HomeMy WebLinkAbout1981-140 CRA
...
.
.
.
.
8,
.
- f
7404B
JHHW:SSW:pl
nt
12/14/Bl
12/21/81
COMMUNITY REDEVELOPMENT AGENCY OF THE
CITY OF SANTA ANA
RESOLUTION NO. 81-140
A RESOLUTION AUTHORIZING THE ISSUANCE OF $1,000,000
PRINCIPAL AMOUNT OF COMMUNITY REDEVELOPMENT
AGENCY OF THE CITY OF SANTA ANA
SECURED PROMISSORY NOTE
(Phillips Block)
Adopted December 15, 1981
.
.
.
.
.
.
ARTICLE I
Section 1.01
Section 1.02
Section 1.03
ARTICLE I I
Section 2.01
Section 2.02
Section 2.03
Section 2.04
Section 2.05
Section 2.06
Section 2.07
TABLE OF CONTENTS
Authorization of Notes; Definitions. . . . . .
Page
2
2
2
2
2
2
2
2
3
3
3
3
4
4
4
4
4
4
4
4
4
5
5
5
5
5
5
5
6
7
7
7
7
8
8
8
8
I
'I
,
Definitions... ...........
(a) Act. . . . . . . . . . . . . . . .
(b) Agency.... ..........
(c) Agreements................
(d) Bank. . . . . . .'. . . . . . . . . . . .
(e) Certificate of the Agency
Written Request of the Agency. . . . . .
(f) Pr.ojectCosts...............
(g) Deeds of Trust..............
(h) Federal Securities. . . . . . . . . . . .
(i) Financial Newspaper. . . . . . . . . . . .
(j) Financing.. . . . . . . . . . . .
(k)FiscalYear....... .....
(1) Holder,Noteholder............
(m) Loans...................
(n) Note.. . . . . . . . . . . . . .
(.0) Outstanding............
(p) Participating Parties. . . . . . . . . . .
(q) Projects. . . . . . . . .
(r)Pr.ojectlA....... "'"
(s) Project lB . . . . . . . . . . . . . . . .
(t) ProjectlC................
(u) Promissory Note. . . . . . . . . .
(v) Purchase Agreement. . . . . . . . . . . .
(w) Revenues.............
(x) Sites.......... .....
(y) Supplemental Resolution. . . . . .
C.ontent.of Certificates and Opinions. . . . . .
EqualSecurity.............
The Note....................
Authorization. ............
Term of Note..................
Prepayment of Note. . . . . . .
Execution of Note...............
Transfer of Note. . . . . . . . . . . . . . . .
Note Mutilated, Lost, Destroyed or Stolen. . .
Note Register. . . . . . . . . . . . . . . . .
.
.
.
.
.
.
ARTICLE II I
Section 3.01
Sect ion 3.02
ARTICLE IV
Section 4.01
Section 4.02
Section 4.03
Section 4.04
Section 4.05
ARTICLE V
Sect ion 5.01
Section 5.02
Sect ion 5.03
Section 5.04
Section 5.05
Section 5.06
ARTICLE V I
Section 6.01
Section 6.02
Section 6.03
ARTICLE VII
Section 7.01
Sect ion 7.02
Section 7.03
Section 7.04
Sect ion 7.05
Section 7.06
Page
Use of Proceeds of Note. . . . . . . . . . . .
9
9
9
Application of Proceeds of Sale of Note
Historical Rehabilitation Fund.
Revenues; Note Fund. . . . . . . . . . . . . .
10
10
10
10
11
11
Pledge of Revenues. . .'. . . . . . . . . . . .
NoteFund...................
Use and Withdrawal of Revenues. . . . . . . . .
Deposit and Investment of Moneys in Funds. . .
Assignmentt.oBank...............
Covenants of the Agency
12
12
12
. . . . . . . .
PunctualPayment................
Against EnculTbrances. . . . . . . . . . . . . .
Preservation.of Revenues;
Amendment of Agreement. Promissory N.ote
and Deed of Trust...............
Accounting Records and Reports.
Compliance with Resolution. . . . . . . . . . .
Further Assurances. . . . . . . . . . . . . . .
12
12
12
12
Amendment of Resolution. . . . . . . . . . . .
14
14
14
Amendments Permitted. . . . . . . . . . . . . .
Effect .of Supplemental Resolution. . . . . . .
Endorsement or Replacement .of Note
AfterAmendments...............
14
Events of Default and Remedies of Noteh.older. .
15
Events of Default and Acceleration
of Maturities.............
Application of Funds Up.on Acceleration. . . . .
Institution of Legal Proceedings
by Bank or Trustee. . " . . . . . . . .
Effect of Delay or Omission to Pursue Remedy. .
Remedies Cumulative. . . . . . . . . .
Control of Proceedings. . . . . . . . . . . . .
15
15
16
16
16
16
i i
.
.
.
.
.
.
ARTICLE VIII
Section 8.01
Section 8.02
Section 8.03
Section 8.04
Section 8.05
Sect ion 8.06
Section 8.07
Secti.on 8.08
Exhibit A
Page
Miscellaneous.................
17
17
Benefits of Resolution limited to Parties. . .
Success.or is Deemed Included
in All References to Predecessor. . . . . . . .
Discharge .of Resolution. . . . . . . . . . . .
Execution of Documents and
Proof of Ownership by Noteholders . . . . . . .
Waiver of Pers.onalliability. . . . . .
Notice and Demands on City. . . . . . . . . . .
PartialInvalidity...............
Effective Date of Resoluti.on. . . . . . . . . .
17
17
18
18
18
18
19
Secured Promissory Note. . . . . . . . . . . .
i i i
.
.
.
.
.
.
RESOLUTION NO. 81-140
A RESOLUTION OF THE
COMMUNITY REDEVELOPMENT AGENCY OF THE
CITY OF SANTA ANA AUTHORIZING THE ISSUANCE OF
$1,000,000 PRINCIPAL AMOUNT OF COMMUNITY REDEVELOPMENT
AGENCY OF THE CITY OF SANTA ANA
SECURED PROMISSORY NOTE
(Phillips Block)
WHEREAS, the Conmunity Redevelopment Agency of the City of Santa Ana
(the "Agency") is a redevelopment agency functioning pursuant to Part 1
(conmencing with Section 33000) of Division 24 of the Health and Safety C.ode
of the State of California and as such constitutes a local agency within
Section 37602(g) of the Marks Historical Rehabilitati.on Act of 1976, as
amended (the "Act");
WHEREAS, pursuant to its Reso lution No. 81-124, ad.opted Noverrber 2,
1981, the Agency, with the consent .of the City of Santa Ana (the "City")
ad.opted by reference the historical rehabilitation program established by the
City under the Act;
WHEREAS, pursuant to the Act, the Agency has determined to issue its
Secured Promissory Note t.o aid in the financing of the rehabilitation of
historical properties l.ocated within the historical rehabilitation - area
designated by the City in accordance with the procedures described in the Act;
WHEREAS, the Agency has reviewed all proceedings heretofore taken and
has found, as a result .of such review, and hereby finds and determines, that
all things, conditions and acts required by law to exist, happen or be
performed precedent to and in connection with the issuance of the Note do
exist, have happened and have been performed in due time, f.orm and manner as
required by law, and the Agency is now duly empowered, pursuant to each and
every requirement of law, to issue the Note in the manner and form provided in
this Resolution.
BE IT RESOLVED BY THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF
SANTA ANA AS FOLLOWS:
.
.
.
.
.
.
ARTICLE I
AUTHORIZATION OF NOTES; DEFINITIONS
Section 1.01. Definitions. Unless the context otherwise requires, the
terms defined 1n subsect1ons (a) through (v), inclusive, of this Section 1.01
shall, for all purposes of this Resoluti.on, of any Supplemental Resolution and
of any certificate, opini.on or other document herein mentioned, have the
meanings ascribed to such terms in subsections (a) through (v).
(a) Act. "Act" means the Marks Historical Rehabilitation Act of
1976, as amended:-being Part 10 (c.ommencing with Section 37600) of Division 24
of the Health and Safety Code of the State of California.
"Agency" means the Community Redevelopment Agency of
(b) Agency.
the City of Santa Ana.
(c) Agreements. "Agreements" means those certain three
agreements, entitled "Project Agreement", dated as of December 1, 1981,
between the Agency and the respective Participating ParHes pertaining,
respectively, to Project 4A, Project 4B, and Project 4C.
(d) Bank. "Bank" means Wells Fargo Bank, National Associati.on,
the .original purCiÏãลก-er of the N.ote.
(f) Deeds of Trust. "Deeds of Trust" means the respective deeds
of trust, from the respectlVe Participating Parties to the Bank, executed and
de 1 i vered pursuant to the respect ive Agreements.
(g) Federal Securities. "Federal Securities" means United States
Treasury notes, bonds, bills or certificates .of indebtedness or those f.or
which the faith and credit of the United States are pledged for the payment of
principal and interest; obligations issued by banks for cooperatives, federal
land banks, federal intermediate credit banks, federal home loan banks. the
Federal Home Loan Bank Board, the Tennessee Valley Authority, or obligations,
participations, or other instruments of or issued by, or fully guaranteed as
to principal and interest by, the Federal National Mortgage Association; or
participation certificates evidencing beneficial interests in obligations, or
in the right to receive interest and principal c.ollecti.ons therefrom, which
obligati.ons have been subjected by one or more government agencies to a trust
or trusts for which any executive department, agency .or instrumentality of the
United States (or the head thereof) has been named to act as trustee, .all as
2
.
.
.
.
.
.
to and the extent that such securities are eligible for the legal investment
of Agency funds.
(h) Financing. "Financing"and its variants means the lending of
moneys or any other thing of value for the purpose of facilitating the
construction of the Projects on the Sites, including refinancing of
outstanding indebtedness incurred for such purposes.
(1) Holder; Noteho1der. "H.o1der" or "Noteho1der" means any person
who shall be the registered .owner of the Note.
(j) Loans. "Loans" means the respective loans made by the Agency
to the respective Participating Parties for the Financing of the
rehabilitation of the Projects on the Sites pursuant to the Agreements and
evidenced by the Promissory Notes.
(k) Note. "Note" means the ColTlllunity Redevelopment Agency of the
City of Santa Ana Secured Promiss.ory N.ote (Phillips Block), authorized by, and
issued pursuant to, this Resolution.
(1) Official Determination. "Official Determination" means (and
for all purposes of this Resolution shall be deemed to have occurred as of) a
change in the Internal Revenue C.ode of 1954, as amended, the issuance of a
statut.ory notice of deficiency, or ruling by the Internal Revenue Service .or a
ruling by any court of co~etent jurisdiction, .or any other occurrence, the
effect of which, in the opinion of nationally-recognized bond collnse1
acceptable to Agency and Bank, is to make interest payable on this Note
includable in the gross income of the h.o1der hereof (except to the extent that
such interest is so includable because the holder is a "substantial user" of
any of the Projects referenced below or a "related person" as such terms are
defined in Section 103 of the Internal Revenue C.ode of 1954, as amended). The
fees and expenses of any such bond counsel in connection with such opini.on
shall be an obligation of Agency payable from the same source and secured in
the same manner as are all other .obligations evidenced hereby.
(m) Participating Parties. "Participating Parties" means with
respect to Project 4A, Elizabeth Phillips, Louis Hutton and Audrey E.
Phillips; with respect to Project 4B, Ronald L. Roelofs and Judith M. Roelofs;
and with respect to Project 4C, Velma Freeman.
(n) Permitted Investments. "Permitted Investments" means Federal
Securities or certificates of deposlt of commercial banks (including the Bank)
with a paid in capital and surplus in excess of $500,000,000.
(0)
"Project Costs" means, with respect to each
Project Costs.
Project,
(1) the arJ1()unt required to pay the interim construction
loan obtained by the Participating Party for said Project provided that the
Participating Party certifies to the Agency that the pr.oceeds of the interim
construction 1.oan were used by the Participating Party for:
3
.
.
.
.
.
.
(A) obligations of the Participating Party incurred for
labor and materials (including reirrDursements payable to the Participating
Party and payments on contracts in the name of the Participating Party) in
connection with the rehabilitation of the Project;
(B) the cost of contract bonds and of insurance of all
kinds that may be required or necessary during the course .of the
rehabilitation of the Project;
(C) all costs of architectural and engineering
services, including the costs of surveys, estimates, plans and specifications
and preliminary investigations therefor, and f.or supervising construction, as
well as for the performance of all other duties required by or consequent up.on
the proper rehabilitation of the Project; or
(0) any other costs or expenses incurred on or after
the date upon which the Agency took official action with respect t.o the
Project, as determined by the Agency, which are properly chargeable to the
capital account for, and constitute capital expenditures for, the Project .or
with a proper election by the Participating Party or but for such an election
w.ou1d constitute capital expenditures for the Project.
(ii) all costs and expenses incurred by the Agency in
connection with the determination as to the feasibility or practicability of
undertaking the Project, and in connection with the administration and
supervision of the Project including architect, engineering, survey and
appraisal fees and costs; and
(iii) all expenses incurred in connection with the closing of
the Loans and the issuance of the N.ote, including with.out limitaticm loan
fees, legal and accounting expenses and fees, costs of title insurance, costs
.of printing, and recording and filing fees;
(p) Projects. "Pr.ojects" means Project 4A, Project 4B and Project
4C. "Project 4A" means the rehabilitati.on .of the pr.operties located at
301/305 West Fourth Street, which properties are awned by Elizabeth Phillips,
Louise Hutton and Audrey E. Phillips. "Project 4B" means the rehabilitation
of the properties located at 307/309 West Fourth Street, which properties are
owned by R.ona1d L. R.oe10fs and Judith M. Roelofs. "Project 4C" means the
rehabilitation of the properties located at 311/315 West Fourth Street, which
properties are owned by Velma Freeman.
(q) Promi ssory Notes. "Promi ssory Notes" means the notes executed
by the respective Participatlng Parties evidencing and securing the repayment
of the respective Loans pursuant to the respective Agreements.
(r) Purchase Agreement. "Purchase Agreement" means that certain
Purchase Agreement dated OecerrDer 15, 1981, pursuant to the terms of which the
Bank agrees t.o purchase the Note fr.om the Agency and the Agency agrees to se 11
the Note to the Bank.
4
.
.
.
.
.
.
(s) Revenues. "Revenues" means all rents, receipts, payments and
.other income and revenue received by the Agency or the Bank with respect to,
or otherwise derived from, the Financing of the Projects, including without
limitation all Loan payments aoo prepayments thereof and other amount received
from the respective Participating Parties pursuant to the Agreements and the
Pr.omissory Notes, all amounts aoo properties derived from the enforcement of
the Agency's rights and privileges under the Deeds of Trust, assignments of
lessor's interest in leases executed by Participating Parties and security
agreements executed by Participating Parties, any guarantees of Promissory
Notes, all proceeds derived from the in.surance policies maintained pursuant to
the Agreements, all funds and accounts created pursuant to this Resolution,
and all investment earnings on said funds aoo accounts.
(t) Sites. "Sites" means premises l{.Ion which Project 4A is
located, as more particularly described in the Agreement pertaining t.o Project
4A; the premises upon which Pr.oject 4B is located as more particularly
described in the Agreement pertaining to Project 4B; aoo the premises upon
which Project 4C is located as more particularly described in the Agreement
pertaining t.o Project 4C.
(u) Supplemental Resolution. "Supplemental Resolution" means any
resolution then in full force aoo effect which has been duly adopted by the
Agency at a meeting of the thereof 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 hereunder.
(v) Taxable Date. "Taxable Date" means the date as of which
interest payable on the Note is includable in the gross income of a N.oteholder
by reas.on of an Official Determinati.on. .
Section 1.02. Equal Security. In consideration of the acceptance of
the Note by the Bank and by all who shall hold the same from time to time,
this Resolution shall be deemed to be and shall constitute a contract between
the Agency and the Holder from time to time of the Note, and the covenants and
agreements here inset forth to be performed on beha lf of the Agency sha 11 be
for the benefit, security and protection of all Holders of the Note without
preference, pri.ority or distinction, for any cause whatsoever, except as
expressly provided therein or herein.
Section 1.03. ~in~in~. Pursuant to Health and Safety Code Section
37629, the Agency here y 1 n s that the Loans to be made from the proceeds of
the Notes are to be used for historical rehabilitation as defined in the Act,
and the financing of the rehabilitation of the Projects is economically
feasible.
Section 1.04. No Limitation. The provisions of this Resolution are not
intended to limit the provisions of the Purchase Agreement, the Pledge
Agreement (as referenced in the Purchase Agreement and referred to herein as
the "Pledge Agreement"), the Agreements or the Collateral Assignment (as
5
.
.
.
.
.
..
referenced in the Agreements and referenced to herein as the "Collateral
Assignment"), each of which documents is this day being approved by the Agency.
6
.
.
.
.
.
.
ARTICLE II
THE NOTE
Section 2.01. Authorization. .A Note in the aggregate principal amount
of One Ml1l1.on Dollars l~l,UUU,UOU) is hereby authorized to be issued by the
Agency under and subject to the terms of this Resolution and the Act. Th is
Resolution constitutes a continuing agreement with the H.older of the Note to
secure the full and final payment .of principal of and premium, if any, and the
interest, fees and other charges on the Note subject to the covenants,
agreements, provisions and conditions herein contained. The purpose for which
the Note shall be issued is to provide funds to make the Loans to the
Participating Parties for the purpose of Financing of the Projects pursuant to
the Agreements. The Note shall be designated the "C.onmunity Redevelopment
Agency of the Agency of Santa Ana Secured Promissory N.ote (Phillips Block)."
Section 2.02. Terms of the N.ote. The Note shall be dated as of
December 1, 1981, and sha 11 be issued as a si ngle fully registered Note,
without coupons, substantially in the f.orm set forth on Exhibit A attached
hereto and by this reference incorp.orated herein. The Note shall be sold and
de 1 ivered to the Bank in accordance with the Purchase Agreement.
The Note shall mature and become payable on December 1, 1991, and shall
bear interest on the unpaid principal balance hereof from the date hereof
until due, at a rate ("Basic Rate") per annum one-half percent greater~than
sixty-five hundredths (.65) times the Base Rate (.5%) (as hereinafter defined
and determi ned) . "Base Rent" shall mean that rate of i nterest charged by Bank
on commercial real estate loans, interest on which is subject to federal
income taxation, on properties similar in use to those described in the
Pr.oject Agreements referenced below. The Base Rate for the period from
December 1, 1981 t.o December 1, 1986 sha 11 be determi ned as of December 1,
1981 and the Base Rate from am after December 1, 1986 shall be determined as
of December 1, 1986. Interest only shall be due and payable on the first day
of each calendar month commencing January 1, 1982 and continuing through
December 1, 1982. Thereafter, installments of principal and interest shall be
due and payable on the first day of each calendar month commencing January 1,
1983 and continuing thr.ough December 1, 1991, whereupon the entire principal
balance of this Note, together with interest thereon, shall be due and
payable. Installment of principal and interest due from January 1, 1983 to
December 1, 1991 shall be in equal amounts sufficient, after the payment of
accrued interest to amortize the original principal amount of this Note in 360
equal monthly installments; provided that the amount of such installments
shall be subject t.o adjustment, as necessary, on December 1, 1986 t.o reflect
any change in the Base Rate. Bank shall determine the initial amount of such
installments and give Agency notice thereof between December 1, 1982 and
December 20, 1982. Bank shall determine the amount of such installments for
the period conmencing December 1, 1986 and shall give Agency notice thereof
between December 1, 1986 and December 20, 1986.
7
.
.
.
.
.
.
Notwithstanding the foregoing, if interest on this Note becomes subject
to federal income taxation pursuant to an Official determination (as
hereinafter defined): (a) the rate of interest otherwise in effect on this
Note shall be increased to a rate ("Adjusted Basic Rate") per annum equal to
one-half percent (.5%) above the Base Rate, detennined as above provided; and
(b) Agency shall forthwith pay to Bank, or its registered assigns, for the
period from the Taxable Date (as hereinafter defined) to the effective date of
the adjustment reuqired by the foregoing sentence an amount equal to the
product of (i) the outstanding principal amount of this Note from time to time
during such period and (ii) the difference between the Adjusted Basic Rate and
the Basic Rate during such peri.od. If more than one person has been the
Holder of this Note during such period, such arJI()unts shall be allocated among
such Holders in accordance with the number of days furing which this Note was
held by each such Holder during such period. Any H.older of this Note may
protest or contest any Official Determination. If an Official Detennination
is protested or contested, interest shall continue to be payable at the
Adjusted Basic Rate while such pr.otest or contest is pending. If such protest
or contest is successful, the Holder hereof shall apply all interest collected
at a rate in excess of the Basic Rate in reduction of the principal hereof or
any other amounts owing hereunder, .or if such principal and all such other
amounts have been paid in full, such excess shall be refunded to Agency.
Without in any way limiting the survival of any other provision of this Note,
Agency hereby expressly agrees that the obligations imposed upon it by this
paragraph shall survive payment and discharge of this Note for a period of
five years.
Any principal .or interest on the Note not paid when due shall thereafter
bear interest at a rate equal to five percent (5%) per annum in excess of the
rate otherwise in effect on the Note. In addition to such interest, the
Agency shall pay upon demand a reasonble rate, fee .or collection charge not
exceeding four percent (4%) of such principal am.ount.
All principal, interest and other amounts payable on the Note shall be
payable in lawful m.oney of the United States of America at the principal
office of the Bank in Santa Ana, California, or at such address as any
subsequent Holder of the Note shall file with the Agency.
S.o long as the Note is n.ot in default, each installment .of principal and
interest when paid shall be applied by the Noteh.older first to the payment of
interest accrued on the Notes, and the balance thereof to the payment of
principal. When any default hereunder has occurred and is continuing, the
Noteholder may apply payments, in its election, to principal or interest.
Section 2.03. Prepayment of Note. This Note may be prepaid in full or
in part, wlthout prepayment pena Ity or premium, on any installment due date
upon thirty (30) days' prior written notice to the Holder .of this Note. The
N.ote shall be prepaid concurrently with and to the extent of any prepayment on
any Part i cipant Note (as defi ned in the Project Agreement referenced be low) .
Each prepayment shall be applied to principal but Agency shall continue' to pay
installments in the amounts and at the times required in this Note until
8
.
.
.
.
.
.
principal and interest on this Note are paid in full. This Note shall also be
prepaid if and to the extent that any event shall occur which makes it
reasonably certain that any portion of the principal amount of the
indebtedness evidenced hereby will not be used to make one or more of the
L.oans contemplated by the Agreements. Without limitation of the foreg.oing,
such result sha 11 be reasonably certa in if (a) Bank dec 1 i nes to approve any
Loan or approves any Loan in an amount less than the maximum permitted by the
corresponding Agreement or (b) any Agreement or Conmitment, as defined in an
Agreement, terminates or expires prior to the funding of the Loan contemplated
thereby.
Section 2.04. Execution of Note. The N.ote shall be executed on behalf
of the Agency by the slgnature of the Chairman and attested on behalf .of the
Agency by the signature of the Executive Direct.or or Vice Chairman, and the
seal of the Agency shall be impressed thereon. If any officer whose signature
appears on the Note ceases to be such offi cer before the de 1 i very of the Note
to the Bank, such signature on the Note shall nevertheless be as effect ive as
if the .officer had remained in office until the delivery of the N.ote to the
Bank.
Section 2.05. Transfer of Note. The Note may be transferred by the
Holder thereof by endorsing thereon (or 00 a paper attached thereto) the
amount of principal paid thereon as of the date of transfer. Notification of
such transfer shall be pr.omptly given to the Agency for entry upon the books
required to be kept by the Agency pursuant to the provisions of Section 2.07,
of the name and address of the transferee.
Section 2.06. Note Mutilated, Lost, Destroyed or St.olen. If the Note
shall become mutilated, the Agency, at the expense of the Holder of the N.ote,
shall execute and deliver, a new Note of like tenor in exchange and
substitution for the Note so mutilated, but only upon surrender to the Agency
of the Note so mutilated. Every mutilated Note so surrendered to the Agency
shall be cancelled by it. If the Note shall be lost, destroyed or stolen,
evidence of such loss, destruction or theft may be submitted to the Agency,
and, if such evidence is satisfact.ory to the Agency and indemnity satisfactory
t.o the Agency is given, the Agency, at the expense of the owner of the Note,
shall execute and deliver, a new Note of like ten.or in lieu of and in
substitution for the Note so lost, destroyed or stolen. The Agency may
require payment of a sum not exceeding the actual cost of preparing each new
Note issued under this Section and of the expenses which may be incurred by
the Agency. Any Note issued under the provisions of this Section in lieu of
any Note alleged to be lost, destroyed or stolen shall be entitled to the
benefits of this Resolution.
Section 2.07. Note Register. The Agency will keep at its -offices,
sufficient bo.oks for the registration and transfer of the N.ote, which shall at
all times be open to inspection by the Bank; and, upon presentation for such
purpose the Agency shall, under such reasonable regulations as it may
prescribe, enter ()I'I said books, the names and addresses .of the Holders' of the
N.ote foll.owing transfer pursuant t.o Section 2.05.
9
(8
8
.
8
8
8
ARTICLE III
USE Of PROCEEDS OF NOTE
receiv~C~~.o~h:'2:~nc:~~c~~~0~a~: :rot~e:~~t~fs;:ll~ b~f d:~~~itedTha~ ~~~~~:~~
(a) The Agency shall deposit int.o the Note Fund established
pursuant t.o Section 4.02 any accrued interest or premium received on the sale
of the Note.
(b) The Agency shall deposit into the Historical Rehabilitation
Fund established pursuant to Section 3.02 the remainder of said proceeds.
Section 3.02. Historical Rehabilitation Fund. There is hereby created a
fund to be designated the "Community Redevelopment Agency of the Agency of
Santa Ana Secured Promissory Note (Phillips Block) Hist.orical Rehabilitation
Fund" (herein referred t.o as the "Historical Rehabilitation Fund"), which
shall be held by the Agency in trust and applied to the payment of the Project
Costs. Within the Historical Rehabilitation Fund, there is hereby created
three accounts to be designated respectively, the "Project 4A Account", the
"Project 4B Acc.ount", and the "Project 4C Acc.ount". Foll.owing delivery of the
Note and dep.osit of the pr.oceeds thereof into the Historical Rehabilitation
Fund, the Agency shall transfer $450,000 thereof to the Project 4A Acc.ount t.o
be applied to the payment of Project Costs in accordance with the terms of the
Agreement relating t.o Project 4A; shall transfer $375,000 thereof to the
Project 4B Account to be applied t.o the payment of Project Costs in accordance
with the terms of the Agreement relating t.o Project 4B; and shall transfer
$175,000 thereof to the Project 4C Account to be applied to the payment of
Project C.osts in accordance with the terms .of the Agreement relating t.o
Pr.oject 4C. With the consent .of the Bank, the Agency may transfer monies from
one of said Accounts to another of said Accounts, but in no event shall such
transfer be made unless and until the applicable areements have been amended
and the principal amount .of the Loans to the applicable Participating Parties
have been appropriately modified.
After payment .of all Project Costs payable from the Historical
Rehabilitation Fund or provision satisfactory to the Agency having been made
for payment of Project Costs not yet due or the Agency becomes reasonably
certain that all or any portion of amounts in the Historical Rehabilitation
Fund will not be used to make all or any portion of the Loans, as further
referenced in Section 2.03 hereof, the Agency shall transfer any remaining
balance in the Historical Rehabilitation Fund to the Note Fund established
pursuant to Section 4.02 to be used for prepayment of the principal of the
Note in an amount equal to the amount of such transfer on the first day of the
month next f.oll.owing the date of transfer.
10
.
.
.
.
.
.
ARTICLE IV
REVENUES; NOTE FUND
secure~e~~i~n fi4;~t\le~~:d~:hiO~ ~~~~~~e~hal ;h:e Pe~ntted o~n t~~ N~::ne~h~~ ~~
the extent hereinafter provided) of all of the Revenues and a first pledge of
all of the m.oneys in the N.ote Fund. The Revenues are hereby allocated in
their entirety to the payment .of the principal of and interest on the Note
and, until the payment in full thereof, the Revenues shall be applied solely
to the payment of such principal and interest. The pledge and all.ocation .of
Revenues is for the exclusive benefit of the Noteh.olders and shall be
irrevocable until the Note has been paid and provision made therefor. The
Agency will not issue any obligation or security superior to or on a parity
with the N.ote, hows.oever denominated, payable in whole or in part from the
Revenues until the N.ote has been paid and retired or provision made therefor.
The Note shall be a special obligation of the Agency and shall be
payable solely from the Revenues. The N.ote shall not constitute a debt of the
Agency, of the City of Santa Ana, of the State of Ca lif.ornia or of any of its
subdivisions, and neither said State nor any .of its political subdivisions
shall be liable thereon, nor in any event shall the Note be payable out of any
funds or properties of the Agency other than the Revenues as pr.ovided herein.
The faith and credit of the Agency is not pledged to the payment of the
principal of or interest on the Note.
Section 4.02. Note Fund. There is hereby created a special fund to be
designated the "Community Redevelopment Agency of the City of Santa Ana
Secondary Promissory Note (Phillips Bl.ock) Note Fund" (herein referred t.o as
the "Note Fund"), wh i ch the Agency hereby covenants and agrees to cause to be
maintained and which shall be held in trust by the Agency for the benefit of
the Noteholders. Upon the receipt thereof, the Agency shall deposit all
Revenues in the Note Fund.
Section 4.03. Use and Withdrawal of Revenues. All Revenues in the Note
Fund shall be used and withdrawn from the Note Fund solely f.or the purpose of
payment .of principal and interest .on the Note when and as due except that
prepayments of Loans made by the Participating Parties, insurance and
condemnation proceeds not used for replacement or repair of the applicable
Project and transfers from the Historical Rehabilitation Fund pursuant to
Section 3.02 shall be used for prepayment of the Note.
When the Note is no longer outstanding, all fees, charges and expenses
of the Bank have been paid or provided f.or, all expenses of the Agency
relating to the Projects have been paid or provided for, and this Resolution
has been discharged and satisfied, the Agency shall deposit any amounts
remaining in the Note Fund in its general funds, unless such amounts properly
belong to the Participating Parties.
11
.
8
,8
.
8
.
Section 4.04. De osit and Investment of Hone s in Funds. All moneys
held in any .of the fun s or accounts esta 1S pursuant t is Resolution
shall be deposited in demand or time deposits (which may be represented by
certificates .of dep.osit) in any bank or trust company authorized to accept
deposits of trust funds (including the banking department of the Bank) and, as
and to the extent required by law, shall be secured at all times as trust
funds, or in lieu thereof may be invested by the Agency in Permitted
Investments maturing prior to the date on which such moneys are estimated to
be required t.o be paid out hereunder.. All interest .or gain received on or
prior to December I, 1982, shall be dep.osited in the N.ote Fund and shall be
used f.or the payment .of interest we on the Note on and prior to Decenber I,
1982. All interest or gain received after December I, 1982, shall be
deposited in the Note Fund and used for the payment of principal and interest
on the Note when due in accordance with the terms of Section 2.02 hereof or by
prepayment in accordance with Section 2.03 here.of. Am.ounts in excess .of the
amounts requi red for use in accordance with Sect ion 2.02 and 2.03 may be
withdrawn by the Agency and deposited in its general funds so long as there is
not an event of default hereunder.
Secti.on 4.05. Assignment to Noteholder. The Agency hereby transfers,
assigns and sets over to the Noteholder with.out recourse all of the Revenues
and any and all rights, privileges and obligations it has under the
Agreements, the Deeds of Trust and the Pr.omissory N.otes including, without
limitation, the right to c.ollect and receive directly all .of the Revenues, and
any Revenues collected or received by the Agency shall be deemed to be held,
and to have been collected or received, by the Agency as the agent of the
Noteholder, and if received by the Ag~!ncy, shall forthwith be paid by the
Agency. The assignment under this Section shall not be in contravention of
any grant or assignment pursuant to the Purchase Agreement, the Pledge
Agreement, the Agreements .or the Collateral Assignments.
12
.
.
.
.
.
.
ARTICLE V
COVENANTS OF THE AGENCY
Section 5.01. Punctual Payment. The Agency will punctually payor
cause to be pald lbut only out of Revenues as herein provided) the principal
and interest to become due in respect .of all the N.ote, in strict conformity
with the terms of the Note and .of thi.s Resolution, and it will faithfully
observe and perform all of the conditions, covenants and requirements .of this
Resolution and of the Note. Nothing herein c.ontained shall prevent the Agency
fr.om making advances of its own moneys howsoever derived to any of the uses or
purposes referred to herein.
Secti.on 5.02. Against Encumbrances. The Agency will not encumber,
pledge or p 1 ace any charge or 11 en upon any of the Revenues, except as
permitted by this Resolution, in favor .of the Noteholder.
Secti.on 5.03. Preservation of Revenues; Amendment of Agreements,
Promissory Notes and Deeds of Trust. The Agency shall cause to be collected
prompt Iy a 11 amounts due from the Part ic ipat ing Parties under the Agreements
and the Pr.omissory Notes as the same become we, and shall promptly and
vigorously enforce all of its rights under the Agreements, the Promissory
N.otes and the Deeds of Trust. Without the written consent .of the Bank, the
Agency shall not amend, modify or terminate, or agree or consent to amend,
m.odify or terminate, the Agreements, :the Promissory Notes .or the Deeds of
Trust and related collateral d.ocuments; but, with the written c.onsent of the
Bank, the Agency may consent to amendments or modifications there.of.
Section 5.04. Compliance with Resolution. The Agency shall not issue,
or permit to be issued, any obligation secured or payable in any manner out of
Revenues .other than in accordance with the provisions of this Resolution, and
shall not suffer or permit any default to occur under this Resoluti.on, but
shall faithfully .observe and perform all the covenants, conditions and
requirements hereof.
Section 5.05. Further Assurances. The Agency will adopt, make, execute
and deliver any and all such further res.olutions, instruments and assurances
as may be reasonably necessary or proper to carry out the intention or to
facilitate the performance of this Resoluti.on, and for the better assuring and
confirming unto the Holders of the Note of the rights and benefits provided in
this Resolution.
13
.
.
.
.
.
.
ARTICLE VI
AMENDMENT DF RESOLUTION
Section 6.01. Amendments Permitted. This Resolution and the rights and
obligations of the Agency and of the Holder of the Note may be m.odified or
amended at any time by a Supplemental Resolution adopted by the Agency and
approved in writing by the Holder of the Note.
Section 6.02. Effect.of Supplemental Resolution. From and after the
time any Supplemental Res.olution becomes effective pursuant to this Article
VI, this Resolution shall be deemed to be modified and amended in accordance
therewith, and the respective rights, duties and obligations under this
Reso lution .of the Agency and the Holders of the Note shall thereafter be
determined, exercised and enforced hereunder subject in all respects to such
modifications and amendments, and all the terms and conditions of any such
Supplemental Resoluti.on shall be deemed to be part of the terms and conditions
.of this Resolution for any and all purposes.
Section 6.03. Endorsement or Replacement of Note After Amendments. The
Noteholder may determine that the Note after the effective date of any action
taken as provided in this Article VI requires a notation, by endorsement or
otherwise, to reflect such action. In that case, up.on demand of the Holder of
the Note and presentation of the N.ote for that purpose at the office of the
the Agency, a suitable notation shall be made on such Note by the Agency. The
Noteholder may determine that a new Note, so modified as in the opinion of the
Noteh.older is necessary to conform to such action, shall be prepared, executed
and delivered. In that case, upon demand of the Holder of the Note, such new
N.ote sha 11 be exchanged at the offi ce .of the Agency, without cost t.o any
Noteholder, for the N.ote then outstanding, upon surrender of such Note.
14
.
.
.
.
.
.
ARTICLE VII
EVENTS OF DEFAULT AND REMEDIES OF NOTEHOLDER
Section 7.01. Events of Default and Acceleration of Maturities. If one
.or more .of the foll.owlng events ("events .of default") shall happen, that is to
say
(a) Failure of Agency to pay any installment of principal or
interest or other amount due on the Note or under this Resolution within ten
days after such installment or other amount becomes due;
(b) Any representati on or warranty of Agency to the Bank under the
N.ote Purchase Agreement or the Agreements sha 11 prove to have been untrue in
any material respect when made;
(c) Agency shall fail to perf.orm or observe any of its covenants
or undertakings under this Res.olution, the Note Purchase Agreement or the
Agreements as such covenants or undertakings affect Noteholder and such
failure shall continue for a period of thirty (30) days after written notice
from Noteholder;
(d) A court having jurisdiction in the premises shall enter a
decree or order for relief in respect of Agency, in an involuntary case under
any applicable bankruptcy, insolvency or other similar laws now or hereafter
in effect, or appointing a receiver, liquidator, assignee, custodian, trustee,
sequestrator (.or similar official) .of Agency, or f.or any substantial part of
its property or .ordering the winding up or liquidation of the affairs of any
of the same, and such decree .or order shall remain unstayed and in effect for
a period .of thirty (30) consecutive days;
(e) Agency shall conmence a v.oluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or
shall consent to the entry of any order for redelase of any involuntary case
under any such 1 aw, .or shall consent to the appoi ntment of a receiver,
liquidator, assignee, trustee, custodian, sequestrator (or similar official)
or the taking possessi.on .of any such official or any substantial part of its
property, or shall make any general assignment for the benefit of creditors,
.or shall fail generally to pay its debts as they become due or shall take any
formal action in furtherance of any of the foregoing;
(f) The occurrence of any event which entitles the holder t.o
declare inmediately due and payable all outstanding principal on any
Pr.omissory Note;
(g) The occurrence of an Official Determinati.on;
then, and in each and every such case during the continuance of such event of
default, the Bank .or, if applicable, the subsequent Holder, may declare the
15
.
.
.
.
.
.
remaining principal .of the Note, and the interest accrued thereon. and any
re 1 ated fees and .other charges. to be due and payable inrnedi ate ly, and upon
any such declaration the same shall become and shall be inrnediately we and
payable, anything in this Resolution or in the Note contained to the c.ontrary
notwithstanding.
This provision, however. is subject to the condition that if, at any
time after the principal .of the Note shall have been so declared due and
payable, and before any judgment or decree for the payment of the monies due
and payable shall have been obtained .or entered. there shall have been
deposited with the Noteholder a sum sufficient to pay all principal on the
Note due prior to such declaration and all due and unpaid interest (if any)
upon the Note. and any related fees and other charges and the reasonable
expenses of the Agency and Noteholder. and any and all other defaults known to
the Agency (other than in the payment of principal .of and interest on the N.ote
due and payable solely by reason of such declaration) shall have been made
good or cured to the satisfaction of the Noteholder or provisi.on deemed by the
Noteholder to be adequate shall have been made therefor, then. and in every
such case, the Noteholder, by written notice to the Agency. may rescind and
annul such declaration and its c.onsequences. However, no such rescission and
annulment shall extend to .or shall affect any subsequent default, or shall
impair or exhaust any right or p.ower consequent thereon.
Notwithstanding any other provision of this Section 7.01. up.on an event
of default relating solely to a single Loan, the N.oteholder shall be entitled
to accelerate an amount of principal on the Note equal to the then outstanding
principal balance of the Promissory Note relating to such Loan, plus related
interest, fees and other charges.
funds ~~t~~~o~~~~' pr~~~~~a~~~n l~f s~~~~~nU)~~2A~~~1~~~iO~on A~~ ~~i: ~~ ~~:
declaration of acceleration by the Noteh.older and all Revenues thereafter
received by the Agency hereunder, shall be transmitted to the Noteholder and
shall be applied by the Noteh.older in a manner consistent with Sections 2.02
and 2.03.
Secti.on 7.03. Institution of Legal Proceedings by Bank. If one or more
of the events of default shall happen and be continuing. the Noteholder may
proceed to protect or enforce its rights under the Act or under this
Resolution by a suit in equity or action at law. either for the specific
performance of any covenant or agreement contained herein, or in aid of the
execut i on of any power herein granted. or by mandal1lJs or other appropri ate
proceeding for the enforcement of any other legal or equitable remedy as the
Noteholder shall deem most effectual in support of any .of its rights or duties
hereunder. .
Section 7.04. Effect of Delay or Omission to Pursue Remed~. No delay
.or omission of the Noteholder to exercise any right or power arislng from any
default shall impair any such right or power .or shall be construed to be a
waiver of any such default or acquiescence therein. and every power and remedy
16
.
.
.
.
.
.
given by this Article VII to the Noteholder may be exercised from time to
time, and as often as shall be deemed expedient. In case the Noteholder shall
have proceeded to enforce any right under this Resolution, and such
proceedings shall have been discontinued or aband.oned because of waiver or for
any other reason, or shall have been determined adversely to the Noteholder,
then and in every such case the Agency and the N.oteholder shall be rest.ored to
their former positions and rights hereunder; and all remedies, rights and
powers of the Agency and the Noteholders shall continue as though no such
proceedings had been taken.
Section 7.05. Remedies Cumulative. No remedy herein conferred upon or
reserved to the Noteholder lS lntendedt.o be exclusive of any .other remedy,
but each and every such remedy shall be cumulative and shall be in addition to
every other remedy given hereunder.or now or hereafter existing at law or in
equity.
Section 7.06. Control of Proceedings. In the event that the
Noteholder, upon the happening of an event of default, shall have taken some
action, by judicial proceedings .or otherwise, pursuant to its rights
hereunder, it shall have full power with respect to the continuance,
discontinuance, withdrawal, compromise, settlement or other disposal of such
action. .
17
.
.
.
.
.
.
ARTICLE VIII
MISCELLANEOUS
Section 8.01. Benefits of Resolution Limited to Parties. Nothing in
this ResolutlOn, expressed or 1mpl1ed, 1S 1ntended to glVe any person other
than the Agency, the Bank and the Holders of the Note, any right, remedy, or
claim under .or by reason of this Resolution. Any covenants, stipulations,
promises or agreements in this Resolution contained by and on behalf of the
Agency shall be for the sole and exclusive benefit of the Holders of the Note.
Secti on 8.02. Successor is Deemed Inc luded in All References to
Predecess.or. Whenever in this Resolution or any Supplemental Resolution
either the Agency or the Bank is named or referred t.o, such reference shall be
deemed to include the success.ors .or assigns thereof, and all the covenants and
agreements in this Resolution contained by or on behalf of the Agency or the
Bank shall bi nd and inure to the benefit of the respective successors and
assigns thereof whether so expressed or not.
Secti.on 8.03. Discharge of Resolution. If the Agency shall pay and
di scharge the entire indebtedness .on the Note in anyone or IßC)re of the
following ways:
(a) by well and truly paying or causing to be paid the principal
and interest on the N.ote, together with applicable fees and other charges as
and when the same become due and payable; .or
(b) by depositing with the Bank .or, if applicable, a subsequent
Noteholder, in trust, at or before maturity, money which, together with the
amounts then on deposit in the funds and accounts provided for in Sections
3.02 and 4.02, is fully sufficient to pay the Note, including all principal,
interest and applicable fees and charges;
then the pledge of the Revenues and other funds provided f.or in this
Resolution and all other obligations of the Agency under this Resolution with
respect to the Note shall cease and terminate, subject to the survival .of
obligations due t.o an Official Determination as more particularly described in
Section 2.02.
Section 8.04. Execution of Documents and Proof of Ownershi b
Noteholders. Any request, dec arat10n or other 1nstrument whic t is
Resolut10n may require or permit to be executed by Noteholders may be in one
or more instruments of s imil ar ten.or, and sha 11 be executed by the Holder of
the Note in person or by its attorney app.ointed in writing. .
Except as otherwise herein expressly provided, the ownership of the Note
and the amount and date of holding the same shall be proved by the Note
Register maintained by the Agency pursuant to Section 2.07.
18
.
.
.
.
.
.
Section 8.05. Waiver of Personal Liability. No menter, officer, agent
or employee of the Agency shall be individually or personally liable for the
payment of the principal of or interest on the Note; but nothing herein
contained shall relieve any such menter, officer, agent or e~loyee from the
performance of any official duty provided by law.
Section 8.06. Notice and Demands- on Agency. Any notice or demand which
by any provision of this Resolution is required or permitted to be given or
served to or on the Agency may be given or served by being deposited postage
prepaid in a post office letter box addressed (until another address is filed
by the Agency with the Noteholder) as follows: Executive Director,
Redevel.opment Agency of the City of Santa Ana, 20 Civic Center Plaza, Santa
Ana, California 92706.
Section 8.07. Partial Invalidit~. If any Section, paragraph, sentence,
clause or phrase of thlS Resolutlon s all for any reason be held illegal .or
unenforceable, such holding shall not affect the validity of the remaining
portions of this Resolution. The Agency hereby declares that it w.ould have
ad.opted this Resolution and each and every other Section, paragraph, sentence,
clause or phrase hereof and authorized the issuance of the N.ote pursuant
thereto irrespective of the fact that anyone or more Secti.ons, paragraphs,
sentences, clauses .or phrases of this Resolution may be held illegal, invalid
or unenforceable.
19
.
.
-8
.
.
.>
.
Section 8.00. Effective Date of Resolution. This Resolution shall take
effect from and after the date of its passage and adoption.
this 15th day of December, 1981, by the following vote:
Members: &/.-,¡f-,......, C',,:r,../'- kN-'~ A.",/..¡.
,I;1'5c:;,,~, ¿ ...~,..- '¡;",p"'-
Members: /f;:',v'¡"'/
Members: ,,¡y.,...,
ADOPTED,
AYES:
NOES:
ABSENT:
~
Executive irector
APPROVED AS TO FORM:
~
t::L? ~
Chairma¡:¡-----
if -:L
f jdftIJ :;
<¿1- / c/o
20
.
.
.
.
.
.
EXHIBIT A
COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF SANTA ANA
SECURED PROMISSORY NOTE
(PHILLIPS BLOCK)
$
Santa Ana, California
December I, 1981
COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF SANTA ANA, a public body
c.orporate and politic, duly organized and existing under and pursuant to Part
1 (commencing with Section 33000) of Division 24 of the Health and Safety Code
of the State of California (the "Agency"), for value received, hereby promises
to pay to the order of Wells Fargo Bank, National Association (the "Bank"), or
its registered assigns (Bank and such registered assigns are hereinafter
sometimes referred to as "holder" or "holders"), at 2323 North Broadway, Santa
Ana, California, .or at such .other place as Bank or its registered assigns
shall designate, and at the times hereinafter provided, the principal sum
of Do 11 ars
($ J, together wlth 1 nterest computed on the bas lS of a 360-day
year and 30-day month, on the unpaid principal balance hereof from the date
hereof until due, at a rate ("Basi c Rate") per annum .one-half percent greater
than sixty-five hundredths (.65) times the Base Rate (.5%) (as hereinafter
defined and determined). "Base Rent" shall mean that rate of interest charged
by Bank on colTIßercial real estate loans, interest on which is subject to
federal income taxation, on properties similar in use to those described in
the Project Agreements referenced below. The Base Rate for the period from
December I, 1981 to December I, 1986 shall be determined as of December I,
1981 and the Base Rate from and after December I, 1986 shall be determined as
of December I, 1986. Interest only shall be due and payable on the fi rst day
of each calendar month c.ommencing January I, 1982 and continuing through
December I, 1982. Thereafter, installments of principal and interest shall be
due and payable on the first day of each calendar month commencin9 January I,
1983 and continuing through December I, 1991, whereupon the entire principal
balance of this Note, together with interest thereon, shall be due and
payable. Installment of principal and interest due from January I, 1983 to
Decerrber I, 1991 shall be in equal amounts sufficient, after the payment of
accrued interest to amortize the principal amount of this Note based upon saie
amount as of December I, 1982, in 360 equal monthly installments; provided
that the amount of such installments shall be subject t.o adjustment, as
necessary, on Decerrber I, 1986 to reflect any change in the Base Rate. Bank
shall determine the initial am.ount of such installments and give Agency notice
thereof between December I, 1982 and December 20, 1982. Bank shall determine
the amount of such installments for the period c.ommencing December I, 1986 and
.
.
.
.
.
.
sha 11 give Agency not i ce thereof between December I, 1986 and December 20,
1986.
Notwithstanding the foregoing, if interest on this Note becomes subject
to federal income taxation pursuant to an Official determination (as
hereinafter defi ned): (a) the rate of interest otherwise in effect on this
Note shall be increased to a rate ("Adjusted Basic Rate") per annum equal to
one-half percent (.5%) above the Base Rate, determined as above provided; and
(b) Agency shall forthwith pay to Bank, or its re9istered assigns, for the
period from the Taxable Date (as hereinafter defined) t.o the effective date of
the adjustment reuqired by the foregoing sentence an amount equal to the
product .of (i) the outstanding principal amount of this Note from time to time
during such period and (ii) the difference between the Adjusted Basic Rate and
the Basic Rate during such period. If more than one person has been the
holder of this Note during such period, such amounts shall be allocated among
such holders in accordance with the number of days furing which this N.ote was
held by each such holder during such period. Any holder of this Note may
protest .or contest any Official Determination. If an Official Determination
is protested or contested, interest shall continue to be payable at the
Adjusted Basic Rate while such protest or contest is pending. If such protest
or contest is successful, the holder hereof shall apply all interest collected
at a rate in excess of the Basic Rate in reduction of the principal hereof or
any .other amounts owing hereunder, or if such principal and all such other
amounts have been pa i din fu 11, such excess sha 11 be refunded to Agency.
Without in any way limiting the survival of any other provision of this N.ote,
Agency hereby expressly agrees that the obligations imposed upon it by-this
paragraph shall survive payment and discharge of this Note for a period of
five years.
The term "Official Determination" shall mean (and for all purposes of
thi s Note shall be deemed to have occurred as of) a change in the Internal
Revenue Code of 1954, as amended, the issuance of a statut.ory notice of
deficiency, or ruling by the Internal Revenue Service or a ruling by any court
.of competent jurisdiction, or any other occurrence, the effect .of which, in
the opini.on of nati.onally-recognized bond counsel acceptable to Agency and
Bank, is to make interest payable on this Note includable in the gross income
of the holder hereof (except to the extent that such interest is so includable
because the holder is a "substantial user" of any of the Projects referenced
below or a "related person" as such terms are defined in Section 103 of the
Internal Revenue Code of 1954, as amended). The fees and expenses of any such
bond counsel in connection with such opinion shall be an obligation of Agency
payable from the same source and secured in the same manner as are all other
obligations evidenced hereby.
The term "Taxable Date" shall mean the date as of which interest payable
on this Note is includable in the gross income of a holder of this Note by
reason of an Official Determination.
Any principal or interest on this Note not paid when due. shall
thereafter bear interest at a rate equal to five percent (5%) per annum in
.' ',0'"
.
.
.
.
.
.
excess of the rate otherwise in effect on this Note. In addition to such
interest, the undersigned pr.omises to pay upon demand a reasonable late fee or
collection charge not exceeding four percent (4%) of such unpaid amount.
All principal, interest, and other amounts payable under the terms of
this Note are payable in lawful money of the United States of America which at
the time of payment is legal tender for the payment of public and private
~bh. .
So long as this Note is not in default, each installment of principal
and interest when paid shall be applied by the holder hereof first to the
payment of interest accrued as above specified, and the balance thereof to the
payment of principal. When any default hereunder has occurred and is
continuing, the holder hereof may apply payments in its election to principal
.or interest.
This Note may be prepaid in full or in part, with.out prepayment penalty
or premium, on any installment due date upon thirty (30) days' prior written
not ice to the holder of this Note. The Note shall be prepaid concurrently
with and to the extent of any prepayment on any Participant Note (as defined
in the Project Agreement referenced below). Each prepayment shall be applied
to principal but Agency shall continue to pay installments in the amounts and
at the times required in this Note until principal and interest on this Note
are paid in full. This Note shall also be prepaid if and to the extent that
any event shall occur which makes it reasoably certain that any portion of the
principal amount of the indebtedness evidenced hereby will n.ot be used to make
one or more of the Loans contemplated by the Project Agreement. Without
limitation of the foregoing, such result shall be reasonably certain if (a)
Bank declines to approve any Loan or approves any Loan in an amount less than
the maximum permitted by the corresponding Project Agreement or (b) any
Project Agreement or Commitment, as defined in a Project Agreement, terminates
or expires prior to the funding of the L.oan contemplated thereby.
This N.ote is issued pursuant t.o the Marks Historical Rehabilitation Act
of 1976, as amended, being Part 10 (commencing with Section 37600) of Division
24 of the Health and Safety C.ode of the State of California, and to Resolution
No. 81-140 of the Agency, entitled "A Resolution Authorizing the Issuance of
$1,000,000 Principal Amount of Community Redevelopment Agency of the City of
Santa Ana Secured Promissory Note (Phillips Block)" (the "Resolution") adopted
DecelTber 15, 1981, for the purpose of providing funds pursuant to the Project
Agreements described in the Resolution for the making of Loans to certain
Participants described in the Project Agreements to finance the rehabilitation
of historical properties located within the City of Santa Ana. This Note is
secured as contemplated by the Resolution to which reference is hereby made
for a description of such security, and of the nature, extent and manner of
enforcement of such security, and a statement of the rights of the holder of
this Note, to all of the provisions of which the registered owner of this
N.ote, by acceptance hereof, consents and agrees.
. ,
. '."-"
I
'.
.
.
.
.
.
This Note and the interest and other charges hereon are payable from,
and are secured by a charge and lien on, certain Revenues and collateral as
contemplated by the Resolution. This Note is a special obligation of the
Agency and is not a lien or charge against the property or funds of the
Agency, except to the extent contemplated by the Resolution. This Note is not
a debt of the City of Santa Ana, the State of California, or any of its
political subdivisi.ons and neither said City, said State, nor any of its
political subdivisi.ons is liable hereon nor in any event shall this Note be
payab 1e out of any funds or propert ies other than the Revenues and co 11 at era 1
therefor, as contemplated by the Resolution. The faith and credit .of the
Agency is not pledged to the payment of the principal of or interest on this
Note. This N.ote does not constitute an indebtedness within the meaning of any
constitutional or statutory debt limitation or restriction.
If an Event of Default (as defined in the Resolution) shall occur, all
or part of the principal am.ount of this Note may be declared due and payable
upon the conditions, in the manner and with the effect provided in the
Resolution but such declaration and its consequences may be rescinded and
annu1ed by the holder hereof as further provided in the Resolution.
[
This Note may be transferred by the holder hereof by endorsing hereon
(or on a paper attached hereto) the am.ount of principal paid hereon as .of the
date of transfer. Notification of such transfer shall be promptly given to
the Agency for entry on the Note register maintained by the Agency pursuant to
the Res.olution, of the name and address of the transferee. The Agency may
treat the reg istered owner hereof as the absolute owner hereof for- all
purposes.
Any holder of this Note subsequent to its original purchaser is hereby
placed on notice of all payments of both principal and of interest on this
Note prior to its transfer to such holder and all such subsequent holders
hereby acknowl edge that they have ascertained the actual unpaid pri ncipa 1
balance of this Note as of the date .of transfer of this Note to them and
hereby release the Agency from all obligation as to all principal and interest
paid by the Agency prior to such date.
It is hereby certified that all of the things, conditions and acts
required to exist, to have happened and to have been performed precedent to
and in connection with the issuance of this Note do exist, have happened and
have been performed in due time, form and manner, and that the amount of this
Note, together with all other indebtedness of the Agency, does not exceed any
limit prescribed by any laws of the State of California, and is not in excess
of the amount of the Note permitted to be issued under the Resolution.
. . .,,\..
.
.
.
.
.
.
IN WITNESS WHEREOF, THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF
SANTA MIA has caused this Note to be executed in its name and on its behalf by
this Chairman and its Executive Director, and its seal to be reproduced
hereon, and this Note to be dated December 1, 1981.
{
COMMUNITY REDEVELOPMENT AGENCY OF THE
CITY OF SANTA ANA
By
Chalrman
(S E A L)
ATTEST:
Executive Director