HomeMy WebLinkAbout1991-5285
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
RESOLUTION NO. 5285
RESOLUTION OF THE COMMUNITY DEVELOPMENT
COMMISSION OF THE CITY OF SAN BERNARDINO
APPROVING A CERTAIN LOAN AGREEMENT BY AND
BETWEEN THE REDEVELOPMENT AGENCY OF THE CITY
OF SAN BERNARDINO AND THE CITY OF
SAN BERNARDINO (WEST SIDE PLAZA PROJECT)
WHEREAS, the community Development Commission of the
City of San Bernardino (the "commission") on behalf of the
Redevelopment Agency of the City of San Bernardino (the
"Agency"), is a redevelopment agency, a public body, corporate
and politic of the State of California, organized and existing
pursuant to the Community Redevelopment Law (Part 1 of Division
24) commencing with section 33000 of the Health and Safety Code
of the State of California (the "Act"); and
WHEREAS, the Redevelopment Plan for the Northwest
Redevelopment Project (the "Redevelopment Plan") was previously
approved and adopted by the Mayor and Common Council of the City
of San Bernardino (the "Council") by Ordinance No. MC-189, dated
July 6, 1982; and
WHEREAS, the Redevelopment Plan provides for the
redevelopment of real property pursuant to the Redevelopment Plan
by owners thereof or by parties seeking to acquire real property
from the Agency; and
WHEREAS, the Agency has previously entered into a
certain Disposition and Development Agreement by and between the
- 1 -
1 Redevelopment Agency of the ci ty of San Bernardino and New
2 Frontier Commercial Properties, Inc. (the "DDA"), pertaining to
3 the development of a certain shopping center within the project
4 area subject to the Redevelopment Plan (the "Project"); and
5
6 WHEREAS, in connection with the implementation of the
7 DDA, the Agency has found it necessary to cause an amendment to
8 the DDA pertaining to the funding of certain Agency redevelopment
9 assistance as provided in the DDA; and
10
11 WHEREAS, in connection with the proposed amendment to
12 the DDA, the Agency deems it desirable to enter into a certain
13 Loan Agreement (the "Loan Agreement") by and between the Agency
14 and the city of San Bernardino (the "City") pertaining to the use
15 of certain Community Development Block Grant funds in connection
16 with the development of the Project; and
17
18 WHEREAS, the Agency deems it desirable to enter into
19 that certain Loan Agreement, a copy of which is attached hereto
20 as Exhibit "A" and incorporated herein by this reference, which
21 pertains to the funding of the project; and
22
23 WHEREAS, the Loan Agreement provides for a loan of
24 Community Development Block Grant funds in an amount equal to
25 $450,000 from the City to the Agency the proceeds of which are to
26 be used by the Agency in connection with the development of the
27 Project.
cr~
28
- 2 -
1 NOW, THEREFORE, THE COMMUNITY DEVELOPMENT COMMISSION
2 ACTING ON BEHALF OF THE REDEVELOPMENT AGENCY OF THE CITY OF
3 SAN BERNARDINO, CALIFORNIA, DOES HEREBY RESOLVE, DETERMINE AND
4 ORDER AS FOLLOWS:
5
6
7
8
9 section 2. The Commission authorizes the Executive
10 Director of the Agency to execute the Loan Agreement and to
11 execute such other documents as may be necessary to implement the
12 Loan Agreement and to make any necessary non-substantive changes
section 1. The Commission hereby approves the Loan
Agreement, a copy of which is attached hereto as Exhibit "A".
'I~
13 to the Loan Agreement as may be approved by Agency Counsel.
14 III
15 //1
16 11/
17 /11
18 III
19 1/1
20 III
21 III
22 III
23 11/
24 11/
25 III
26 III
27 III
28 III
- 3 -
~
4
Section 3.
This Resolution shall take effect upon
5 adoption.
6
7 I HEREBY CERTIFY that the foregoing resolution was duly
8 adopted by the Community Development Commission of the City of
9 San Bernardino at a
10 the 6th day of
11 wit:
Regular meeting thereof, held on
May , 1991, by the following vote, to
12 Commission Members:
13 ESTRADA
REILLY
14 FLORES
MAUDSLEY
15 MINOR
POPE-LUDLAM
16 MILLER
AYES NAYS
ABSTAIN
x
---L-
-^--
-1L-
-1L-
~
----1l!:>sent
17
18
19
20
21
22
23
pproved as to
24 form and legal content:
25 ~
y. J
26 /Agency Co el
Secretary, Ken neth J. Henderson
day of
The foregoing resolution
May , 1991.
6th
San Bernardino
27
28 BEO\0092\DOC\17
- 4 -
1 STATE OF CALIFORNIA )
COUNTY OF SAN BERNARDINO )
2 CITY OF SAN BERNARDINO )
3
ss
I, Kenneth J. Henderson Secretary of the Community
Development Commission of the City of San Bernardino, DO HEREBY
4 CERTIFY that the foregoing and attached copy of Community
Development Commission of the City of San Bernardino Resolution
5 No. 5285 is a full, true and correct copy of that now on
file in this office.
6
IN WITNESS WHEREOF, I have hereunto set my hand and
7 affixed the official seal of the Community Development Commission
of the City of San Bernardino this 6 Lh day of
8 May , 1991.
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
secre~e
Community Development
Commission
of the City of San Bernardino
1
EXHIBIT "A"
2
LOAN AGREEMENT
3
4
5
6
7
8
9
10
11
12
13
14
'"-J~""
15
16
17
18
19
20
21
22
23
24
25
26
27
-
28
1
2
3
4
5
6
7
8
9 Item:
10
11
12
13
14 Action to be
Taken:
COMMUNITY DEVELOPMENT COMMISSION OF THE
CITY OF SAN BERNARDINO
AGENDA
April 15, 1991
RESOLUTION OF THE COMMUNITY DEVELOPMENT
COMMISSION OF THE CITY OF SAN BERNARDINO
APPROVING A CERTAIN LOAN AGREEMENT BY AND
BETWEEN THE REDEVELOPMENT AGENCY OF THE CITY
OF SAN BERNARDINO AND THE CITY OF
SAN BERNARDINO (WEST SIDE PLAZA PROJECT)
EXHIBIT "A" - Loan Agreement
Adopt Resolution
15
To be Published:
16
17
Newspaper:
N/A
N/A
18
certified copy of Resolution to be returned to Sabo & Green, A
19 Professional Corporation.
20
21 SBEO\OO92\017\ea
04/10/91 849
22
23
24
25
26
27
28
o
fl"_
I
'-'
\-
~
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
LOARACVDhRrr
THIS LOAN AGREEMENT dated , 1991, by and
between the Redevelopment Agency of the City of San Bernardino (hereinafter
called the "BORROWER") and the CITY OF SAN BERNARDINO (hereinafter called the
"LENDER").
WHEREAS, the BORROWER has applied to the LENDER for a Loan for the
purpose of construction of the West Side Plaza on the corner of Baseline and
Medical Center Drive (hereinafter the "PROJECT") as described in the legal
description set forth in the attached Exhibit "A".
WHEREAS, the purpose of the Loan, as hereinafter defined, is to
enable the future construction of a neighborhood shopping center, reSUlting in
employment opportunities to the region's low and moderate income work force,
and:
WHEREAS, Community Development Block Grant (CDBG) funds have been
made available to the LENDER by the United States Department of Housing and
Urban Development (BUD) on the condition that the CDBG funds, notwithstanding
the Loan, as hereinafter defined, of same to BORROWER shall, as necessary, be
at all times immediately available for such CDBG programmed purposes as may
from time to time be determined by LENDER and BUD, and;
WHEREAS, such short term use of CDBG funds have been found necessary
and appropriate by the Mayor and Common Council, and;
WHEREAS, the LENDER is willing to make such a loan to the BORROWER on
the terms and conditions set forth.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements contained herein, the parties hereto agree as follows:
AftICLB "I"
TIlE LOAR
SECTIOR 1.01: The Loan, Rote And Rate
Subject to the terms and conditions of this Loan Agreement, the
LENDER hereby agrees to lend the BORROWER, and the BORROWER hereby agrees to
borrow from the LENDER and repay the LENDER or its Assigns, the amount of
FOUR-HUNDRED, FIFTY-THOUSAND DOLLARS ($450,000.00) (hereinafter called the
"Loan") . The Obligation of the BORROWER to repay the Loan shall be evidenced
by the Promissory Note (hereinafter called the "Note") of the BORROWER in a
form satisfactory to the LENDER (or in the form of Exhibit "B" attached
hereto) dated the date on which the Loan is made (hereinafter known as the
"Closing Date") payable to the order of the LENDER for the amount of the Loan
without interest. The Note shall be secured by an unconditional, irrevocable
Letter of Credit, payable upon demand (hereafter the "Letter of Credit) in a
form approved by the LENDER. BORROWER and LENDER agree that if the Project
costs are less than $450,000.00, the Loan amount shall be reduced to the
actual Project cost. The Project cost shall be construction, site
-1-
KJH:lab:1373C
May 3, 1991
,.-..
c"""
~
. . .~ ~~.""'~ .'-". ..;_.~......,...~....,_.._.~'- ........ ...... ,,-,
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
improvements, soft costs, professional fees, Letter of Credit, and other
related eligible costs as permitted by BUD regulations and agreed to by the
LENDER.
SECTIOR 1.02: the Term and ReDaYment
The term of the Loan shall be for four (4) years, except that the
Note shall be repayable on demand, provided that not less than ten (10) days
written notice is required if the BORROWER is not in default of BORROWER's
obligations. If prior demand is not made, the payment of principal shall be
due and payable on Said payment shall be made
upon the Letter of Credit being called by LENDER. LENDER makes no commitment
to future support and assures no obligations for future support, except as
expressly set forth in this Loan Agreement.
SECTIOR 1.03:
PurDOse of Loan
The purpose of the Loan is solely to "construct" the real property
(including on-site improvements, tenant improvements, professional fees,
interim costs and developer profit and overhead) described in the attached
Exhibit "A". BORROWER agrees that it shall apply the funds received by it
under this Loan Agreement in accordance with the uses permitted in this Loan
Agreement. BORROWER further agrees that no application of any funds received
from LENDER hereunder shall be made in violation of the laws of the State of
California, or the governing BUD regUlations.
SECTIOR 1.04: Letters of Credit
The Note shall be secured by an unconditional, irrevocable Letter of
Credit, payable upon demand, and in a form of approved by LENDER addressed to
LENDER as beneficiary. The Letter of Credit shall have expiration dates which
shall be one-hundred, twenty (120) days longer than the due date as set forth
in the Note. The Letter of Credit shall be in the amount of FOUR-BUNDRED,
FIFTY-THOUSAND DOLLARS ($450,000.00).
Payment on the Letter of Credit shall be on demand but not less than
ten (10) days written notice if the BORROWER is not in default of BORROWER's
Obligations. Payment on the Letter of Credit shall not be conditioned upon
any action or omission to take such action on the part of LENDER, whether
under this Loan Agreement, or under the terms of any document executed or
delivered hereunder or otherwise. Neither the acceptance of, the transfer of,
or receipt of monies under the Letter of Credit shall in any manner relieve
BORROWER of any obligation hereunder or under the terms of any document
executed or given herewith, except to the extent payment is actually received
under the Letter of Credit.
ARTICLE "II"
UPUSDrATIOR J.BD WAUAlTS
The BORROWER represents and covenants the following:
SECTIOR 2.01:
DulY Oraanized
-2-
ICJH:lab:1373C
May 3, 1991
~
'-'
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
\-
#:w"~_
'-"
.' .-~ ....,....-.... ... .~-~ -...- ~
. ...- _.. ...il. _ . .J<.- -...:.... .. . .' _. ~ . .'_. .
The BORROWER is duly organized, validly existing and in 'good standing
under the laws of the State of California and has the power to enter into this
Loan Agreement to borrow.
SECTIOB 2.02:
Duly Authorized
The making and the performance by the BORROWER of this Loan
Agreement, and the execution and delivery of the Note, and any security
agreements and instruments have been duly authorized by all necessary actions
and will not violate any law, rule, regulation order, writ, Judgment, decree,
determination or award presently in effect having applicability to the
BORROWER or any provision of BORROWER's Articles of Incorparation or result in
a breach of any credit agreement or any other agreement or instrument to which
the BORROWER is a party or by which it is or its property may be bound or
affected.
SECTIOB 2.03:
Leaallv Bindina InstlUllent8
When this Loan Agreement is executed by the BORROWER and the LENDER,
and when the Note and the Letter of Credit are fully executed and delivered by
the BORROWER, each such instrument shall constitute the legal, valid, and
binding Obligation of the BORROWER and on the financial institution issuing
the Letter of Credit in accordance with its terms.
SECTIOB 2.04:
Bo Leaal Actions
There are no legal actions, suits, arbitrations, or proceedings
pending or to the knowledge of the BORROWER, threatened against the BORROWER
or business of the BORROWER, before any court or administrative agency, which,
if determined adversely to the BORROWER, would interfere with the BORROWER's
performance of this Loan Agreement or the Project for which the Loan was made.
SECTIOB 2.05:
Bo Leaal Authorization Beeded
No authorization, consent or approval or any formal exemption of any
governmental body, regulatory authority (federal, state or local) or
mortgagor, creditor or third party is or was necessary to the valid execution
and delivery by the BORROWER of this Agreement, the Rote, the Letter of
Credit, or any.other document except as provided for under Sections 3.03 and
3.04 herein.
SECTIOB 2.06:
Bot in Default
The BORROWER is not in default of any obligation, covenant or
condition contained in any bond, debenture, note, or other evidence of
indebtedness or any mortgage, Deed of Trust or collateral instrument securing
the same, except as disclosed in writing to LENDER, and consented by LENDER
and/or LENDER's counsel prior to the Closing Date.
SECTIOB 2.07:
Proiect ImDlementation
The schedule of activities surrounding the Project shall adhere to
-3-
ICJH:lab:1373C
May 3, 1991
,.-
,,-.
"""'....
,
'-
,~,-
-
-~_. .._.~.............._.......-.. .......... ..- --....... -_..~ '................._.... ._..~_._.4__.._.....;........._ .......". or ..., .,. ...
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
the following time schedule and is so certified by the BORROWER:
A. The escrow for the construction of the real property described
in Exhibit "A" shall close on May 1, 1991 or as mutually agreed
upon by both parties.
B. The shopping center shall open its doors for business on or
before May 1, 1992.
C. Two-hundred, forty-eight (248) Jobs as required by Section 4.14
will have been created by Bovember 1, 1992.
SECTIOK 2.08: Taxes are Paid
The BORROWER has filed all tax returns which are required and has
paid or made provision for the payment of all taxes which have or may become
do pursuant to said returns or pursuant to any assessments received by them.
Bo tax liability has been asserted by the Internal Revenue Service or other
taxing agency, federal, state, or local for taxes materially in excess of
those already provided for and the BORROWER knows of no basis for any such
deficiency assessment.
SECTIOK 2.09: Bo Adverse Chan_e
The BORROWER certifies that there are no mutual adverse changes since
December 31, 1990 in its financial condition, organization, operation, fixed
properties, real properties, or management personnel of the BORROWER that have
not been disclosed in writing to LENDER prior to the Loan closing.
AJr.rICLB "III"
COBDITIOKS OF LDDIKG
The obligation of the LENDER to make the Loan shall be subject to the
fulfillment at the time of Loan Closing and the continued fulfillment of each
of the following conditions:
SBCTIOB 3.01: Execution and De1iverv of Bote. the Loan ARreement,
Letter of Credit and Related Documents
The funding of the Loan is predicated on receipt of the fOllowing
documents:
A. The receipt by LENDER of such documents, certifications and
opinions as may be reasonably satisfactory to LENDER, evidencing that this
Loan Agreement, the Bote, the Letter of Credit and all other documents given
or executed in connection herewith are duly and validly executed by and on
behalf of and constitute the valid and enforceable obligations of BORROWER
thereunder pursuant to the respective terms of each, and that the execution
and delivery of this Loan Agreement, the Rote, the Letter of Credit and all
other documents executed or given hereunder and the performance by BORROWER
hereunder will not breach or violate any prOVision of Borrower's Partnership
Agreement, or any law or governmental regulation or constitute any breach or
-4-
KJH:lab:1373C
May 3, 1991
"'-
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
,-.
.,-,.
,..$0#",
~
default under any instrument or agreement to which BORROWER may be a party.
B. The continued availability to LENDER of $450,000.00 in proceeds
of obligated but not liquidated Community Development Block Grant funds.
C. BORROWER shall have executed and delivered this Loan Agreement,
the Bote, the Letter of Credit and any and all other documents to LENDER which
LENDER may deem reasonably necessary with respect to the Loan in a form and in
terms and conditions satisfactory to LENDER and its counsel.
D. The receipt of documentation satisfactory to LENDER evidencing
the fact that the Loan proceeds are being used for the construction of the
real property of the Project. The LENDER shall have the right to fund the
Loan through escrow.
SBCTIO. 3.02: becution and Deliverv of Letter of Credit
BORROWER shall have lending institution(s) approved by LENDER execute
and deliver to LENDER an irrevocable Letter of Credit in a form satisfactory
to LENDER and its counsel giving LENDER a total not to exceed $560,000.00.
Said Letter of Credit is to secure payment of the principal amount of the
Bote, and any other sums due and payable by BORROWER hereunder.
SBCTIO. 3.03: CovPnJlnts, Zonina and Codes
BORROWER has complied and will continue to comply with all applicable
environmental statutes and regUlations in connection with the development of
the Project. All permits, consents, approvals and authorizations by, and
registrations and declarations necessary for the development of the Project,
shall be obtained, and will be valid, adequate and in full force and effect
for any of the development activities for which a permit, consent, approval or
authorization is necessary. Development of the Project will in all respects
conform to and comply wi th all covenants, condi tiono, use and building codes,
laws, regulations and ordinances.
SBCTIO. 3.04: ADDroval of Others
The BORROWER shall secure all necessary approvals and consents, if
required, of governmental bodies having jurisdiction with respect to any
portion of the construction contemplated. The BORRO\,ER shall secure all
necessary approvals and consents required with respect to this transaction by
any mortgagor, creditor or other party having any financial interest in the
BORROWER.
SECTIOR 3.05: ODinion of CODnAel
LENDER shall receive an Opinion of Counsel from BORROWER stating that
(i) BORROWER's Representations and Warranties were true and accurate on the
Closing Date; (ii) the conditions of the Loan have been duly satisfied as of
the Closing Date, and; (iii) all representations, warranties, covenants and
conditions continue to be true, accurate and in effect throughout this Loan
Agreement.
-5-
ICJH:lab:1373C
May 3, 1991
,-..
I
'-
t"'"
.~
~~
,-.
..:. .-.....- . .:. --',-"._- - ._._......-.;. . _.. .,...... ~~.-,., ;...._'1:"'.....-'........._.."'".;.,......'_.....$..1. ,'_.',r., .,,'
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
.uTICLB "IV"
Al'FIIllATIVI COVBlU.RTS OF TBI BOUOWD AIm GUAUITOR
BORROWER agrees to comply with the following covenants from the date
hereof until the LENDER has been fully repaid with interest, unless the LENDER
or its Assigns shall otherwise consent in writing.
SBCTIOB 4.01: Pavment of the Loan
The BORROWER agrees to pay punctually the principal and the Note
according to its terms and conditions and to pay punctually any other amounts
that may become due and payable to the Lender under or pursuant to the terms
of this Loan Agreement or the Rote.
SBCTIOB 4.02: Satisfaction of Other ObUaations
The BORROWER agrees to pay punctually the principal and interest due
on any other indebtedness now or hereafter, at any time owing by the BORROWER
to any other lender.
SBCTIOB 4.03: Maintain and Insure ProDertv
The BORROWER agrees to insure the Project at all times and at all
times maintain assets acquired with this Loan and the shopping center in such
condition and repair that the value of the land and improvements therein will
be adequately maintained and protected. BORROWER also agrees to insure the
project and maintain during the term of the Loan adequate hazard insurance
pOlicies covering fire and extended coverage and such other hazards as may be
deemed appropriate in amounts and form satisfactory to LENDER, with the LENDER
as an additional insured with a loss payee clause acceptable to LENDER.
BORROWER further agrees if at any time during the life of the Loan the Project
is declared to be within a flood hazard area, to insure purchase of Federal
Flood Insurance if available. Such inslJ.rance, to the extent available, shall
be in an amount equal to the greater of: (i) the amount of the Loan; (ii) the
insurable value of the Project, or; (iii) the max~ limit of coverage
available. If the property is not located in a flood hazard area at the time
of the Loan Closing date, BORROWER will provide satisfactory evidence
thereof. BORROWER further agrees to insure the Project and to maintain
adequate liability and Workers' Compensation Insurance in amounts and form
satisfactory to the LENDER.
SBCTIOB 4.04: Pay All Taxes
The BORROWER agrees to insure the Project and duly pay and discharge
all taxes, assessments and governmental charges upon it or against its
properties prior to the date on which the penalties attache thereto; except
that the Project shall not be required to pay any such tax, assessment or
governmental charge which is being contested by BORROWER in good faith and by
appropriate proceedings.
SBCTIOB 4.05: Provide Additional Bauity
-6-
ICJH: lab: l373C
May 3, 1991
,,-
'-'
1"-
"'-
,-:t~,
""-'
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
BORROWER agrees to insure the Project is provided additional equity
funds to cover additional Project costs incurred as a result of overruns or
unanticipated expenses or changes in work orders in the Project.
SKCTIOK 4.06: Maintain Existence
BORROWER agrees to maintain its existence, rights, privileges, and
franchises within the State of California until the Loan has been repaid to
LENDER in full.
SKCTIOK 4.07:
Provide Fin.ncial Information
Until the Loan is repaid, the BORROWER will insure that the Project
maintains adequate records and books of accounts, in which complete entries
will be made reflecting all of the Project's business and financial
transactions. Such entries are to be made in accordance with consistently
applied, generally accepted accounting principles and practices.
In addition, the BORROWER agrees to deliver to the LENDER annual
Project financial statements. Annual financial statements of BORROWER are to
be prepared by an independent accountant and certified by an authorized
officer of the BORROWER to be true and accurate copies, and are to be
submitted to LENDER with ninety (90) days of the close of the annual period.
BORROWER agrees to provide any additional financial information on
the Project as it becomes available to BORROWER, including, but not limited
to, copies of Project income tax returns and instruments and information as
may be reasonably requested by the LENDER, its Assigns or Counsel.
The BORROWER further agrees to prOVide written notice to the LENDER
of any trial, pUblic hearing or meeting before any administrative or other
public agency which may in any manner, effect the personal property or real
estate of this Project.
SKCTIOK 4.08: Il&ht to Ins>>ection
BORROWER agrees to grant the LERDER, until the Note has been fully
repaid, the right at all reasonable hours to inspect the real estate,
improvements placed thereon and all personal property and fixtures of this
Project and the BORROWER furtner agrees to provide LENDER free access to the
Project property for the purpose of such inspection to determine the condition
of the Project's property and real estate.
SKCTIOK 4.09: Bull and Void COVPn.nts
BORROWER agrees that in the event that any provision of this Loan
Agreement, or any other instrument executed at Closing or the application
thereOf, to any person or circumstances, shall be declared null and void,
invalid, or held for any reason to be unenforceable by a Court of competent
jurisdiction, the remainder of this Agreement shall nevertheless remain in
full force and effect, and to this end, the provisions of all covenants,
conditions, and agreements described herein are deemed separate.
-7-
IOH: lab: l373C
May 3, 1991
r-
"-
,-,
"-
!"'''',",
'-
-r _.... ......,.
.....p.... ." - : ." - ..-..:. ..-
..... ,~. -, . . -, ,... ...
. '-
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
SBCTIOR 4.10: BzDPnAes and C10sina Costs
BORROWER agrees to pay all fees, expenses and charges in any way
connected to the Loan, its making or transfer, therewith including, but not
limited to, the fees and out-of-pocket expenses of counsel employed by the
LENDER and any taxes, fees and expenses payable in connection with this
transaction and with the enforcement of this Loan Agreement, Rote, and the
Letter of Credit. A reasonable amount shall be withheld from disbursement of
the Loan proceeds for the payment of these costs and expenses.
SBCTIOR 4.11: Rotice of Default
BORROWER agrees to give written notice to LENDER, within fifteen (15)
days, of any event which would constitute an Event of Default under this Loan
Agreement or that would with notice or lapse of time or both, constitute an
Event of Default under this Loan Agreement.
SBCTIOR 4.12:
Ind..-ntfication
BORROWER agrees to indemnify and save the LENDER and its Assigns
harmless against any and all liability with respect to, or resulting from any
obligation of the BORROWER.
SBCTIOR 4.13: BzDMlAes of Collection or Enforcement
BORROWER agrees, if at any time BORROWER defaults on any provision of
this Loan Agreement, to pay the LENDER or its Assigns, in addi don to any
other amounts that may be due from the BORROWER an amount equal to the costs
and expenses, of collection, enforcement or correction or waiver of the
default incurred by the LENDER or its Assigns in such collection, enforcement,
correction or waiver of default, inCluding but not limited to attorney fees
and costs of litigation.
HCTIOR 4.14: Rev Aft" Retained Positions Reauired
A. In consideration for the Loan made by the LENDER, BORROWER
agrees to expand the Project's employment base by a minimum of Two-Hundred,
Forty-eight (248) permanent, new full time employment positions or full time
equivalents (FrEs) over and above the Project's full time employment base at
Loan Closing Date which LENDER and BORROWER agree is zero (0).
Full time positions are positions requiring forty (40) hours a week
per employee. For calculation purposes, two (2) part-time employees shall be
considered one (1) FrE.
C. BORROWER agrees that at least one-hundred, sixty-one (161)
(i.e. sixty-five percent 651)) of the two-hundred, forty-eight (248) FrE
positions will be (i) held by, or; (ii) made available to qualified persons
(i.e., referral or assistance eligible) under the categories listed on the
attached Exhibit "D", Employment Information Form or persons whose current
family income level is less than that shown on attached Exhibit "D",
Employment Information Form. BORROWER agrees to have all prospective
-8-
ICJH:lab:1373C
May 3, 1991
,-
'--
',,-,
'~~
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
employment applicants complete the Employment Information Form.
D. BORROWER agrees to file and maintain completed employment
information forms separated into four (4) categories.
1) Full Time Hires below Income Criteria or
Referral/Assistance Eligible.
2) Full Time Hires above Income Criteria.
3) Part Time Hires below income Criteria or
Referral/Assistance Eligible.
D. Upon documentation of at least two-hundred, forty-eight FTE
hires and at least one-hundred, sixty-one (161) income eligible placements,
BORROWER shall submit to LENDER, copies of all Employment Information Forms
accompanied by an inventory sheet listing the number of forms collected under
each of the four (4) categories under Section 4.l4(C).
E. Should the Job creation and income eligible placement goals not
be met by the end of thirty (30) months after Loan disbursement, BORROWER
shall at that time, submit all available documentation required under this
Section including documentation for those NOT HIRED.
The purpose is to ascertain progress towards meeting projected
overall job creation goals, to determine the number of targeted positions
failing short of placement and to determine the number of income eligible
persons that were interviewed (and not hired) to fill the shortfall.
F. Upon review of Section 4.l4(E) documentation, LENDER will
determine if satisfactory measures have been taken to make targeted jobs
available to income eligble persons. Job Training and Partnership Act
(hereinafter "JTPA") referrals who are interviewed, although not necessarily
hired, for unfilled targeted positions will satisfy this purpose.
Failure to take satisfactory measures, as determined by LENDER at its
sole discretion, to make the targeted jobs available to income eligible
persons is an Event of Default.
SECTIOB 4.15: Third Party Aareements
A. BORROWER agrees to insure that when the Project developer
enters into any agreement with a third party which conveys any leasehold
interest in the real property or improvements covered by the terms of this
Loan Agreement that said third party shall execute an agreement with the
Project developer indicating the third party will use their best efforts to
comply with the guidelines for hiring employees as set forth in Section 4.14.
The agreement shall obligate the third party to provide BORROWER with the
documentation required under Section 4.14 which BORROWER is required to submit
to LENDER. The use of best efforts by the third party shall not relieve the
BORROWER from its responsibility and obligation to provide employment required
under Section 4.14.
-9-
ICJB:lab:1373C
May 3, 1991
'"~
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
--"
"-'"
-
B. A copy of aareement(s) entered into by the Project developer
with third parties which transfer an interest in the Project or its
improvements shall be delivered to LENDER within five (5) days of the
execution of said aareements(s) between the Project developer and any third
party(ies) that conveys the interest.
AKTICLB "V"
lIBGATIVB COVllWlTS OF TUB BOUOwn
BORROWER covenants and aarees that, from the date hereof until
payment in full of the Note, unless the LENDER or its Assians shall otherwise
consent in writins, BORROWER shall not enter into any aareement or other
commitment the performance of which would constitute a breach of any of the
covenants contained in this Loan Aareement includins but not limited to the
followins covenants:
SECTIOR 5.01:
Sale of the Acauisition Assets
So Ions as the Note is unpaid the BORROWER shall not permit the sale,
conveyance, lease (except in the normal course of operation of the Project),
assianment, transfer or other disposition of the Project's Assets unless
approved in writins by the LENDER which approval shall not be unreasonably
wi thheld.
SECTIOR 5.02:
CbAft.e OwnershiD
BORROWER will not permit without the written permission of LENDER,
which permission shall not be unreasonably withheld, any chanae in the
ownership structure, control, or operation of the Project developer, including
but not limited to: (i) meraer into or consolidation with any other person,
firm or corporation; (ii) chanaes in the composition of its Partners; (iii)
chanains the nature of its business as carried on on the date hereof, or; (iv)
substantial distribution, liquidation or other disposal of the Project
developer's assets to its OWners.
SECTIOR 5.03:
ChAft.e the Proiect
BORROWER shall not permit nor allow to exist without prior written
consent from LENDER, which permission shall not be unreasonably withheld, any
material chanse in the Project's plans and/or specifications which may be
submitted to the LENDER.
AKTICLB "VI"
EVERrS OF DEFAULT
The entire unpaid principal of the Note shall become and be
immediately due and payable upon the written demand of the LENDER or its
Assigns, without any other notice or demand of any kind or any presentment or
protest, if any one or more of the events listed in this Article (hereinafter
termed an "Event of Default") shall occur, whether voluntarily or
involuntarily, with or without limitation, occurrins or brought about by
operation of law or pursuant to or in compliance with any jUdgment, decree or
-10-
KJH:lab:1373C
May 3, 1991
A!t"l'"
"----
~
'-
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
order of any court or any order, rules or regulation of any administrative or
governmental body, provided, however, that such sum shall not be then payable
if BORROWER's payments have been waived, or the time for making the Borrower's
payments have been extended by the LENDER.
SBCTIO. 6.01: Late Pa'9llent of Loan
If the BORROWER shall fail to make payment when due of any
installment of principal on the Bote, or interest accrued thereon the funds
due shall accumulate interest until paid by the BORROWER. Acceptance of any
late payment shall not constitute a waiver of BORROWER's default with respect
to the overdue amount or satisfy BORROWER's obligation to pay interest on the
late payment, or prevent LENDER from exercising any of the other rights and
remedies available to LENDER. Payment not paid when due shall bear simple
interest from date due until paid at the rate as set forth on the Note.
SKCTIO. 6.02:
Incorrect ReDresentation or Warranty
If representations or warranties contained in, or made in connection
with the execution of, or delivery of, this Loan Agreement, or in any
certificate furnished pursuant hereto, shall prove to have been incorrect when
made in any adverse respect.
SBCTIO. 6.03: Default in COVI!II.nta
If the BORROWER ahall default in the performance of any other term,
covenant or agreement contained in this Loan Agreement, and if any such
default shall continue unremedied for five (5) days after either: (i) it
becomes known to an executive officer of the BORROWER, or; (ii) written notice
thereof shall have been given to the BORROWER by the LENDER.
SBCTIO. 6.04: VoluntarY Insolvency
If the BORROWER shall become insolvent or cease to pay its debts as
they mature or shall voluntarily file a petition in bankruptcy or a petition
seeking reorganization, or the appointment of a receiver, trustee, or
liquidator for it or a substantial portion of its assets, or effect a plan or
other arrangement with creditors, or shall be adjudicated bankrupt, or shall
make a voluntary assignment for the benefit of creditors.
SBCTIO. 6.05:
InvoluntarY Insolvency
If any involuntary petition shall be filed against the BORROWER under
any bankruptcy, insolvency or similar law seeking the reorganization of or the
appointment of any receiver, trustee or liquidator for the BORROWER, or of a
substantial part of the property of the BORROWER or if a writ or warrant of
attachment or similar process shall be issued against a substantial part of
the property of the BORROWER, such petition shall not be dismissed or such
writ or warrant of attachment or similar process shall not be released or
bonded, within fifteen (15) days after filing of levy.
SBCTIO. 6.06: Judlnllenta
-11-
ICJH:lab:1373C
May 3, 1991
r
.......
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
I""'"
'-'
,#"f<~i'
~
. .... .
-..-. ---..
If any final judgment for the payment of money that is not fUlly
covered by liability insurance and is in excess of $10,000.00 shall be
rendered against the BORROWER, and shall not be discharged within thirty (30)
days, or an appeal therefrom taken and execution thereon effectively stayed
pending such appeal and, if such appeal, and if such judgment affirmed on such
appeal, the same shall not be discharged within thirty (30) days.
AftICI.'R "VII"
IIISt:'RT.J.& nODS
SECTIOR 7.01: Waiver of Rotice
No failure or delay on the part of the LENDER in exercising any
right, power, or remedy hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right, power, or remedy preclude
any other or further exercise thereof or the exercise of any other right,
power or remedy hereunder. No modification or waiver of any provision of this
Loan Agreement or of the .Note or of the Letter of Credit, nor any consent to
any departure by the BORROWER therefrom, shall in any event be effective
unless the same shall be in writing and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given. No notice to or demand on the BORROWER shall in any case entitle the
BORROWER to any other or further notice or demand in similar or other
circumstances.
SECTIOR 7.02: Amendments
The BORROWER, LENDER and its Assigns hereby expressly reserve all
rights to amend any provisions of this Loan Agreement, to consent to or waive
any departure from the provisions of this provisions of the Note, or to
release or otherwise deal with any collateral security for payment of the Note
provided, however, that all such amendments be in writing and executed by
LENDER or its Assigns, and BORROWER.
SECTIOR 7.03: Rotices
All notices, consents, requests, demands and other communications
hereunder shall be in writing and be duly given to a party hereto by personal
delivery or mailed by certified mail, prepaid, to the LENDER or BORROWER at
their addresses set forth at the signature of the parties to this Loan
Agreement, or at such other addresses as any party may have designated in
writing to any other party hereto and which notice shall be effective upon
receipt. Receipt shall be five (5) days after mailing.
SECTIOR 7.04:
Survival of ReDresentations and Warranties
All agreements, representations, and warranties made by the BORROWER
herein or any other document or certificate delivered to the LENDER in
connection with the transactions contemplated by this Loan Agreement shall
survive the delivery of this Agreement, the Note and the Letter of Credit, and
shall continue in full force and effect so long as the Rote is unpaid.
-12-
KJH:lab:1373C
May 3, 1991
. -- .,. .-
~
......,..,
~
'-
~~~
'-
.-.. .,.. -""'-. - . ,. ... .!.
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
SBCTIOB 7.05:
Successors and Assima
This Loan Agreement shall be binding upon the BORROWER, their
Successors and Assigns, except that the BORROWER may not assign or transfer
their rights without prior written consent of the LENDER. This Loan Agreement
shall inure to the benefit of the LENDER, its Successors and Assigns, and,
except as otherwise expressly provided in particular provisions hereof, all
subsequent holders of the Note.
SBCTION 7.06: .bdll
LENDER shall have the right to require BORROWER to provide within a
reasonable time, a financial audit of BORROWER, by an independent certified
public accountant chosen by LENDER and paid for by BORROWER, if BORROWER is in
default of any of its covenants or obligations to LENDER.
SBCTION 7.07:
C01DlterDarts
This Loan Agreement may be executed in any number of counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
SBCTION 7.08:
GoverniJU[ Law
This Loan Agreement, the Note and the Letter of Credit, shall be
deemed contracts made under the laws of the State of California and for all
purposes shall be construed in accordance with the laws of said state. In the
event that any action, at law or in equity, be commenced by any party against
any other party, the parties agree that jurisdiction and proper venue shall
lie solely with the Superior Court of the State of California for the County
of San Bernardino, or if the amount in controversy is not sufficient for the
Jurisdiction of the Superior Court, then the venue and forum for such action
shall be the Municipal Court of the State of California for the County of San
Bernardino.
SBCTIOB 7.09: AttorneY's Fees
In the event either party shall bring an action to enforce the terms
and conditions of this Loan Agreement, the prevailing party shall be entitled
to recover all of its costs and expenses, including, but not limited to,
reasonable attorney's fees as determined by the court.
SECTION 7.10:
Conflict of Interest
No member, official or employee of LENDER shall have any personal
interest, direct or indirect, in the subject matter of this Loan Agreement,
nor shall any member, official or employee participate in any decision
relating to this Loan Agreement which effects whether directly or indirectly,
his or her personal interests or the interests of any corporation, partnership
or association in which he or she has an interest.
SECTION 7.11: Article and Section BeadiJU[s
-13- .
KJH:lab:1373C
May 3, 1991
..~ .'.- - ~.. -..-....... ..~-~ .- ...... _ ......_.. ._1_ ...._.J.. _..._'-'....._.\_.......,.....__.........._...:...
.r 1 Article and Section Headings used in this Agreement are for
"-" convenience only and shall not affect the construction of this Agreement.
2
3 IN WITNESS WHEREOF, the parties hereto have each caused this Loan
Agreement to be duly executed as of the day and the year first written above.
4
5 LEImER: BODOWEK:
6 CITY OF SAIl BEJUWmIBO UDEVELOPImRT AGEBCY OF TIlE CIl'Y
7 OFFICE OF COIItDBITY DEVELOPImRT SAIl BEJUWmIBO
8
9 By: By:
10 Title: Title:
11 Dated: Dated:
12
13
~~"
'- 14
15
16
17
18
19
20
21
22
23
24
25
26
""n'lI~
'- 27
28 -14-
KJB: 1ab: 1373C
May 3, 1991
;".-.
"-
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
ft~"'-
'-
-
DDWm ROTE
For value received, the undersigned, the City of San Bernardino
Redevelopment Agency, whose principal office is located at 300 North "D"
Street, Fourth Floor, San Bernardino, California 92418 ("BORROWER"), promises
to pay to the order of the Department of Community Development of the City of
San Bernardino (the "City"), a pUblic body corporate and politic, at 300 North
"D" Street, San Bernardino, California 92418, Attention: Mr. Kenneth J.
Henderson (or at such other address as the City may direct), the principal sum
of FOUR-HUNDRED, FIFTY-THOUSAND DOLLARS ($450,000.00) or so much thereof as
may be advanced hereunder from time to time, on the earlier of (i) LENDER's
demand; (ii) forty-eight (48) months from the date hereof, unless extended, in
the sole and absolute discretion of its Executive Director, by written notice
to the BORROWER given at least thirty (30) days prior to the forty-eight (48)
month maturity date hereinabove set forth, or; (iii) as otherwise provided in
the Agreement (as defined below).
This Demand Note is made pursuant to the terms of the Loan Agreement dated as
of , 1991 (the "Agreement") entered into between
BORROWER and the City, and is secured by an irrevocable, unconditional and
callable upon demand letter of credit (the "Letter of Credit") issued by Wells
Fargo Bank for the account of BORROWER, in favor of the City.
BORROWER shall, upon demand by the Ci ty, pay to the City, mandatory
prepayments (as hereinafter defined) of principal at such times and in such
amounts as the City may determine from time to time in its sole discretion.
As used herein, "Mandatory Prepayment" means a demand for prepayment by the
City for the partial or total prepayment of the principal due on the Loan
evidenced by this Demand Note. In the event of a Mandatory Prepayment, the
City shall give BORROWER ten (10) days written notice prior to the date such
prepayment is due.
BORROWER shall also have the right to make optional prepayments, at any time,
without penalty, upon at least thirty (30) days prior written notice to the
City, provided any such notice of optional prepayment shall be irrevocable,
and failure of BORROWER to make such prepayment within the time specified in
such notice shall constitute a default hereunder.
BORROWER hereby waives diligence, presentment, demand, protest and notice of
any kind whatsoever. In the event of a default in the paymAnt of principal or
of interest on this Demand Note, the City may, among other remedies, declare
the unpaid balance hereof, together with accrued interest thereon, to be
immediately due and payable. The Reference Rate shall be the announced prime
or reference rate of Bank of America or a reasonably comparable bank chosen by
the City. Overdue principal shall bear interest at the Reference Rate plus
two-percent (2X) per annum (the "Default Rate") changing as and when such
Reference Rate may be changed, payable from the date of declaration of default
by the City until payment to the City by BORROWER of all costs incurred in
connection with the enforcement of this Demand Note, including attorneys' fees
and costs, whether or not suit is filed, as is further provided in Section
4.13 of the Agreement.
-15-
ICJH: lab: l373C
May 3, 1991
,I"""'"
"-'
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
'-"
Upon occurrence of any Event of Default Bet forth in the Agreement, and
subject to any applicable notice requirements and cure periods provided by the
Agreement, the City may declare this Demand Note immediately due and payable.
If the Letter of Credit is not extended or renewed beyond each expiration date
of the Letter of Credit, the Lender shall have the right to make immediate
demand on the Note and the Letter of Credit.
This Demand Note shall be construed in accordance with and governed by the
laws of the State of California. Failure of the City to exercise any right or
remedies hereunder shall not constitute a waiver of any future or other
default. Amendments to this Demand Note shall be in writing and signed by the
party against who such amendment is sought to be enforced.
Dated as of:
IEDEVELOPIIDr AGDCY OF THE CITY
OF SAJI BEJUU.lDIBO
By:
Executive Director
-16-
ICJH: lab: 1373C
May 3, 1991