HomeMy WebLinkAbout1981-497
San Bernardino
(Langstoh-Newby) .
60,009-8-1
TriE CITY OF' SAN BERNARDINO
CALIFORNIA
RESOLUTION NO. !? 1--<197
A RESOLUTION OF THE MAYOR AND COMMON COUNCIL
OF THE CITY OF SAN BERNARDINO, CALIFORNIA,
AUTHORIZING THE ISSUANCE OF ITS INDUSTRIAL
DEVELOPMENT REVENUE NOTE, LANGSTON-NE\r.BY
PROJECT, 1981 SERIES, FOR THE ~URPOSE OF
ACQUIRING AND IMPROVING REAL PROPERTY; AND
MAKING CERTAIN FINDINGS AND DETERMINATIONS
IN CONNECTION THEREWITH
IMPERIAL BANK, PURCH~SER
Dated as of October 1, 1981
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Whereas Clauses
Granting Clauses
Section 1. Ol
Definitions
San.Berni!!rdino
(Langston-Newby)
60,009-8-1
TABLE OF CONTENTS
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ARTICLE 1
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Granting Clauses
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ARTICLE 2
Section 2.01
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Section 2.02
Section 2.03
The City Note
Defini tions ................................................
Inclusiveness of Certain Terms .....
References to Resolution of Issuance
ARTICLE 3
section 3.01
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section 3.02
Section 3.03
Section 3.04
Section 3.05
Section 3.06
Issuance of the City Note;
Purpose ........................................................ 17
Terms; Amount; Maturity Date;
Interest Rate; Place of Payment
Security for City Note; No City
Debt...................................... .............
Payment of the city Note at Election
of City From Other Lawfully Available
Funds; Advances by City............
Forms of City Note
.. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. ..
Execution of the city Note
.. .. .. .. .. .. .. .. ..
(i)
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3
3
5
5
15
16
17
17
17
19
19
20
Section 3.07
Section 3.08
Section 3.09
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TABLE OF CONTENTS
(Continued)
Page
City Note Mutilated, Lost,
Destroyed or Stolen ................
20
Validity of the City Note ..........
21
Participations .....................
21
ARTICLE 4
Delivery of the City Note; Establishment of Funds;
Application of city Note Proceeds .................... 22
Section 4.01
Section 4.02
Section 4.03
Issuance of City Note ..............
Creation of Funds ..................
22
22
Application of Proceeds of
ci ty Note ..........................
22
ARTICLE 5
Redemption of Allor Part of the City Note Prior
to Maturity .......................................... 23
Section 5.01
Section 5.02
Section 5.03
section 5.04
Section 5.05
Section 5.06
Use of Revenues
Terms of Redemption
. . . . . . . . . . . . . . . .
23
Call and Redemption
. . . . . . . . . . . . . . . .
23
Notice of Redemption ............... 23
Partial Redemption of the city Note 24
Redemption Fund .................... 24
Effect of Redemption
. . . . . . . . . . . . . . .
24
ARTICLE 6
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26
(ii)
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Section 6.01
Section 6.02
Section 6.03
Section 6.04
San Bernardino
(Langston-Newby)
60,009-8-1
TABLE OF CONTENTS
(Continued)
Revenue Fund .......................
Administrative Expense Fund ........
Operation and Maintenance Fund .....
Surplus Fund.......................
ARTICLE 7
Page
26
26
26
27
Particular Covenants of the City....................... 28
Section 7.01
section 7.02
Section 7.03
Section 7.04
Section 7.05
Section 7.06
Section 7.07
Section 7.08
Section 7.09
Punctual Payment ...................
Maintain Corporate Existence .......
Project Agreement
. . . . . . . . . . . . . . . . . .
Further Assurance
. . . . . . . . . . . . . . . . . .
28
28
28
29
29
29
29
29
30
Section 8.01
Events of Default and Remedies ......................... 31
Section 8.02
Not sell, Lease, Etc. .............
Not Extend Time for Payment ........
Prosecution and Defense of Suits
Relating to Title ..................
Limits on Additional Debt ..........
Covenant Covering Arbitrage ........
ARTICLE 8
Events of Default ..................
Bank's Rights on Default ...........
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32
Section 8.03
section 8.04
Section 8.05
Section 8.06
Section 8.07
Section 8.08
Section 8.09
Section 8.10
San ;Bernqrdino
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60,009-8-1
TABLE OF CONTENTS
(Continued)
Page
Actions Upon Default ................ 32
Nonwaiver ........................... 33
Enforcement, Suits at Law or in
Equi ty .............................. 33
Remedies Nonexclusive ............... 34
No Waiver ........................... 34
Use of Moneys Received by Bank
34
No Impairment of Bank's Rights
35
Remedies Lawful..................... 35
ARTICLE 9
Modification of this Resolution of Issuance and
the Project Agreement ................................. 37
Section 9.01
section 9.02
Section 9.03
Section 9.04
Section 9.05
Resolution to be Amended Only in
Manner Provided in Article 9 ........
37
Permissible Purposes for, and
Limitation Upon, Supplemental
Resolutions .........................
37
Resolution May be Modified or Altered
with Consent of Bank ................
38
Supplemental Resolutions Deemed
Part of Resolution; Entitlement
to Rely Upon Opinion of Counsel
38
Supplemental Resolutions Affecting
Rights of Company Require Consent
of Company ..........................
39
(iv)
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TABLE OF CONTENTS
(continued)
Page
ARTICLE 10
Defeasance
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40
Section 10.01 Release of Assignment Upon Payment
or Provision for Payment, of Prin-
cipal of, Premium, if any, and
Interest on City Note ............... 40
Section 10.02 Defeasance Prior to Maturity or
Redemption Date ..................... 40
ARTICLE 11
Miscellaneous
.................................................................................. ..
42
section 11.01 Resolution to Bind and Inure to
Benefit of Successors of the City... 42
section 11.02 provisions of Resolution for Sole
Benefit of Parties and Bondholders 42
section 11.03 Compliance Certificates and
Opinions ............................ 42
Section 11.04 Form of Documents ................... 43
section 11. 05
Notice
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44
section 11.06 Effect of Headings and Table
of Contents ......................... 44
Section 11.07 Invalid or Illegal Provisions of
Resolution, Project Agreement, City
Note or Coupons Not to Affect Other
Provisions .......................... 44
Section 11.OS Officials, Officers, Agents and
Employees of City Exempt from
Individual Liability................ 45
(v)
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TABLE OF CONTENTS
(Continued)
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Section 11.09 Construction of Resolution
Governed by City Charter and
California Constitution and
Laws ................................ 45
EXHIBITS
Exhibit I City Note
Exhibit 2 Legal Description of Land
Exhibit 3 Schedule of Base Payments
Exhibit 4 Schedule of Prepayment Options
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..
aESOLUTION NO. f/ - 'I'll
A aESOLUTION OF THE .....YOR AND COMMON
COUNCIL OF THE CITY OF SAN BERNARDINO,
CALIFORNIA. AUTHORIZING THE ISSUANCE
OF ITS INDUSTRIAL DEVELOPMENT REVENUE
NOTE, LANGSTON-NEWBY PROJECT, 1981
SERIES. FOR THE PURPOSE OF ACQUIRING
AND IMPROVING REAL PROPERTY; AND MAKING
CERTAIN FINDINGS AND DETERMINATIONS IN
CONNECTION THEREWITH
WHEREAS, the City of San Bernardino ("City" or
"the City") is a municipal corporation. duly organized and
existing under the Constitution of the State of Californin
and the City Charter of said City; and
WH~REAS, the City has adopted its Ordinance N0. 381~
entitled "Ordinance of the City of San Bernardino Relatin3
to the Financing of Projects for the Encouragin<) of Increas!':!
Employment wi thin the Ci ty" and certain amendments then:tc.
(collectively the "Ordinance No. 3815"); and
WHERE^~, said Ordinunce No. 3815 is intended to
provide a means for the financing of the development of
industry and co~nerce and to thereby broaden the employmc~t
opportunities for residents of the City and its tax and
revenue base; and
WHEREAS, Robert L. Langston and Wilton K. Newby, a
General Partnership ("Company" or "the Company") has submitted
its Application for the financing of certain capital improve-
aents and improvements to land as authorized by Ordinance
No. 3815 and on April 14, 1980, the Mayor and Common Council
of the City have adopted a Resolution approving the same and
aaking the necessary determinations, in a certain Resolution
No. 80-126 entitled: "Resolution of the Mayor and Common
Council of the City of San Bernardino Approving an Application
for the Issuance of Industrial Development Revenue Bonds of
the City and the Project Referred to Therein; Finding that
There Was No Evidence Presented at a Public Hearing Held on
Said Application in Opposition to Said Application or Said
Project; Directing the Preparation of a Project Agreement.
Resolution of Issuance and other Legal Documents as May Bl'
Necessary to Carry Out Said Project and Provide for thl'
Issuance of Industrial Development Revenue Bonds Therefor;
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and Making certain Other Findings and Determinations in
Connection Therewith"; and
WHEREAS, pursuant to and in accordance with the
provisions of Ordinance No. 3815, the Company proposes to
undertake the construction of a 22,612 square feet commercial
office building located at 1255 East Highland Avenue in the
City of San Bernardino, together with off-street parking
therefor, the same to be acquired and financed by this
Project Agreement (the "Project Agreement"); and the City
intends to finance the cost of the Project by the issuance
of special revenue bonds of the City under this Resolution
(the "Resolution"); and
WHEREAS, one City Note will be issued under this
Resolution and will be secured by a pledge of the Revenues
derived by the City under this Project Agreement; and
WHEREAS, this Resolution and the Project Agreement
to which it pertains have in all respects been duly and
validly authorized by the Mayor and Common Council of the
City; and all things required by Ordinance No. 3815 to be
done have been done; and
WHEREAS, it has been determined that the estimated
amount necessary to finance the cost of the Project, including
necessary expenses incidental thereto, will require the
issuance, sale and delivery of the city Note pursuant to
Resolution No. 3815 in the principal amount set forth in
this Resolution; and
WHEREAS, all things necessary to make the city
Note, when issued as provided in this Resolution, the valid,
binding and legal special revenue obligation of the City
according to the import thereof, and to constitute this
Resolution a valid assignment and pledge of the Revenues
derived by the City from the Project Agreement to the payment
of the principal of and interest on the city Note and a
valid assignment and pledge of the rights of the City under
the Project Agreement have been done and performed, and the
creation, adoption, execution and delivery of this Resolu-
tion, and the creation, execution and delivery, and issuance
of the City Note, subject to the terms hereof, have in all
respects been duly authorized.
NOW, THEREFORE, BE IT RESOLVED, DETERMINED AND
ORDERED BY THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN
BERNARDINO, AS FOLLOWS:
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ARTICLE I
GRANTING CLAUSES
Section 1.01. Granting Clauses.
The City, in consideration of the promises and the
purchase and acceptance of the Bond by the Purchaser, and
for other good and valuable consideration, the receipt of
which is hereby acknowledged, in order to secure the payment
of the principal of and interest on the Bond according to
its tenor and effect and the performance and observance by
the City of all of the covenants expressed or implied
herein and in the Bond, does hereby assign to the Purchaser
and to its successors and assigns the following:
FIRST, the amounts required by this Resolution and
the Project Agreement to be deposited from time to time in
the Revenue Fund created by this Resolution, and all other
amoun'ts, from time to time held by the City for the benefit
of the holders of the Bond pursuant to this Resolution
together, in each case, with the proceeds of any investments
and reinvesbnents made with such amounts and moneys and the
proceeds thereof; and
SECOND, all of the City's right, title and inter-
est in and to the Project Agreement (except for the rights
of the City to receive payments, if any, under Section 4.02
of the Project Agreement, the Company Note and Deed of Trust
as hereinafter defined, together with all powers, privileges,
options and other benefits of the City contained in the
Project Agreement, and said Company Note and Deed of Trust,
which are not specifically described in the Second Granting
Clause above; provided, however, that nothing in this clause
shall impair, diminish or otherwise affect the City's obliga-
tions under the Project Agreement, and said Company Note and
Deed of Trust, or, except as otherwise provided in this
Resolution, impose any such obligations on the Trustee; and
THIRD, any and all property of every kind or
description which may from time to time hereafter be sold,
transferred, conveyed, assigned, hypothecated, endorsed,
deposited, pledged, mortgaged, granted or delivered to, or
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deposited as additional security by the City or anyone on
its behalf or with its written consent, or which pursuant to
any of the provisions hereof or of the Project Agreement, or
of said Company Note and Deed of Trust, may come into the
possession or control of the City or of a receiver lawfully
appointed pursuant to Article 9, as such additional security;
and the Purchaser is hereby authorized to receive any and
all such property as and for additional security for the
payment of the Bonds and coupons appertaining thereto, if
any, and to hold and apply all such property subject to the
terms hereof.
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ARTICLE 2
DEFINITIONS
Section 2.01. Definitions.
The terms defined in this Article 2 shall, for all
purposes of this Resolution. have the meanings herein speci-
fied, unless the context clearly otherwise requires:
Accountant's Certificate
"Accountant's Certificate" means an opinion signed
by a firm of certified public accountants approved by the
City.
Administration Expenses
"Administration Expenses" shall mean the reasonuble
and necessary expenses incurred by the City in the adminis-
tration of the Project Agreement. this Resolution and th~
financing of the Project and shall be paid to the City as
Additional Payments by the Company pursuant to the Project
Agreement.
Agency
"Agency" means the Redevelopment Agency of th~
City of San Bernardino, a public body, corporate and politic.
Annual Debt Service on the Note
"Annual Debt Service on the Note" means the total
amount of principal and interest payable on the Company Note
for any Bond Year after the computation is made.
Assignment of Leases, Rents and Profits
"Assignment of Leases, Rents and Profits" means
the document by such name and in substantially the form
approved by the City and the Bank.
Authorized Company Representative
"Authorized Company Representative" shall mean a
person authorized to act on behalf of and bind the Company.
Such authorization shall be evidenced by written~ertifi-
cate, power of attorney, or other instrument acceptable to
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the City and the Trustee, furnished to the City, the Agent
and-the Trustee, as the case may be, containing the .pecimen
signature of the Authorized Company Representative and
executed and signed on behalf of the Company by one of the
general partners thereof, [and shall be accompanied by an
unqualified Opinion of Counsel to the Company as to the
foregoing]. Such certificate, power of attorney or instru-
ment may designate one or more alternate representatives and
may designate a different Authorized Company Representative
to act for the Company with respect to different sections of
the Agreement and this Resolution, and any other documents
which are a part of the financing transaction which is the
subject of the Agreement and the Resolution of Issuance.
Authorized Newspapers
"Authorized Newspapers" means a financial paper,
or a newspaper of general circulation in the City of Los
Angeles, California, and the Daily Bond Buyer or other
financial paper or newspaper circulated in the City and
State of New York, each of which is published at least once
a day for at least five (5) days (other than legal holidays)
in each calendar week, and is printed in the English language.
Authorized Officer
"Authorized Officer" means the Mayor of the City
of San Bernardino, the City Attorney, the City Clerk or any
other authorized elected official of the City or any other
person authorized by resolution of the City to perform the
act or sign the document in question, on behalf of the City_
Bank
"Bank" means Imperial Bank, a California Corpor-
ation, sometimes also referred to as "Purchaser."
Bond Counsel
"Bond Counsel" shall mean .James Warren Beebe, A
Law Corporation, its successors or assigns or any other firm
of nationally recognized bond counsel of favorable reputation
selected by the City.
Bondholder
"Bondholder," "Holder" or "Holders of the Bonds"
or any similar term, when used with respect to the City
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Note, mean any person who shall be the registered owner or
his duly authorized attorney, trustee, representative or
assigns on the City Note.
Bond Year
"Bond Year" means the twelve (12) month period
commencing on October 15, 1981 and on each October 15 there-
after.
Business Day
"Business Day" shall mean a day on which banking
business is transacted in the city in which the Bank has its
principal corporate trust office.
City
"city" shall mean the City of San Bernardino,
California.
City Note
"city Note" means any City Note authorized and
issued under this Resolution of Issuance.
City Note Proceeds
"City Note Proceeds" shall mean all amounts re-
ceived by the City upon the sale or other disposition of the
City Note issued under this Resolution of Issuance.
Code
"Code" shall mean the Internal Revenue Code of
1954, as amended.
Company
"Company" shall mean Robert L. Langston and Wilton
K. Newby, a General Partnership, duly formed and existing
under the laws of the State of California, or any entity
which is the surviving, resulting or transferee entity in
any merger, consolidation or transfer of assets of said
Company permitted under Section 8.11 of the Project Agree-
ment.
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Company Note
"Company Note" or "Note" means that certain
promissory note executed by the Company and payable to the
City, secured by the Deed of Trust, which Note evidences thc.
debt obligation of the Company to the City under the Project
Agreement.
Company Representative
"Company Representative" shall mean the person or
persons at the time designated to act on behalf of the
Company by written certificate furnished to the City or thE:
Bank containing the specimen signature of such person or
persons.
Conflict of Interest
"Conflict of Interest" shall mean an interest
which constitutes a conflict of interest as applied to
pUblic officials, public officers and employees in the City
and the State.
Costs of Issuance
"Costs of Issuance" means items of expense p<:yable
or reimbursable directly or indirectly by the City or the
Company and related to the adoption of the Project Agree-
ment, the authorization, sale and issuance of the City Note,
which items of expense shall include but not be limited to,
costs of document production, costs of reproducing and
binding documents, filing and.recording fees, insurance
premiums, City Note discounts, legal fees and charges, pro-
fessional consultants' fees, fees and charges for execution,
transportation and safekeeping of the City Note, and other
costs, charges and fees in connection with the foregoing.
Counsel
"Counsel" shall mean all attorney at law or firm of
attorneys (who may be of counsel to the City or the Company,
or retained by the City or the Company in other connections,
as the context may require), licensed to practice in the
State in which said attorney or firm maintains an office,
selected by the City and satisfactory to the Bank.
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Counsel's Opinion
"Counsel's Opinion" means an opinion signed by
Counsel. Any Opinion of such Counsel may be based upon,
insofar as i~ relates to factual matters, information which
is in the possession of the City or Company, as the case may
be, upon a certificate or opinion of, or representation by,
an officer or officers of the City or Company, unless such
Counsel knows, or in the exercise of reasonable care should
have known, that the certificate or opinion or representa-
tion with respect to the matters upon which his opinion may
be based, as aforesaid, is erroneous, incomplete, or mis-
leading.
County Recorder
"County Recorder" means the County Recorder of the
County of San Bernardino.
Deed of Trust
"Deed of Trust" shall mean the document by such
name and in substantially the form approved by the City and
the Bank.
Determination of Taxability
"Determination of Taxability" means any deter-
mination, decision or decree made with regard to Section 103
of the Internal Revenue Code of 1954, as amended and then in
effect, by the Co; nissioner or any District Director of the
Internal Revenue Service or by any court of competent juris-
diction that, due to an Event of Taxability interest on the
City Note, is includable in the gross income of the holders
of the City Note (other than a holder who is a substantial
user or related person as defined in the Internal Revenue
Code of 1954, as amended); provided, however, should the
Agency, Company or any holder of the City Note, either
jointly or severally, succeed in reversing or setting aside
a Determination of Taxability, then an Event of Default of
Taxability will not be deemed to have occurred hereunder.
Event of Taxability
"Event of Taxability" means the occurrence of the
circumstances described in Section 103(b)(6)(D) of the
Internal Revenue Code of 1954, as amended and then in effect,
resulting from any action or inaction on the part of the
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Company or a principal user of the Project or any other
related person, which results in a Determination of Tax-
ability, with the result that the interest payable on the
City Note becomes includable in the gross income of the
holders of the City Note (other than a holder who is a
substantial user or related person as defined in the Inter-
nal Revenue Code of 1954).
Facili ties
"Facilities" shall mean the 57,600 square feet
commercial center located on the Land at South "E" Street
and Hospitality Lane in the City of San Bernardino, with
off-street parking therefor.
Hazard and Liability Insurance
"Hazard and Liability Insurance" means insuranc~,
issued by a person qualified to issue such insurance in th~
State which provides coverage at least equal to that pro-
vided in connection with commercial developments similar to
the Project constructed by the Company. Such insurance
shall include, but not be limited to (i) c0mprehensive
public liability insurance with respect to Project in minimum
amounts of $1,000,000 for death or bodily injury in connec-
tion with each occurrence and $100,000 for property damag~
in connection with each occurrence or such greater amounts
as may from time to time be required by Federal National
Mortgage Association in connection wit' loans for projects
similar to the Project; (ii) insurance against loss or
damage by fire and any of the risks covered by insurance of
the type known as "fire and extended coverage" for an amount
not less than the replacement cost of the Project; and (iii)
insurance against loss or damage due to floods for an amount
not less than the replacement cost of the Project if the
Project shall at any time hereafter be located in an area
designed by the Department of Housing and Urban Development
as a flood hazard zone. The premiums on Hazard and Liability
Insurance shall be paid by the Company.
Independent
"Independent," when used with such terms as "Cel-
tified Public Accountant," means any person or firm, respec-
tively, appointed by the City or the Company, as the context
may require, in such capacity, and who, or each of whom, has
a favorable reputation in the field in which his opinion or
certificate will be given, and:'
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(1) is in fact independent and not under
domination of the City or the Company;
(2) does not have any substantial interest,
direct or indirect, with the City or the Company; and
(3) is not connected with the City or the
Company as an officer or employee of the City or the
Company, but who may be regularly retained to make
reports to the City or the Company.
Interest Payment Date
"Interest Payment Date" means each date on which
interest on any City Note is requi=ed to be paid by this
Resolution.
Interest Requirement
"Interest Requirement" means, as of any particular
date of calculation, the amount equal to any unpaid interest
then due plus an amount equal to the interest to become due
on the City Note on the next succeeding Interest Payment
Date.
Issue Date
"I ssue Date" means the datc' of the ci ty Note
specified and determined in accordance with this Resolution.
Land
"Land" shall mean the Land (sometimes referred to
as "Site"), on which the Project is to be acquired and
constructed, described on Exhibit C and on the Title Insur-
ance Policy attached to the Project Agreement as Exhibit D
and which will be SUbject to the lien of the Deed of Trust
and this Resolution.
Loan
"Loan" means an interest-bearing obligation made
for the purpose of financing of the Project and secured by a
Mortgage on the Project and an Assignment of Leases, Rents
and Profits and such other security arrangements described
in the Project Agreement and in the Company Note.
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Maintenance and Operating Expenses
"Maintenance and Operating Expenses" lIeans all
costs and expenses of operating the Project, including (1)
the cost of all utiJities, taxes and assessments, if any, of
any type or character levied at any time during the term of
the Project Agreement upon the Project or upon the operation
of the Project; (2) the premiums on all insurance required
or permitted under the Project Agreement; (3) the cost of
keeping the Project free and clear of all liens, charges and
encumbrances; (4) all costs of maintaining the Project in
proper order and repair; and (5) the amount of any reasonable
replacement or repair reserves required hereunder.
Maximum Annual Debt Service on the Note
"Maximum Annual Debt Service on the Note" means
the largest amount of Debt Service on the Company Note
payable in any Bond Yeal.
Net Proceeds
"Net Proceeds," when used with respect to any
insurance proceeds from policies required to be maintained
by the Company and by the Project Agreement, means the
amount remaining after deducting from gross proceeds a~l
exp'nses (incl uding attorneys' fees) incurr'cd in the collec-
tion thereof.
Net Revenues
"Net Revenues" means all revenues excluding all
insurance revenues or sale proceeds received by the Company
including all payments by tenants with respect to the
Project less Maintenance and Operating Expenses.
Officer's certificate
"Officer's Certificate" means a certificate of the
City signed by an Authorized Officer and filed with the
Bank.
OrdiDance No. 3S1~
"Ordinance No. 3815" means that certain Ordinance
of the City entitled "Ordinance of the City of San Bernardino
Relating to the Financing of Projects for the Encouraging of
Increased Employment Within the City" and all amendments
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hereto, under the authority of which this Resolution is
adopted and the City Note is to be issued.
Outstilnding
The term "outstanding", when used with reference
to the City Note, shall meaTl, as at any particular date, the
aggregate amount of t.he City Note authenticated and dt:livered
under the Resolution of Issuance except:
(I) The amount of such city Note for tht:
payment of which cash shall have been theretofore
deposited in trust; and
(2) Tht: amount of such City Note otherwise
deemed to be paid in accordance with the Resolution of
Issuance.
Permitted Encumbrrtnces
"Permitted Encumbrances", when used with respect
to Mortgage Loans, means those liens, covenants, condition~,
restrictions, easements, encr0achments or rights which arc
customarily waived or accepted by prudent lending institu-
tions i"nd the existence of which will not prevent the
conveyance of good title to a mortgaged premises if a claim
for Mortgagt: Insuranct: benefits with respect thereto shall
thereafter bp made.
Pt:rmitted Investments
"Permitted Investments" means any of the following
which at the time are legal investments for the City under
the laws of the State, and to the extent provided by law,
for the moneys held hereunder then proposed to be invested
therein: (i) time or demand deposits in, or other bankiug
arrangements with any bank or trust company having aggregate
capital and surplus of at least $50,000,000 and authorized
to accept deposits of public funds (including the investment
department of the Bank), which are secured at all times by
bonds or other obligations which are authorized by law as
security for public deposits, of a market value at least
equal to the amount required by law; (ii) evidences of
indebtedness, or obligations for which the full faith and
credit of the United States are pledged for the payment of
principal and interest; (iii) obligations, participations,
or other instruments of, or issued by, or fully guaranteed
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as to principal and interest by, FNMA, or issued by a fed-
eral agency or a United States Government sponsored enter-
prise; (iv) evidence of indebtedness of corporations autho-
rized by the provisions of section 1364 of the California
Financial Code provided such indebtedness is rated, or is on
a parity with obligations that are rated "M" or better by a
nationally recognized rating agency; (v) mortgage obliga-
tions on single-family dwellings purchased from a state or
federally chartered bank or savings and loan association
pursuant to a repurchase agreement under which the bank or
savings and loan association will repurchase for a specified
amount.
Prepayment
"Prepayment" means any amount received or re-
covered which reduces or eliminates the principal amount of
the Loan other than scheduled amortization payments of the
principal amount of the Loan, including any prepayment
penalty, fee, premium or other such additional charge.
Prime Rate
"Prime Rate" is the weighted average for the
immediately preceding three (3) months prior to the date
that the Prime Rate is to be computed as the contract may
require, of the interest rate established by the Bank as its
prime rate. In the event that the Bank shall fail to
establish or publish a "Prime Rate," then, for purposes
hereof, the "Prime Rate" shall be deemed to be the average
Prime Rate for the three (3) largest (total assets) banking
institutions in the State then publishing a Prime Rate.
Principal User
"Principal User" means any principal user of the
Project within the meaning of Section 103 of the Internal
Revenue Code.
Proceedings
"Proceedings" means the actions taken by the City
in undertaking, carrying out and completing the Project,
including, without limitation, the Project Agreement, this
Resolution of Issuance, the Company Note, the City Note, the
Deed of Trus t and any and all othel' agreements and documents
involved in the issuance, sale, delivery of the Cit~ Note,
the security therefor and the expenditure of the City Note
Proceeds.
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Project
"Project" shall mean collectively the Facilities
and the Land.
Project Aqreement
"Project Agreement" or "Agreement" shall mean the
Project Agreement dated as of October 1, 1981, by and between
the City, the Company and the Bank, and any and all modifi-
cations, alterations, amendments and supplements hereto.
Resolution of Issuance
"Resolution of Issuance" or "Resolution" means
this Resolution of Issuance adopted under and pursuant to
Ordinance No. 3815, providing for financing of the Project.
Resolution of Preliminary Approval
"Resolution of Preliminary Approval" means that
certain Resolution entitled "Resolution of the Mayor and
Common Council of the City of San Bernardino Finding That an
Application for Industrial Development Bond Financing Has
Been Submitted Pursuant to the Provisions of Ordinance
No. 3815 of the City by Robert L. Langston and Wilton K.
Newby, a General Partnership; Finding That Said Application
Complies With the Provisions and Requirements of Said Ordinance
No. 3815; Preliminarily Approving Said Application and the
Project to Which it Refers; Fixing a Time and Place for the
Holding of a Hearing Thereon; Ordering the Publication of a
Notice of Hearing in the Form an Manner Provided by Said
Ordinance No. 3815; and Making Certain Other Findings and
Determinations in Connection Therewith."
Revenues
"Revenues" shall mean all payments and other
income derived by the City from the Company or its legal
Successor in interest, if any, under the Project Agreement,
to wit: payments made directly to the Bank under the Company
Note, but does not include receipts designated to cover
administrative expenses.
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State
"State" means the State of California.
Supplemental Resolution
"Supplemental Resolution" means any resolution at
any time in full force and effect which has been duly adopted
by the City under Ordinance No. 3815, or under any act
supplementary thereto or amendatory thereof, at a meeting of
the Mayor and Common Council duly convened and held, at
which a quorum was present and acted thereon, amendatory of
or supplemental to this Resolution, but only if and to the
extent that such Supplemental Resolution is specifically
authorized thereunder.
Treasurer
"Treasurer" means the officer who is then performing
the functions of Treasurer of the City.
Written Requisition
"Written Requisition" means a requisition prepared
in sllch form or forms and signed by the Treasurer and con-
taining the information required by the Project Agreement.
Section 2.02. Inclusiveness of Certain Terms.
Words of the masculine gender shall be deemed and
construed to include correlative words of the feminine and
neuter genders. Unless the context shall otherwise indicate,
the words "Note," "owner," "Holder" and "Person" shall
include the plural as well as the singular number.
Section 2.03. References to Resolution of
Issuance.
The terms "hereby," "hereof," "hereto," "herein,"
"hereunder," and any similar terms, as used in this Resolu-
tion of Issuance, refer to this Resolution, and, unless the
context shall otherwise indicate, the term "this Resolution"
shall mean this Resolution together with any resolution
supplemental hereto.
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ARTICLE 3
THE CITY NOTE
Section 3.01. Issuance of the City Note;
Purpose.
An Industrial Revenue Note of the City is hereby
authorized to be issued under and subject to the terms of
this Resolution of Issuance for the object and purpose of
providing the funds for the construction of and permanent
financing for the Project. The City Note is designated as
the "Industrial Development Revenue Note, Langston-Newby
Project, 1981 Series, sometimes herein referred to as the
"city Note." The City Note issued hereunder shall be sold
and delivered to the Bank, as purchaser, concurrently with
the delivery of the Company Note by the Company to the Bank
on behalf of the City.
Section 3.02.
Terms; Amount; Maturity Date;
Interest Rate; Place of Payment.
The City Note
Issuance shall be in an
$1,130,000.
issued under this Resolution of
aggregate principal amount of
The City Note and the Company Note are companion
instruments and shall be so construed. This Resolution
pledg~s all Revenues to the payment of the City Note, to
wit: payments made directly to the Bank under the Company
Note, except to the extent set forth in Section 3.03.
Payments to the Bank by the Company under the Company Note
are deemed to be payments by the City to the Bank under the
City Note. The City Note shall be payable on the dates, at
the place and in the amounts set forth in the Company Note
and the provisions of the Project Agreement are hereby
incorporated herein, including, without limitation, Sec-
tions 3.02, 3.03, 3.04, 3.05, 3.06 and 3.07.
Section 3.03. Security for City Note; No
Ci ty Debt.
The City Note, together with interest thereon, is
a special obligation of the City issued pursuant to and
subject to the terms and conditions of Ordinance No. 381S,
Section 19 of which provides as follows:
"(a) None of the City Note issued by the City
pursuant to this Ordinance shall be deemed to constitute
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a debt or liability of the City, or a pledge of the
faith and credit of the City, but shall be payable
solely from the Revenues and other funds, if any,
provided therefor in the proceedings.
"(b) The issuance of the City Note shall not
directly or indirectly or contingently obligate the
city to levy or to pledge any form of taxation whatsoever
therefor or to make any appropriation for their payment.
"(c) The city Note shall contain on the face
thereof a statement to the following effect:
"'Neither the faith and credit nor the taxing
power of the City of San Bernardino is pledged to
the payment of the principal of, premium, if any,
or interest on the City Note, nor is the City of
San Bernardino in any manner obligated to make any
appropriation for payment.'
"(d) Neither the Mayor and Common Council nor
any persons executing the city Note shall, in any
event, be subject to any personal liability or account-
ability by reason of the issuance of such City Note.
"(e) The city Note shall be a special obliga-
tion of the City, and the City shall, under no circum-
stances, be obligated to pay the city Note or Project
costs (other than Administrative Expenses), except from
Revenues and other funds received under the Project
Agreements for such purposes, nor to pay Administrative
Expenses except from funds received under Project
Agreements for such purposes, or from funds which are
made available as otherwise authorized by law. The
City Note shall contain on the face thereof a statement
of their special obligation nature."
This Resolution of Issuance pledges all Revenues,
to the payment of the City Note, except, under certain
circumstances, to the proceeds of insurance or condemnation
awards, and the City Note shall be a valid claim of the Bank
only against the Revenues and such specifically mentioned
other moneys.
The validity of the City Note is not and shall not
be dependent upon the completion of the Project or upon the
performance by any person, firm, corporation, partnership,
association, or other entity, whether private, public, or
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governmental of any obligations of any of the foregoing
relative to the Project.
Section 3.04. Payment of the City Note at
Election of City From Other
Lawfully Available Funds;
Advances by City.
Nothing in this Resolution of Issuance shall be
construed as prohibiting or limiting the city from doing any
or all of the following to the extent otherwise permitted by
the Constitution and laws of the state of California and the
City Charter of the City, as said Constitution, laws and
City Charter now exist, or as the same may be amended from
time to time:
(a) paying or providing for the payment of
the City Note, or any part thereof, and any interest or
prem1ums payable thereon, from the proceeds of refunding
bonds, refunding notes, or other obligations issued by
or on behalf of the city;
(b) paying or providing for the payment of
the City Note, or any part thereof, and any interest or
premiums payable thereon, from any legally available
funds of the City, including, without limitation, any
funds made available to the City by the United states,
the state of California, or any department or agency of
the foregoing or any other public or private corporation
or agency; or
(c) advancing any of its own funds lawfully
available therefor as a loan or contribution to the
Project, the Facilities, or to the payment of the City
Note, or any part thereof, and any interest or premiums
payable thereon, on such terms and conditions as deter-
mined by the City;
Section 3.05. Forms of City Note.
The city Note shall be substantially in the form
attached hereto and made a part hereof, marked "Exhibit 1
('City Note')." Such form is hereby approved and adopted as
the form of the City Note, and assignment provisions pertaining
thereto; and such City Note shall be in substantially the
form set forth in said Exhibit with necessary or appropriate
variations, omissions and insertions, as permitted or required
by this Resolution and the Project Agreement.
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The recitals of regularity of proceedings in the
City Note issued and sold under this Resolution shall be
conclusive evidence of compliance with the provisions of
Ordinance No. 3S15, this Resolution, and of the validity of
the City Note.
section 3.06. Execution of the City Note.
The City Note shall he executed in the name and on
hehalf of the City and under its seal with the signature of
the Mayor and the countersignature of the City Clerk.
Either such signature or such countersignature may he printed,
lithographed, engraved or otherwise mechanically reproduced,
but one of them shall be manually affixed to the City Note
hy the Mayor or the city Clerk. Unless otherwise determined
by the City, the City Clerk's signature shall he manually
affixed. The seal of the City may he printed, engraved,
stffinped or otherwise placed in facsimile form on the City
Note.
Any person whose signature appears on the City
Note, hy facsimile shall first comply with the provisions of
the Uniform Facsimile Signatures of Public Officials Act,
Title 1, Division 6, Chapter 6 of the Government Code of the
State of California (Sections 5500, et ~).
If any officer who shall have signed or sealed the
City Note or whose facsimile signature shall be upon the
City Note shall cease to be such officer of the City before
the City Note so signed and sealed shall have been actually
delivered hy the City, such signature shall nevertheless be
valid and sufficient for all purposes the same as if he had
remained in office until delivery, and such City Note may be
issued and delivered with the same force and effect as
though the person who signed or sealed such city Note or
whose facsimile signature shall he upon the City Note had
not ceased to be such officer of the City; and also any such
City Note may be signed and sealed on behalf of the City by
those persons who, at the actual date of the execution of
such City Note, shall be the proper officers of the City,
although at the nominal date of such City Note any such
person shall not have been such officer of the City.
Section 3.07. City Note Mutilated, Lost,
Destroyed or Stolen.
If the City Note shall hecome mutilated, the city,
at the expense of the owner of said City Note, shall execute,
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an~ thereupon deliver, a new City Note of like tenor and
number in exchange and substitution for the City Note so
mutilated, but only upon surrender of the City Note so
mutilated. The City Note so surrendered shall be cancelled.
If the City Note shall be lost, destroyed or stolen, evidence
of such loss, destruction or theft may be submitted to the
City and, if such evidence be satisfactory, and an indemnity
satisfactory to the City shall be given, the City, at the
expense of the owner, shall execute, and deliver, a new City
Note of like tenor and number in lieu of and in substitution
for the City Note so lost, destroyed or stolen. The City
may require payment of an appropriate fee for the new City
Note issued under this section and of the expenses which may
be incurred by the City in the premises, and an indemnity
against other possible losses.
Section 3.08. Validity of the City Note.
The validity of the authorization and issuance of
the City Note shall not be dependent on or affected in any
way by:
(a) any proceedings taken by the City or
Company or their agents for the acquisition, construction
or completion of the Project or any part thereof; or
(b) any contracts made by the City or Company
or their agents in connection therewith; or
(c) the failure of the Company, or its
agents, to complete the Project or any part thereof in
accordance with the Project Agreement.
Section 3.09. Participations.
The Bank shall have the right at any time without
the consent of or notice to the City to sell, assign, transfer,
negotiate or grant participations in all or part of the City
Note outstanding under this Agreement. The City hereby
acknowledges and agrees that any such disposition will give
rise to a direct obligation of the City to the participant
as if a separate City Note in the principal amount of the
participation had been issued to participant and the partici-
pant shall for all purposes, where relevant, be considered
to be the Bank.
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ARTICLE 4
DELIVERY OF THE CITY NOTE; ESTABLISiIMENT
OF FUNDS; APPLICATION OF CITY NOTE PROCEEDS
Section 4.01. Issuance of City Note.
At any time after the adoption of this Resolution
the City may deliver the City Note to the Bank, as purchaser
thereof, it being the intent hereof that the city Note and
the Company Note shall be sold and delivered simultaneously
and that they be in the same amounts.
Section 4.02. Creation of Funds.
The City shall establish, maintain and hold in
trust separate funds which are hereby created for the purposes
of this Resolution as follows:
(a) Administrative Expense Fund. Tha Adminis-
trative Expense Fund pursuant to Section 6.02.
(b)
Operation
6.03.
Operation and Maintenance Fund. The
and Maintenance Fund pursuant to Section
(c) Surplus Fund. The Surplus Fund pursuant
to Section 6.04.
Section 4.03. Application of Proceeds of
ci ty Not_~.
The proceeds of the sale of the City Note shall
at the Closing be used as follows:
(a) For the funding of the Loan to the
Company in accordance with the Project Agreement.
(b) For the payment of the Costs of Issuance
and the expenses as shown by a Certificate of the City
and/or a Certificate of the Company.
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ARTICLE 5
REDEMPTION OF ALL OR PART OF
THE CITY NOTE PRIOR TO MATURITY
Section 5.01. Terms of Redemption.
(a) The City Note or the appropriate portion
thereof, if at that time outstanding, shall be called and
redeemed prior to maturity on any date, at the same time or
times and under the same terms as are provided in the Company
Note in the Project Agreement.
(b) Except as set forth in the preceding paragraph,
the City Note is subject to redemption as a whole, or in
part, from funds derived by the City from prepayments by the
Company under Section 3.06 of the Project Agreement at the
time therein stated, upon payment of a redemption price
equal to the principal amount thereof with accrued interest
to the redemption date.
(c) The date on which the City Note is to ~e
presented for redemption is hereinafter sometimes called the
"redemption date."
Section 5.02. Call and Redemption.
The Mayor and Common Council of the City: (i) shall,
if the redemption is pursuant to subsections (a) or (b) of
Section 5.01 or (ii) if the redemption is pursuant to funds
made available by the City, may by resolution direct the
call and redemption prior to maturity of the City Note or
the applicable portion thereof, as the case may be.
Section 5.03. Notice of Redemption.
Notice of redemption prior to maturity shall con-
tain the information described below, and shall be mailed to
the Bank at least sixty (60) days prior to the redemption
date. The notice of redemption shall:
(a) state the redemption date;
(b) state the redemption price;
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redeemed;
(c) state the portion of the City Note to be
(d) require that, in the case of an entire
redemption, the City Note be surrendered at the place
of redemption; and
(e) state that interest on the City Note or
on the portion thereof to be received shall cease to
accrue from and after such redemption date, and that,
on said date, there will become due and payable on said
City Note the principal amount thereof to be redeemed
and interest accrued thereon to the redemption date.
Section 5.04. Partial Redemption of the
City Note.
The Bank, the City and the Company shall cooperate
so that, in case of partial redemption there shall be an
endorsement on the reverse of the City Note and on the
Company Note a notation of such partial redemption, in such
form as may be satisfactory to the Bank, the City and the
Company. Such partial redemption shall be valid upon
payment of the amount thereby required to be paid to the
Bank, and the Company and the City shall be released and
discharged from all liability to the extent of such payment,
irrespective of whether such endorsement shall or shall not
have been made upon the reverse of such City Note and on the
Company Note irrespective of any error or omission in such
endorsement.
Section 5.05. Redemption Fund.
Prior to the redemption date, suitable arrangements
shall have been made for deposit into a separate trust fund
moneys for the purpose and sufficient to redeem, the city
Note or portion thereof, as the case may be, designated in
such notice of redemption. Said moneys must be set aside in
said Fund solely for that purpose and shall be applied on or
after the redemption date to the payment (principal and
accrued interest, if any) of the City Note or portion thereof,
as the case may be, to be redeemed as aforesaid.
section 5.06. Effect of Redemption.
Notice of redemption having been duly given as
aforesaid, and moneys for payment of the principal of and
interest payable upon redemption of the City Note being set
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aside as aforesaid, the City Note or portion thereof, as the
case !:lay be, so called for redemption shall, on the redemp.-
tion date designated in such notice, beconle due and payable
at the redemption price specified in such notice, interest
on the City Note or portion thereof, as the case may be, so
called for redemption shall cease to accrue, and said city
Note or portion thereof, as the case may be, shall cease to
be entitled to any lien, benefit or security under this
Resolution, and the Bank shall have no rights in respect
thereof except to receive payment of the redemption price
thereof.
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ARTICLE 6
USE OF REVENUES
section 6.01. Revenue Fund.
Payments on the City Note will be made monthly and
will go directly from the Company to the Bank. If at any
time the City shall operate the Project, by reason of default
by the Company, it shall by Supplemental Resolution establish
a Revenue Fund and appropriate sub funds for the proper ad-
ministration of the flow of Revenues, all for the benefit of
the Bondholder.
section 6.02. Administrative Expense Fund.
Additional Payments made under Section 3.0S of the
Project Agreement shall be deposited in the City Treasury in
payment of any or all of the items of expense for which the
Additional Payments were received.
The city shall, pursuant to Section 3.08 of the
Project Agreement, bill the Company for any amounts necessary
to pay any of the items of expense referred to in the Project
Agreement as "Additional Payments" when the same become due
and, upon receipt of same, such amounts for such purposes,
deposit such amounts in the Administrative Expense Fund.
section 6.03. Operation and Maintenance Fund.
If at any time the City shall operate the Project,
by reason of default by the Company, the City shall deposit
in the Operation and Maintenance Fund hereby established,
the priority of which shall be the same as the Adminis-
trative Expense Fund above, all amounts which shall be
required to provide for the payment of all costs of mainten-
ance and operation of the project, including costs of repairs
and replacements, labor costs and insurance. Moneys in the
Operat.ion and Maintenance Fund shall be disbursed to pay
such costs in accordance with such procedure as the City may
establish.
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Section 6.04. Surplus Fund.
Any moneys remaining in the Administrative Expense
Fund or the Operation and Maintenance Fund, after the accom-
plishment of the purposes for which such Funds were established,
may be used for retirement of the City No~e.
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ARTICLE 7
PARTICULAR COVENANTS OF THE CITY
Section 7. Ol. Punctual Paynlent.
The City will promptly payor cause to be paid the
principal of and interest on the City Note issued hereunder
and secured hereby at the place, on the dates and in the
manner specified herein and in the city Note, according to
the true intent and meaning thereof; provided, however, that
all principal of and interest on the City Note shall be
payable solely out of the Revenues. The City of San Bernardino,
California, shall not in any event be liable for the paym~nt
of the principal of or interest on the City Note or for the
perfornlance of any pledge, mortgage, obligation or agreement
of any kind whatsoever which may be undertaken by the City,
and the City Note or any of the agreements or obligations of
the City shall not be construed to constitute an indebtedness
of the City of San Bernardino, California, within the meaning
of any constitutional or statutory provision of the State of
California whatsoever.
Section 7.02. Maintain Corporate Existence.
The City will at all times maintain its corporate
existence or assure the assumption of its obligations under
this Resolution by any public body succeeding to its powers
under the Constitution and laws of the State of California,
and it will use its best efforts to maintain, preserve and
renew all the rights and powers provided to it by the Con-
stitution and laws of the State of California; and it will
comply with all valid acts, rules, regulations, orders and
directions of any legislative, executive, administrative or
judicial body applicable to this Resolution, the City Note,
the Project Agreement, the Company Note and the Deed of
Trust.
Section 7.03. Project Agreement.
So long as the City Note is outstanding, the City
will enforce the obligation of the Company to pay, or cause
to be paid, all the payments and other costs and charges
payable by the Company under the Project Agreement. Except
as specifically provided for herein, the City will not enter
into any agreement with the Company amending the Project
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Agreement, the Company Note, or the Deed of Trust without
the prior written consent of the Bank.
Section 7.04. Further Assurance.
The City will from time to time execute and deliver
such further instruments and take such further action as may
be reasonable and as may be required to carry out the pur-
poses of this Resolution.
Section 7.05. Not Sell, Lease. Etc.
Except for the assigrunent to the Bank herein, the
City will not sell, lease or otherwise dispose of or encumber
its interest in the Project Agreement, the Company Note, or
the Deed of Trust, or any of the payments of receipts
derived therefrom, and will promptly payor cause to be
discharged or make adequate provision to satisfy and dis-
charge any lien or charge on any part of such payments or
receipts.
Section 7.06. Not Extend Time for Payment.
The City will not directly or indirectly extend or
assent to the extension of the time for pa~nent of any
interest on or principal of the city Note or the Con~any
Note and will not directly or indirectly be a party to or
approve any such arrangement.
Section 7.07. Prosecution and Defense of Suits
Relating to Title.
The City hereby agrees that it shall upon re~~est
of the Bank promptly from time to time take such action as
may be necessary and proper to remedy or cure any defect in
or cloud upon the title to the Project or any part thereof,
whether now existing or hereafter developing, and shall
prosecute all such suits, actions and other proceedings as
may be appropriate for such purpose.
Section 7.08. Limits on Additional Debt.
The City covenants that:
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(a) no additional indebtedness payable out
of the Revenues shall be issued having any priority in
payment of principal or interest out of the Revenues
over the City Note authorized by this f<esolution;
(b) no Additional city Note or any other
evidences of indebtedness payable out of the Revenues
shall be issued, except as provided herein subject to
the limitations thereof, and ranking on a parity with
the city Note; and
(c) no Refunding City Note shall be issued
to refund all or part of the City Note authorized by
this Resolution except as provided in this Resolution.
Section 7.09. Covenant Covering Arbitraqe.
The city hereby covenants to the Bank that it
will make no use of the proceeds of the City Note at any
time during the term thereof which, if such use had been
reasonably expected at the date the City Note is issued,
would have caused such city Note to be "arbitrage Bonds"
within the meaning of Section 103(c) of the United States
Internal Revenue Code of 1954, as amended, and applicable
regulations adopted thereunder by the Internal Revenue
Service, and the City hereby assumes the obligation to
comply with such Section 103(c) and such regulations through-
out the term of the City Note.
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ARTICLE S
EVENTS OF DEFAULT AND REMEDIES
Section 8.01. Events of Default.
(a) Each of the following events shall constitute,
and be referred to in this Resolution as, an "Event of
Defaul t":
(I) default in the due and punctual payment
of the principal and interest installments of the City
Note when and as the same shall become due and payable;
(2) the occurrence of an Event of Default
under the Project Agreement, Company Note or Deed of
Trust; or
(3) failure by tlle City in the performance
or observance of any other of the covenants, agreements
or conditions on its part in this Resolution or in the
City Note contained, which failure shall continue for a
period of sixty (60) days after written notice specify-
ing such failure and requesting that it be remedied, is
given to the City by the Purchaser.
(b) In the case of an event described in para-
graphs (1) or (2) above, unless the principal of the City
Note shall have become due and payable otherwise than by
acceleration, the Bank may, by written notice given to the
City and the Company and provided that the default has not
theretofore been cured, declare the princip~l of the City
Note then outstanding to be due and payable immediately, and
upon such declaration such principal, together with interest
accrued thereon, shall become due and payable immediately at
the place of payment provided in the notice, anything in
this Resolution or in the city Note to the contrary notwith-
standing.
(c) The above provisions, however, are subject to
the condition that if, after the principal of the City Note
then Outstanding shall have been so declared to be due and
payable, all arrears of interest upon such City Note, and
interest on overdue installments of interest (to the extent
permitted by law) at a rate per annum which is one percentage
point greater than the rate per annum borne by the City Note
and the principal if any, on the City Note then outstanding
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which shall have become due and payable otherwise than by
acceleration, and all other sums payable under this Resolu-
tion, except the principal of and interest on the City Note
which by such declaration shall have become due and payable,
shall have been paid by or on behalf of the City, and the
City also shall have performed all other things in respect
of which it may have been in default under this Resolution,
and shall have paid the reasonable expenses of the Bank
reasonable attorneys' fees paid or incurred, then and in
every such case, such default shall be waived and such
declaration and its consequences rescinded and annulled by
the Purchaser by written notice given to the City and the
Company by registered mail, which waiver, rescission and
annulment shall thereafter be binding; but no such waiver,
rescission or annulment shall extend to or affect any sUDse-
quent default or impair any right or remedy consequent
thereon.
Section 8.02. Bank's Rights on Default.
The Purchaser, as pledgee and assignee for security
purposes of all the right, title and interest of the City in
and to the Project Agreement (except those rights under
Section 3.08 thereof), Company Note and the Deed of Trust
shall, upon compliance with applicable requirements of law
and except as otherwise set forth in this Article 8, be the
sole real party in interest in respect of, and shall have
standing, to enforce each and every right granted to the
City under the Project Agreement, Company Note and the Deed
of Trust. The City and the Bank hereby agree, without in any
way limiting the effect and scope thereof, that the pledge
and assignment hereunder to the Bank of any and all rights
of the City in and to the Project Agreement and the Deed of
Trust shall constitute an agency appointment coupled with an
interest on the part of the Bank which, for all purposes of
this Resolution, shall be irrevocable and shall survive and
continue in full force and effect notwithstanding the bank-
ruptcy or insolvency of the City or its default hereunder or
on the city Note.
Section 8.03. Actions Upon De[~u1t.
Upon the happening and continuance of any Event of
Default, the Bank in its discretion may take anyone or more
of the following steps:
(a) by mandamus, or other suit, action or
proceeding at law or in equity enforce all rights of
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the Bank, and require the city or the Company or both of
them to carry out any agreements with or for the benefit of
the Bank and to perform its or their duties under Ordinance
No. 3815, the Project Agreement, the Deed of Trust and this
Resolution;
(b) by action or suit in equity require the
City to account as if it were the trustee of an express
trust for the Bank; or
(c) by action or suit in equity enjoin any
acts or things which may be unlawful or in violation of
the rights of the Bank.
Section 8.04. Nonwaiver.
In case any proceeding taken by the Bank on account
of any Event of Default shall have been discontinued or
abandoned for any reason, or shall have been determined
adversely to the Bank, then and in every case the City and
the Bank shall be restored to their former positions and
rights hereunder, respectively, and all rights, remedies and
powers of the Bank shall continue as though no such proceeding
had been taken.
Section 8.05. Enforcement, Suits at Law
or in Equity.
The Bank shall not have any right to institute any
suit, action or proceeding in equity or at law for the
enforcement of any trust hereunder, or the pursuit of any
remedy hereunder or on the City Note, other than a default
in the obligations of the City, unless there shall have been
offered to the Trustee security and indemnity satisfactory
to it against the costs, expenses and liabilities to be
incurred therein or thereby.
Such notification, request and offer of indemnity
are hereby declared in every such case, at the option of the
Trustee, to be conditions precedent to the enforcement of
the trusts of this Resolution or the pursuit of any other
remedy hereunder by the Lender, it being understood and
intended that the Lender shall not have any right in any
manner whatever by its action to affect, disturb or prejudice
the security of this Resolution, or to enforce any right
hereunder or under the City Note, except in the manner
herein provided.
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Section 8.06. Remedies Nonexclusive.
No remedy herein conferred upon or reserved to the
Bank is intended to be exclusive of any other remedy or
remedies, and each and every such remedy shall be cumulative,
and shall be in addition to every other remedy given here-
under or now or hereafter existing at law or in equity or by
statute.
Section 8.07. No Waiver.
No delay or omission of the Bank to exercise any
right or power accruing upon any default shall impair any
such right or power or shall be construed to be a waiver of
any such default, or an acquiescence, therein; and every
power and remedy given by this Article to the Bank may be
exercised from time to time and as often as may be deemed
expedient.
Section 8.08. Use of Moneys Received by Bank.
(a) All moneys received by the Bank or by any
receiver pursuant to any right given or action taken under
the provisions of this Article 8, after payment of the costs
and expenses of the proceedings and any expenses for the
collection of such moneys and of the expenses, liabilities
and advances incurred or made by the Bank, shall be held in
trust during the continuance of an Event of Default (other
than moneys for the payment of the City Note and/or for the
payment of interest thereon and shall (after payment of all
of the aforesaid fees and expenses) be applied as follows:
(I) unless the principal of the City Note
shall have become or shall have been declared due and
payable, all such moneys shall be applied to the payment
of all installments then due on the City Note, and, if
the amounts available shall not be sufficient to pay in
full any particular installment, then to the payment
ratably;
(2) if the principal of the City Note shall
have become or shall have been declared due and payable,
all such moneys shall be applied to the payment of the
principal and interest then due and unpaid upon the
City Note, with interest on overdue principal and
interest, if lawful, at the rate per annum which is one
percentage point greater than that borne by the City
Note, without preference or priority of principal over
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interest or of interest over principal, or of any
installment of interest over any other installment of
interest, ratably; or
(3) if the principal of the Bond shall have
been declared due and payable, and if such declaration
shall thereafter have been rescinded and annulled under
the provisions of this Article 8, then, subject to the
provisions of subparagraph (2) of this Section which
shall be applicable in the event that the principal of
all the city Note shall later become due or be declared
due and payable, the moneys shall be applied in accor-
dance with the provisions of subparagraph (1) of this
section.
. ~b) Whenever moneys are to be applied pursuant to
the prov1s10ns of this section, such moneys shall be applied
at such time, and from time to time, as the Bank shall
determine, having due regard to the amount of such moneys
available for application and the likelihood of additional
moneys becoming available for such application in the future.
Whenever the Bank shall apply such funds, it shall fix the
date (which shall be an interest payment date) upon \'lhich
such application ~s to be made and upon such date interest
on such amounts to be paid on such date shall cease to
accrue; and on or before such date set aside the moneys
necessary to effect such application.
Section 8.09. No Impairment of Bank's Riqhts.
Notwithstanding any other provision in this Resolu-
tion, the right of the Bank to receive payment of the
principal of and interest on the City Note on tlle respective
due date expressed therein, or to institute suit for the
enforcement of any such payment on or after such respective
dates, shall not be impaired or affected without the consent
of the Bank.
Section 8.10. Remedies Lawful.
It is the purpose and intention of this Article 8
to provide all rights and remedies to the Banlt which may be
lawfully granted under the provisions of the Constitution
and laws of the State of California, and under the provisions
of Ordinance No. 3815, but should any such right or remedy
herein granted be held to be unlawful, the Bank shall be
entitled, as above set forth, to every other right and
remedy provided in this Resolution and by the Constitution
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and laws of the State of California and by the provision of
Ordinance No. 3815.
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ARTICLE 9
MODIFICATION OF THIS RESOLUTION OF ISSUANCE
AND THE PROJECT AGREEMENT
Section 9.01. Resolution to be Amended Only in
Manner Provided in Article 9.
This Resolution shall not be modified or amended
in any respect except as provided in and in accordance with
and subject to the provisions of this Article 9.
Section 9.02. Permissible Purposes for, and
Limitation Upon, Supplemental
Resolutions.
(a) The City may, from time to time and at any
time, without the consent of Bank, execute resolutions
supplemental to this Resolution for the following purposes:
(I) to specify and determine any matters and
things relative to the City Note which are not contrary
to or inconsistent with this Resolution and which shall
not adversely affect the interests of the Bank;
(2) to cure any defect, omission or ambi-
guity in this Resolution if such action does not adversely
affect the rights of the Bank;
(3) to grant to or confer upon the Bank any
additional rights, remedies, powers, authority or
security which may lawfully be granted or conferred and
which do not adversely affect the rights of the Bank;
(4) to add to the covenants and agreements
of the City in this Resolution, other covenants and
agreements to be observed by the City which do not
adversely affect the rights of the Bank;
(5) to add to the limitations and restrictions
in this Resolution, other limitations and restrictions
to be observed by the City which do not adversely
affect the rights of the Bank;
(6) to confirm, as further assurance, any
pledge under, and the subjection to any claim, lien or
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pledge created or to be created by this Resolution, of
the Revenues or of any other moneys, securities or
funds; or
(7) to authorize and provide for the issuance
hereunder of additional bonds or refunding bonds.
(b) Before the city shall adopt any supplemental
resolution pursuant to this Section, there shall have been
filed with the Bank an opinion of Bond Counsel stating that
such supplemental resolution is authorized or permitted by
this Resolution and complies with its terms, and that upon
enactment it will be valid and binding upon and City in
accordance with its terms.
Section 9.03. Resolution may be Modified or
Altered with Consent of
Bank.
The Bank shall have the right from time to time to
consent to and approve the execution and delivery by the
Bank of any supplemental resolution as shall be deemed
necessary or desirable by the City for the purposes of
modifying, altering, amending, adding to or rescinding, in
any particular, any of the terms or provisions contained in
this Resolution.
Section 9.04. Supplemental Resolutions Deemed
Part of Resolution; Entitle-
ment to Rely Upon Opinion of
Counsel.
(a) Upon the execution, delivery and acceptance
of any supplemental resolution pursuant to the provisions of
this Article 9, this Resolution shall be, and be deemed to
be, modified and amended in accordance therewith, and the
respective rights, duties and obligations under this Resolu-
tion of the City, the Bank shall thereafter be determined,
exercised and enforced under this Resolution subject in all
respects to such modificiations and amendments.
(b) For all purposes of this Article 9, the City
and the Bank shall be entitled to rely upon all opinion of
Counsel with respect to the extent, if any, as to which any
action affects the rights of the Bank under this Resolution.
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Section 9.05. Supplemental Resolutions Affectinq
Rights of Company Require Consent
of Company.
Anything herein to the contrary notwithstanding,
any supplemental resolution under this Article 9 which
affects any rights, powers and authority of the Company
under the Project Agreement or Deed of Trust, or requires a
revision in whole or in part of the Project Agreement or
Deed of Trust, shall not become effective unless and until
the Company shall have consented in writing to such supple-
mental resolution.
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ARTICLE 10
DEFEASANCE
section 10.01. Release of Assignment Upon
Payment or provision for
Payment, of Principal of,
Premium, if any, and Interest
on City Note.
If and when the City Note secured hereby shall
become due and payable in accordance with its terms as
provided in this Resolution, or otherwise, and the whole
amount of the principal and the interest so due and payable
upon the City Note shall be paid, or provision shall have
been made for the payment of the same, together with all
other sums payable hereunder by the City, then and in that
case, and all covenants, agreements and other obligations of
the City to the Bank shall thereupon cease, terminate and
become void and be discharged and satisfied. Any surplus
funds shall be turned over to such person, body or authority
as may be entitled to receive the same. The Bank shall
execute such documents as may be reasonably required to
effect the release of assignments hereunder. If and when
the Bank shall hold or there shall be otherwise held in
trust sufficient moneys hereunder to provide for payment of
the whole amount of the principal and interest due and
payable and thereafter to become due and payable on the City
Note, together with all other sums payable or which may
thereafter become payable hereunder by the City, notwith..
standing that the City Note has not yet become due and
payable and that consequently the assignment hereunder shall
not have ceased, terminated and become void, any surplus
shall be turned over to such person, body or authority as
may be entitled to receive the same.
section 10.02. Defeasance Prior to Maturity or
Redemption Date.
The City Note shall, prior to the maturity or
redemption date thereof, be deemed to have been paid, if:
(a) there shall have been deposited with the
Bank or there shall be otherwise held in trust
either moneys in an amount which shall be sufficient
(or Federal Securities, which shall not contain provi-
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sions permitting the redemption thereof at the option
of the issuer), the principal of and the interest on
which when due, and without any reinvestment thereof,
will provide moneys which, together with the moneys, if
any, so deposited with or held by the Bank or there
shall be otherwise held in trust at the same time,
shall be sufficient to pay when due the principal and
interest due and to become due on said City Note on and
prior to the redemption date or maturity date thereof,
as the case may be; and
Any surplus resulting from such defeasance prior
to maturity or the redemption date shall be turned over to
such person, body or aturhority as may be entitled to receive
the same.
As used in this paragraph, "Federal Securities"
means United States Treasury notes, bonds, bills or certifi-
cates of indebtedness, or obligations for which the faith
and credit of the United States are pledged for the payment
of principal and interest including the guaranteed portions
of small business administration loans, so long as such
loans are obligations for which the faith and credit of the
United States are pledged for the payment of principal and
interest: bonds, consolidated bonds, collateral trust
debentures, consolidated debentures, or other obligations
issued by federal land banks or federal intermediate credit
banks established under the Federal Farm Loan Act, as amended,
and Farm Credit Act of 1971, debentures and consolidated
debentures issued by the Central Bank for Cooperatives and
banks for cooperatives established under the Farm Credit Act
of 1933, as amended, and the Farm Credit Act of 1971, bonds
or debentures of the Federal Home Loan Bank Board established
under the Federal Home Loan Bank Act, bonds of any federal
home loan bank established under said act and stocks, bonds,
debentures, participations and other obligations of, or
issued by, the Student Loan Marketing Association, the
Government National Mortgage Association and the Federal
Home Loan Mortgage Corporation; and bonds, notes or other
obligations issued by the Federal Financing Bank, the United
States Postal Service, or issued or assumed by the Inter-
national Bank for Reconstruction and Development, the Tennessee
Valley Authority, the Inter-American Development Bank, the
Government Development Bank for Puerto Rico, or the Asian
Development Bank.
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ARTICLE 11
MISCELLANEOUS
section 11.01. Resolution to Bind and Inure
to Benefit of Successors of
the City.
In the event of the dissolution, disincorporation,
or merger of the City, all the covenants, stipulations,
promises and agreements in this Resolution contained, by or
on behalf of, or for the benefit of, the City, shall bind or
inure to the benefit of the successors of the City from time
to time and any entity, officer, board, commission, agency
or instrumentality to whom or to which any power or duty of
the city shall be transferred.
Section 11.02. Provisions of Resolution for
Sole Benefit of Parties and
Bondholders.
Except as herein otherwise specifically provided,
nothing in this Resolution expressed or implied is intended
or shall be construed to confer upon any person, firm or
corporation other than the City or the Bank, any right,
remedy or claim under or by reason of this Resolution, this
Resolution being intended to be for the sole and exclusive
benefit of the city and the Bank.
Section 11.03. Compliance Certificates and
Opinions.
Upon any application or request by the City to the
Bank to take any action under any provision of this Resolution,
the City shall furnish to the Bank an Officers' Certificate
stating that all conditions precedent, if any, provided for
in this Resolution relating to the proposed action have been
complied with and an Opinion of Counsel stating that in the
opinion of such counsel all such conditions precedent, if
any, have been complied with, except that in the case of any
such application or request as to which the furnishing of
such documents is specifically required by any provision of
this Resolution relating to such particular application or
request, no additional certificate or opinion need be furnished.
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Every certificate or opinion with respect to
compliance with a condition or convenant provided for in
this Resolution, shall include:
(a) a statement that each individual signing
such certificate or opinion has read such covenant or
condition and the definitions herein relating thereto;
(b) a brief statement as to the nature and
scope of the examination or investigation upon which
the statements or opinions contained in such certificate
or opinion are based;
(c) a statement that, in the opinion of each
such individual, he has made such examination or investi-
gation as is necessary to enable him to express an
informed opinion as to whether or not such convenant or
condition has been complied with; and
(d) a statement as to whether, in the opinion
of each such individual, such condition or covenant has
been complied with.
Section 11.04. Form of Documents.
In any case where several matters are required to
be certified by, or covered by an opinion of, any specified
person, it is not necessary that all such matters be certified
by, or covered by the opinion of, only one such person, or
that they be so certified or covered by only one document,
but one such person may certify or give an opinion with
respect to some matters and one or more other such persons
as to other matters, and any such person may certify or give
an opinion as to such matters on one or several documents.
Any certificate or opinion of an officer of the
City may be based, insofar as it relates to legal matters,
upon a certificate or opinion of, or representations by,
counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion
or representations with respect to the matters upon which
his certificate or opinion is based are erroneous. Any such
certificate or Opinion of Counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion
of, or representations by, an officer or officers of the
City stating that the information with respect to such
factual matters is in the possession of the City, unless
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such counsel knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representa-
tions with respect to such matters is erroneous.
Where any person is required to make, give or
execute two or more applications, requests, consents, certifi-
cates, statements, opinions or other instruments under this
Resolution, they may, but need not, be consolidated and form
one instrument.
section 11.05. Notice.
Any request, demand, authorization, direction,
notice, consent, waiver or other document provided or permitted
by this Resolution to be made upon, given or furnished to,
or filed with:
(a) the Bank in writing and sent by registered
mail, return receipt requested, to the Bank at its
principal corporate trust office in the place of payment;
or
(b) the City, if in writing and sent by
registered mail, return receipt requested, to the City,
addressed to the city Clerk, at the then current letter-
head address.
Section 11.06. Effect of Headinqs and Table
of Contents.
The Article and Section headings herein and the
Table of Contents are for convenience only and shall not
affect the construction hereof.
section 11.07. Invalid or Illegal provisions
of Resolution, Project Agree-
ment, City Note or Coupons Not
to Affect Other Provisions.
In case anyone or more of the provisions of this
Resolution or of the Project Agreement or Deed of Trust, or
of the city Note shall, for any reason, be held to be illegal
or invalid, such illegality or invalidity shall not affect
any other provisions of this Resolution or of the Project
Agreement or Deed of Trust, or of said City Note and this
Resolution and the Pr~ject Agreement or Deed of Trust, and
the City Note shall be construed and enforced to the end
that the transactions contemplated hereby be effected and
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the obligations contemplated hereby be enforced as if such
illegal or invalid provisions had not been contained therein.
Section 11.08. Officials, Officers, Agents
and Employees of City Exempt
from Individual Liability.
No covenant or agreement contained in the City
Note or in this Resolution shall be deemed to be the covenant
or agreement of any official, officer, agent, or employee of
the City in his individual capacity, and neither the Mayor
of the City and city Councilman, the City Attorney, the City
Clerk, any other officer or employee of the City nor any
official executing the city Note shall be liable personally
on the City Note or be subject to any personal liability or
accountability by reason of the issuance thereof.
Section 11.09. Construction of Resolution
Governed by City Charter
and California Constitution
and Laws.
The City Charter of the City and the laws and
Constitution of the State of California shall govern th~
construction of this Resolution and of the City Note issued
hereunder.
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Executed as of the twelfth day of October, 1981.
THE CITY OF SAN BERNARDINO
SAN BERNARD]NO~ CALIFORNIA
(the "city")
P.ttest:
^ ~r/~#d:fr
<~ City Cl k
, [stALl
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I HEREBY CERTIFY that the foregoing resolution was
duly adopted by the Mayor and Common Council of the City of
Adjourned
San Bernardino at an Reqular meeting thereof, held on the
12th day of
October
, 1981, by the following
vote, to wit:
AYES:
Councilmen
Castaneda, Reilly, Hernandez,
Botts, Hudson, Hobbs and Strickler
NOES: None
ABSENT: None
ABSTAIN: None
/d~ k~ ~
~/J,k~,
~ C1t lerk
The foregoing resolution is hereby approved this
I V day of
C)J~~
, 1981.
Approved as to form:
~~~
ity At orney
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Langston
STATE OF CALIFORNIA
COUNTY OF SAN BERNARDINO
CITY OF SAN BERNRADINO
ss
I, LUCY MARTINEZ, Deputy City Clerk, in and for the City of
San Bernardino, DO HEREBY CERTIFY that the foregoing and attached
copy of San Bernardino City Resolution No. 81-497 is a full, true
and correct copy of that now on file in this office.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed
the official seal of the City of San Bernardino this 14th day of
October, 1981.
~~
/,
Deputy . y Cler
'IV
ACKNOWLEDGEMENT
STATE OF CALIFORNIA
)
) ss.
COUNTY OF SAN BERNARDINO)
On this 1,-/ day of ()cJ~, 1981, before me, a Notary Public duly
commissioned, qualified and acting within and for the County and State aforesaid,
appeared in person the within named W. R. Holcomb and Lucy Martinez, Mayor and
Deputy City Clerk, respectively, of the City of San Bernardino, California, to me
personally known, who stated that they were duly authorized in their respective
capacltles to execute the foregoing instrument for and in the name and behalf of
the City, and further stated and acknowledged that said Lucy Martinez executed
manual1y the within document and that said document was executed by facsimile
stamp by W. R. Holcomb, and that the document was delivered for consideration,
uses and purposes therein mentioned and set forti).
IN TESTIMONY THEREOF, I have hereunto set my hand and offical seal this
~dayof ()d-~, 1981.
. . .
. _ _ A _ _ . . - - ~
lO.FlC1Al SEAL)
SANDRA A. BAXTER
NOTi\RY P'JELlC . CALIFORNIA
SAN BlRNARDINO COUNTY
My Commission 'E::pires Dec. 7, 1981
-_..~ --...;~-,;;;;...-
cI CL.~ (~~
Notary Public
(SEAL)
My Commission Expires:
vcr
San. Bernardino
(Langston-Newby)
60,009-8-3
EXHIBIT 1
"CITY NOTE"
$1,130,000
CITY OF SAN BERNARDINO
INDUSTRIAL DEVELOPMENT REVENUE NOTE
LANGSTON-NEWBY PROJECT
1981 EERIES
KNOW ALL MEN BY THESE PRESENTS that the City of
San Bernardino, California, a municipal corporation duly
organized and existing under teh laws of the State of Cali-
fornia (the "City"), for value received, hereby promises to
pay (but only out of the Revenues hereinafter referred to)
to Imperial Bank, a California Corporation or its successors
or assigns, herein sometimes referr'ed to as "Bank," at the
address indicated below or at such other location as the
Bank shall designate in writing, or at such other place as
the holder of this Note may from time to time designate, the
principal sum of one million one hundred thirty thousand
dollars ($1,130,000), plus interest as computed below.
This city note shall mature and bear interest all
as provided in that certain $1,130,000 Promissory Note
secured by Deed of Trust from Robert L. Langston and wilton
K. Newby, a General Partnership (the "Company") to the City
of San Bernardino, California, a Municipal Corporation,
dated as of October ,1981, (the "Company Note"), which
provides as follows:---
"This Company Note will bear interest at a rate
equal to sixty-five percent (65%) of the Prime Rate (as that
Rate may change from time to time), plus four percent (4%)
per annum, until completion of construction by the Company
of a commercial office building located at 1255 East Highland
Avenue, San Bernardino, California, known as Langston-Newby
(the "Project"). Any change in the interest rate hereunder
#208.2(ph)
10/9/81
50
San Bernardino
(Langston-Newby)
60,009-8-3
shall become effective as of the date of any change in the
Prime Rate. Completion of construction shall occur when the
certificate of Completion is issued by the Redevelopment
Agency of the City of San Bernardino for the entire Project.
Thereafter, this Company Note shall bear interest at a rate
equal to sixty-five percent (65%) of the Prime Rate, plus
two percent (2%) adjusted annually on the unpaid balance of
this Company Note for a period of ten (10) years following
completion of construction of the Project. In no event
shall the interest rate chargeable hereunder exceed twenty-
one percent (21%) per annum. The Bank shall notify the
Company, as may be appropriate from time to time, the amount
of the Prime Rate and the amount of the payments computed in
accordance therewith.
Interest shall be payable on the outstanding
principal amount of the Company Note, calculated on a 360-day
basis from the date of funding of the Loan.
Payments of principal and interest shall be payable
interest only, on a quarterly basis, until completion of
construction of the Project, then, in approximately equal
monthly installments, based on an amortization period of
twenty-five (25) years after the completion of construction
of the Project, subject to periodic adjustments to reflect
the then current interest rate as herein provided. Payment
shall be made, on the first day of each quarter until comple-
tion of construction, thereafter on the first day of each
month commencing on the first day of the month next following
the completion of construction. All payments shall be in
lawful money of the United States of America and shall be
applied first to interest and the remainder, if any, on
principal."
It is the intent of the city, the Bank and the
Company that payments on the Company Note shall be in an
amount sufficient to fully pay all payments of principal and
interest on the city Note of the City together with any fees
of the City or any servicer of the Loan. Payment on the
Company Note shall be deemed to constitute payment on this
city Note without further delivery by the City.
This City Note, like the Company Note, is subject
to all of the terms and conditions contained in the Project
Agreement, Deed of Trust, Resolution of Issuance, and Assign-
ment of Leases, Rents and Profits, executed, acknowledged
and delivered on or prior to the date of this city Note and
#208.1(ph)
10/9/81
51
San. Bern'ardino
(Langston-Newby)
60,009-8-1
the Company Note to the same extent as if such doc~~ents
were set forth in full in this City Note and the same are
hereby incorporated by reference.
This City Note shall become immediately due and
payable prior to maturity with notice in the amount and
under the circumstances as provided for the Company Note in
the Project Agreement. This City Note may be prepaid at the
option of the City in whole or in part on the dates and in
the amounts as provided for the Company Note in the Project
Agreement. The Company has agreed to pay all costs of
collection when incurred, including but not limited to
reasonable attorneys' fees. If any suit or action is insti-
tuted to enforce this city Note, and consequently the Compa~y
Note, the Company has promised to pay, in addition to the
costs and disbursements otherwise allowed by law, such sum
as the court may adjudge reasonable attorneys' fees in such
suit or action.
If any payment due l:..der this City Note and,
consequently under the Company Note, is delinquent ten (10)
or more days, the Company has agreed to pay a late charge in
the amount of 5% of the payment so due and unpaid, in addition
to the pa}~ent; but nothing in this paragraph is to be
construed as any obligation on the part of the holder of
this City Note to accept payment of any installment or of
less than the total unpaid principal balance after its due
date.
In the event of default in payment of this indebted-
ness in full upon maturity, the interest rate thereafter
shall be increased to the then current Prime Rate plus five
percent (5%) of the unpaid balance, but in no event shall
interest exceed the maximum interest allowed by law.
The following provisions appear in the Company
Note, which to the extent applicable, apply to this City
Note:
"Defaults shall include, but not be limited to,
the failure of the maker(s) to pay principal or interest
when due; the filing as to each person obligated hereon,
whether as maker, co-maker, endorser or guarantor (individ-
ually or collectively referred to as the "Obligor") of a
voluntary or involuntary petition under the provisions of
the Federal Bankruptcy Act; the issuance of any attacrunent
or execution against any asset of any Obligor; the death of
#208.2(ph)
10/6/81
52
Sari Bernardino
(Langston-Newby)
60,009-8-3
any Obligor; or any deterioration of the financial condition
of any Obligor which results in the holder hereof considering
itself, in good faith, insecure.
"If this Company Note is not paid when due, each
Obligor promises to pay all costs and expenses of collection
and reasonable attorneys' fees incurred by the holder hereof
on account of such collection, plus interest at the rate
applicable to principal, whether or not suit is filed hereon.
Each Obligor shall be jointly and severally liable hereon
and consents to renewals, replacements and extensions of
time for payment hereof, before, at, or after maturity;
consents to the acceptance, release or substitution of
security for this Company Note; and waives demand and protest
and the right to assert. any statute of 1 imi tations. Any
married person who signs this Compnny Note agrees thnt
recourse may be had against separate property for any obliga-
tions hereunder. The indebtedness evidenced hereby shall be
payable in lawful money of the United States. In any action
brought under or arising out of this Company Note, each
Obligor, including successor(s) or assign(s) hereby consents
to the jurisdiction of any competent court within the State
of California, and to service of process by any means
authorized by California law.
"This Company Note is secured by a deed of trust
to Imperial Bank, as Trustee, which contains the following
provision:
'No single or partial exercise of any power
hereunder, or under any deed of trust, security agreement
or other agreement in connection herewith shall preclude
other or further exercises thereof or the exercise of
any other such power. The holder hereof shall at all
times have the right to proceed against any portion of
the security for this note in such order and in such
manner as such holder may consider appropriate, without
waiving any rights with respect to any of the security.
Any delay or omission on the part of the holder hereof
in exercising any right hereunder, or under any deed of
trust, security agreement or other agreement, shall not
operate as a waiver of such right, or of any other
right, under this note or any de,~d of trust, security
agreement or other agreement in connection herewith.'"
Any payment to be made under this City Note shall
be made when due at the office of the Trustee at: -
1208.2(ph)
10/9/81
53
San Bernardino
(Langston-Newby)
60,009-8-3
Imperial Bank
9920 La Cienega Boulevard
Inglewood, California 90301
Attention: Municipal Government
Finance Department
This City Note is authorized in the aggregate
principal amount of $1,130,000 designated as "City of San
Bernardino, Industrial Development Revenue Note, Langston-
Newby Project, 1981 Series" (the "City Note") issued by City
to fund a loan to Robert L. Langston and Wilton K. Newby, a
Generul Partnership (the "Company" for the purpose of con-
structing certain facilities to be used by the Company for
the construction of a commercial center (the "Project") and
paying necessary expenses incidental thereto. The funds for
the Project have been loaned by the City to the Compuny
under the terms of a Project Agreement dated as of October
1, 1981, as from time to time amended and supplemented (the
"Project Agreement"). This City Note is issued under and is
secured and entitled to the protection given by that certain
Resolution entitled "A Resolution of the Mayor and Common
Council of the City of San Bernardino, California, Authorizing
the Issuance of its Industrial Development Revenue Note,
Langston-Newby Project, 1981 Series, for the Purpose of
Acquiring and Improving Real Property; and Making Certain
Findings and Determinations in Connection Therewith," adopted
on October 12, 1981, as from time to time amended and
supplemented (the "Resolution of Issuance"). Reference is
hereby made to the Resolution of Issuance for a description
of the Revenues, the property subject to the Deed of Trust
securing the Project Agreement and the City Note, the provi-
sions, among others, with respect to the nature and extent
of the security, the rights, duties and obligations of the
City and the Bank and by acceptance hereof the Bank assents,
and accepts said terms and conditions.
Said Resolution is adopted under and tl.e ci ty Note
is issued under and are to be construed in accordance with
the laws of the State of California and Ordinance No. 3815
of the City (the "Ordinance").
This City Note and the interest hereon (to the
extent set forth in the Resolution) is payable from, and are
secured by a pledge of and lien upon, the Revenues derived
by the City from the Project (as that term is defined in the
Resolution), and all such Revenues constitute a trust fund,
41208.2(ph)
10/9/81
54
San' Berrlardino
(Langston-Newby)
60,009-8-1
in accordance with the provisions of the Resolution and the
Ordinance for the security and payment or redemption of this
City Note.
This City Note is a special obligation of the City
only, and is not a liability of any other public agency, or
a pledge of or lien against the property or funds of the
city, except to the extent of the pledge of and lien upon
the Revenues, as provided by the Resolution. Neither the
payment of the principal of this City Note, or any part
thereof, nor any interest or premium thereon constitute a
debt, liability or obligation of the City, the state or allY
other public corporation.
The City Note is issued pursuant to and in full
compliance with the Constitution and laws of the state of
California, particularly said Ordinance No. 3815 of the City
of San Bernardino, and pursuant to a resolution adopted by
the Mayor and Common Council of the City which authorizes
the execution and delivery of the Project Agreement and the
Resolution of Issuance which has been approved by such Mayor
and Common Council of the City. This City Note is a limited
obligation of the City and is payable solely from tlle payment
of principal and interest under the Projec'.; Agreement via
the Company Note. This City Note shall never constitute an
indebtedness of the City of San Bernardino, California,
wi.thin the meani,Jg of any California constitutional provision
or statutory limitation, and shall not constitute or give
rise to a pecuniary liability of the City of San Bernardino,
California, or a charge against its general credit or taxing
powers. Neither the faith and credit nor the taxing power
of the City of San Bernardino is pledged to the payment of
the principal of or interest on this City Note, nor is the
City of San Bernardino in any manner obligated to make any
appropriation for payment. Payments under the Project
Agreement and the Company Note sufficient for the prompt
payment when due of the principal and interest on this City
Note are to be paid to the Bank and are deemed to be payments
on this city Note.
IT IS HEREBY CERTIFIED, RECITED AND DECLARED that
all acts, conditions and things required by the Constitution
and statutes of the State of California, tlle Charter of the
City, Ordinance No. 3815, the Resolution of Issua~ce and the
Project Agreement referred to therein, to exist, to have
happened and to have been performed precedent to and in the
issuance of this City Note exist, have happened and have
been performed in due time, form and manner as required by
#208.2(ph)
10/6/81
55
.
.
, .
San Bernardino
(Langston-Newby)
60,009-8-1
.
~.: '
,
law; that the issuance of this city Note and the issue of
which it forms a part, together with all other obligations
of the City, does not exceed or violate any constitutional
or statutory limitation; and that the principal and interest
installments under the Project Agreement pledged to the
payment of the principal of and interest on this city Note
via the Company Note will be sufficient in amount for that
purpose.
All capitalized terms used herein shall have the
meanings attributed to them in the Resolution of Issuance
and the Project Agreement.
IN WITNESS WHEREOF, the city of San Bernardino,
California, has caused this Bond to be executed in its name
by the facsimile signature of its Mayor and attested by the
manual signature of its city Clerk and its corporate seal to
be imprinted hereon, all as of the day of
1981.
THE CITY OF SAN BERNARDINO,
CALIFORNIA
ATTEST:
_~1?t/7?al L2;?/,b'
, ci ty Clerk
[SEAL]
4208.2(ph)
10/6/81
56
.
San Bernardino
(Langston-Newby)
60,009-8-1
[FORM OF ASSIGNMENT]
For value received
hereby sells, assigns and transfers unto
the within-mentioned Bond and hereby
irrevocably constitute and appoint
attorney, to transfer the same on the books
of the Trustee with full power of substitution in the pre-
mises.
DATED:
NOTE:
The signature to this Assignment must correspond
with the name as written on the face of the with-
in Bond in every particular, without alteration
or enlargement or any change whatsoever.
#208.2(ph)
10/6/81
57