HomeMy WebLinkAboutR09-Redevelopment Agency
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, R~VELOPMENT AGENCY.~ST FOR 9,.ISSION/COUNCIL A~ION
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Glenda Saul, Executive Director
Subject:
RETENTION OF BANKRUPTCY COUNSEL -
HOTEL AND CONVENTION CENTER
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Cept: Redevelopment Agency
Da~: September 17, 1985
Synopsis of Previous Commission/Council action:
8/82 RDA entered into Disposition and Joint Development Agreement with English
Enterprises for the Hotel
8/82 City entered into Convention Center Lease and Operating Agreement with
English Enterprises
10/84
RDA entered into Loan Agreement with English Enterprises for remodeling of
Convention Center
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7/85 City Attorney directed to file default notice on Disposition and Joint
Development Agreement, Operating Agreement and Loan Agreement
Recommended motion: (MAYOR AND COMMON COUNCIL)
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a) MOTION: THAT THE CITY ATTORNEY BE AUTHORIZED TO RETAIN SPECIAL BANKRUPTCY
COUNSEL, WITH COSTS THEREOF TO BE PAID BY THE REDEVELOPMENT AGENCY, AND A CONTRACT
FOR SUCH SERVICES TO BE PREPARED AND PRESENTED FOR REVIEW AND APPROVAL BY THE
COMMISSION
(COMMUNITY DEVELOPMENT COMMISSION)
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b) MOTION: THAT THE CITY ATTORNEY BE AUTHORIZED TO RETAIN SPECIAL BANKRUPTCY
COUNSEL, WITH COSTS THEREOF TO BE PAID BY THE REDEVELOPMENT AGENCY, AND A CONTRACT
FOR SUCH SERVICES TO BE PREPARED AND PRESENTED FOR REVIEW AND APPROVAL BY THE
COMMISSION
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Signature
Contact person:
GLENDA SAUL
Phone:
Supporting data attached:
YES
Ward:
383-5081
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FUNDING REQUIREMENTS:
Amount: $
N/A
Project:
MCC
No adverse Impact on City:
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\..,...lCil Notes:
Date:
September 23, 1985
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Agenda Item No.
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, CI'C' OF SAN BERNARDO - REQUI()r FOR COUNCIL AC.~N
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75-0264
STAFF REPORT
Pursuant to Commission/Council Action, Agency Counsel, on 7-15-85, sent Notices of
Default to English Enterprises for the Convention Center Operating Agreement, the
Disposition and Development Agreement and the Loan Agreement for the Convention Center
rehabilitation.
As you are no doubt aware, English filed bankruptcy on September 6, 1985.
The City Attorney's Office requests that bankruptcy counsel be retained to assist the
City and the Redevelopment Agency in getting the Hotel and Convention Center released
from the Bankruptcy Chapter 11 Reorganization proceedings filed by English
Enterprises, Inc. Only with Court permission may the City and Agency proceed to have
both the Disposition and Development Agreement and the Convention Center Operating
Agreement declared in default through the arbitration proceedings established in both
such agreements. Mr. Briggs has consulted one outstanding bankruptcy attorney and
will have recommendations and estimates of costs involved by the time of the meeting.
Bankruptcy is a very special type of proceedings, in which special counsel is
frequently retained. Although Mr. Briggs has experience in bankruptcy matters
involving small corporations and individuals, he indicates his experience is
insufficient to handle the particular problems anticipated to arise in the English
Bankruptcy/Reorganization matter.
Relief in some form from the Bankruptcy Court is required before the City, Agency or
the Developer can proceed to arbitration; relief in some form (either appointment of a
trustee, authority to English to continue operations, or some similar relief) is also
required before English can operate the Convention Center or make other provisions for
continuing activities. In any event, special bankruptcy counsel should be involved in
the proceedings and protecting the City and Agency's interests. Use of the Convention
Center for several significant events may be precluded unless Bankruptcy Court
direction is obtained. On September 12, 1985 the Redevelopment Committee recommended
that a bankruptcy attorney be hired.
1380J/SL
9-23-85