HomeMy WebLinkAboutCity Council - 5922 RESOLUTION NO. 5922
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
HUNTINGTON BEACH AUTHORIZING THE SALE OF THE
SEABRIDGE VILLAS PROJECT BY SEABRIDGE VILLAS
ASSOCIATES TO JMB INSTITUTIONAL APARTMENT
PARTNERSHIP-I , APPROVING THE DELIVERY OF AN
ALTERNATE LETTER OF CREDIT AND CERTAIN AMENDMENTS
TO BOND DOCUMENTS, AND AUTHORIZING OFFICIAL ACTION
WHEREAS, on February 1, 1985, the City of Huntington Beach
(hereinafter referred to as "City" ) , issued its Multifamily
Housing Revenue Bonds, 1985, Series A (Seabridge Villas
Project ) , in the aggregate principal amount of $25,000,000
(hereinafter referred to as "Bonds" ) , under and pursuant to the
California Health and Safety Code, Sections 52075 et seq. , in
order to provide financing to Seabridge Villas Associates, a
California general partnership (hereinafter referred to as
"Developer" ) , for the acquisition and construction of an
approximately 344-unit multifamily residential rental project
located at 20191 Cape Coral Lane and 20251 Cape Coral Avenue in
the City (hereinafter referred to as "Project" ) ; and
The Bonds were issued under and pursuant to an Indenture of
Trust (hereinafter referred to as "Indenture" ) , dated as of
February 1, 1985, between the City and First Interstate Bank of
California (hereinafter referred to as "Trustee" ) ; and
Pursuant to the terms of the Regulatory Agreement and
Declaration of Restrictive Covenants (hereinafter referred to as
"Regulatory Agreement" ) , dated as of February 1, 1985, among the
City, the Trustee and the Developer, at least twenty percent
(20% ) of the dwelling units in the Project are required to be
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leased or rented to persons or families of low income; and
The proceeds of the Bonds were loaned to the Developer under
a Loan Agreement (hereinafter referred to as "Loan Agreement" ) ,
dated as of February 1, 1985, by and among the City, the Trustee
and the Developer pursuant to which the City agreed to loan the
proceeds of the Bonds to the Developer to finance the Project;
and
The obligations of the developer under the Loan Agreement
are secured in part by a letter of credit (hereinafter referred
to as "Letter of Credit" ) , issued by The Bank of Toyko, Ltd. ,
Los Angeles Agency (hereinafter referred to as "LC Bank" ) ; and
The Developer proposes to sell the Project to JMB
Institutional Apartment Partnership-I , an Illinois Limited
partnership (hereinafter referred to as "Purchaser" ) , pursuant
to an Agreement between the Purchaser and the Developer
(hereinafter referred to as "Agreement" ) , dated as of December
23, 1987; and
Pursuant to Section 6 .02 of the Loan Agreement, the
Developer covenanted not to sell, transfer or otherwise dispose
of the Project, or any portion thereof without the prior
consents of the City, the Trustee and the LC Bank; and
Because the impact of such consent will be to release the
I
Developer from all future liability under the Loan Agreement and
the Regulatory Agreement, the Developer must provide to the City
prior to its giving its consent, the following:
( i ) evidence reasonably satisfactory to the City that
the Purchaser has assumed in writing and in full, and is
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reasonably capable of performing and complying with the
Developer ' s duties and obligations under the Loan Agreement
and the Regulatory Agreements; and
( ii ) an opinion of counsel of the Purchaser that the
Purchaser has duly assumed the obligations of the Developer
under the Loan Agreement and the Regulatory Agreement and
that such obligations and the Loan Agreement and the
Regulatory Agreement are binding upon the Purchaser
(hereinafter referred to as "Purchaser 's Counsel Opinion" ) ;
and
Pursuant to Section 2 .2 of the Agreement the Purchaser is
deemed to have paid a portion of the purchase price for the
Project equal to the outstanding principal balance of the
existing loan as of the closing date of the sale by acquiring
the Developers interest in the Project subject to certain Bond
Documents defined therein, including the Loan Agreement and the
Regulatory Agreement; and
The Developer has caused, or will cause to be provided,
evidence that the Purchaser is reasonably capable of performing
and complying with the Developer ' s duties and obligations under
the Loan Agreement and the Regulatory Agreement; and
The Developer has provided a draft of the Purchaser 's
Counsel Opinion it will cause to be delivered at the closing of
the sale; and
Pursuant to Section 3 .9 of the Loan Agreement, the Purchaser
proposes to provide an alternate Letter of Credit (hereinafter
referred to as "Alternate LC" ) from Security Pacific national
Bank (hereinafter referred to as "Alternate LC Bank" ) ; and
Pursuant to Section 6 .2 of the loan Agreement, the Purchaser
proposes to amend the Loan Agreement to provide that the loan
thereunder is a non-recourse loan, except with respect to
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certain indemnifications of and the payments of fees and
expenses of the Trustee and the City; and
The City needs a law firm knowledgeable about municipal bond
transactions and qualified to deliver opinions required under
the Loan Agreement to facilitate the sale of the Project, the
substitution of the Alternate LC and the amendment of the Loan
Agreement, and the City desires to retain the law firm of Jones
Hall Hill & White, A Professional Law Corporation.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the
City of Huntington Beach, as follows :
SECTION 1 . Sale of Project . The City Council hereby
authorizes the sale of the Project by the Developer to the
Purchaser subject to its satisfaction that the conditions
outlined above and in the Loan Agreement have been met and upon
the delivery of the opinion of Jones Hall Hill & White, A
Professional Law Corporation, concerning no adverse tax impact
of the sale. The City Administrator, with the approval of the
City Attorney, is hereby authorized and directed to consent to
the sale if the conditions are met and to execute a consent for
and in the name and on behalf of the City.
SECTION 2 . Alternate Letter of Credit . The City Council
hereby approves the substitution of Security Pacific National
Bank for The Bank of Tokyo, Ltd. , Los Angeles Agency provided
the conditions set forth above have been met . The City
Administrator, with the approval of the City Attorney, is hereby
authorized and directed to consent to the delivery of the
Alternate LC and execute a written consent for and in the name
and on behalf of the City, if the conditions set forth above
have been met .
SECTION 3 . Amendment to Bond Documents. Provided the
required conditions have been met and subject to the consents
and approvals of all required parties, the City Administrator,
with the approval of the City Attorney, is hereby authorized and
directed to make any and all insubstantial changes necessary to
the bond documents, including but not limited to the Indenture,
the Loan Agreement, the Regulatory Agreement, the form of Bonds
and the Official Statement , which he deems necessary or
advisable in light of such sale and the substitution of an
Alternate LC and an Alternate LC Bank . In addition, subject to
the approval of the owners of the Bonds, the City Administrator,
with the approval of the City Attorney, is authorized to consent
to the insubstantial amendments of the bond documents,
including, but not limited to the Loan Agreement, to clarify
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that the loan made under the bond documents is a non-recourse
loan, except with respect to indemnifications of and payments of
fees and expenses of the Trustee and the City.
SECTION 4 . Employment of Bonds Counsel . The City
Administrator, with the approval of the City Attorney, is
authorized to enter into an agreement for bond counsel services
between the City and Jones Hall Hill & White, A Professional
Corporation in a form approved by the City Administrator, and
the City Administrator and the City Clerk are hereby authorized
and directed to execute and deliver such agreement for and in
the name and on behalf of the City.
SECTION 5 . Official Action. Ail actions heretofore
taken by the officers and agents of the City with respect to the
sale of the Project, delivery of the Alternate Letter of Credit
and amendment of the bond documents relating to addition of
non-recourse language with respect to the loan, are hereby
approved, confirmed and ratified, and, subject to the approval
of the City Attorney, where necessary, the Mayor, the City
Clerk, the City Administrator, the City Attorney, the Principal
Redevelopment Specialist, and any and all other officers of the
City are hereby authorized and directed, for and in the name and
on behalf of the City, to do any and all things and take any and
all actions relating to the execution and delivery of any and
all certificates, agreements and other documents, including, but
not limited to those described in the Agreement, which they, or
any of them, may deem necessary or advisable in order to allow
the sale in accordance with the Agreement and this Resolution,
permit the delivery of an Alternate letter of Credit, and
provide for a non-recourse loan under the bond documents .
PASSED AND ADOPTED by the City Council of the City of
Huntington Beach at a regular meeting thereof held on the 19th
day of September , 1988 .
May r
ATTEST: APPROVED AS TO FORM:
City Clerk C ty Attor
REVIEWED AND APPROVED: ITIATED AND APP ED:
C ty Administrator Di e for of Economic
evelopment
be
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Res. No. 5922
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss:
CITY OF HUNTINGTON BEACH )
I, CONNIE BROCKWAY, the duly appointed, qualified City
Clerk of the City of Huntington Beach, and ex-officio Clerk of the
City Council of said City, do hereby certify that the whole number of
members of the City Council of the City of Huntington Beach is seven;
that the foregoing resolution was passed and adopted by the affirmative
vote of at least a majority of all the members of said City Council
at a regular meeting thereof held on the 19th day
of September 19 88 by the following vote:
AYES: Councilmembers:
Kelly, Green, Finley, Erskine, Mays, Winchell, Bannister
NOES: Councilmembers:
None
ABSENT: Councilmembers:
None
City Clerk and ex-officio Cl
of the City Council of the City
of Huntington Beach, California
5922