reilly, Flores, Maudsley, Minor, Pope-Ludlam NAYS: None ABSENT: Council Member Miller AdM?l4~1P CitY Clerk day of The foregoing February resolution is , 1988. hereby approved this /7/,A- / ulr~ 4--c~ t/ V' ( Mayor of Ithe Ci ty of. San Bernardino Approved as to form and legal content: By: a/}t~~a4J /" y Attorn.e"y - 7 - 1- . . .. EXHIBIT "A" AGREEMENT FOR BOND COUNSEL SERVICES - 9 - . .. SBE00031-72/2794S/km 02/03/88 AGREEMENT FOR BOND COUNSEL SERVICES THIS AGREEMENT is made and entered into this 15th day of February, 1988, by and among Sabo & Deitsch, a Professional Corporation (the "Bond Counsel"), the City of San Bernardino, California (the "City"), and Gate City Beverage Distributers (the "Developer") in connection wi th the redelivery of the $2,900,000 City of San Bernardino, California, Floating/Fixed Rate Industrial Development Bonds (Gate City Beverage Distributors Project) Series 1985 (the "Bonds"). - WITNESSETH - THE PARTIES HERETO HEREBY AGREE AS FOLLOWS: 1. SERVICES The Developer and the City request that Bond Counsel provide legal services in connection with the City's amendment of certain documents in connection wi th the redeli very of the Bonds (the "Bond Documents") including, but not limited to, the Trust Indenture by and between the Ci ty and Manufacturers Hanover Trust Company of California (the "Trustee") dated as of March I, 1985 (the "Indenture"). All capitalized terms used herein and not otherwise defined shall have the same meaning as in the Indenture. The amendments shall effect the substitution by the Mitsubishi Bank of the present letter of credit bank and appoint Prudential Bache Securi ties, Inc. as remarketing agent and requi re the consent of two-thirds of the Bondholders as described in Section 1102 of the Indenture. Such services shall include, but not be limited to, the rendering of a legal opinion if required by the placement agent (the "Opinion") pertaining to the Bondholder election and the amendment of the Bond Documents to the effect that: a. after said Bondholder election and amendment the Bonds have been properly authorized and issued and are valid and binding obligations; b. after said amendment security for the provided; and the Bonds essential sources of have been legally c. after said amendment all interest on the Bonds is exempt from federal and California income taxation. - 1 - . , The Bond Counsel's services will also include compiling a sufficient record justifying the opinion by: I . researching related to Bondholder Documents"); applicable laws and ordinances the proposed amendments and drafting election documents (the "Election II. attending conferences and consulting with staff, - Bondholders and counsel regarding laws, and need for amendments thereto; City such Ill. participating with any financial advisors, underwriters or other experts retained by the City in structuring the Bondholder election and amendment of the Bond Documents; IV. supervising and preparing documentation of all steps to be taken through the amendment of the Bonds and the Bondholder election, including but not limited to: a. drafting all Election Documents, resolutions of the City and all other basic documents relating to the securi ty of the Bonds, in consultation with City, its counsel and financial advisors, underwriters and other experts; b. preparing the record of proceedings amendment of the Bond Documents Bondholder election; for the and the c. preparIng documents relating to the financing and the Bondholder election, including, but not limited to, amendments to the Loan Agreement and the Indenture; d. assisting in the preparation of the official statement or placement memorandum and supporting documentation relating to the amendment of the Bond Documents, if applicable; e. attending informational meetings and other conferences scheduled by the Ci ty, the Bondholders, the financial advisors or the underwriter; f . consulting their legal applicable; with prospective counsel and rating purchasers, agencies as - 2 - , .. g. consulting with counsel to the City concerning any legislation or litigation during the course of the financing; h. consulting with the trustee and counsel to the trustee; 1. rendering the final approving opinion as to the validity, legality and tax exemption of the Bondholder election and the Bonds for use and distribution upon amendment of the Bond documents; and J. rendering any necessary collateral legal opinions as to the inapplicability of the registration requirements of federal securities laws and other matters related to the Bondholder election and the amendment of the Bond Documents. 2. FEES A. Fee to City The Developer hereby agrees to pay to the City an amount equal to $550 to cover administrative expenses of the City. B. Basic Fee The parties hereto agree that insofar as the Developer has requested the foregoing assistance from the City concerning the amendment of the Bond Documents and the Bondholder election, the Developer shall bear any and all costs for the above-described legal services performed by Bond Counsel concerning the Project. The Developer hereby requests that the Bond Counsel provide the above-described legal services to the City, all at the cost and expense of the Developer. The Developer agrees to pay for the foregoing legal services and for any and all costs of the Bond Counsel related to such legal services in accordance with the fee and cost schedule hereinafter set forth. Such legal services shall be provided at an hourly rate, to wit: Principal Attorney-$150.00 per hour, Associate Attorney-$135. 00 per hour; Paralegals and Law Clerks-$90.00 per hour. The Developer acknowledges that the Bond Counsel represents the City and that the interests of the City may be adverse to, or in conflict with, the interests of the Developer. The Developer acknowledges and agrees that the Bond Counsel shall have no duty or obligation to represent or protect the interests of the Developer or hold in confidence any communication from the Developer to Bond Counsel and that in any dispute between City and the Developer, the Bond Counsel shall have no fiduciary duty or loyalty to the Developer whatsoever. The Ci ty and the Developer understand and agree that the Bond Counsel shall provide legal services hereunder subject to the foregoing conditions, and the City - 3 - ~ and the Developer consent to the provision of legal services by the Bond Counsel hereunder pursuant to the terms and conditions of this Agreement. C. Out-of-Pocket Expenses The Developer also agrees to reimburse the Bond Counsel for out-of-pocket expenses incurred in connection with the provision of the aforementioned services, including, but not limited to, travel, document reproduction, postage, courier service, secretarial and/or word processing overtime specifically requested by the City or the Developer, and the like, plus general administrative costs equal to twenty-five percent (25%) of such documented expenses. The Bond Counsel shall bill for all such fees and expenses monthly, but no later than the tenth (lOth) business day of the month subsequent to the month in which such legal services are performed. D. Retainer The Bond Counsel shall require the Developer to provide a $5,000.00 retainer, such moneys to be retained by the Bond Counsel in a trust account, and applied against the last outstanding invoice. In any event, the maximum amount to be paid by Develoer to Bond Counsel for fees and expenses is $23,500. E. Responsible Party The City shall bear no liability to any party herein for payment for legal services under this Agreement, and the Bond Counsel shall hold the City harmless from any obligations for payment for legal services provided by the Bond Counsel pursuant to this Agreement. The parties acknowledge and agree that any failure of the Developer to make timely payments hereunder as billed by the City may result in the discontinuance of the provision of assistance by the City and/or the rendering of legal services by the Bond Counsel pertaining to the amendment of the bond documents. 3. TIME Time is of the essence. 4. INTERPRETATION OF AGREEMENT Should interpretation of this agreement, or any portion thereof, be necessary, it is deemed that this agreement was prepared by each of the parties hereto jointly and equally, and shall not be interpreted against any party on the ground that the party prepared the agreement or caused it to be prepared. 5. ENTIRE AGREEMENT OF THE PARTIES oral This agreement supersedes any or written, between the parties and all agreements, hereto wi th respect either to the - 4 - ^ . rendering of services by Bond Counsel to the City, and contains all of the covenants and agreements between the parties with respect to the rendering of such services in any manner whatsoever. Each party to this agreement acknowledges that no representations, inducements, promises, or agreements, oral or otherwise, have been made by any party or anyone acting on behalf of any party, which are not embodied herein, and that no other agreement, statement, or promise not contained in this agreement shall be valid or binding. Any modification of this agreement will be effective only if it is in writing, signed by the party to be charged. 6. COUNTERPARTS The Agreement may be executed by all parties in duplicate counterparts, each of which will be considered an original agreement. - 5 - ..... ~ ' IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day entered above. SABO & DEITSCH, a Professional Corporation -- I;~ A l By: :/;-4'0 ,'/;";;1---- CITY OF SAN BERNARDINO By:&A-d lJ ~ Mayor ATTEST: o6'!fd~t?}:/2//t?61~ City Clerk (SEAL) GATE CITY BEVERAGE DISTRIBUTORS By: ~~,. , j<L~~ (! ~( Title: SBE00031-72/2794S Approved as to form and legal content: ~~~~ - 6 -