SR-203-002
,
.
.
1(- fI
OCT 2 2 '''5
CA:RMM Imo07o
CIty CouncIl f>1pptlna 10~22--85
;2P3....-0&:/2-
~anta MonIca;
Cdllfornla
s'rAFF REPORT
TO
Mayor and CIty CouncIl
FROM:
CItv ~Haft
SUB.JEC'!':
Apnroval of Agreements and Other Ar.tlon5
Necessarv for I~suance of CertIfIcates
at PartIcIpatIon PertaInIng to CertaIn
AIrport faCIlItIes
1 n tTOQllf"t_1 0[1_
ThIS ~taff Report requests that the CIty CouncIl approve
varl QllS
aareements and take certdln actIon~ pertaInInq to the
Issuance of CertIfIcates of
PartIcIpatIon to fInan~e certaIn
AIrport
FaCIlItIes
~9E'cJfIcally a new AIrport AdmInIstratIon
BUIldlnCl and SpecIalty/LimIted FIxed Base Operator Hangar
Aooroval
of the PrelImInary OffIcal Statement to market
the COPs
and the Purchase Aoreement for
such COPs IS also
rpoupstpd
AddItIonally, the CIty CounCI] JS requested to desIgnate
Hank
DIttmar~
Alrport DIrector. to
conduct a publIc hearIng
pursuant
the
regUlrernents
ot
the Tax and EqULty
to
ResponSlbllltv Act of 198/ ('''1'EF'RA'').
Thp Issuance of thpse
AIrport
cop." must comnly wIth thp 'J'EFRA rpql1lrement that an
plected
offlClal such as the Mayor;
aoorove the 15~Ue of the
Certlflrate<;
qubsE'ouent
to a nuhllC hearIng preceded by 14
~
(Jays
publl<;hpd notIce
rpgulatIons permIt
such a
Fecterdl
1
I (-A
ItT 2 2 t!8!
.
.
-,
hearIna to be conducted by an aoproprlatelv desIgnated CIty
Staff oerson. Ratlflcat~on of the publIshed notIce IS also
reauested.
Such
TEFH~
hearIng
1 S
scheduled
for Tuesday:
Q.tobpr )g, 1985. at 5:00 p m
~n the CItv Councll Chambers.
Aoproval of ~qreement5 P~rtalnIna to the ~lrDort Faclllt~~
The
related
t,rst
resolutIon requests approval
of the varIOUS
agreoement<;
pPrtrll n1 n<J
to
the
flnanclng
and
the
constructIon
CertIfIcatps
The ~grepment~ presented for approval are as follows:
of
the
FaCIlItIes
and
lssuance
of
1 .
Ground
Lease Agreement between Clty, as Lessor, and
SecurIty PaCIfIC
Nat]()nal
BankIng Asso.latlon,
as Lessee,
pertalnIng to the deSIgnated SIte tor the AIrport FaCllltles
2
Lease
Agreement
relatIng
to AIrrort
Jiarl1ItIes
between
SecurIty PaclflC
NatIonal
Bank,
as Lessor
of the
FaCIlItIes and Suble5sor of the SIte. and CIty. as Lessee of
the FaCIlItIes and Sublessee ot the SIte.
3
ASSIonment
Agreement
bf"twpen
SecurIty
PaCl-[lc
NatIonal Bank. as Ass19nor, and Bank of AmerIca NatIonal Trust
and
SaVInas
ASSOCIatIon,
a
natIonal
trust
and
saVIngs
aSSOCIatIon, as Asslgnee.
4.
Trust
Aqreemenr-
among
thE' CIty,
SpcurIty Paclflc
NatIonal
Bank; and Hiink of AmerIca Natlollal Trust and SaVIngs
As~ocIatlon. as Tru~tep.
5
Aaency Agreement bptween
SecurIty PaCIfIC NatIonal
Bank
and CIty dpsIqnatlng
t-he
CIty
ac;
SecurIty
PaCIfIC
?
.
.
NatIonal
Bank'')
ag€'nt
tor
p!1rpo'i€''i
of QVer')PPlng and
supervlslng constructIon of the Alrport FaCIlItIes
ExecutIon of the varIOUS
agreement.. IS contIngent upon
the monetary parameters establIshed for
the CertIfIcates In
thl'i
resolutlon_
SpecIflcally. the followln~ factors must be
satIsfIed:
1. The
total sum to be deposIted WIth the Trustee from
of th~ CertIfIcates shall not be less than
the
proceeds
$3;840;000-
} The
amollnt
to be rlepO,)lLed bv the Trustee In the
DelIvery Costs Account (as that term
IS defIned In the Lease
and Trust Aqreements) ..hall not exceed $125~OOO
3. ThE' maXlmum annual Lease Payments shall not exceed
$525,000
4.
The amount
to be 0ellvered by Clty to Trustee for
establIshment of
exceed $450,000
the SpeCIal
Redemption Account
shall not
5
The
orlnclDa] component of
the CertIfIcates as 'iet
forth
1 n
the T rLl s t
Aoreem€'n t
<;ha 11
eaual
the prlnrloal
component
at
the
Lease Payments 'ihown on ExhIbIt B to the
Lease Agreement.
6 The Interest com~oDent at the Certlflcates shall not
exceed 11% per annum.
3
.
.
8p~roval of Prp]~~~~Qfflcal ~t~t~ment-pnd
CertIfIcate Purch~se Aqreement
The second resolutIon approves
the PrelImInary OffIcal
Statement WhICh contalns flnancl~l and other relevant data on
the
CIty
and
the
proposed AIrport
FaCllltlPS.
Such
Prpllmlnary
OfflClal
Statement wll1
be utIlIzed by
the
UnderwrIter (PalneWebber) to market the COPs.
ThIS
resolutIon
requests
aporoval of
the CertIfIcate
Purchase Aareement and
the PrelImInary OffIcIal Statement.
EXf'CutIon of such r:ertlflcate Purchasp A9rpement 1<:; ~ubJE"ct to
tne folloWIng condltlons;
1. The aggregate prInclpal amount of CertIfIcates shall
not be Jess than S3}980:000.
2. The purchase prIce ~ha]l not be les~ than 96 1/2% of
- -
the aggregate par value of
the CertIfIcates (Underwrlter's
DISCou~t shall not exceed 1-1/2%l
The CIty Hanauer
1 S
authorIzed and dIrected by thIS
resolutIon
to
execute
the
11nal
Certlflcate Purchase
Agreement. Incluoln0 approval of Insprtlon of those terms lett
open.
so long a~ the Darameter~
set forth In thIS resolutIon
are satlstled
The CIty Manager I~ dlso
authorIzed to dIrect that the
PrelImInary OftlClal Statement be brought
Into the form of a
FInal
OffICIal Statement dated as of
the date of sale of the
Certlflrdtes: and to execute such Flnal OffIcIal Statement
4
.
.
Comollance wIth 1'ax EQUltv and ResponsIbIlIty
bct__Qf._L982 [" TEFRA_'~
As a result of the Tax EouIty and FIscal ResponsIbIlIty
Art
of 1982 ["TEFRA"). a reqUJrement
IS Imposed on Issues of
CertIflcates of PartIclpatIon ("COPSU) whIch are classIfIed as
IndustrIal DE'velooment Bonds ["IDBs") for federal law
purposes
The ISSllE' of Cert1.flcates of PartlcIpatIon for the
AJroort
FaCIlltle<;,
fall" wIthIn
the cateqory requIrIng
complIancE' wIth TEFRA.
Pursuant
to Sectlon
l03(k) of the
Jr)ternal
RevenuE' Corle
of lq~4.
as amended; approval of the
hy an elected offIcIal such
Issuance
of the COPs 15 requIred
as thE' Mayor) subseouent to a publIc hearIng whIch 1<; preceded
by 14 days pUblIshed notIce.
Such procedureg must be followed
In
orde-r
for
the
Intere~t
receIved by owners
of
the
CertIfIcates of PartIcIpatIon to be exempt from Yederal income
'1' a xe s
The federal regulatIons allow the requIred T~FRA hearIng
to be Gonducted by a deSIgnated Staff person.
ThI<; thIrd resolutIon would ratJty the oublIcatlon of
notlcP ot the TEFRA hearlng, deSIgnate Hank DIttmar, AIrport
DIrector. as the Staff person to conduct such hearIng, and
appOint
the Mayor
Lo make approprIate determlnatlons and
.qpprove or
dlsappr-ovp
Issuance of the COPs, subJect to the
TEFRA hear-Ina beIng held.
~
.
.
SoecIal RedemotIon Fund
For the protectIon of the holders ot the CertIfIcates~
the CIty
15 requIred to establIsh an account to be utIlIzed
for
dutomatIc
redemptIon
of
all
the CertIfIcates
If
a
ronstructIon
contract
for
the AIrport VacIIItles
I5
not
awarded
Agreemen t,
such
to August 15, 1986_ As requIred by thp Trust
SpeCIal RedemptIon Fund must be establIshed
orlor
WIr.h
legally avaIlable funds
other than proceeds
from the
Issuance at the CertIfIcates
of PartICIpatIon
ThIS assures
arlf'ouate
proceeds
WIll hp avaIlable
to
redeem all
the
CertIflcate~ If necessary
In ordpr
to satlsfv thIS
reaUIrement, It IS requested
that funds be transferred from the AIrport EnterprIse Fund In
an amount not to exceed $4bO,OOU for deposIt wIth the Trustee
In a SpeCIal RedemptIon Trust Account.
The funds
In
thIS SpeCIal RedemptIon Account and all
earned Interest wI}l be returned to CIty upon executIon ot the
constructIon contract wIthIn the tIme perIod IndIcated
On
March
EJ.A~~grolJnd
11. 1985, the CIty CounCIl approved the SIte
Plan
for
the Santa MonIca MunIcIoal
AIroort.
'l'hIS actIon
Included dIrectIon
to CIty Staff
to begIn plans
for thE'
deSI0n,
constructIon,
and
tInancIng of
a
new AIrport
AdmInIstratIon
BUIldIng and Spe~Ialty/LlmIted FIxed Bage
Operator Hanoar at the AIrnort.
fi
.
.
The
CIty CouncIl ~ubsequently
authorIzed Clty ~taff to
retaIn
PaIneWebber; Inc. as fInancIal adVIsor/underwrIter and
MorrIson & Foerster as bond counqel for the CIty In connectIon
WI th
the Issuance of CertIfIcates of PartICIpatIon as a means
of fInanCIng the speCIfIed AIrport Improvements.
CI ty
Staff
has worked closely wIth
the two fIrms over
the
past
several
months
to
devlse a
tax-exempt fInanCIng
strategy for
the
AIrport proJect.
A
number of alternatIve
fInanCIng mechanIsms were revlewed and conSIdered orlor to the
selertlon of a lease-lease back apnroach known as CertIfIcates
of
PartIcIpatlon: as the most
approprIate manner In WhIch to
fInance Its proJect.
On
September
10:
1985.
a Staff
Report was presented
requestlng
IntroductIon
for
fIrst
readIna of
.'
an ordInance
apprOVIng
the Lease Agreement relatlng to AIrport FaCIlItIes
However.
reVISions
to
the
Lease Agreement
relatIng to the
AIrport FaCIlItIes and related aareements were necessary after
receIVIng comments
from
the
Lessor bank
fSecurlty PaCIfIC
NatIonal
Bank);
'l'rustE'E'
Rank
(Bank
of Arne r 1 C a 1 .
and bond
counsel
AddItIonally: bond counsel has adVIsed us that It IS
approprIate
to
approve
by
resolutlon~ the varIOUS related
legal
documents,
PrelImInary
OfflClal
Statement:
and
CertIflcate
purcha"le
Agreement
necessary
to
proceed With
lssuance
of
the
CertIfIcates
of
PartICIpatIon.
ThesE'
resolutIons
authorIze
the
CIty
Manager:
subJect
to
the
parameters
set
forth thereIn: to
complete those sectIons of
the varIOUS agreement5 settIng forth the Interest rate, Lea"le
7
.
.
Payment
prICE'.
Schedule, prlncl~al amount
of the IqSUanCe, purchase
and amounts of proceeds to be deposIted In the varIOUS
trust
accounts, and to make
nonmaterIal chanaes to the legal
documents as necessary after adoptIon of such resolutIon The
CIty Manaaer ]s al~o authorIzed to execute all ~uch agreements
and
any
addItIonal
documf"nts
to
effect
Issuance
of
the
CE"'rtlflcates.
proposed Flnanclnq TechnIoue
ThE'"
re('ommenoed
fInanClna ~trucrure 15
a Varl.=l110n of
]easp
and
lease
back
techn1oues.
Under
the
proposed
arrangemE"'nt;
the CIty would ground
leage that portIon of the
AIrport
(the
"SIte") unon WhIch the
two structures would be
btnl t
to
SecurIty PaCIfIC NatIonal
Bank, a natIonal bankIng
aSSOCIatIon.
as
Lessor
Lessor would agree
to tInance and
arrange constructIon of these AIrport FaCIlItIes; and DUrqUant
to a Leas? Agreement pprtalnlng to such Improvements~ sublease
the
S1te and lease the FaCIlItIes back to the CIty
The CIty
would manage the constructIon of the FaCIlItIes pursuant to an
agency agreement WIth the Lessor.
The
CI ty 's
rent
ohllqatlon under
the Lease Agreement
would Include an expressly stated lntprest component, SInce It
IS the Lease Agreement ltself whICh constItutes the munICIpal
obllqatlon:
the
Interest
on
WhlCh
IS expmpt
from federal
Income taxes.
SecurIty PaCIfIC
Natlonal
Bank.
a
natIonal
banklna
aSSOCl.atlon:
as
Lessor;
would aSSIgn Its
rlghts to reCeIVE>
8
.
.
rent
payments as well as other rIghts arIsIng under the Lease
Agreement
to
Bank
of
AmerIca
NatIonaJ
Trust
a n(] SaVl ngs
ASSOcIatIon:
a
natIonal
trust
and saVIngs
aSSQC"latIon: as
'J'rustE"e,
pursuant
to
a
<;eparatE'
ASSIgnment
Agreement.
Lessor] and
FInally; under the Trust Agreement among the CIty:
'I'rLlstE'E']
the Trustee would I~sue tractIonal and proportIonate
Interests In the rent payments to
tor subsequent dIstrJbutIon to
be sold to an underwrIter
the publIC
pllrSUant to the
Cf"rtlflcate
Purchase Aqreement
The
fractIonal
Interf"sts
would
be
rprresented
by
certIfICAtes
of
partICIpatIon
{ "COp's" ] .
A CertIflcdte at PartICIPatIon JS an agreement much lIke
a bond. WhICh IS eVIdence that the Investor owns an Interest
In a leasp held by a trustee who IS to receIve payments from
']' r u s t p E'
TechnIcally: such CertIfIcate 15 Issued by
than the munICIpalIty and IS not Itself
the
the
munICIpalIty
rather
eVIdence of Indebtedness of the munICIpalIty
The
Lessor bank aSSIanb ItS
unnpr
1 t 5
leasE" WIth
Cltv
rlght] tItle] and Interest
an escrow bank WIth dutIes
to
SImllar
to
those
of a Trustee under
a bond Indenturp.
The
Trustee/Escrow Agent IS emoloyed by the Clty to admInIster the
funds WhICh ultImately wll1 be nrovIded by the underwrIter and
Its
Il'lVestor
clIents
Thus.
the
Trustee/Escrow ~gent's
prlmary
functIon IS that of
custodIan at thp ACQUISItIon and
ConstructIon
Account. Resprvl? Account; Lease Payment Account]
and
any other accounts pertaInIng
to the constructlon of thp
faCIIItIPS.
The Lessor bank aSSIgns the rIght to recelve the
g
.
.
lease
payments to such Trustee/Escrow Aaent
Once the COP's
are r:luthorlzed, the underwrIter sFllc; them to Its Invpstorc;
pursuant to an offICIal statement prepared by the underwrIter
and
LtS
separate counsel
and wherE>
avaIlable wIth a ratIng
from Moody's
Investor
Sf'rVlce
or
Standard &
Poor's.
Thp
Investor IS also provJded wlth an opInlon bv speCIal bond
counsel (MorrIson & Foerster) as to the tax exemot nature of
the Interest port1on of the mun1c10al obllaatIon under federal
law as
well as to the fact
that the transact10n 1S a legal:
val1d. and hlndlna oblIoatlon of the wunlClpalIty.
Investors
Trustee/Ec;crow
holdIng the
COP's
rece1ve
payment
Account
by the
In the
Such
Aaent
from
the Lease Paymf'nt
requlred
oayment5
amount
of prInCIpal nnd
tax-exempt Interest
are
derIved
tram
funds
deposIted by
the CIty 1n
amounts equal to those It 15 reqUIred to remIt under thp Lease
Agreement WIth the Lessor
It
1S ObVIOUS that ]n
substance) thp structure IS very
SImIlar to the Park1ng AuthorIty Lease Revenue Bond structure.
Tn both rases. the cost of the facl1~ty, 1ncludIng fInanCIng
costs;
15
amortl7E'O
through
a
lease to the
CIty.
Tn the
latter
casp;
the
tax-exempt
debt
IS ] n the
form of bond~
securf"d
by
rpnt
payment. whf"rea~ In the
case of COP's, thp
tax-pxpmpt debt IS the lease Itsf"lf. no bonds are I5qUpd The
COP's merely rppreqent tract10nal lntprpsrs ]n the lea~e
The FInance Department; throuah a compet1tlve selertlon
OrOCE-55,.
qerv~ces
selec:ted
outlIned
a
Lf"ssor
and
a
Trustee to
DE'rform the
above.
Staff
recommends SecurIty PaCIfIC
10
.
.
NatIonal
Bank~ a natIonal bankIng assocIatIon~ as Lessor; for
the orOlPct The resDonSlbIIItIe.:; of thE> LE>ssor arE' lImltE"d
to execution of the Lease Agreement and subsequent asslonment
of tnf" Lease Agreemel1t to the 'rrustf"P.
Staff rerommends Bank of AmerIca NatIonal Trust and
SaVIngs ASsocIatIon: a natIonal trust and savIn9s aSSOCIatIon;
to undertake the rE'sponslbIlItIes of TrusteE' for the proJect.
The
two
InstItutIon,,>
werE'
chosen
on
thE"
baSIS
of
reasonableness
of
prICE'.
prIor relatIonship With CIty~ and
WIllIngness to undertake thE" orOlf"ct
RudSfttarv/FlnanClal Imoact
In
order
to
lessf"n
thE"
lease payment
burden on thp
AIrport
Fund, the original E'stlmatE'
ot a $7 mIllIon Issuance
has bepn rf"duced
The schedulf" bE'low reflE'cts the SIZe of the
l<>suance
now contemolatf"d
by
the City and
assumes annual
Airport
revenuE"s
avaIlable
for
df"bt
serVIce
of $500,000
ThesE' numbE'rs are sUbJert to rE'flnement
Par Value
$4;480;000
Funded Interest
(30 months)
1;036;000
Debt SerVice Reserve
Fund
500,000
Issuance Costs
100,000
DJ SCollnt [1.0%}
135;000
Nf"t
$2,709.,000
11
.
.
The
current estImate for
constructIon
of
the
two
~tructurp~ IS S3,OOO}OOO.
ThlS amount 5hould be avaIlable for
the
proJect
once
edrned
Intere~t
15
Included
In
the
of
calculatIon
The
CIty
must
back
the CertIfIcates
PartICIpatIon WIth
the full faIth and
credIt of the General
Fund
revenues,
and
Lease Payment~ WIll
bE" made
tram the
General
Fund,
although AIrport Fund revenues WIll reImburse
the General
Fund for actual
Lease Payment5 of approxImately
$500.000
annually.
Hence, a ReImbursement Agreement between
the AIrport Fund and the Gpn~ral
Fund WIll he requIred.
The
AIrport
WIll
derIve
the $500,000 each year from subleaSIng
portlon5
of
the FaCIlItIes and
trom other AIrport recurrIng
revenues
RECOMMENDATION
It
15
respectfully
recommended that
the CIty CounCIl
take the follOWing actIons.
1 .
AdoptIon
of
a
resolutIon
authorIZIng a
Lease
Aoreement
hetween CIty and Spcurlty PaCIfIC NatIonal Bank; a
~rust Agreement among CIty, SecurIty PaCIfIC NatIonal Bank and
Bank of AmerIca
NatIonal
Trust and SaVIngs:
and related
agreementg
pertaInIna
to
Issuance
of
CertIfIcates
of
PartIcI~atlon
In an aggregate prInCIpal
amount not to exceed
$5 mIllIon dollars tor a term not to exceed 25 years.
2 _
OffICIal
AdoptIon
ot
a
r?SOlutlon apprOVIng a PrelImInary
Statement and CertIfIcate Purchase Agreement) and
12
.
.
authorlZ1.ng
and
dIrectIna certaIn
actIon<; WIth
rec;pect
thf'reto
'3
Adootlon
of
a
resolutIon dec;lgnatInq
the C"lty
AIroort DIrector, Hank DIt,mar 1 to conduct a QubllC hearIng as
reauIred by the Tax
and EqUIty ResponsIbIlIty Act of 1982
r"TRFRA")
and appolnt"lng the Mayor
to execute a CertlfIcate
approvIng the Is<>uanre ot the COPs, sublect to the holdIng of
such TEFRA hearIna
4.
Instruct
the CIty'S DIrector of FInance to WIthdraw
from
thf' Alroort
Entprprl<>E> Fund and deposIt WIth Trustee.
Bank of AmerIca, a c;um not to exceed $4~D,ODOJ for purposes of
pstabllshlna the SpecIal RedemptIon Fund requIred by SectIon
406 of the Truc;t Agreement.
PREPARED BY:
Robert M. Myers, CIty Attorney
Hank DIttmar, Airport DIrector
LInda Moxon, Deputy CIty Attorney
1 '3
'-
-,
,.
.
. Zc;g-O<:02-
CA: H.MM ~ 1 meW H 1
CIty CouncIl MPptIng 10-?I-H~
Santa MonIca} CalItornIa
H.t'.:'-JOI.lJ'f' [ON NlH"l H EH. 7107 (CCS)
(CIty Councll SprlPsl
A R"~SOLUfl'ION OF' 'l'Hr~ CITY COlJtIICTL Or'
'j'HI-: c: l'rY OF SAN')'A MON LCA AP....HOV 1 N(; AND
AUTHORfZiNG F.:Xt<.CU'l'fON OF A GROUND LEA~E)
I. Jo:AS r: AtilU-:r.M ". NT} '['!-l lJ s'r A(;H.t<~i';M}-. NT} At" l) O'i'H J:o;H
AC;Rr.:r~Mr~N'l'S Ri:';r.A'rI-:D 'fO 'rHJo: SAN'I'A MON leA
t1LJN LCl PAL. AI H....OR.j'
'J'Hr. CI'I'Y COIJNCIL OF 'PHI": CLTY Or SAN'['A MONICA DOES RESOLVE
AS FOLLOWS:
Sfo;C'l' ION 1.
Thp Ground Lease} dated as at Octobpr 1} lYH~J
by and betwpeo thE" CIty} ae:; Lessor} ilon Ser:urlty PacltIc NatIonal
Bank: ("SecurIty PacIflC"J, as Le~'H"p) substant1.aJ Iy In thf> form
presentpd at thl~ mf>etlng} Ie:; herpby ApprovPd.
'l'he C;1 ty Mandger
and the C1.ty Clerk arE> authorIzed and dIrected to expcutp the
Ground I.pase on behaJ t at the (:1 ty) SllhJPct to Sect Ion h her(~of-
~ J<.C'l' ION 2.
Thp Lea~e Agrepmpnt relatIng to AIrport
FaCIlItIes Ithe "LF!asp Agreement"), dated AS of Octobpr 1, 1YB5j
by and betwppn thp CIty and SecurIty PacItIC} ~ubstantIally In
the torm prpsentpd at thIS meetIng} lq hprphy approvpd.
'I'he C1 ty
Manager and the C1.ty Clprk arE> authorIzed and dIrpcted to
- 1 -
...
.
.
cnmplPte and eXPcIltp thp LPB~P AqrpPffipnt on bphalt ot thp CIty,
SUbJPct to Spct I on b hprpof -'inn sut)JPC'i to thp 101 I OWl ng,
A_ 'I'hp tot i'il <;um to be OPpO"il t€'d WI th thp 'l'rllstep
pursuilnt to ~eC'tlon 'i()l ot thp I.PiI"lf" A<Jrpempnt shall bp not less
than S::l]840;OOO.
B Thp amount to bf" df"pOs1ted by thp Truc;tee In the
Dellvpry CO"lts Account pur'want to Sp,tlon '101 of the 1.f"ilSP
Agreement shall not ex,eert $12~,000.
C. l.p<1">f" Paympnts n5 <>i='t torth 1n ~'XhIhIt H to the
LAnse Agrppmpnt ShaLL bp calculated by thp C1ty Manngpr at such
tImp as thp lntprpst componpnt thprpot 15 dPtprmlnpd; proVlded
that Lf"ASe Payments In any calpndar y~ar shall not exceed
$!)2~,()OO.
SI:<:C'I'JON 3
Thp Trust Agref"ffiPnt rf"latlng to A1rport
}o'aclllt1P5 IthE' "'j'nIst Agrppmpnt"J; f'lillf'(1 .'1<; ot OctClhpr 1, 1-l8~;
by and among Ban Ie at Ampr lca Na t 1 onn I '!'nJS t and Savl "g<>
A"l so C I a t 1 0 n; a s 'I' r u c; t P e; ~ p (' II r 1 t Y P n C 1 t 1 ("' And t h pel t y ,
substantIally In thp form prp"lpntpd at thls mpetlng, 1<; hpreby
approved. 'I'h~ CIty Managpr <'Inn thp Clty C!prk nrp rluthorI7Po anti
dlrected to complpte and pxprutp th~ Tru~t Agreement on behalf ot
t h pC, 1: y, ~ II h J pet t 0 ~ e c t Ion 6 h p r (~() tan d sub J po C" t t () t h p
folLowIng,;
- :I. -
.
.
A. 'l'hp c;um to hp p'=ll r1 hy thp (;1 ty to thp '{'ruc;tP(
pur'3uant to Sprtlon 406fhl at thp. '['rust Agrepmf>nt shall not
exceen $4!-lO,OOO.
H. 'rhp aggregn~e prlnr1p~1 amount ot Cert1tlcatp$ as
set fort.h 1n ~ectlon bO] of th@ Trust Agrpf>mpnt 5hi'l11 hf> not leSf.
thrtn $i;9HO,OOO.
c. Thp prlnC1pal amounts spt forth 1n Sprtlon 604 ot
thp Trust Agrppmpnt c;hi'lll pqual thp prlnC1prtl componpnts of the
Lpa~e paympntc; i'lS shown ]n ~Xhlh1t B to thp Lpase Agrppment.
D. '['hp 1 ntprest rates SPI torth 1 n ~pct 1 on &04 01
t hp 'l'ru s t Agreempn t s ha 11 not exrepd 11':t. ppr an ourn 1 n any YPi'l r .
SI-:CTION 4 The AgE"ncy A9rpPIllPnt, dAtpd af> ot Ortnhpr 1,
lYH~] hy ann hetwppn Sprurlty ~aC1 tIC and thp Cltv; c;uhc;tantlally
In the torm prec;ented ;it thIS meetIng, IS hprPhY approvpc1. 'j'he
CIty Manager and the Clty Cler~ arp 311thor1zed and dIrectpc1 to
expcute thp Agpnry Agrf>f'mpnt on twh.=t I t at t hp C1 ty, sllbJPct to
Sprtlon b hpreot
St<:C'I'JON!:J 'rhp Ground Lpi'lse, Lerlse Agrpempnt] 'rrust
Agrepmpnt] and Agpnry A<]TPempnt milY be moc11t1Po, pr lor to I heIr
expcutlon and dpl1very, by the CIty Manager WIth the adVIce ot
thp CIty Attornpy] prOV1dPd that ~uch mod1tlcatlon 15 ronsl~tpnt
WIth the es~entlal terms thpreot and WIth thp 1ImItat1ons set
torth herPln.
'I'he C1 ty Managpr' S .=lppr aVril ot such modl t Ira t Ion c-,
- 3 -
"
.
.
ghAll be ('oorluslvely establ] <;nf>rl l1Y IllS PXI?Cutlon ot tll~ (;rouno
Lpagp) Lprl~p Agrppmpnt; Trust Agrppmpnt and Agpncy Agrppmpnt.
SEC'I'10N b.
'I'he Ground Ll?.-i<>e I [,p;H,e Agrppmf>nt; 'l'nlc:t
Agrepmpnt] ann Agpney Agrpempnt shall not be executed by the Clty
Manager and Llty CIE'rk untll lal thP C1ty Gouncll Sh;'III haVf>
approved a PreLlmlnary Ottlclal ~tntpment tor USP In marketIng
the Certltlcatps, lbl the Clty COllne1l shnll have approved an
agreement wlth PaIne Wehher Incorporated, UnderwrIter, tor thP
purChac;p ot thp CPrtlt1Crltes <1f>srrlhpo 1n the 'l'rust Agrppment anc,
(el thp Mayor toJ lOWIng a PUblIC hparIng on Oelobpr 2Y) tYH~]
shall havp approVE'd the lSSUilncp ot thp CertlflCo"It.f>"I a<> rpqulred
by Sectlon l()~lkl at the tnternal Hevenue codp ot 19~4J ae;
ampndpd.
S,"~C'1' ION I.
'I'hp C1 ty Clerk sha 11 rertl ty to the adopt1on ot
thIS Hpsolutlon and thencp10rth ann Iherpatter the ~Rme sh~lJ be
In tull torce a.nd etteet.
APPHOV Ell AS 'ro r OH M :
~ ~. '^"
HOH~HT M. MYERS C)
Clty Attornpy
4 -
.-
.
.
Adopted and approved this 22nd day of October, 1985.
~~J~
~ . Mayor
I hereby certIfy that the foregoing ResolutIon No. 7107(CC3)
was duly adopted by the CIty CouncIl of the CIty of Santa Monica
at a meeting thereof held on October 22, 1985 by the followIng
CouncIl vote:
Ayes: Councilmembers: Conn, Epstein, JennIngs, A. Katz,
H. Katz, Zane and Reed
Noes: Councilmembers: None
Abstain: Councllmembers: None
Absent: Councllmembers: None
ATTEST:
~~.~
Clty Clerk" ,
~
;0
.......
:::>
~
.......
71
Vl
Q)
U
C
:d
t:::
-\
':.::I
f-<
o
Q.l
>
r-l
Q)
:)
(\)
;....
i-J
o
t:::
>...
c:.>
t:::
f-<
o
i-J
oJ
::c:
~
...
..
C
oJ
':.::I
Q)
i-J
'./',
(l)
-
--
.::::"
Q)
~
(!)
U
-I
H
....
o
'./',
>...
Q)
~
f-<
o
jJ
jJ
<:e:
>...
,I-J
.....
:....J
~
o
~
,I-J
h
Q)
.c
o
a::
.
. ..2t?3-00'Z-
BEFORE DISTRIBUTION CHECK CONTENT OF ALL
DISTRIBUTION OF RESOLUTION # ~/~ 7
/0)<:-,>- /y. ::;--
Council Meetlng Date/_~~/c ~
Agenda Item # P ~ 4-
Was lt amended? ~O
VOTE~ Affirmatlve~ 7~ 0
Negative~
Abstain~
Absent~
~ PROOF VOTE~ WITH ANOTHER PERSON BEFORE A~~THING
DISIKIBullvN: vRIGINAL ~o be signed, sealed and filed in Vault.
FO~ CITY C~ERK'S ACTION
ORDINANCE #
Introduced'
Adopted:
AI}.OfAYS PUBLISH AOOP'1'w ORDINANCES*
*Cross out Attorney's approval
NEWSPAPER PUBLICATION (Date:
)
)
Department originating staff report (
Management Serv.~~e? Lynne Barrette .urdinances only
.:
Agency mentioned in document or staff report
(certlfled?)
SubJect flle (agenda packet) 1
Counter file 1
Others:
SE~D FOU~ COPIES OF ALL ORDI~ANCES- TO:
CODfD SYSTEMS, Attn Peter Macfearie
12~ Main rtT~et ~
AV0~7 ~~w Jersey_07717
SEND FOUR COPIES OF ALL ORDTNANC''P5. TO:
PRESIDING JUDGE
SANTA MONICA MUNICIPAL COURT
:725 MAIN STREET
SANTA MONICA, CA 90401
*Check Code SectJ.ons before sendJ.ng.
TOTAL COPIES
3
~
.
.
2-p3,-ocz..
CA:RMM:lmd085
city Council Meeting 10-22-85 Santa Monica, California
RESOLUTION NUMBE~ 7108(CCS)
(City Council Series)
RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF SANTA MONICA APPROVING
PRELIMINARY OFFICIAL STATEMENT AND
CERTIFICATE PURCHASE AGREEMENT, AND
AUTHORIZING AND DIRECTING CERTAIN
ACTION WITH RESPECT THERETO
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA
MONICA RESOLVES AS FOLLOWS:
SECTION 1.
The Certificate Purchase Agreement, by and
among Paine Webber Incorporated (the "Underwriter"), Bank of
America National Trust and Savings Association as Trustee, and
the City, relating to the purchase and sale of Certificates of
Participation to finance certain improvements at the Santa Monica
Municipal Airport (the "Purchase Agreement"), substantially in
the form presented at this meeting, is hereby approved. The City
Manager and the city Clerk are authorized and directed to
complete and execute the Purchase Agreement on behalf of the
City, subject to the following:
(a) The aggregate principal amount of certificates set
forth in Paragraph 1 of the Purchase Agreement shall be the
- 1 -
. .
amount set forth in section 601 of the Trust Agreement relating
to Airport Facilities, dated as of October 1, 1985, by and among
the City, the above named Trustee and Security pacific National
Bank, and shall be not less than $3,980,000.
(b) The purchase price of the Certificates set forth in
Paragraph 1 of the Purchase Agreement shall be not less than
96-1/2% of the aggregate par value of the Certificates.
The Purchase Agreement may be modified, prior to its
execution and delivery, by the city Manager with the advice of
the city Attorney, provided that such modification is consistent
with the essential terms thereof and with the limitations set
forth above. The City Manager's approval of such modifications
shall be conclusively established by his execution of the
Purchase Agreement.
SECTION 2. The Mayor, City Manager, City Clerk, and other
officials of the City are hereby authorized and directed to
execute such other agreements, documents, and certificates as may
be required by the Purchase Agreement or otherwise necessary to
effect its purpose.
SECTION 3. The Prelminary Official statement, dated as of
October 22, 1985, relating to the Certificates of Participation,
substantially in the form presented at this meeting, is hereby
approved for use by the Underwriter in the offering and sale to
the public of the Certificates.
- 2 -
.-
-~
.
SECTION 4. The city Manager is
.
authorized to approve
corrections and additions to the Prelminary Official statement by
supplement or amendment thereto, or otherwise as appropriate,
provided that any such corrections or additions shall be
necessary to cause the information contained therein to conform
with facts material to such certificates or to the proceedings of
the City, or that such corrections or additions relate to fonn
rather than substance.
SECTION 5. The City Manager is authorized and directed to
cause the Preliminary Official Statement to be modified into the
form of a Final Official statement and to execute said Final
Official statement, dated as of the date of the city's execution
of the Purchase Agreement.
SECTION 6. The city Clerk shall certify to the adoption of
this Resolution and thenceforth and thereafter the same shall be
in full force and effect.
APPROVED AS TO FORM:
n~_.A.o., \~_
1 '1""" \J"\-..:,I \ ~ * -
ROBERT M. MYERS
city Attorney
<r
- 3 -
~
.
.
Adopted and approved thIS 22nd day of October, 1985.
t44;f~
/ Ma yor-
I hereby certify that the foregoIng Resolution No. 7108(CCS)
was duly adopted by the CIty Council of the City of Santa MonIca
at a meetIng thereof held on October 22, 1985 by the followIng
CouncIl vote:
Ayes: Councllmembers: Cono, EpsteIn, JennIngs, A. Katz,
H. Katz, Zane and Reed
Noes: Councllmembers: None
AbstaIn: Councilmembers: None
Absent: Councilmembers: None
ATTEST:
~lJl
..._._-~
City Clerk
.
. f PfYtPc$
"
'\.
.,
CA~HMM:lmd()H,
CIty Councll Mf'f'tlng llJ-//-Ho..,
~anta Monled; Calltornla
I-n.~OI.Il'I'l()1\I I\IIJf-1KFH .?lO~ (CCS)
IClty Counell Sprlesl
}lr~OLLJ'J'JON 01" THE C]'f'y COUNCJL Or 'I'Hi-.
CITY 0.... SANTA MON! CA APP~OV [NG
PH 1',1. I M I NAKY OFt- I (, I AI, l-l'j'A']'r'MI' NT AND
Ci':H'I' ) I< I CA'I'I-: PlJKCHA~-d': ACI'H'~I<:M r.N'I'; AN I)
AII'J'HOH I / I Nt, AND j) i Rf:CT J ,..J(; CI::.H'I'A I N
AC'I'ION WI'['H HI',<:>Pfo:C'[' 'I'Hr.Hb:'I'O
NOW; 'I'HEI-U<,rOH.I::., '['H~. CITY COUNCil. 0... 'I'Hr, CI'j'Y Or' ~f\N'['r\
MONICA Hfo.~Ol,Vr:~ A~ l"Ol.l.OW~:
~r.C'I' I ()N 1.
'l'hE'" Cprt]1Icatf' Purrha'H" AgrE"PffiE-'nt, l,yaneJ
among palrtp Wf'tlhpr InrorpOr<'ltpc1 (thp "Un(iprwrltpr"I; l3~nl<. ot
AmerlC'il NatIonal 'I'rust rinrt '-,aVlrt{]5 AC:;"iOr1atlon n"i 'I'rustpey ane,
thp Clty. rpl~tlng to thp purchac:;p and salp ot CprtltlratpQ at
PArtlclpallon to tlT1anC'P rprtriln lmnrovpmpntc:; At . hE" ::-ii/nil! MOllle'''
MtHl1Clral Alrport tthp "purrha<;e A.C:lTE>pmpnt"\) fiunc;tantlally 10
the torm prp"pntpd at thlC:; mpptlfl(}; lS hPYE-'tlY rlpprOVf"~d.
The \:1 t yo
Miinagpr ann thp CIty CIprk arp ;:luthor]7PO and dll-pctpd to
romplptp rind f>Xl"'("utp tIlE' Pur(~'lrl'H" AqrppnlPnt nn l1phal1 ot thp
C 1 t y; c; u t) ) p c t tot t1 p to I i ow 1 n g :
- 1 -
.
.
,/
SJ"'t
t i'l i
'j'hp aryl) reg,ll e pr 1 nf" 1 pa I
amount at CprtltlrRtps
torth In parRgrnph 1
ot
thp Pur(hri~p Aorppmpnt c;hrlll
..}
OP t'hp
"
amount qpr torth 1n ~f'.tIon 001 ot thp 'I'ruc;t A<J' eempnt t'plat Ing
to Alrport ,"rt\'llltlec;; di'ltpd ac; of Octohpr 1, lYH~.f hy ,Ind F1Hlonl.
the Clty; thp above named 'l'rllstpe and SP\lHIty parltlc NatlOni'lJ
Hank} .=loel srlFll1 bp not 1 PSS than S 1; YHO J nno
I h I Thp pur cha<;p prlcP ot the Cprt lit l.atpc; flPt torth 1 n
Parrll]r dph 1 01 thE> t'ur'chasp AgrpPTllt-'nt c;tlall [)f> 110t I Pc;q ;- I'dn
96-1/2% ot t.hp ageJyegatp par valup at t.hE'" Certltlcates.
'I'hp I-'Ll(('h,:lRP AgrpPlOpnt may bp mOdltJPl1; prior tll It<,
expcutlon and dpjlvery} by thp CIty Managpr wlrh t.hp advlcP ot
thp Clty Atto-r-npy; provlch>d Ih...t ~Llch Hloejltl\'atlon IS ronRl<-'lPnt
wlth thp ec;c;pntlal terms thereot and WIth thp llmlt.atlQnC; set
torth abovp.
'l'hP (;1 ty ManrHJf'r' q apprOVA I ot '>llr-h mod It 1 cat lon',
e;hRIJ hp concluslvply pst,:lhllshpd by hIS execut10n of thp
t'llrrh;lse AgrpPlnpnt_
h t<:C'I' lON 2
'l'l).f> MRyor) Clty Milnagf"rj Clty Clpr\(J ann other
ottlrlr:llc; ot the CIty arp hE"tPby C1u,hor17pd ,:Inn c11rpctpd tu
eXf'f"llte ~uch othf'r agr ppmf'nt s, documente;, ;H1\1 cer tIt 1 cater; ac; mrty
be rpc!'llrpn t)y thE> Purcha5P Agrr,pmpnl- or nthf"YWlc;P nprp<;qilry to
E'ttpc:t Ite; [llltpoC;P.
!
ht<.C'l'J'ON i
/
Thp Prp]mlnary Ott~Clal ~tntempntJ datpd ac; ot
Octobpr )2, lYH~} relatlng to tt1e Cf'rtltlriltp~ or J-'.Jrtlf"lpat lon,
c;uhstantlal Jy 10 the torm prpc;ented at
th~c; mpf"tlno.
..} I
1S herpby
approvpo tor 115P hy thp lJnoprwr-ltpr In thp ot1prlng and '>Aip to
- /. -
.
.
thE> nuh 11 r ot
L
thp CprtltlC'<itps_
To
thE> rH:.si
of
th15 Clty
J
/
/
/
Counrl!'q knowlf"ogpj lr'ltormrltlon; ano bE"llef; thp Prpllm1nary
() t t 1 r 1 i'l I ~ tat f' rn p n t r 0 n t in n <; no un 1 t- II P ... tat f> m p n tot it m ii t {. ~- 1 A 1
tArt wlth rf"c,pprt to t.hp Clty; nor onp<; 1t omlt to st<'ltf> (l
mat p r 1 ii I t A c: t W 1 t h r p <; r p ('" t t 0 1 h f> C I t Y r p qUI r p c1 t 0 h p 5 1- .. t P ,I
whf'rp nprp<;sRry to makp a qtatpmpnt not m1<;]Pao1nq 1n thp Ilght
ot thE> C'lrrllm<;t<incPS unrlpr whlrh 1t wac; m..H1E"
SI-C'I'ION 4_
'I'hp CIty Mana<)f'r 15 Fluthor17f>rl tn .:l;pprovp
rorrpct1on<; .:l;nrl iiorlltlOn<i to ih? PlPlmlnrlry OftlCl"1l ~1~Fltpmpnt by
<3upplpmpnt or Flmpnrlmpnt
thprpto.
I
or ot herW1 <iP aq appropr 1 atp J
provH1pd t hat any 5urh rorrprt 1 on,> or ..locl1 t 1 on5 ,,;h..11 I OP
nprp5<;ary to CaU<3p thp lntormi'ltlon contalnpd thprPln t.o C'ontorm
WIt h t rI r: t <; m ci t P r' I ."lIt 0 c, II C' h LP r t 1 t 1 r rl t P S 0 r tot tl f" rH- 0 r p P d PH) sot
thp CIty; or thrlt <;urh cnrrprt10n<; or aodltlnn<; rplatp to torm
rathf"r than <;uh<;trlnrE".
S to.C'!, ION ,_
'I'hp Clty MilnAl)pr 1<; authorl7pd and d1rprtf"O to
call'>p thp Prpllrnlnrtry Ottl,lal :-:.trltpmpnt to tH~ morlltlPo Into tht'
torm ot a ~ln"ll Ot11clal Htatpmpnt ann to pxpC'utp <;<'Ilrl Flnal
OttlC'lal ~tatf'ment} datpo as ot th? (jrltp nt thp Clty'C; f'XPf"LJt10t.
ot t_ht" Pll r ..hn gp AlJrf'pmf"n t
3 -
.
.
~I-C.'I'ION n
'I'hl'" Clty Clf"rk o;h<'lll rprtlty to thp <l.dopt1on ot
thlC; f,lPc;olllt1on ,'Inri thpnrptor-th .-Jon thprpi'll tp.r the <:;rime c;h<=l.ll hp
1n tul I torcp and pTtprt
APPH()V~l) A~ '1'0 ,,'OHM;
~\.a........\r
------ - ------ --0--""""'- -- -- -
HOHI-:f,l'I' M. MV/-:Hh
CIty Attornpy
- 4 -
VOTE: Affirmative:
Negative:
Abstain:
Absent:
2 ~ PROOF VOTE~ WITH ANOTHER PERSO~ BEFORE ANYTHING
DiSTRIBUTIuN: ORIGINAL to be signed, -sealed and
.r::
;0
---
:;l
"
---
j)
'Jl
~
u
:::::
.-I
~
l-
o
:v
>
-l
Q)
U
C>
I--
~
o
-
>.
~
....
-
~
o
~
.....
--
-
.....
~
-
-
j...J
;j
Q)
j...J
:J)
Q)
:::l
......
--
C)
~
t)
U
.-I
j.;
H
o
<Il
>-
Q)
I:::
~
o
j...J
j...J
-<(
>-
~
...;
:~
+'.
C
('j
,j..)
;...
o
.c
o
0:::
.
.
BEFORE DISTRIBUTION CHECK CONTENT OF ALL FOR CITY C~ERKfS ACTION
DISTRIBUTION OF RESOLUTION # 7,6? ORDINANCE #
CouncIl Meeting Date /~~7 ~~~ Introduced:
/1 r fi-
;[/0
7 -- ()
Agenda Item #
Adopted:
AIl/lAYS PUBLISH AOOPTJ:ill ORDINANCES*
*Cross out Attorney's approval
Was it amended?
filed in Vault.
NEWSPAPER PUBLICATION (Date.
J
)
Department originating staff report (
Management Serv.i5e~ Lynne Barrette -urdinances only
~
Agency mentioned In document or staff report
(certifIed?)
Subject file (agenda packet) 1
Counter file 1
Others:
Airport
I
Parking Auth.
Auditorum
Personnel
Building Dept.
EnVIron. Servo
Planning
Police (en-
forcement?)
Finance
Purchasing
.
Fire
Recr/Parks
General Servo
Transportation
LIbrary
Treasurer
Manager
SEi\D F()U~ COPIES OF ALL ORDIKANCES TO:
COD!3D SYSTEMS, Attn Peter Macl'earie
12_0 Main S'tT<?-et
AV0~r ~ew Jersev_07717
SEND FOUR COPIES OF 1\LJL ORDTNANrFs TO:
PRESIDING JUDGE
SA~TA MONICA MUNICIPAL COURT
~ 72 S t-1AIN STREET
SANTA MONICA, CA 90401
*Check Code Sections before sendmg.
TOTAL COPIES
:2
.... '
.
.
J1'-
CA.RMM:JmnOH2/hpw
C~ty COUnrl \ M0Ptlng 10-l;-H~
Santa MonIca) Cal1tornlR
l.n:~OLLJ'I'ION NlJMH}<:H 7l~(CCS}
(CIty Councll Her-lesJ
A HESOLlJ'l'l ON OF THE C 1'1'Y COU Nt: I L (W 'PH b.
Cr'l'Y OF SANTA MONiCA AU'l'HOR12INC> AND
DIRECTING Cl<.H'I'AIN ACTIONS PUH.~I)AN'f '1'0
S!:<:C'L'lON 10~lKJ OF 'rH~. H/'I't-:RNAI.
H FV to NlJlo: CODE
WH~H~AS) the CIty CouncIl at thp CIty ot Santa MonIca
proposes to ~uthorlZe the .1rgulslt1on} constructlon, Rncl
tlnanr1ng ot certaIn lmprovement~ at th~ Santa Monlra MunICIpal
A1rport lthe "proJPct"JJ lnelun1ng thE> c;alp ;Jnn df>llvpry 01
C~rtltlcatf'q ot PartICIpatIon [the "Cprtltlcatpq") aq deqCrlDpd
10 that cpr-tal n 'l'ru.,t Agrppment dated as at Octobf'r 1} 1 ':H:I~, by
and among the Cl~Y) SecurIty Pacltlc NatIonaL Hank} and Bank ot
AmerIca NatIonal Trust and bavlngs As~oclatlon as 'rrust0e; and
WHKRKAS, prlor to thp delIvery ot thp CertltIcatp~ to the
purChaser thE"reot, the CIty 1.S requlre(1 hy ~f"ct.lon 10-llkl ot thp
Intern~L Rpvpnue Code ot \9~4) a~ amendpd Ithe "COdp")} to comply
WIth certaIn pUhlIC hparlng and approvRl prorpdures In nrrlpr tor
the lntere~t receIved by the ownprs or the CertIt1.Catp., to bE"
expmpt trom ypdpral Income taxp~,
- 1 -
.
e
NOW, THEREJoORE, THE cr<j'Y COUNCIL OF 'I'HE CJ'rv ()fo' SAN'fA
MmnCA DOI-:S RE:SOLVE AR ~'OLLOWS ~
SF:C<l' I ON 1.
The AIrport Ulrector sh~ll conduct a punllc
hearIng on Tue~day} October 2Y, 19H~} at 5:00 p.m. In the Councl}
Chambers, City Hall, 1685 MaIn street, ~anta MonIca, Calltorola,
on the matter of the sale and delIvery at the CertIfIcates and
the nature and locatIon of the ProJect.
At the conclUSion of
such hearIng, the AIrport DIrector shall provIde the Mayor WIth a
summary of all testImony and other eVldpnce taken at the publIC
hearIng_
SgC'nON 2.
The CIty Manager has pUblIshed a notice of such
hearIng In the torm attached hereto, marked "Exhlblt A,~ by one
Insertion on October 14} 19H~, In the EvenIng Outlook, a
newspaper of general cIrculation puhllshed 1n the CIty ot Santa
MonIca} county of Lo~ Angeles, as reqUIred by SectIon 103(k) of
the Code.
'J'he to rm of sa 1 d not 1 ce I s hereby approved} and quch
actIon of the CIty Manager IS hereby approved and ratIfIed
SEe'l' I ON 3.
The Mayor, as an elected ottlclal ot the CltYl
shall conSider the eVIdence presented at the publIC hearing and
shall promptly certIty to thIS CIty CounCIl her approval or
dIsapproval of th~ ProJect and ot th~ sale and dellvery at the
CertltIcates by executIng an approprlate Certlflcate ot Approval.
- 2 -
.
e
RECTION 4. t~he Clty Cl?rk shatl certlty to the adoptlon ot
thIS ResolutIon] and thpncetorth and thpreafter the same shall be
In tull force and effect.
APPROVED AS TO FORM:
~ "'-.'-
ROBER'I' M. MY tmS
CIty Attorney
---
~
- 3 -
-0-'
.
e
Adopted and approved thIs 22nd day of October, 1985.
PO") , // n
:~~ i-=;,- ,~ ~
- Mayor ~
I hereby certIfy that the foregOIng ResolutIon No. 7109(CCS)
was duly adopted by the City Council of the CIty of Santa Monica
at a meeting thereof held on October 22, 1985 by the following
CounCIl vote:
Ayes: Councllmembers: Conn, EpsteIn, Jennlngs, A. Katz,
H. Katz, Zane and Reed
Noes: Councilmembers: None
Abstain: CouncIlmernbers: None
Absent: Councilrnernbers: None
ATTEST:
~A~
-- CItyfClerk
or-
}:j
......
::l
'1
......
J1
if,
:ll
U
c:
~
J::
r-\
o
~
o
Q)
>
r-\
C)
U
ill
...
~
::>
:::
>.
o
-
....
~
::>
I-l
p.l
:t:
o.J
:'j
C
I-l
d
:;)
tJ
r-
III
::I
.....
~
~
~
Q
U
r-\
....
-<
o
:r.
>-
Q)
~
~
o
t-J
t-J
<:
>-
,j..J
r-I
...)
4-'
o
~
,j..J
l--<
CJ
.0
o
::::::
.
e
FOR CITY CkERK'S ACTION
ORDINA.~CE #
Introduced:
Agenda Item It
Was it amended?
Adopted:
AIJ..JAYS PUBLISH AOOPl'w ORDINANCES*
*Cross out Attorney's a~roval
~
VOTE: Affirmative:
Negative:
Abstain:
Absent:
PROOF VOTE~ WITH ANOTHER PERSON BEFORE A~WTHIKG
iJISIKIBUIIuN": vRIGINAL 1:0 be signed, sea:i~a and filed In Vault.
NEWSPAPER PUBLICATION (Date:
)
)
Department orIgInating staff report (
Management Serv.~se~ Lynne Barrette -urdinances only
~
Agency mentioned In document or staff report
(certi fied?)
Subject file (agenda packet) 1
Counter file 1
Others:
Airport / ParkIng Auth.
Audltorum Personnel
Building Dept. Planning
EnVIron. Servo Police (en-
forcement ?)
FIn.ance
Purchasing .
Fire
Recr/Parks
General Servo
Transportation
Library
Treasurer
Manager
SEND FOU~ COPIES OF ALL ORDINANCES TO:
CODfD SYSTEMS , At tn pe't er Mac fe a r ie
l~O Main r~r~et ~
AVO~1 ~~w Jersey_07717
SEND FOUR COPIES OF ALTL ORDTNANr?5 _to:
PRESIDING JUDGE
SANTA MONICA MUNICIPAL COURT
1725 MAIN STREET
SANTA MON~CA, CA 90401
*Check Code Sect~ons before sending.
TOTAL COPIES
_5
.
e
.!':l<_HJ1LL'L ~
fJlJ KI.I L NO'J' J Cl<: ()(o' I-'HOI-'()io~.1) .. I NANe I N(; Or
I M PHOV Io,M 10; N'I'~ AT SAW!' AMON 1 CA Mil N r c IlJ A l. A I H POWI'
NO'I'IC"~ IS Hl<Hf-HY (;IVf-.N that ih@ Clly ot Santi! MonlC"',q Villi
cnn~ldpr pntprlnq Into A I.p,q~p Agrp@mpnt rpliltlng to A1rport
FilCllltlP~ ."loci othpr cnntrilctlli11 arrilrl\.lpmpnl<;7 <'Ino thp <.,nlp nnc,
c1pl1vpry on ]t"O bf'halt ot Cprt1tlCi'ltP<; ot lJartlc1pt'ltlon 1n n
prlnClpill afTlllllnt not to f>X,f"PO S'-);OOO,()(lO 10 tlnancp thf> ro.;t 01
<;u,h IoArl1111PC;-
'J'hp ".'1< I III 1 P~ WI I I ron";l ,,;, ot an approx I milt E" I Y 71 j OOU
$ n II n r P too I A I f 00 r tAd Tn 1 n I <; If .-I I I on H II I I c1 I n 1I n no And no r oX 1 m.-l t @ I '-I
:;!. J,. ~ 1. :.. ..r.
4H 000 C;OlJi'lrp toot Al r>rriltt Ht'lnOAr to hF' 10r.'itE"o ]n thp
, I
<;Outhpfl<;tprn portlon ot thp Altl)Ott south ot thp rlln'WrtY ;,no 10 bf'
lpa<;po; o[H"ratpd; .'ino lJltuniltply ownp-cl by thp. Clty
A ~)lJhI1C h@i'lr1nq 1<; tlPlng hplrt pur<;ll<lnt to ~!-"rtl()n 10Hkl
01 thp Lntprni'll HpvpmJP CocJf' i'lnO Rpglllo'l:tlon<; ot thp Dppflrtmpnt ot
thp 'l'rpi:l<;llry lc;c;upd ttlprPLJnopr to pP1mlt per'~(Jn~ to r:ommf>f1t' on
thp l~~Ui'lncp ot thp Cprtltlratp~ ot PRrt1rlpdtlon ano thp naturp
iino locatlon of thp r'A.r:l J1tIPS. 'I'hl? hP;:JrlrH] wl\1 hp hpj(1 hy thf
C 1 t Y 0 t ~ .q n t il M 0 n 1 C' i'l II t ,: (J II P _ m 0 n '1' U f" ~ 0 A Y, 0 (' t 0 h p r 2 Y J 1 q H , 1. r'l
thp City Counrll ChillTltl!-"rs; ('lty H.-ill) 1hH'1 Milln Strppl, Spconc1
Floor S.lntd MonlC'.'i] C.'I11torrna; Y0401-31Y,
,JOHN .IAI, 11.1; C1 ty M;:tn<'lt)pr-
.
.
611 {ht+- A-
~uu ,oq....... ........--.....
PUBUC NonCE OF PROPOSED
FL~ANClNG OF IMPROVEMENTS
AT SANTA MONICA
MUNICIPAL AIRPORT
NOTICE IS HEREBY GIVEN that
the City of Santa MOnica will con-
Sider entenng moo a Lease Agree-
ment relatmg to AIrport Fac1l1hes
and other contractural arrange-
ments, and the sale and dehvery on
Its bebaH of Certlflcates of
Participation m a pnnclpal amount
not to exceed $5,000.000 to (mance
the cost of such FacIlities
The Faclhues will consist of an
approxImately 21,000 square foot
airport administration buddmg and
an approximately 48,000 square foot
aIrcraft hangar to be located m the
southeastern portlOll of the airport
south of the nmway and to be leased.
operated and ultunately owned by
the Cltv
A pubhc hearmg IS bemg held
pursuant to Section l03(IU of the
Internal Revenue Code and Regula-
tIOns of the Department of the
Treasury Issued thereunder to
permit persons to comment on the
Issuance of the Certificates of
PartiCipatIOn and the nature and
location of the FacilIties The hear-
mg will be held by the City of Santa
Momca at S 00 PM on Tuesday,
October 29. 1985 an the City Counell
Chambers, Cltv Han. Ui85 Mam
Street, Second Floor, Santa Momca,
CalifornIa SOfOl-3295
JOHN JAUU,
Clty Manager
Pub Oct 14-1985
~
I
e
.....-,
.
'J
(
I
~
.
~
J
I
!
f
i
i
~
(
w
.
!
I
f
..
i
~
.
~
r
f,
f
,
~
t
.
.
11679 00000002/083975-L
ASSIGNME~ AGREEMENT
RELATIKG TO AIRPORT FACILITIES
THIS ASSIGKME~T AGREEMEKT RELATIKG TO AIRPORT FACILITIES is made and
entered ~n~o as of the 1st day of October, 1985, by and between Security
Pac~f~c Nat~onal Bank, a natlonal bank~ng assoc~atlan (hereln called
"Lessor"), and Bank of Amerl.ca Nat10nal Trust and Savings Assocl.atl.on. a
nat1.onal trust and savl.ngs assoc1.ation (herel.n called the "Trustee").
WIT~ESSETH
In the Jo~nt and mutual exerC1se of the1.r powers, in consl.derat1.on
of the mutual covenants hereln conta1.ned. and for other valuable consld-
erat10n, the part1es hereto reC1.te and agree as follows:
SECTION 1
Ree1.tals.
(a) Lessor and the C1.ty of Santa Monica (the lICity") have
entered lnto a Lease Agreement Relat1.ng to Alrport FaC11ltles, dated as
of October 1, 1985 (the "Lease Agreement"), ,,'hereby Lessor has agreed to
lease to C~ty, and C1.ty has agreed to lease from Lessor. the fac11ities
more partlcularly descr1bed l.n the Lease Agreement (the "Fac.:llities"), to
be constructed on that certaln real property more partIcularly described
In Exhlblt A attached to the Lease Agreement (the "Slte"). 1D the manner
and on the terms set forth in the Lease Agreement.
(b) Upon execut10n and delIvery of the Lease Agreement, Lessor
or 1tS a5s~gnec 15 required to depo5~t or cause to be depos1ted w~th the
Trustee certaln sums of money to be credIted, held and applled In
accordance wl.th a Trust Agreement Relatlng to Airport faC111t1es by and
among the Trustee, Lessor and the C1ty dated as of October 1. 1985 (the
"Trust Agreementll)
(c) Upon del1very of the Lease Agreement and the depos1t of
moneys by Lessor or 1ts ass1gnee pursuant thereto, C1ty IS obl1gated to
pay certa1n Lease Payments to Lessor or its aS5:lgnee. For the purpose of
obtaining the moneys requIred to be depos~ted wlth the Trustee, Lessor 15
willl.ng to assl.gn and transfer l.ts rIghts and Interests under the Lease
Agreement to the Trustee for the benefIt of the owners of the
certIflcates of partlcipatlon (the "Cert:lficates") to be executed and
dell.vered under the Trust Agreement, and 1n conSIderatIon of such
assl.gnment. the Trustee 15 executl.ng, delIverIng and seIIl.ng such
Cert1.fIcates to the purchasers thereof, the proceeds of WhICh sale are
antlc1pated to be suffICIent to provlde the moneys requ1red to be
deposl.ted by Lessor or 1ts aSSIgnee pursuant to the Lease Agreement.
.
.
(
(d) Each of the part1es has author1ty to enter 1nto ~h1s
Asslgnment Agreement, and has taken all actIons necessary to author1ze
its offlcers to enter 1nto 1t.
(e) The terms capltallzed 1n thls Asslgnment Agreement but not
deflned herein shall have the meanlngs glven to them in the Lease Agree-
ment and the Trust Agreement.
SECTlOl'; 2
ASSIgnment.
Lessor, for good and valuable conslderation 1n hand recelved, does
hereby lrrevocably sell, assign and transfer to the Trustee, for the
beneflt of the o~ners of the Certif1cates, all of ltS rlghts and lnterest
ln the Lease Agreement, lncludlng its rIghts to receive Lease Payments
from City under the Lease Agreement, and the rlght to exercise such
rlghts and remedles as are conferred on Lessor by the Lease Agreement as
may be necessary to enforce payment of such Lease Payments when due or
otherw1se to protect ltS Interests upon an Event of Default by Clty. The
Lease Payments shall be applled, and the rlghts so asslgned shall be
exercised, by the Trustee as provlded ln the Trust Agreement. Title to
the FaC1l1tles and the leasehold lnterest ln the Slte shall remaIn vested
in Lessor throughout the term of the Lease Agreement; provlded, however,
that upon an Event of Default under the Lease Agreement Lessor shall,
upon request of the Trustee, transfer tltle to the Facllltles and such
leasehold lnterest to the Trustee lf the Trustee deterrolnes that the same
is necessary In order to enable the Trustee to comply w1th Sectlon 703 of
the Trust Agreement
SECTION 3. Acceptance.
The Trustee hereby accepts such ass~gnment ~n trust for the purpose
of securlng such payments and r1ghts to the owners of the Cert1ficates
dellvered pursuant to the Trust Agreement, and subject to the provlslons
of the Trust Agreement.
SECTIOK 4. Cond~tlons.
ThlS Asslgnment Agreement shall confer no rlghts and lmpose no
dutles upon the Trustee beyond those expressly provlded ln the Trust
Agreement. The Trustee 1S not responsible tor the rec~tals herein
contalned
SECTION 5. Counterparts.
Th1S Asslgnrnent Agreement may be executed in counterparts and each
of sald counterparts shall be deemed an orlg~nal for all purposes of thlS
2
.
.
-;
Agreement All of such counterparts taken together shall be deemed to be
one and the same lnstrument.
IN WITKESS wHEREOF. the partles have executed this Assignment Agree-
ment by thelr offlcers thereunto duly autborlzed as of the day and year
flrst wrltten above.
LESSOR
SECURITY PACIFIC NATIO~AL BAKK
By
Vlce Presldent
By
Vlce Presldent
TRUSTEE:
BA~K OF A~ERICA NATIOKAL TRUST
ASD SAVIKGS ASSOCIATION
By
Vlce P-l"esldent
3
.
.
STATE OF CALIFORKIA
)
) S5
)
COC'~TY OF
On th~s
Oc~ober, ~n the year 1985, before me,
, a notary publlc, personally appeared
, personally known to me (or
sa~~sfac~ory ev~dence) to be the persons who
and
{Lessor] and acknowledged to me tha~
[Lessor] executed ~t.
day of
and
proved to me on the bas~s of
executed th1S 1nstrument as
of the
O\otarla1 Seal)
Kotary Pub11c In and for said
County and State
My commlSS10n explres
4
.
.
ASSIGN~EKT AGREEMENT
RELATING TO AIRPORT FACILITIES
by and between
SECURITY PACIFIC NATIO~AL BANK,
As Lessor
and
BAKK OF A:lliRICA KATIO\AL TRUST A~D SAVINGS ASSOCIATION,
as Trustee
Dated as of October I, 1985
.
.
TABLE OF COKTEKTS
Page
Sectlon 1 Recitals 1
Sectlon 2. Ass1gnment 2
Sectlon 3 Acceptance 2
Sect:lon 4. Cond1.t:lons 2
Sect:lon J. Count.erparts 2
(1)
.
.
AGENCY AGREEMENT
by and between
SECURITY PACIFIC NATIONAL BANK
and the
CITY OF SANTA MONICA
Dated as of October I, 1985
(PERTAINING TO THE LEASE AGREEMENT
RELATING TO AIRPORT FACILITIES)
.
.
11679 00000002/091002-L
AGENCY AGREEMENT
Th~s AGENCY AGREEMENT ~s made and entered ~nto as
of October 1, 1985, by and between SECURITY PACIFIC NATIONAL
BANK, a nat~onal bank~ng assoc~at~on duly organlzed and
ex~st~ng under and by vlrtue of the laws of the Unlted States
of Amer~ca (the "Corporat~on"), and the CITY OF SANTA MONICA,
a charter clty and rnuu1c1pal corporat1on duly organ~zed and
eXlstlng under and by v~rtue of the Constltutlon and laws of
the State of Callforn~a (the "C1ty").
WIT N E SSE T H :
WHEREAS, the Corporat1on and the C1ty have entered
~nto a Ground Lease dated as of October 1, 1985 (the "Ground
Lease"), whereby the C1ty, as lessor, has agreed to lease the
preml.ses descr1bed thereJ.n (the "Slte") to the Corporat1on,
as lessee, as prov~ded there1n; and
WHEREAS, the Corporat1on and the C~ty have entered
~nto a Lease Agreement Relat1ng to A1rport Facl.ll.t1es dated
as of October 1, 1985 (the "Lease Agreement"), whereby the
Corporat~on, as sublessor of the Slte and lessor of the
Facl1J.t~es (as that term 1S def1ned l.n the Lease Agreement),
has agreed to sublease the Slte and lease the Fac~ll.t~es to
.
.
the C~ty, as sublessee of the S~te and lessee of the
Fac~11t~e5, as provlded there1nj and
WHEREAS, under the Lease Agreement, the Corporatlon
15 obllgated to procure flnanc1ng for, and to construct and
lnstall or cause the constructlon and lnstallatlon of the
Fac~11t1e5 ~n accordance w1th plans and spec1flcatlons
approved by the C1ty, and the C1ty 1S obllgated to make
rental payments to the Corporat1on for the sublease of the
Slte and lease of the Fac~1~t1esi and
WHEREAS, the Corporatlon, pursuant to an asslgnment
agreement dated as of October 1, 1985 (the "Ass1gnment Agree-
ment"), by and between the Corporat1on and Bank of Amer~ca
Nat10nal Trust and Sav1ngs ASSOc1at1on, a nat10nal trust and
savlngs a5s0c~atlon duly organ1zed and eXlsting under and by
vlrtue of the laws of the Un1ted States, as trustee (the
"Trustee"), has ass1gned wlthout recourse all lts r.1ghts to
recelve such rental payments and certa~n other r1ghts to the
Trustee for the beneflt of the owners of cert1flcates of
partlc1pat~ on (the '.Cert1 flcates") Wh1Ch are to be executed
and dellvered under a Trust Agreement, to be entered lnto by
and among the Trustee, the Corporat1on and the Clty dated as
of October 1, 1985 (the "Trust Agreernentll)j and
WHEREAS, all acts, condlt1ons and th1ngs requlred
by law to eXlst, to have happened and to have been performed
precedent to and 10 connect1on wlth the execut10n and
2
.
.
enterlng lnto of thlS Agency Agreement do eXlst, have
happened and have been performed ln regular and due tlme,
form and manner as requlred by law, and the partles hereto
are now duly authorlzed to execute and enter lnto thls Agency
Agreement;
NOW, THEREFORE, IN CONSIDERATION OF THE PREMISES
AND OF THE ~mTUAL AGREEMENTS AND COVEN~~TS CONTAINED HEREIN
~~ FOR OTHER VALUABLE CONSIDERATION, THE PARTIES HERETO DO
HEREBY AGREE AS FOLLOWS:
SECTION 1. Clty to Act as Agent.
The Corporatlon hereby lrrevocably appolnts the
Clty as lts agent ln connectlon wlth the deslgn, constructlon
and lnstallatlon of the Facllltles ln accordance wlth such
plans and speclflcatlons, bld documents and purchase or other
agreements as shall be approved, entered lnto or contracted
by the Clty, lncludlng, wlthout limltatlon, the preparatlon
and flllng wlth the Trustee of certlflcates requestlng dlS-
bursement pursuant to Sectlon 402{b) of the Trust Agreement.
The Clty, as the agent of the Corporatlon, shall cause such
constructlon and lnstallatlon of the Faclllt1es to be com-
pleted as soon as 15 reasonably practlcable and ln accordance
wlth the Ground Lease, the Lease Agreement and the Trust
Agreement and any appllcable requlrements of governmental
author1tles and law.
3
.
.
f
SECTION 2. Acceptance.
The C1ty, for one dollar ($1.00) and other good and
valuable conslderatlon In hand rece1ved, hereby accepts the
foregolng appolntment as agent of the Corporatlon for the
purposes set forth 1n Sect10n 1 hereof.
SECTION 3. D1scla1mer of the Corporat1on.
The C1ty acknowledges and agrees that the type and
des1gn of the FaCllltles have not been selected by the Corpo-
rat1on, that the Corporatlon has not supplled any speclflca-
tlons wlth respect thereto and that the Corporatlon (a) 1S
not a manufacturer of, nor a dealer ln, the Facllltles or
slm1lar proJects, (b) has not made any recommendatlon, glven
any advlce nor taken any other act10n w1th respect to (1) the
chOlce of any suppl1er, vendor or deslgner of, or any other
contractor wlth respect to, the Fac1l1t1es or any part
thereof or any property or r1ghts relat1ng thereto, or
(11) any act10n taken or to be taken wlth respect to the Slte
or the Fac111t1es or any part thereof or any property or
rlghts relat1ng thereto at any stage of the deslgn,
construct1on, 1nstallatlon or operat1on thereof, and (c) has
not made any warranty or other representatlon, express or
lmpl1ed, that the Slte or the Facll1tles or any part thereof
or any property or rlghts relatlng thereto (1) W1ll not
result 1n or cause 1nJury or damage to persons or property,
(11) has been or w1ll be properly des1gned or constructed or
4
.
.
wlll accompllsh the results WhlCh the Clty lntends therefor,
or (lll) lS safe In any manner or respect.
Except as speclflcally provlded In the Ground
Lease, the Lease Agreement, the Asslgnment Agreement and the
Trust Agreement, the Corporatlon makes no express or lmplled
warranty or representatlon of any klnd whatsoever wlth
respect to the Slte or the Facllltles or any part thereof In
connectIon WIth the sublease of the SIte and lease of the
FaCIlltles to the CIty, the use thereof by the Clty or any
other CIrcumstance whatsoever, 1ncludIng but not llmlted to
any warranty or representatIon WIth respect to: the mer-
chantabIlIty or the fItness or sUItablllty thereof for any
purpose; the deslgn or condltlon thereof; the safety, work-
manshlp, qualIty or capac1ty thereofi complIance thereof WIth
the requlrements of any law, rule, speclflcatlon or contract
pertaInIng thereto; any latent defecti the leasehold tltle to
or lnterest of the Corporatlon therein; the abIlIty thereof
to perform any functIon; that the proceeds derlved from the
sale of the Certlflcates WIll be suffICIent to pay the cost
of constructIng and InstallIng the FaCIlItIes; or any other
characterIstIc of the SIte or the FaCIlItIes; It beIng agreed
that except as set forth 1n the Ground Lease, the Lease
Agreement, the ASSIgnment Agreement or the Trust Agreement
all rIsks, costs or expenses relatIng to the Ground Lease,
the Lease Agreement, the SIte or the FaCIlItIes or the
5
.
.
transactlons contemplated hereby or by the Ground Lease, the
.
Lease Agreement, the Asslgnment Agreement or the Trust
Agreement, are to be borne by the Clty, and the beneflts of
any and all lmplled warrantles and representatlons of the
Corporatlon wlth respect to the Slte or the Facl1ltles are
hereby walved by the Clty.
The Clty acknowledges and agrees that the Clty as
agent hereunder accepts all responslblllty for preparlng and
flllng wlth the Trustee certlf1cates reguestlng dlsbursement
pursuant to Sectlon 402(b) of the Trust Agreement. The Cor-
poratlon makes no express or lmplled warranty or representa-
tlon of any klnd whatsoever (and dlsclalms any and all
llablllty) wlth respect to the preparatlon, f111ng,
completeness or accuracy of such certlflcates, and the
beneflts of any and all lmplled warrantles and represen-
tatlons of the Corporatlon wlth respect to such certlflcates
are hereby walved by the Clty.
SECTION 4.
Indemnlty.
The Clty hereby lndemnlfles and agrees to hold
harmless the Corporatlon and lts offlcers, dlrectors, agents
and employees, and thelr successors, helrs and asslgns, and
each of them, from and agalnst any and all clalms, demands,
llens, 11abl1ltles, obllgatlons, losses, damages, penaltles,
actlons, Judgments, orders, sUlts, causes of actlon, obllga-
tlons, controversles, debts, damages, costs, expenses or
6
.
.
d1sbursements (includ1ng, w1thout llmltatlon, reasonable
attorneys' fees) that may be imposed on, 1ncurred by, or
asserted aga1nst the Corporatlon by the C1ty or any thlrd
party, WhlCh ln any way relate to or arlse from the City's
actlvltles as Agent pursuant to thlS Agreement and any act,
transactlon, occurrence, cert1flcatlon, representatlon, error
or omlSS1on of the C1ty alleged ln connact1on therewlth.
7
.
.
IN WITNESS WHEREOF, the partles hereto have exe-
cuted and attested thlS Agency Agreement by thelr officers
thereunto duly author~z~d as of the day and year flrst wr2t-
ten above.
SECURITY PACIFIC NATIONAL BANK
By
Vlce Pres2dent
By
Vlce Presldent
(SEAL)
APPROVED AS TO FORM~
Clty Attorney
CITY OF SANTA MONICA
By
C~ty Manager
(SEAL)
Attest:
C2ty Clerk
8
.
.
LEASE AGREE:1EJ',l'
RELATING TO AIRPORT FACILITIES
by and between
SECCRITY PACIFIC ~ATIO~AL BA~~t as Lessor
and
CITY OF SA\l'A HONICA, as Lessee
DaLed as of October It 1985
101.
102.
103
104
105.
106.
20l.
202.
30l.
302
303
304.
305.
306
401.
402.
403
404
405.
406.
407
408.
409
.
.
TABLE OF CO~TENTS
ARTICLE I
RECITALS
Status and Powers of Lessor ..... . . .. ... ........
Stat.us and Powers of Clt.y .. .. ...... ..... . . . . .. ..
Purpose of Agreement .... ... ..................
Issuance of Cer~lflcates ....... ..... ..... ........
Related Agreements ....................................
Constructlon of thlS Agreement .. ... . . . . . . .. ..
ART! CLE I I
DEFI~ITIOKS A~D GENERAL PROVISIO~S
Definltlons In General .
Rules of Constru~tlon
ARTICLE III
RIGHT OF E~TRY, COKSTRCCTIO~ OF FACILITIES
Deposlt of Moneys ... ... . ...... .....
Ground Lease of Slte .. ... ... ..... .....
Rlght of Entry . .. . . . .. . .... .. ..
Constructlon of FaCllltles .. .. ... .... .... .......
Payment of Dellvery Costs .... . . .. ... .....
Unexpended Moneys . . .. ... ... . . .
ART! CLE IV
LEASE OF FACILITIES AKD SUBLEASE OF SITE; LEASE PAYMENTS
Term of Agreement ......... . . . .. .. .... . . .
Sublease of Slte and Lease of FaCllitles ... ......... .
Lease Payments . . . . . . . . . .. ....... .. ...... ..... . .
Prepayment of Lease Payments .... . .. ...... ..... ...
Interest Component ..... .. . ..... .... . " ........
Payment ln Lawful ~oney; No Set-Off ...... .' ..........
Covenant to Budget and Approprlate " .... ............
Secur i ty Depos 1 t .... . . .. ..... . . .. ....
Ground Leas e . ... . . . . ........ .. . . ......
1
Page
1
1
1
1
2
2
3
6
7
7
7
7
8
B
10
10
10
11
13
13
13
13
14
501.
502.
503
504
505
506.
507.
508.
509
510.
511.
512.
513
514
515
516.
517.
518.
519
520
521
522.
523.
524.
525.
526
527.
601.
602.
603.
604
605.
606.
.
.
ARTI CLE V
COVE~A~lS
Improvements .. .. ...... .. . . . .. ..... .............
Ma~ntenance and Ut~l1.tl.es ... ..... ..................
PublIc Ll.abJ.1ity Insurance ....... . .. .. .... .....
Workers' Compensatl.on Insurance .. .. .. ...
Fl.re and Specl.a1 Extended Coverage Endorsement. .. ...
Rental Interruptl.on Insurance. .. ....... ........... .
Form of Insurance POll.CleS, Delivery.. ... .. .. ... .
Appll.cat~on of Net Proceeds of Insurance. ., ...
T1tle Insurance. .. ... ... .... ..... . ..... .
Appll.catl.on of ~et Proceeds of Title Insurance
or Condemnation .. ..' " .' ... ......... . . . . . . . .
Payment of Lease Payments ........ .....
Compl1ance wlth thl.s Agreement . '" ..... . .. ......
Payment of Taxes . . .. .. .. . .. .' ...
Observance of Laws and RegulatJ.ons .. .. .., .. ......
Mal.ntal.n and Preserve the Facl.l1t1es ....... .... ......
Other Llens .. . . .. ..... . . . . .. .. .. ... ...... ..
Aga~nst Encumbrances or Sales. . . . . . . . . . . ...... .
Prosecut1on and Defense of SU1ts ...... ..... .....
Recordat1on and Flllng . ...... ....
Wa1ver of LawS ... ...... ......... .., ..... ....
Compliance ~l.th Condl.tl.ons Precedent ..... ...
Power to Enter lntO Agreement ..... .. .. ..
Further Assurances ... . . . . .. . .......... ..... ..
F1nanclal Reports . ... .. ... ..................
Lessor Not Ll.able . . . . .. .. .... .. .... ....
Net Lease .. . . . . .. ............ ....
Trus tee Fees .... .. ...... ...... . . . .. ...
ARTICLE VI
DISCLAIMER OF WARRANTIES; ASSIG~~~7, SUBLEASING;
ACCESS; AMENDME~l
Dl.scla1mer of Warranties ......... .. .............
Assignment by Lessor .... ..... ............ .. ......
Assignment and Subleasing by City. ..... .... ........
Transfer of Tax Benef1ts .... ..... ..... .... ........
Access to Site and the Faclllt1es .. .... .............
Amendment .., .. .. ...... ..... ...... .. ............
i1
Page
15
15
15
15
15
16
16
16
17
18
19
19
19
19
20
20
20
21
21
21
21
22
22
22
22
22
23
24
24
24
24
25
25
70l.
702.
703.
704.
705.
706.
801
B02.
B03.
B04.
B05.
B06.
B07.
B08.
809.
BlO.
Bll.
B12.
.
.
ARTICLE VII
EVE~lS OF DEFACLT A~D REMEDIES
Events of Default ...... .. .. .. . . . . . . . . .. ........
Remedl.es on Default . ......... . .. .. .. .. ... .. ..
SU1ts at Law or 1n EqU1ty and Mandamus .......... .....
Non-Wal.ver ...... .. ....... ............ .. .........
Remedl.es ~ot Exclus1ve ........ ...... .........
Status Quo Ante . . .. .. .. .. .. ...... .. ..
ARTICLE VIII
AD~nKISTRATIVE PROVISIONS
Preservat10n and Inspect10n of Documents
Part1es of Interest ..._.... ............
~o Recourse Under Agreement ... ..... ... ......
Not~ces .. .. ... .. . .. ..... .........
B~nd1ng Effect ............ ...
Severab11~ty ....... ........ ........
Headl.ngs . _. ... _ . . . . . . . . . . . . . .. ..
Apphcable Law . . . . . . . . .. ..... . . ..... .....
Lessor and C~ty Representat~ves . ..... ...............
Further Assurances... .. ..... ...... ..........
Form of Cert~fl.cate of Off~cers ...... ......
Bus 1ness Days .... _ . . . . . . .. . .. ... .. .. ..
Exh~b~t A
Exh~b~t B'
Descr~pt1on of S~te
Lease Payments
i11.
Page
26
27
28
29
29
29
30
30
30
30
31
31
31
31
31
31
32
32
.
.
11679 00000002/089266-L
LEASE AGREEMENT
RELATI~G TO AIRPORT FACILITIES
THIS LEASE AGREEME~l RELATI~G TO AIRPORT FACILITIES is made and
entered into as of October 1, 1985, by and between SECURITY PACIFIC
I\ATIOKAL BA:--rK, a national banb.ng assoclatlon (herein called ItLessorll),
and the CITY OF SAKTA MOKICA, a munlclpal corporatlon organ1zed and oper-
atlng under the laws of the State of Callfornla and the C1ty Charter
(hereln called "Clty").
WITNESSETH:
In consideratlon of the mutual covenants here1nafter contalned and
for other valuable cons1derat1on, the partles hereto hereby agree as
follows
ARTICLE I
RECITALS
101 Status and Po~ers of Lessor. Lessor 1S a nat10nal banking
assoc1at10n duly organ1zed and val1dly eXlstlng under the laws of the
Un1ted States and has full power, author1ty and legal right to enter lnto
and perform its obl1gat10ns pursuant to th1S Lease Agreement.
102 Status and Powers of Clty Clty is a charter Clty and municl-
pal corporatlon organlzed and operatlng pursuant to the laws of the State
of Callforn18 and the C1ty Charter and 1S author1zed by Californla Gov-
ernment Code Sectlon 37350 to acqulre and lease property for the common
benef1t and in furtherance of 1ts publ1C purposes.
103. Purpose of Agreement. Pursuant to the "Ground Lease" (as here-
lnafter deflned) by and between Clty, as lessor, and Lessor, as lessee,
Clty has demised and leased to Lessor, and Lessor has taken and hlred
from Clty, the "Slte" (as herelnafter deflned). In order to provlde for
its governmental and proprletary needs and ~n furtherance of ~ts publ1c
purposes, Cl.t:y des~res to sublease the Slte and lease the "FaClllt1es"
(as here1nafter defined). Lessor 15 able and wll11ng, for adequate con-
sideratlonl to sublease the Slte and lease the Facllltles to C1ty.
104. Issuance of Certlflcates. Certiflcates of partlcipation (the
"Certlf1cates"), representlng the d1rect and proportlonate interests of
the reg1stered owners thereof In payments to be made by C1ty as rental
for the Site and the Faclllt1es pursuant to this Agreement, will be
.
.
lssued and de11vered pursuant to a Trust Agreement Re1atlng to Alrport
Faclh.tles, dated concurrently herewlth (the "Trust Agreementtl), by and
among Clty, Lessor and the trustee under the Trust Agreement (the
"Trustee")
105 Related Agreements. The partles hereto acknowledge the fo11ow-
lng agreements and hereby approve of. and consent to, the terms thereof:
(a) the Asslgnment Agreement pursuant to which Lessor asslgns
all of lts rights and interest 1n this Agreement to the Trustee. and
(b) the Trust Agreement pursuant to Wh1Ch the Trustee, Lessor
and City agree to lmplement this Agreemen~ by providing for the de1lvery
of the Certlflca~es, for the admlnlstration of funds and for the exerC1se
of rlghts and remedles.
106 Constructlon of This Agreement. Except1ng the ob11gatlon to
acqulre, construct and lnsta11 the FaC11ltles as provlded 10 Sect10n 304
hereof, for all purposes of thlS Agreement, reference to the "asslgnee"
of Lessor means the Trustee actlng on behalf of the Owners of the Cer-
tlflcates dellvered pursuant to the Trust Agreement. So long as the
Asslgnwent Agreement shall be 1n effect, references hereln to Lessor or
lts asslgnee shall be deemed to also refer to the Trustee as asslgnee of
Lessor
2
.
.
ARTICLE II
DEFI~ITIOSS AND GE~ERAL PROVISIONS
201. Def~n~t~ons ~n General. The terms def~ned ~n th~s Section 201
shall. for all purposes of th~s Agreement. have the meanlngs ascr1bed to
them here~n. as follows
Acqu1.s1.tion and Construct~on Account. The t.erm ItAcquisltlon
and ConstructIon Account" means the account by that name establIshed
under. and held by the Trustee pursuant to. Sect~on 402 of the Trust
Agreement.
Acqu1.sit1.on and ConstructIon Costs The term "Acquisition and
ConstructIon Costs" means all costs of payment of. or re1.mbursement for,
acqU1.S1t~on. constructIon and ~nstallatlon of the FacIl~tles, Includ~ng
but not lImIted to. archItect. engIneerIng, project manager and construc-
tIon superVIsIon costs. constructIon contractor payments, and costs of
feaSIbIlIty, envIronmental and other reports, bUIlders' r~sk Insurance
premIums, lnltial hazard and 11ability Insurance premlums, tItle insur-
ance costs, InspectIon costs, permIt fees and fIling and recordIng costs.
and, In add~tion, DelIvery Costs to the extent that the amounts on
depOSIt In the DelIvery Costs Account are InsuffICIent to pay all DelIv-
ery Costs In full
". A "
ASSIgnment Agreement The term ASSIgnment greement means
the ASSIgnment Agreement Relating to AIrport FaCIlItIes, dated as of
October 1, 1985. by and between Lessor and the Trustee. as now or here-
after amended
Authorized Off~cer. The term "AuthorIzed OffIcer", when used
WIth respect to Lessor. means any VIce PreSIdent of Lessor or any other
offIcer of Lessor who ~s deSIgnated by the Lessor as an AuthorIzed OffI-
cer for purposes of the Lease Agreement. The term "AuthorIzed OffIcer,"
when used WIth respect to CIty, means the Mayor. CIty Manager. City
FInance DIrector or AIrport D1rector or their deput1es or assistants or
any other offIcer or employee of CIty who 15 deSIgnated by the City Coun-
cll or the CIty tlanager as an AuthorIzed Offlcer for purposes of this
Agreement.
Certlflcates The term "CertIficatesfl means the certIfIcates
of partIcIpatIon prepared and delIvered by the Trustee pursuant to the
Trust Agreement.
City. The term "C1ty" means the CIty of Santa Mon1ca.
California.
Dellvery Costs. The term "Dellvery Costs" means all costs of
payment of or reImbursement for executlon, sale and delIvery of the Lease
3
.
.
Agreement and the Certlflcates, lncludlng, but not limlted to, costs paid
or lncurred by City, Lessor or the Trustee for flllng costs, prlnting
costs, reproductlon and blndlng costs, fees and charges of the Trustee,
flnanclng discounts, legal fees and charges and relmbursements, flnanclal
and other professlonal consultant fees and charges and relmbursements,
Budltors fees and charges and reimbursements, costs of rating agencies
for credit ratlngs, fees for execution, reglstrBtion, transportatlon and
sBfekeeplng of Certlflcates, munlclpal bond lnsurance premlums, If any,
and other charges and fees ln connectlon wlth the foregolng
Dellvery Costs Account The term "Delivery Costs Account"
means the account by that name establlshed under and held by the Trustee
pursuant to Sectlon 403 of the Trust Agreement.
Event of Default. The term tlEvent of Default" means an event
of default under the Lease Agreement as set forth ln Sectlon 701 of the
Lease Agreement.
FaCll1tles. The term "Facl1itlesll means the facl11ties located
and to be located on and ln the Slte conslstlng generally of B hangar and
an alrport admlnlstratlon bUlldlng.
Federal Securlties. The term "Federal Securitles" means United
States Treasury notes, bonds, bllls or certlflcates of indebtedness or
obllgatlons for WhlCh the full fa1th and credlt of the Unlted States are
pledged for the payment of princlpal and lnterest, lncludlng Unlted
States Treasury (book entry) certlflcates, notes and bonds, state and
local government serles
Ground Lease. The term 'tGround Leaselt means the Ground Lease
dated as of October I, 1985 by and between Clty, as lessor, and Lessor,
as lessee, pertalnlng to the Slte.
Lease Agreement. The terms "Lease Agreement" or "Agreement"
mean this Lease Agreement Relat~ng to Alrport Fac111tles, dated as of
October 1, 1985, by and between Lessor, as lessor, and C~ty, as lessee,
as now or hereafter amended
Lease Payment Account. The term "Lease Payment. Account" means
the account by that name establlshed under, and held by the Trustee pur-
suant to, Sectlon 404 of the Trust Agreement.
Lease Pa~..ments The term tlLease Payments II means lease payments
payable by Clty for the use of the Slte and the Facllitles pursuant to
the Lease Agreement.
Lessor The term "Lessor" means Securlty Paclflc Natlonal
Bank, a natlonal banklng aSSOc18tlon.
4
.
.
Net Proceeds. The term "Net Proceeds," \t.!hen used w1th respect
to any 1nsurance or condemnat1on award, means the gross proceeds from the
insurance or condemn8t1on award with respect to Wh1Ch that term 1S used
rema1n1ng after payment of all expenses incurred in the collection of
such gross proceeds.
Outstandlng The term ItOutstanding" when used with reference
to the Certif1cates and as of any partlcular date means all Certlf1cates
theretofore del1vered except: (a) any Certificate cancelled by the Trus-
tee at or before sald date and (b) any Certlf1cate 1n 11eu of or in sub-
stltutlon for WhlCh another Certlflcate shall have been del1vered
pursuant to the Trust Agreement.
Ol..'ner. The term "Owner" or "Certlflcate ~'ller" or "Owner of
Certlf1cates" or any slml1ar term, when used with respect to the Cer-
tlflcates, means any person who shall he the reglstered owner of any Out-
stand1ng Certlflcate or, 1n the event of amendment of the Trust Agreement
to permlt Certlflcates payable to bearer, any person who shall be the
bearer of any Outstandlng Certlflcate not reglstered.
Payment Date. The term "Payment Date" means April 1 and
October 1 of each year commenclng wlth Aprl1 1, 1986
Permltted Encumbrances. The term "Permltted Encumbrances"
means if and to the extent permltted by law and by any POllCY gUldellnes
promulgated by Clty
(1) Ad valorem taxes and assessments for the current
flscal year of Clty.
(11) Easements, r1ghts-of-way, mlneral rlghts and other
rlghts, covenants, cond1tlons of restrlctlcns WhlCh ln the Judgment of
Clty do not lrnpalr or lrnpede or otherwise adversely affect constructlon
or operatlon of the Facll1tles or access to the Facil1ties by Lessor or
lts ass1gnee.
(11i) The Lease Agreement
(1V) The Asslgnment Agreement.
Princl.pa1 Office. The term IIPr1ncipal Offlcell means the
prlnclpal corporate trust office of the Trustee ~n Los Angeles,
Callfornla.
Redemptlon Fund The term "Redemptlon Fund" means the fund by
that name establ~shed under and held by the Trustee pursuant to Sec-
t10n 615 of the Trust Agreement.
5
.
.
Reserve Account. The term "Reserve Account" means the account
by that name establlshed under, and held by the Trustee pursuant to,
Sect20n 405 of the Trust Agreement.
Reserve Requ1rement. The term "Reserve Requirement" means an
amount equal to the largest of the annual Lease Payments as shown in
Exhlbit B to thlS Lease Agreement.
81te. The term "Slt8" means the land more partlcularly
descr1bed 2ll Exhlblt ~ attached to thlS Lease Agreement.
Speclal Redemptlon Account The term "Specl.al Redemptlon
Account" means t.he account by that name establlshed under, and held by
the Trustor pursuant to, Sect10n 406 of the Trust Agreement.
Substantl.al Co:npletlon. The term "substantial completion" or
"substantlally complete," when used with respect to the Facl1itles, shall
mean completion of the acquisltl.On, construction, installatlon and equip-
plng of the Faci11ties 1n accordance with the plans and speciflcations
therefor, except for such minor 1tems as shall not prevent the full
occupancy and utillzatlon of the Facilltles by Glty.
Trust Agreement The term "Trust Agreement" means the Trust
Agreement Relatl.ng to Airport Fac1ll.tles, dated as of October 1, 1985, by
and among the Trustee, Lessor and Cl.ty, as now or hereafter amended.
Trustee. The term IITrusteetl means Bank of America Natlonal
Trust and Sav1ngs ASSoc1ation, a nat20nal trust and sav1ngs association,
or 1tS successors 1n ~nterest acting as Trustee under the Trust
Agreement.
Usable. The term "usable," when used with respect to the
Facl11t1es, means tenantable and available for use for the normal opera-
t10n of such Facilities.
202. Rules of Construct10n. Words of the masculine gender shall be
deemed and construed to include correlative words of the femin~ne and
neuter genders. Unless the context otherw1se indicates, words lmporting
the s1ngular number shall lnclude the plural number and vice versa, and
words 1mportlng persons shall include corporations and associat1on,
including publ1c bodles, 8S well as natural persons.
The terms "hereby.tf "hereof," IIhereto." "herein," "hereunder" and
any sLmilar terms, as used 1n this Agreement. refer to this Agreement.
6
.
.
ARTICLE III
RIGHT OF E~1RY, CO~STRUCTION OF FACILITIES
301 DeposIt of ~oneys. In order to induce CIty to sublease the
SIte and lease the FaCIlIties from Lessor and to assure City that the
moneys needed to pay the Acquis1tlon and ConstructIon Costs and Dellvery
Costs ~111 be avaIlable for thIs purpose wIthout delay, Lessor or lts
assIgnee, ImmedIately follo~lng dellvery of this Agreement by City to the
Trustee, shall cause to be deposIted wIth the Trustee, from the proceeds
of the CertIf1cates, the sum of $ Of thlS amount an amount
equal to Interest WIth respect to the Cert1fIcates for a perIod of t~o
and one-half years lS requIred to be depos1ted In the Lease Payment
Account, an amount equal to the Reserve ReqUIrement IS requIred to be
deposIted In the Reserve Account, an amount equal to estImated Del1very
Costs 1S requ1red to be deposIted In the DelIvery Costs Account, and the
balance thereof IS requ1red to be deposlted In the Acqulsltlon and
ConstructIon Account.
302 Ground Lease of SIte PrIor to the executIon of thIS
Agree~ent, CIty, as lessor, and Lessor, as lessee, shall execute a Ground
Lease of the SIte by which CIty shall, In conslderatIon of One Dollar
($1) per annum and other addItIonal rent paId by the Lessor, ground lease
the SIte to Lessor Such Ground Lease shall expressly permIt the
sublease of the SIte to the City pursuant to thIS Agreement. A
memorandum of such Ground Lease shall be recorded on the date of
recordatIon of a memorandum of this Lease AgreeMent
303 RIght of Entry_ In order to enable Lessor to carry out the
terms of thIS Agreement and to faCIlItate the exerCIse pursuant to Sec-
tIon 702 hereof of remedIes upon an Event of Default by City hereunder,
CIty hereby grants a rIght of entry to Lessor, Its agents and ltS assign-
ees to the SIte and the FaCIlItIes, exercIsable (except as otherwIse
prOVIded In SectIon 702 hereof) on reasonable notice to City and durIng
normal bUSIness hours. CIty represents that It is empowered to grant
such r1ght of entry to Lessor.
304 Construction of FaCIlItIes. Lessor shall construct and 1nstall
or cause the construct1on and 1nstallation of the FacilIties in
accordance w1th plans and specifications approved by City Disbursements
for acqulslt1on, construct1on and lnstallatlon shall be from the AcqUIsi-
tIon and Construct1on Account established and held by the Trustee
pursuant to the Trust Agreement and in accordance WIth the procedures set
forth In SectIon 402 of the Trust Agreement for said dIsbursements.
CIty may, at any tIme, approve modiflcat1ons or change orders to
plans and speclflcatlons for the FaCIlItIes provlded that amounts in the
Acquls1tlon and Constructlon Account (lnclud1ng, WIthout llmitatlon, any
amounts deposlted thereIn by the CIty, at lts optIon, for payment of
7
.
.
addltlonal constructlon costs) are sufflClent to pay constructlon costs
resultlng from such modlflcatlons or change orders.
Lessor agrees that It shall cause the acquisition, construction and
lnstallation of the Facll1tles to be substantially completed by Aprl1 2,
1988. Lessor further agrees to assure that contractors carry such per-
formance bonds, and agree to such lIquIdated damages for constructIon
delays as may be reqUIred by CIty and comply WIth workers' compensatlon
laws applIcable to CIty and affIrmative Bctlon standards of Clty Pro-
ceeds of 11quIdated damages, If any, receIved by Lessor shall be
deposIted In the Lease Payment Account to be held for Lease Payments,
provIded, however, that If 11quldated damages are to be imposed through
wlthholdlng payment from contractors, then Lessor shall dIrect the
Trustee to wIthdraw frorr- the Acqulsltlon and ConstructIon Account an
amount equal to saId 1Iquldated damages and to deposIt such amount in the
Lease Payment Account for the benefIt of CIty.
CIty agrees that Lessor may cause the aforesaId stIpulated comple-
t10n date to be extended for a perIod equal to any extensIons of tIme to
whIch contractors are entItled under contracts therefor and any delays in
construction resultIng from other causes and events not WIthIn the
reasonable control of CIty or Lessor. CIty shall take posseSSIon of the
FaCIlItIes upon substantlal completlon of constructlon thereof.
Ir, however, Lessor, for any reason whatsoever, cannot delIver pos-
seSSIon of the Fac11It1es as substantlally complete to C1ty In a condl-
tl0It acceptable to Clty by the aforesald stlpulated complet1on date, thIS
Agreement shall not be vOld or VOIdable, nor shall Lessor be lIable to
the CIty for any loss or damage resultlng therefrom; but In such event
the remaln1ng Lease Payments pertalnlng to the Fac1litles shall be
abated, ln the proportIon that the AcqUIsitIon and Construction Costs of
the portion of the FaCIlItIes not so substant1ally completed bears to the
entire Acqulsitlon and Constructlon Costs, wlth respect to the perIod
between the aforesa~d st1pulated completIon date and the t1me when Lessor
is able to dellver posseSSIon of the portIon of the FaCIlItIes not so
substant1ally completed; prov1ded, however, that there shall be no
abatement to the extent of amounts on deposit In the Lease Payment
Account or the Reserve Account, it be1ng acknowledged that sald Accounts
constltute speclal funds for the payment of amounts pursuant to thls
Agreement.
305 Payment of DelIvery Costs. Payment of DelIvery Costs shall be
made from moneys depos1ted WIth the Trustee 1n the Dellvery Costs Account
and shall be dIsbursed In accordance wlth and upon compl1ance with Sec-
tIon 403 of the Trust Agreement.
306 Unexpended Moneys Lessor agrees that unexpended moneys
remaInIng 1n the DelIvery Costs Account shall, upon the earller of
(1) payment ln full of Dellvery Costs or (11) AprIl 2, 1986, be
8
.
.
transferred to the Acqu~slt~on and Constructlon Account and that excess
moneys. lf any. rema~nlng ln the Acqu~sltion and Constructlon Account
shall, upon the earl~er of (i) recelpt by the Trustee of the certlficate
of substantlal completlon referenced ~n Sectlon 402(e) of the Trust
Agreement or (11) Aprl1 2, 1988. be transferred by the Trustee to the
Lease Payment Account and be applled as a credlt against the prlnclpal
component of the next subsequent Lease Payments. as more particularly
descrlbed in Sect~on 402(e) of the Trust Agreement
or
9
.
.
ARTICLE IV
LEASE OF FACILITIES A~D SCBLEASE OF SITE, LEASE PAYME~!S
401 Terw of Agreement. The term of th~s Agreement shall commence
as of the date hereof and shall end on the date upon wh~ch Lease Payments
are pa~d ~n full, unless term~nated earlier ~n accordance w~th the provi-
s~ons hereof, but ~n no event later than October 1, 2007.
402 Sublease of SIte and Lease of Fac~llt~es. In cons~deratlon of
the payment by CIty to Lessor or ~ts assignee of the Lease Payments and
for other valuable cons~derat~on, Lessor hereby subleases the Slte and
leases the FacIlltles to CIty.
403
Slte and
forth In
hereln
Lease Payments For the rlght to posseSSIon and use of the
the FaCIl1tles, CIty shall pay to Lessor the Lease Payments set
ExhIbIt ~ attached hereto and by thIS reference lncorporated
Each Lease Payment shall be for the rIght to possess the Site and
the FaCIlItIes for the annual perlod commenclng the second day of October
of each calendar year and ending on the first day of October of the fol-
low~ng calendar year, except that the Lease Payments attrlbutable to the
period through and Includ~ng Aprll 1, 1988 shall const~tute advance Lease
Payments In cons~deratlon of Lessor's agreement to sublease the SIte and
lease the FacIIItles to CIty, shall be deemed to be made on October 1,
1985, and shall be paId from moneys In the Lease Payment Account, it
beIng hereby acknowledged that sald moneys constltute speclal funds held
by the Trustee pursuant to thlS Lease Agreement and the Trust Agreement.
For each annual rental perIod cornrnenclng WIth the period beglnnlng on the
date hereof, Clty shall make Lease Payments durlng said annual per~od as
more partlcularly set forth 1n Exhiblt B, as Exhlb1t B may from tlme to
tlme be modlf1ed by the Trustee, as ass1gnee of Lessor, followlng prepay-
ment of Lease Payments.
Lease Payments for each annual payment perlod dur~ng the terms of
thls Agreement shall constltute the total amount due for sald payment
perlod, and shall be pald by Clty for and 10 consideratlon of the right
of posseSSIon of, and the contlnued qu~et use and enjoyment of, the Slte
and the Facl1Itles dur1ng each such annual payment per1od.
An amount equal to the Lease Payment attributable to each annual
payment perlod shall be due on the fIrst day of September In each year as
speCIfIed ln Exhlblt B; provided however, that, wlth respect to Lease
Pa)~ents constltut1ng advance rental as referenced above, there shall be
applled as a credlt an amount equal to the amount then on deposit in the
Lease Payment Account therefor, and prov1ded, further, that commenclng
WIth the flrst Payment Date following the date upon WhICh the Acqulsltlon
and Constructlon Account is closed pursuant to Sectlon 402(e) of the
10
.
.
Trust Agreement and for each Payment Date thereafter, there shall be
applled as a credlt (provlded there are no delinquent Lease Payments)
agSlnst the Lease Payments payable on such date an amount equal to the
sum of (1) the amount of 1nterest or income, lf any, theretofore earned
on the Lease Payment Account and Redemption Fund Slnce the date of the
preVlOUS report made by the Trustee ln accordance wlth the provislons of
Section 408 of the Trust Agreement, plus (ii) the amount of interest or
lncome, lf any, earned on the Reserve Account Slnce the date of the pre-
vious report made by the Trustee ~n accordance wlth the prov1s1ons of
Sectlon 408 of the Trust Agreement, plus (111) the amount, if any, then
on depos1t 1n the Lease Payment Account, WhlCh total credlt shall have
been reported on the preceding August 31 by the Trustee to C1ty pursuant
to Sectlon 408 of the Trust Agreement. In the event that the total
amount of credlt exceeds the Lease Payment due on the Payment Date fol-
10~lng sald report, the amount of sald excess shall be applied as a
credlt agalnst subsequent Lease Payments. In addlt1on, the amount in the
Reserve Account shall be appl1ed as a credlt agalnst the last Lease Pay-
ments due prlor to the expiratlon of the term of this Agreement. Should
any Lease Payment be made later than the Puyment Date to WhlCh such Lease
Payment pert81ns, such Lease Payment shall bear lnterest at the same rate
as the rate represented by the lnterest component of said Lease Payment
from such Payment Date to the dace of actual payment
Lessor directs that Clty shall ma~e the Lease Payments directly to
the Trustee as asslgnee of Lessor for deposlt in the Lease Payment
Account.
404. Prepayment of Lease Payments.
(a) The pr~c1pal component of Lease Payments shall be prepa1d on
any Payment Date (but not 10 a total amount of less than $5,000 at any
one t1me) ln inverse order of Payment Date, without prem~um or penalty at
the prlnclpal amount thereof, together wlth 1nterest accrued to said
Payment Date, from the Net Proceeds of 1nsurance or condemnat1on not used
for repalr, reconstruction or replacement and depos~ted in the Lease
Payment Account pursuant to Sect~ons 508(a), 508(h), 510(a) and 510(b),
1t belng 8ckno~ledged that such Net Proceeds so deposited constltute a
speclal fund for the payment of Lease Payments.
(b) The pr~nclpal component of Lease Payments shall be prepald 1n
full on October 1, 1986, under the circumstances descrlbed 1n Section
614(b) of the Trust Agreement, wlthout premlum or penalty at the
princlpal amount thereof, together wlth accrued interest to October 1,
1986, from amounts on deposlt 1n the Speclal Redemptlon Account, it being
acknowledged that such amounts constitute a speclal fund for the payment
of Lease Payments
11
.
.
(c) Subject to the terms and condit~ons of th~s Section. Lessor
hereby grants an opt~on to City to prepay the Lease Payments in full by
paY1ng ~he stipulated value (as set forth 1n Exhibit B) of the Lessor's
1nterest in the Ground Lease and the Fac111t1es, in whole or in part.
Said opt~on may be exerC1sed w1th respect to Lease Payments due on and
after October 1. 1996, on any Payment Date commencing on October 1, 1995.
Sa~d opt10n shall be exercised by C1ty by g1V1ng wr1tten notice to Lessor
or its ass1gnee of the exercise of such opt1on on or before the first day
of February or August pr10r to the selected Payment Date. Such option
shall be exerc1sed, 1n the event of prepayment in full, by either
(1) fil1ng with sa1d not~ce a cert1f1ed copy of a resolution of the City
approv1ng the issuance of refund1ng bonds or notes, the proceeds of wh1ch
pursuant to such resolut10n are required to be applied to redempt10n of
Cert~f1cates and are suff1C1ent to redeem the Cert1f1cates at the prem1-
urns payable as prov1ded 1n the Trust Agreement on the date fixed for
redempt10n thereof, or (1i) deposit1ng on the date sa1d notice ~s given
cash ~n the amount suff1c1ent to pay the st1pulated value of the Ground
Lease and the Fac111ties on said Payment Date as set forth in Exh1bit B
together w1th any Lease Payments then due but unpaid, or. 1n the event of
prepayment 1n part, by depositing with sa1d notice an amount d1visible by
$5,000 equal to the amount described to be prepa1d, together with any
Lease Payments then due but unpa1d, and the interest component of Lease
Payments accrued to the selected Payment Date. In any event, said cash
depos~t shall be accompan1ed by an amount equal to the follow1ng amount
(expressed as a percentage of the amount prepa1d) const1tut1ng a prepay-
ment penalty:
Date of Prepa)~ent Penalty
August 1, 1995 and February 1. 1996 2-1/2%
August 1, 1996 and February 1. 1997 2%
August 1. 1997 and February I, 1998 1-1/2%
August 1. 1998 and February I, 1999 1%
August 1. 1999 and February 1, 2000 1/2%
August I, 2000 and thereafter -0-
In the event of prepayment in part. the partial prepayment shall be
app11ed by Lessor or 1ts ass1gnee aga1nst the pr1ncipal component of
Lease Payments in 1nverse order of the1r Payment Dates, and the Trustee,
as ass1gnee of Lessor, shall prov1de to C1ty a rev1sed schedule of Lease
Payments reflect1ng sa1d part1al prepayment.
12
.
.
405. Interest Component. Allor a port~on of each Lease Payment is
pa~d as, and represents payment of, ~nterest. The ~nterest component of
each Lease Payment ~s set forth in Exh~b~t B.
406. Payment ~n Lawful Money~ No Set-Off Each Lease Payment shall
be pa~d by C1ty ~n la~ful money of the Cn~ted States of America, wh1ch at
the t~me of payment 15 legal tender for the payment of public and pr1vate
debts, to or upon the order of Lessor or ~ts ass1gnee at the Pr1nc~pal
Off1ce of the Trustee or at such other place as Lessor or 1ts assignee
shall des~gnate. Notwithstand1ng any d1spute between C1ty and Lessor,
C1ty shall make or cause to be made each and all Lease Payments when due
and shall not wIthhold or permit to be ~1thheld any Lease Payments
pend~ng the flnal resolut1on of such d~spute nor shall CIty assert nor
permIt to be asserted any r~ght of setoff or counterclalm aga~nst the
obl~ga~lon to make Lease Payments as set forth hereIn.
407. Covenant to Budget and ApproprIate C1ty covenants to take
such act10n as may be necessary to Include all Lease Payments (other than
the aMount of any Lease Payment ~hIch 15 subject to a credit from funds
depos1ted wlth the Trustee, as reported by the Trustee to the City pursu-
ant to Sect10n 408 of the Trust Agreement) and other payments requ1red to
be made hereunder pursuant to th~s Agreement In ~ts annual budget and
annually to approprIate an amount necessary to make such Lease Payments.
Dur~ng the term of th~s Agreement, CIty ~1l1 furnlsh ~O ~he ~rustee, as
aSSIgnee of AuthorIty, a certIf~cate stating that the f~nal budget for
such f1scal year conta~ns an apprO?rlatlon of amounts suff~cient to make
the Lease Payments payable durIng such flscal year, w1th1n twenty (20)
days after each f1nal budget of C~ty ~s printed The covenants on the
part of C~ty here1n contained shall be deemed to be and shall be con-
strued to be mln~sterlal dutIes lmposed by law and 1t shall be the duty
of each and every pub11c offIcial of CIty to take such act10n and do such
thlngs as are requlred by la~ In the performance of the off~c~al duty of
such off~c1als to enable CIty to carry out and perform the covenants and
agreements In this Agreement agreed to be carr led out and performed by
CIty.
408 SecurIty DepOSIt Kotw1thstandlng any other prOV1S1on of th1s
Agreement, C1ty may on any date secure the payment of all or a port1on of
Lease Payments by a depos1t WIth the Trustee, as escrow holder under an
escrow deposlt and trust agreement as referenced In Sect~on B02(d) of the
Trust Agreement, of elther (~) an amount, lf any, whlch, together with
amounts on deposit ln the Lease Payment Account and the Reserve Account,
is sufflc~ent to pay all unpaid Lease Payments, Includlng the princ~pal
and 1nterest components thereof, in accordance with the Lease Payments
schedule set forth In Exhibit B, or (1~) Federal Securities, together
w1th cash, if requ~red, ~n such amount as WIll, ln the opinion of counsel
whose opln~on 1S acceptable by underwr1ters 1n the marketIng of tax.
exempt ob11gatlons or of an 1ndependent certlf~ed publIC accountant,
together w1th ~nterest to accrue thereon and, if requlred, all or a
13
.
.
port~on of moneys or Federal Secur~t~es then on deposit in the Lease
Payment Account and Reserve Account, be fully suff~c~ent to pay all
unpa~d Lease Payments on their Payment Date.
409 Ground Lease. It 2F expressly understood, acknowledged and
agreed by C~ty that ~n add~t~on to the terms, conditions and covenants
stated hereln, all of the other terms, cond~tlons and covenants of thls
Lease Agreement shall be those stated in the Ground Lease and any amend-
ments and modlf~cat~ons thereto as of the date of thlS Lease Agreement;
provided, however, that ~n the event of any inconsistencies between any
of the prOV~Slons of this Lease Agreement and the Ground Lease, the terms
of th~s Lease Agreement shall govern Lessor shall have an ob1igatlon to
malntaln the Ground Lease in full force and effect durlng the term of
th~s Lease Agreement. Whenever the prov~sions of the Ground Lease whlch
have been lncorporated as prov~s~ons of thlS Lease Agreement requlre the
wrltten consent of the Lessor, sa~d prOV1S1ons shall be construed to
requ~re the wrltten consent of both the lessor under the Ground Lease and
the Lessor.
14
.
.
ARTICLE V
COVEKAklS
501 Improvements Clty shall have the rlght during the term of
thlS Agreement La make. or permlt to be made. Improvements to the Slte
and the FacI11tles If such are necessary or beneficial to the Slte and
the Facllltles
502. MaIntenance and UtIlItIes. All maIntenance and repaIr of the
Facl1Itles shall be Lhe responslbll1ty of CIty. and City shall pay for.
or other~lse arrange for the payment for. any necessary utilIty serv~ces
supplIed to the FacIlIties, all costs of operation of the FacilitIes and
all costs of repaIr and replacement of the Facl11tles resultIng from
ordInary wear and tear or want of care on the part of Clty. In exchange
for the Lease Payments hereIn provIded. Lessor agrees to provlde only the
SIte and the FacIlities.
503 PublIC LIabIlIty Insurance. City shall maIntaIn or cause to
be maintaIned. throughout the term of thIS Agreement. a comprehenslve
general publIC lIabilIty insurance POllCY or pollcles agaInst dIrect or
contIngent loss or lIabIlIty for damages for personal InjUry. death or
property damage occasIoned by reason of the constructIon or operatIon of
the SIte or the Facllltles SaId POllCY or polICIes for comprehenSIve
general publIC llabl1lty insurance shall provIde a total coverage of not
less than $10,000.000 comblned SIngle lImIt of bodIly InjUry. personal
InjUry and property damage IncludIng umbrella excess liability, and may
be subject to such deductIble or self-~nsured retentlon as may be autho-
rlzed by the City's 11abl11ty Insurance program
504 Workers' CompensatIon Insurance CIty shall ma~ntaln or cause
to be malntalned. follo~lng substantlal completIon of the FaCIlities and
thereafter throughout the term of thlS Agreement. Workers' CompensatIon
Insurance or self-~nsurance to cover all persons employed In connect10n
with the FaCIlItIes who are not otherwIse covered as requIred by the
Labor Code of the State of CallfornlB. or any act hereafter enacted as an
amendment or supplement thereto or in lIeu thereof
505. FIre and Special Extended Coverage Endorsement. Clty shall
maintain or cause to be malntalned. throughout the term of this
Agreewent. fIre. 11ghtning and speclal extended coverage Insurance. whIch
includes vandallsm and malIcious m1schief on all lmprovements
constItuting any part of the Facl1Ities in an amount equal to the greater
of one hundred percent (100%) of the replacement cost of such
~mprovements or the outstandlng prlnclpal component of Lease Payments.
All lnsurance requIred to be malntained pursuant to thlS SectIon may be
subject to such deductlble amount as may be authorlzed by City's
lIabIlIty Insurance program. Each sueh POlICY of Insurance shall contaln
15
.
.
a standard replacement cost endorsement providIng for no deductIon for
deprecIatIon and a stIpulated amount endorsement
506. Rental InterruptIon Insurance. CIty shall maintain or cause to
be maIntaIned throughout the term of thIs Agreement rental 1nterruptlon
Insurance In an amount not less than the maXImum total Lease Payments
payable by CIty on any two consecutIve Payment Dates, to Insure agaInst
loss of Lease Payments to Lessor or Its assignee caused by perils covered
by the Insurance reqUIred by SectIon 505 hereof.
50i. Form of Insurance Pollcies~ Delivery.
(a) Any polICIes of Insurance delIvered in satIsfactIon of the
requIrements of SectIons 503 through 506 shall provIde that all Ket Pro-
ceeds thereunder shall be payable to CIty and to the Trustee, as aSSIgnee
of Lessor. as theIr Interests may appear SaId polICIes shall permlt the
Trustee In the absence of any actIon by CIty In accordance WIth thlS
Agreement. to adJust, collect and receIve all moneys whIch may become due
and payable under any such polICIes, to compromIse any and all claIms
thereunder and to apply the ~et Proceeds of such Insurance as provlded in
thIS Agreement. All polICIes of Insurance reqUIred by thIS Agreement
shall provide that CIty and the Trustee shall be gIven thIrty (30) days'
notIce of any Intended cancellation thereof or reduction of the coverage
prOVIded thereby.
(b) City shall delIver, or cause to be delIvered, to the Trustee as
aSSIgnee of Lessor 1n the month of September In each year a schedule, in
such detaIl as Lessor or Its aSSIgnee may request, settIng forth the
Insurance polICIes then In force pursuant to thIS Agreement, the names of
the Insurers Wh1Ch have Issued the polICIes, the amounts thereof and the
property and rIsks covered thereby. If so requested in wr~ting by the
Trustee as ass~gnee of Lessor, CIty shall also deliver, or cause to be
delIvered to the Trustee, dupllcate or~ginals or certlfled cop1es of each
insurance POllCY described In such schedule, prOVIded that de11very of
the insurance pol1cies under the provls10ns of thIS SectIon shall not
confer responsibIlIty upon Lessor or the Trustee as ltS aSSIgnee as to
the sufflclency of coverage or amounts of said polIcies
508. ApplIcatIon of Net Proceeds of Insurance. Any Net Proceeds of
any lnsurance required by thls Agreement relatIng to an accIdent to or
destruction of any part of the FaCIlItIes whIch IS collected by CIty 1n
consequence of any such accident or destructIon shall be deposIted by
Clty in a spec1a1 fund to be held in trust by the Trustee as aSSIgnee of
Lessor and shall be applied and dlsbursed as set forth below:
(a) If CIty determlnes that such Net Proceeds are to be ut1-
llzed for the repair, reconstructIon or replacement of the damaged or
destroyed portIon of the Facllities, evidenced by a certificate executed
by an AuthorIzed Off1cer of CIty and filed WIth the Trustee, then Clty
16
.
.
shall cause such portIon of the FacilItIes to be repaIred, reconstructed
or replaced to at least the same good order, repaIr and condItIon as It
eXIsted prIor to the damage or destructIon, Insofar as the same may be
accomplished by the use of saId Net Proceeds, and shall direct the
Trustee to WIthdraw sa~d Net Proceeds from saId specIal fund held by the
Trustee from time to t~me and to pay such Ket Proceeds to City for the
purpose of such repaIr, reconstruction or replacement. CIty shall dIrect
the Trustee to depOSIt any balance of saId Net Proceeds remaInIng In saId
speCIal fund and not requIred for such repaIr, reconstructIon or replace-
ment Into the Lease Payment Account as a prepayment of Lease Payments. In
accordance WIth SectIon 404(a) hereof. Subject to the proviSIons of sub-
sectIons (b) and (c) of thIS Section, CIty shall be oblIgated to continue
to make Lease Payments required by thIS Agreement not~ithstanding aCCI-
dent to or destructIon of all or a portIon of the FaCIlItIes, prOVIded,
ho~ever, that in the event that aCCIdent or damage to any portIon of the
FaCIlItIes ~s such as to cause such portIon not to be usable) then such
Lease Payments shall he abated, In the proportIon to wh~ch the unusable
portIon of the FacIllt~es bears to the entIre FacilItIes, until repaIr of
such damaged portIon IS completed to such an extent as to enable use
thereof, except that there shall be no abatement so long as moneys then
on deposlt In the Lease Paywent Account or In the Reserve Account, or Net
Proceeds of Insurance, are suffiCIent for the maklng of Lease Payments
when and as due it beIng hereby declared that such moneys and Net Pro-
ceeds constitute speCIal funds for the payment of Lease Payments.
(b) In lleu of repaIr, reconstructlon or replacement of the
damaged or destroyed portlon of the Facillties, CIty may) by a certIfi-
cate executed by an Authorlzed OffIcer of C~ty and ftled WIth the Trus-
tee, dIrect the Trustee to apply the ~et Proceeds of lnsurance to the
exerCIse In whole to the extent of sald Net Proceeds, on the next suc-
ceedlng Payment Date to the prepayment of Lease Payments in accordance
WIth Sectlon 404(a) hereof. For the purposes of thIS subsection, Sec-
tion 404(a) of thIS Lease Agreement shall be deemed to require prepayment
WIthout premIum on the Payment Date followlng the date WhICh is SIXty
(60) days subsequent to receIpt by the Trustee of the Net Proceeds of
Insurance and of said certIfIcate of an Authorlzed Officer of CIty.
(c) Any Net Proceeds of rental interruption lnsurance required
by thIS Agreement shall be used first to reimburse CIty for Lease
Payments theretofore paId durIng any period in whIch abatement of Lease
Payments would otherWIse have occurred notWIthstanding aCCIdent to or
destruction of all or a portIon of the Facilities. Any balances
remaInlng shall be paId by CIty to the Trustee, as assignee of Lessor,
for depOSIt In the Lease Payment Account and applIed as a credit against
the next subsequent Lease Payments.
509. Tltle Insurance. City shall provide, or cause to be provided,
at ~ts o~n expense a Cal~forn~a Land T~tle Assoc~at~on t~tle insurance
POllCY WIth endorsement so as to be payable to the Trustee (as Ass~gnee
17
.
.
of Lessor pursuant to the Ass~gnment Agreement). Such policy shall
insure Cityts subleasehold tltle to the Slte and leasehold title to the
Facllltles, subject only to Permltted Encumbrances. Said title insurance
polley shall be in a princlpal amount equal to the aggregate unpaid prln-
clpal component of Lease Payments set forth in Exhlblt B.
510. Appllcatlon of Net Proceeds of Tltle Insurance or Condemnation.
All Net Proceeds recelved under the tltle lnsurance POllCY provlded for
by this Agreement or in any condemnatlon proceeding undertaken by any
governmental agency relatlng to all or a portlon of the Slte or the
Faclllties shall be pald to the Trustee pursuant to the Trust Agreement
and shall be applled and dlsbursed as set forth below:
(a) If Clty determines that such title defect or condemnation
has not materlally affected the operation of the Facilitles or the abil-
lty of Clty or lts assignee to meet any of the obllgations hereunder or
if such Net Proceeds are lnsufflcient to enable Clty to prepay Lease Pay-
ments in full pursuant to Sectlon 404(a) hereof. as set forth in a cer-
tificate exerclsed by an Authorized Offlcer of Clty and filed with the
Trustee, City shall dlrect the Trustee by sald certificate of an Autho-
rlzed Offlcer, to hold such Net Proceeds In the Lease Payment Account and
apply such Net Proceeds as a prepayment ln part of Lease Payments pur-
suant to Sectlon 404(a) hereof. For the purposes of this subsection,
Sectlon 404(a) of thlS Lease Agreement shall be deemed to permit prepayment
wlthout prernlum or penalty on the Payment Date following the date which
is thlrty (30) days subsequent to recelpt by the Trustee of Net Proceeds
of tltle lnsurance or condernnatlon and of sald certificate of an Autho-
rlzed Officer of City. Subject to the prov~sions of subsectlon (b) of
thls Section, Clty shall be obllgated to contlnue to make Lease Payments
requlred by this Lease Agreement notwlthstand~ng condemnatlon of or a tltle
defect relat~ng to a port~on of the Slte or the FaClllt1es; provided,
however. that in the event that such condemnation or defect lS to such
extent as to cause such portion not to be usable, then such Lease Pay-
ments shall be abated, 1n the proportlon to whlch the unusable portion of
the Facilltles bears to the ent1re Fac1l1tles, except that abatement
shall not result so long as moneys then on deposit 1n the Lease Payment
Account or Reserve Account or Net Proceeds of title 1nsurance or condem-
nation are sufflclent for the maklng of Lease Payments, it belng hereby
declared that such moneys and Net Proceeds constltute special funds for
the payment of Lease Payments.
(b) If Clty determ1nes that such title defect or condem-
nation has mater1ally affected the operation of the Facilit1es or the
abllity of Clty to meet any of the obllgatlons hereunder as set forth 1n
a certificate executed by an Authorized Offlcer of City, and filed wlth
the Trustee, or if such Net Proceeds are sufflclent to enable City to
prepay in full as set forth in Sectlon 404(a) hereof as set forth in a
cert~ficate exerclsed by an Authorlzed Offlcer of City and flIed w1th the
Trustee, Clty shall d1rect the Trustee, by said certlflcste of an
18
.
.
Authorlzed Offlcer, to treat such Net Proceeds as the prepayment. on the
Payment Date follo~lng the date WhlCh 1S thlrty (30) days subsequent to
recelpt by the Trustee of Net Proceeds of tltle insurance or
condemnatlon, and of sald certlflcate of an Authorlzed Officer of City,
of Lease Payments ln full.
(c) In the event of condemnatlon of the Slte and the
Faclllties. C~ty wlll use all efforts to assure that any award made as a
result of SBld condemnation lS sufflclent to pay the stlpulated value (as
set forth ln Exhlblt B hereof) of the Lessor's lnterest ln the Ground
Lease and the Facllltles.
511 Payment of Lease Payments. Clty shall duly and punctually pay
or cause to be pald the Lease Payments, at the dates and places and in
the manner provlded in thlS Lease Agreement accordlng to the true lntent
and meanlng hereof and shall not dlrectly or lndlrectly extend or assent
to the extenslon of the Payment Dates of any Lease Payments
512. Compllance ~lth thlS Agreement Each of Clty and Lessor wlll
falthfully observe and perform thelr respectlve covenants, condltlons and
requlrements of thls Lease Agreement. Clty wlll not suffer or permit any
default to occur hereunder, nor do or permlt to be done ln, upon or about
the Slte or the Facllltles or any part thereof, anythlng that mlght ln
any way ~eaken, dlmlnlsh or lmpalr the operation of the Facilitles. Clty
wlll not do or permit anythlng to be done, or omlt or refrain from dOlng
anythlng, ln any case where any such act done or permltted to be done, or
any such OW1SSlon of or refralnlng from act lon, would or mlght be a
ground for cancellatlon or termlnatlon of thls Lease Agreement.
513. paynent of Taxes. Clty ~lll payor cause to be pald all taxes,
assessments and other governmental charges, lf any, that may be levled,
assessed or charged upon the Slte or the Facllltles or any part thereof,
promptly as and when the same shall become due and payable, provlded,
however, that Clty shall not be requlred to pay any such tax, assessment,
or charge, lf the valldlty thereof shall concurrently be contested in
good falth by approprlate proceedlngs, and lf Clty shall set aSlde, or
cause to be set aSlde, reserves deemed by lt to be adequate ~ith respect
thereto and provlded further, that Clty, upon the commencement of any
proceed1ngs to foreclose the llen of any such tax, assessment. or charge,
wlll forthwlth pay, or cause to be pald, any such tax, assessment or
charge, unless contested ln good f81th as aforesBld. Clty wlll not
suffer the Slte or the FaCllltles or any part thereof to be sold for any
taxes, assessments or other charges whatsoever, or to be forfelted
therefor. Nothlng hereln contalned shall be deemed to lmpose any
llablllty to pay taxes, assessments or charges where none 15 imposed by
law
514 Observance of Laws and Regulatlons C1ty wlll well and truly
keep, observe and perform all valld and lawful obllgatlons or regulatlons
19
.
.
now or hereafter 1mposed on 1t by contract, or prescT1bed by any law of
the Un~ted States, or of the State of Cal~forn~a, or by any officer,
board or comm~ss~on having Jur1sdict~on or control, as a cond~tlon of the
cont~nued enjoyment of any and every rlght, prlvilege or franchise now
owned or hereafter acqulred by Clty, ~nclud1ng ~ts r~ght to ex~st and
carry on bus~ness as a publ~c body, corporate and po11tic, to the end
that such r~ghts, pr~vlleges and franch~ses shall be ma~nta~ned and pre-
served, and shall not become abandoned, forfe~ted or 1n any manner
lmpa~red.
515 Ma1ntaln and Preserve the FaClllties. City will operate, maln-
ta~n and preserve, or cause to be operated, ma1nta1ned and preserved, the
Facl11tles 1n good repalr and work1ng order and wl11 operate, or cause to
be operated, the FaClllt1es 1n an efflc1ent and economlcal manner.
516. Other L1ens Clty shall keep the Facilit~es and all parts
thereof free from Judgments, from rnechanlcs' and materlalmen's l~ens
(except those mechan1cs' and materlalmen's liens arislng from construc-
t10n of all or a portlon of the Fac~llt~es) and, except as to Permltted
Encumbrances, free from all 11ens, clalms, demands and encumbrances of
whatsoever nature or character. to the end that the S1te and the Fac~ll-
Lles may at all tlmes be malntained and preserved. and Clty shall keep
the Slte and Facllltles free from any clalm or liab111ty wh~ch, 1n the
reasor-ble Judgment of Lessor or its ass~gnee, m1ght 1mpa1r or impede the
operat~on of the Facll~t~es, prov~ded, however, that C1ty shall not be
requlred to pay any such llens. cla1ms or demands lf the valld1ty thereof
shall concurrently be contested ~n good fa~th by appropr1ate proceedlngs,
and lf Clty shall set as~de or cause to be set aS1de reserves deemed by
1t to be adequate ~lth respect thereto and prov1ded further. that Clty
upon the commencement of any proceedlngs to foreclose the lien of any
such charge or c1a1m, ~111 forthw~th payor cause to be paid any such
charge or cla1m unless contested 1n good fa~th as aforesa1d. Lessor, or
its ass1gnee, at 1tS optlon (after f1rst glvlng City ten (10) days' wrlt-
ten notlce to comply there~1th and fa11ure of Clty or 1ts assigns to so
comply wlthin SBld ten-day perlod) may defend agalnst any and all actions
or proceedings ln Wh1Ch the val1dity of thlS Agreement 1S or m1ght be
questloned. or may payor comprom1se any cla1m or demand asserted in any
such act10ns or proceed1ngSj provlded, however, that, In defend1ng
against such actlons or proceed~ngs or 1ll paY1ng or compromlsing such
claims or demands, nelther Lessor nor its asslgns shall 1n any event be
deemed to have walved or released C~ty from l~ab~lity for or on account
of any of its covenants and warranties conta~ned hereln. or from lts
l~ab~l~ty hereunder to defend the valldlty of th1S Agreement and the
pledge here1n made to perform such covenants and warranties.
517. Aga~nst Encumbrances or Sales. Except as permitted ln this
Agreement and except as to Perm1tted Encumbrances. Clty will not create
or suffer to be created any mortgage, pledge. lien, charge or encumbrance
upon the Site or Fac111tles or any part thereof. or upon any real or
20
.
.
personal property essential to the operat10n of the Fac1lities. City
wll1 not sell or otherW1se dlspose of the Site or the Fac1litles or any
property essentlal to the proper operatlon of the Facl11tlesJ except as
other~lse provlded in thls Agreement.
518 Prosecutlon and Defense of SUlts City shall promptly, upon
request of Lessor or 1tS asslgneeJ from t1me to t1me take or cause to be
taken such act10n as may be necessary or proper to remedy or cure any
defect 1n or cloud upon the title to the Slte or the Facilities whether
no~ eX1stlng or hereafter developing and shall prosecute all such SU1tSJ
actlons and other proceedlngs as may be appropriate for such purpose and
shall indemnlfy or cause to be 1ndemn1f1ed Lessor and its asslgns for all
loss, cost, damage and expenseJ 1ncluding attorneys' fees, WhlCh they or
any of them may lneur by reason of any such defect, cloud, sUlt, actlon
or proceedlngs
Clty shall defend, or cause to be defended, every SUlt, action or
proceedlng at any tlme brought against Lessor or 1ts assignee upon any
cla1ffi ar1slng out of ~he recelpt, appllcatlon or dlsbursement of any
amounts held by the Trustee or lnvolving the rights of Lessor or 1tS
ass1gnee under thlS Agreement; provlded, that Lessor and its asslgnee at
the1r eleetlon may appear ln and defend any such SUltJ actlon or pro-
ceedlng Clty shall lndemnlfy or cause to be indemnlfled Lessor and its
asslgnee against ny and all 11ab111ty cla1med or asserted by any personJ
arlslng out of such recelptJ appllcatlon or dlsbursement
519 Recordation and Fil1n~. C~ty shall record and f11e, or cause
to be recorded and flIed, a memorandum of thlS Agreement and all such
supplemental lnstruments and other documents as may be required by law
(together with ~hatever else may be necessary or be reasonably requ1red
by Lessor or 1ts asslgnee), In such manner, at such times and 1n such
places as may be requ~red by la~ ~n order fully to preserve and protect
the rlghts of Lessor and 1ts aSSlgnee under thlS Agreement
520 Walver of Laws. Clty shall not at any time 1nslst upon or
plead 1n any manner whatsoever, or clalm or suffer or take the benefit or
advantage of any stay or extenslon la~ now or at any time hereafter in
force ~hlCh may adversely affect the covenants and agreements contalned
In thls Agreement and the beneflt and advantage of any such law or laws
lS hereby expressly walved by Clty to the extent that City may legally
make such ~alver.
521 Compllance wlth Conditions Precedent Upon the date of del1very
of th~s Agreement, all condltlons, acts and thlngs requ~red by law or by
this Lease Agreement to have happened or to have been performed precedent
to or 1n the executlon of thlS Lease Agreement shall eXlst, have happened
and have been performed, and thlS Lease Agreement shall be within every
I1m1t prescrlbed by law.
21
.
.
522. Power to Enter Into Agreement City IS duly authorIzed
pursuant to the law to enter Into this Agreement. The provisions of thIS
Lease Agreement are and wIll be the valId and legally enforceable specIal
obllgat~ons of CIty In accordance wIth theIr terms and the terms of thIs
Lease Agreement
523. Further Assurances. ~henever and so often as requested so to
do by any party or its assIgnee the other party ~ill upon wrItten request
by such party or Its assIgnee and followIng reasonable notIce execute and
delIver or cause to be executed and delIvered all such other and further
Instruments, documents or assurances. and do or cause to be done all such
other and further things, as may be necessary or reasonably requIred in
order further and more fully to vest in such party or Its assIgnee. all
rIghts. Interest, powers, benefIts, prIvIleges and advantages conferred
or Intended to be conferred upon such party by thIS Agreement
524 FInancIal Reports. WIthIn one hundred eIghty (180) days after
the close of each fIscal year of CIty, CIty will furnIsh, or cause to be
furnIshed, to the Trustee as assIgnee of Lessor detaIled certIfIed
reports of audIt, based on an examInatIon SUffiCIently complete. prepared
by an Independent certIfIed publIc accountant coverIng the operatIons of
the CIty for saId fIscal year shOWIng the general funds. revenues and
expenses for such perIod Such audIt report shall Include statements of
the status of each fund esta~llshed by CIty pertaInIng to thIS Agreement
or the FacIlItles, showlng the amount and source of deposits therein. the
amount and purpose of the WIthdrawals therefrom and the balance thereIn
at the beginnIng and end of the fIscal year Such audIt reports may be
combIned WIth the audIts made for CIty'S general bUSIness and operat1ons.
525 Lessor ~ot L1able ~elther Lessor nor Its members, off1cers,
agents, employees, or aSSIgnee shall be lIable to CIty or to any other
party whomsoever for any death, InjUry or damage that may result to any
person or property by or from any cause whatsoever ~n, on or about the
SIte or the FaCIlitIes. C1ty shall indemnIfy or cause to be ~ndemnlfIed
and hold Lessor, ItS members. offIcers, agents, employees and Its
assignee harmless from. and defend or cause each of them to be defended
aga1nst any and all claIms. lIens and Judgments for death of or injury to
any person or damage to property whatsoever occurrlng In, on or about the
SIte or the FaC1llties, except for claIms, l1ens or Judgments of any
nature whatsoever arISIng from the gross neglIgence or WIllful mIsconduct
of Lessor or 1tS ass1gnee and their respectIve members. offIcers, agents
and employees.
526. Net Lease. It IS the purpose and intent of Lessor and CIty
that Lease Payments shall be absolutely net to Lessor so that thIS Lease
Agreement shall y~eld to Lessor the Lease Payments. free of any charges.
assessments, or 1mposltlons of any kInd charged. assessed. or 1mposed on
or agaInst the SIte or the FacIlltles. and WIthout abatement, counter-
claIm, deductIon, defense. deferment or set-off by Clty. except as herein
22
.
.
spec1f~cally otherwise prov1ded, and Lessor shall not be expected or
required to pay any such charge, assessment or 1mposit~on, or be under
any obl~gat10n or l1ab1lity hereunder except as here1n expressly set
forth, and that al} costs, expenses and obl~gat10ns of any k1nd relating
to the ma1ntenance and operation of the S1te and the Fac11~ties which may
arise or become due during the term of th~s Lease Agreement shall be pa1d
by C~ty. To that end, C1ty shall indemn1fy and hold Lessor, its members,
off1cers, agents and employees, and 1ts assignee harmless from and
aga1nst any and all costs, expenses and ob11gat~ons (1nclud1ng, w1thout
1~m1tat10n, reasonable attorneys' fees) that may be imposed on or asserted
aga1nst Lessor relat1ng to the ma1ntenance and operation of the Site and the
Fac1lities pursuant to th~s Lease Agreement and the Ground Lease, except
for costs, expenses and obl~gations ar~s1ng from the gross neg11gence or
willful misconduct of Lessor or 1tS ass1gnee and the1r respective
members, off1cers, agents and employees
527 Trustee Fees C1ty shall payor cause to be paid to the Trus-
tee reasonable fees and compensat1on due under the Trust Agreement upon
per10dic b1l11ng therefor by Trustee.
23
.
.
ARTICLE VI
DISCLAIMER OF ~ARRA~TIES, ASSIGK~E~~;
SCBLEASIKG, ACCESS; ~~ENDME~l
601 DISCLAIMER OF WARRA~lIES. NEITHER LESSOR NOR ITS ASSIG~EE MAKE
!hi WARRA~TY OR REPRESE~lATION. EITHER EXPRESS OR IMPLIED, AS TO THE
VALUE, DESIG~, CONDITION, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR
PCRPOSE OR FITKESS FOR THE USE CO~lEMPLATED BY CITY OF THE FACILITIES OR
~~Y PORTIO~ THEREOF, OR A~Y OTHER REPRESE~TATION OR ~ARRA~~Y WITH RESPECT
TO THE FACILITIES OR A~Y PORTIO~ THEREOF IN NO EVE~l SHALL LESSOR OR
ITS ASSIGKEE BE LIABLE FOR INCIDE~l~L. IKDIRECT, SPECIAL OR CONSEQUE~TIAL
DAMAGES, IN COK~ECTIOK ~ITH THIS AGREE~lliKT OR THE EXISTENCE. FURKISHIKG.
OR FC~CTIONI~G OF THE FACILITIES OR CITY'S USE OF THE FACILITIES, EXCEPT
SUCH DA~lAGES AS MAY ARISE BY REASOK OF LESSOR'S BREACH OF THIS AGREEME~~
602. Ass1gn~ent by Lessor. Lessor's r1ghts under thlS Agreement,
lncludlng the r1ght to rece1ve and enforce payment of the Lease Payments
to be made by the C1ty under thlS Agreement. may be asslgned and reas-
s1gned, III conformance wlth the terms and conditions of this Agreement,
III whole or in part to one or more ass1gns by Lessor at any tlme, wlthout
the consent of Clty. Lessor agrees to provlde prompt written not1ce of
any such ass1gnment to Clty
603 Ass1gnment and Subleas1ng by Clty Except as provlded hereln.
this Agreement may not be asslgned by C~ty w~t~out the written consent of
the Trustee as asslgnee of Lessor Such wr~tten consent shall not be
unreasonably wIthheld.
Notw1thstandlng any other provlslon of thls Agreement the S1te and
the Facllit1es may be subleased by CIty, subject to Permltted Encum-
brances, ln whole or In part, wlthout the consent of Lessor, subject,
however, to each of the followIng condltlons:
(a) This Agreement and the obllgatlon of Clty to make Lease
Payments hereunder, shall not be adversely affected; and
(b) No such sublease shall cause the lnterest component of the
Lease Payments to become subject to Federal lncome taxes; prOVIded that
Clty may ln enter1ng 1nto any such sublease rely upon the opln1on of
counsel whose opln1on lS acceptable by underwrIters In the marketIng of
tax-exempt obllgatlons w1th respect to the effect, if any, of such
sublease.
604. Transfer of Tax Beneflts. Nothlng here1n shall be deemed to
prevent Clty from enterlng Into any agreement or rnaklllg any d1Sposltlon
for the sole purpose of transferrlng to one or more corporatlons. part-
nersh1ps or lnd1vlduals Federal or state lncorne tax benefits which would
24
.
.
be ava1lable for the Fac111ties 1f o~ned by a pr1vate person, subJect,
however, to each of the follow1ng cond1t10ns=
(a) Th1s Agreement and the obl1gat1on of C1ty to make Lease
Payments hereunder shall not be adversely affected;
(b) Ko such agreement or dispos1tion shall cause the interest
component of the Lease Payments to become subject to Federal income
taxes; and
(c) The transact10n ~111 be so structured 8S to assure that in
the event of bankruptcy of the transferee, the Lease Payments shall not
become a part of the transferee's estate under Sect10n 362a, 54ib and
552a of the Federal Bankruptcy Code or any S1m1Iar successor Sections
wh1ch may hereafter be enacted.
605 Access to S1te and Faci11t1es. C1ty agrees that Lessor and 1tS
ass1gnee shall have the r1ght at all reasonable t1mes and upon reasonable
not1ce to exarn1ne and 1nspect the Site and the Fac111t1es and the r1ght
of access to the S1te and the Fac111t1es for such purpose.
606 Amendment. Th1S Lease Agreement may be amended 1n ~r1ting by
the part1es hereto or by the1r ass1gnees on the1r behalf or 1n the1r name
for the purpose of (a) cur1ng any amb~gu1ty or of curing, cc rect1ng or
supplement~ng any defect1ve prov1s10n conta1ned hereln~ or (b) 1n regard
to quest10ns ar~s1ng under this Agreement wh~ch City may deem necessary
or des1rable and not 1ncons1stent w1th the prov1s~ons of this agreement;
prov1ded, however, that no such amendment shall adversely affect the
exempt10n from Federal 1ncome taxat10n of the lnterest component of Lease
Payments or the interests of the Certif1cate Owners, and provlded, fur-
ther, that the part1es hereto or the1r assignees may rely in entering
1nto any such amendment pursuant to th1s Sect10n 606 upon the op1nion of
counsel ~hose op1n10n 1S acceptable by underwr1ters 1n the marketing of
tax-exempt obligat1ons stat1ng that the requirements of th1s sentence
have been met w1th respect to such amendment.
Th1S Lease Agreement may be amended in wr1t1ng by the part1es hereto
or by their ass1gnees on the1r behalf or in their name w~th respect to
matters not lncluded 1n (a) or (b) above upon approval of a maJor1ty 1n
aggregate pr1nc1pal amount of the Owners of the Cert1f1cates then Out-
standlng, prov1ded that no such amendment shall impa1r the rlght of any
Owner to rece1ve h1s proportionate share of any Lease Payment in accor-
dance w1th h1s Certlf1cate. Notwlthstand1ng the foregolng, no amendment
to th1S Lease Agreement may confer any additlonal obl1gations on Lessor
w1thout the prior wr1tten consent of Lessor, to be granted 1n 1ts sole
dlscret1on.
25
.
.
ARTICLE VII
EVE~TS OF DEFACLT AKD REMEDIES
701
Defaultt' under
\<o"henever it l.S
events.
Events of Defal~l t;. The follo....1.ng shall be "Events of
thlS Agreement and the term "Event of Defaulttl shall mean,
used l.n thlS Agreement anyone or more of the follo~l.ng
(a) Fal.lure by City to pay any Lease Payment required to
be pald hereunder at the tlme speclfled hereln and the contlnuatlon of
sal.d fallure to the Payment Date to ~hl.ch such Lease Payment pertalllS; or
(b) Fallure by Clty to observe and perform any covenant,
condl.tl.on or agreement on ltS part to be observed or performed, other
than as referred to in clause (a) of the Sectlon 701, for a perlod of
thirty (30) days after wrl.tten notlce specifYl.ng such fallure and
requestlng that lt be rernedl.ed has been gl.ven to City by Lessor or lts
asslgnee, unless Lessor or lts asslgnee shall agree in writing to an
extenslon of such tlrne prlor to ltS explratlon. provlded. however, If the
fallure stated l.n the notl.ce cannot be corrected wl.thl.n the applicable
perlod. Lessor or lts asslgnee ~lll not unreasonably wl.thhold lts consent
to an extenslon of such tlme If correctlve actlon 1.S 1.nstituted by Cl.ty
Wlthl.n the appllcable perlod and dlllgently pursued untll the default 1
corrected. or
(c) A court havlng Jurlsdictlon ln the premises shall
enter a decree or order for relief in respect of Clty In an lnvoluntary
case under any appllcable bankruptcy, lnsolvency or other slmllar law now
or hereafter ln effect, or appointing a recelver. liquldator. assignee,
custodian. trustee. sequestrator (or slrnllar offlclal) of City or for any
substantlal part of lts property. or ordering the wlndlng up or llqul.da-
tlon of lts affairs, and such decree or order shall remaln unstayed and
ln effect for a perl.od of Slxty (60) days, or
(d) Clty shall commence a voluntary case under any appli-
cable bankruptcy. insolvency or other slml1ar law now or hereafter in
effect, or shall consent to the entry of an order for rellef 1n an 1nvol-
untary case under any such law, or shall consent to the appolntment of or
taklng possesslon by a recelver, liquldator, assignee, trustee.
custodlan, sequestrator (or slml.lar offlclal) of Clty or for any
substantial part of ltS property, or shall make any general asslgnment
for the beneflt of creditors, or shall fall generally to pay its debts as
they become due or shall take any corporate action in furtherance of any
of the foregolng
26
.
.
702. Remed1es on Default.
(a) Upon the happening of any of the Events of Default
spec1f1ed 1n Sect10n 701 hereof, Lessor or its ass~gnee may exerC1se any
and all remedles aval1able pursuant to law or granted pursuant to this
Agreement. In the event of an Event of Default, City shall, as here1n
expressly provided, cont1nue to rema1n liable for the payment of Lease
Payments and damages for breach of th1s Agreement and the performance of
all cond1t1ons hereln contSlned and, in any event, such Lease Payments
and damages shall be payable to the Lessor or 1ts ass1gnee at the t1me
and in the manner set forth ~n paragraphs (1) and (2) of this subsect1on.
(1) In the event that Lessor or its assignee does
not elect to terrn1nate th1s Agreement pursuant to paragraph (2) below,
Clty agrees to and shall rema1n 11able for the payment of Lease Payments
and the performance of all cond1t10ns herein conta1ned and shall relm-
burse Lessor or 1ts ass1gnee for any def1ciency arls1ng out of the relet-
ting of the Slte and the Fac111ties, or, in the event that Lessor or 1tS
assignee is unable to relet the Site and the Facilit1es, then for the
full amount of the Lease Payments to the end of the term of th1s Agree-
ment, but sald Lease Payments or def1clency shall be payable only at the
same tlme and 1n the same manner as prov1ded in Sect10n 403, notwith-
stand1ng any suit in unlawful deta1ner, or otherwise, brought by Lessor
or its assignee for the purpose of obta1ning possession of the Site and
the Fac1litles or the exerC1se of any other remedy by the Lessor or its
ass1gnee City hereby 1rrevocably appoints Lessor or its assignee as the
agent and at~orneY-1n-fact of Clty to enter upon and relet the Slte and
the Fac11it1es in the event of default by City Clty hereby exempts and
agrees to save harmless Lessor and 1tS assignee from any costs, 10s5 or
damage whatsoever (1nclud1ng, w1thout llm1tat1on, reasonable attorneys'
fees) ar151ng or occasioned by any such entry upon and letting of the Site
and the Facllit1es, except for any such costs, loss or damage arising from
the gross negl1gence or w11lfu1 misconduct of Lessor or its assignee. C1ty
hereby wa1ves any and all claims for damages caused, or wh1ch may be
caused, by Lessor or 1ts assignee 1n tak1ng possession of the S1te and
the Facll1t1es, for all claims for damages that may result from the
destruct10n of or 1nJury to the S1te and the Faci1it1est and all claims
for damages to or loss of any property belong1ng to City that may be 1n
or upon the S1te and the Facll1t1es, except for damages or loss aris1ng
from the gross neg11gence or w11lful m1sconduct of Lessor or its
assignee. C1ty agrees that the terms of this Agreement const1tute full
and suff1c1ent not1ce of the rlght of Lessor or its assignee to relet the
Site and the Faci11ties w1thout effect1ng a surrender of th1s Agreement,
and further agrees that no acts of Lessor or 1tS ass1gnee 1n effect1ng
such relettlng shall const1tute a surrender or terminat10n of this Agree-
ment irrespective of the term for wh1ch such relettlng is made, or of the
terms and condit10ns of such relett1ng. or otherwise. but that, on the
contrarYt 1n the event of such default by Clty, the right to terminate
th1S Agreement shall vest in Lessor or its ass1gnee to be effected in the
27
.
.
sole and exclusive manner herelnafter provided for in paragraph (2)
below
(2) Upon an Event of Default, Lessor or its assignee
may, at its optlon. terminate th1s Agreement follo~ing ten (10) days'
wrltten notlce thereof to Clty. In the event of termlnation of this
Agreement by Lessor or 1tS assignee on account of an Event of Default
(and notwithstandlng any resubletting of the Site and the Facil1t1es),
Clty nevertheless agrees to pay to Lessor or to its asslgnee all costs,
loss or damages howsoever (lncludlng, wlthout llmitat1on, reasonable
attorneys' fees) arlsing or occurring payable at the same tlme and in the
same manner as in the case of payment of Lease Payments hereunder. Lessor
or ltS asslgnee may resublet the Site and the Facllities. Moneys recelved
from such resublettlng and any surplus received by Lessor or its assignee
from such resublettlng shall be the absolute property of Lessor or 1tS
asslgnee and C1ty shall have no rlght thereto. Neither not1ce to pay
rent or to dellver up posseSSlon of the Slte and the Facilities glven
pursuant to law nor any proceed1ng in unlawful deta1ner taken by Lessor
or 1tS ass1gnee shall of ltself operate to termlnate th1S Agreement, and
no termlnatlon of thlS Agreement on account of default by Clty shall be
or become effect1ve by operatlon of law. or otherwise. unless and until
Lessor or 1ts asslgnee shall have given wrltten notlce to C1ty of the
electlon on the part of Lessor or ltS asslgnee to term1nate thlS
Agreement
(b) Each and all of the remedies given to Lessor and 1tS
asslgnee hereunder or by any law now or hereafter enacted are cumulatlve
and the exerC1se of one right or remedy shall not impslr the right to
Lessor or ltS asslgnee to exerC1se any or all other remedies.
703. Suits at Law or 1n EqUlty and Mandamus. In add1t10n to
the remedles set forth In Sectlon 702 hereof. ln case one or more of the
Events of Default shall happen, then and 1n every such case, Lessor and
its ass1gnee shall be ent1tled to proceed to protect and enforce the
r1ghts vested in Lessor and its assignee by thlS Agreement by such appro.
prlate jud1cial proceed1ng as Lessor or its assignee shall deem most
effectual to protect and enforce any such right, either by suit ln equity
or by act10n at law, whether for the specific performance of any covenant
or agreement contained ln this Agreement, or to enforce any other legal
or equ1table r1ght vested 1n Lessor and its asslgnee by this Agreement or
by law. The provis10ns of th1s Agreement and the dut1es of Clty and of
the members. off1cers and employees thereof shall be enforceable by
Lessor or its asslgnee by mandamus or other approprlate SUlt, actlon or
proceed1ng ln any court of competent jurisdlction.
(a) Wlthout Ilm1tlng the generallty of the foregoing,
Lessor and lts asslgnee shall have the rlght:
28
.
.
(~) Ac~ount1ng. By action or suit ~n equity to
requIre the C1ty and Its offIcers, agent and employees and Its ass1gns to
account as the trustee of an express trust.
(~1) r~jUnct1on.
enJoIn any acts or thIngs Wh1Ch may
r~ghts of Lessor or Its assignee
By actlon or SUlt in eq~ity to
be unla~ful or ~n violatIon of the
(111) Mandamus. By mandamus or other suit. act~on or
proceedlng at law or in equlty to enforce its or the1r r1ghts aga1nst
C1ty and 1ts and any of 1tS offIcers, agents. and employees and 1tS
assIgns, and to compel It or them to perform and carry out its and the1r
dutIes and obl~gat1ons under the law and Its and theIr covenants and
agreements w~th Lessor as prov~ded here~n
704. Non-Wa~ver. ~oth~ng In th~s Article VIr or 1n any other
prOV1S1on of thIS Agreement shall affect or Impalr the obllgatlon of Clty
to pay the Lease Payments, as hereln prov1ded. ~o delay or om1SS1on of
Lessor or Its assIgnee to exerCIse any r~ght or power ar1sIng upon the
happenlng of any event of default shall impaIr any such r~ght or power or
shall be construed to be a waIver of any such event of default or any
acquiescence there~n, and every power and remedy gIven by th1s ArtIcle
VII to Lessor and ~ts aSSIgnee may be exerc1sed from time to time and as
often as shall be deemed exped~ent by Lessor or ~ts ass~gnee.
705 Remedies not Exclus~ve No remedy herein or by law con-
ferred upon or reserved to Lessor and ~ts assignee IS intended to be
exclus~ve of any other remedy, but each such remedy is cumulative and ~n
add~tlon to every other remedy, and every remedy g~ven hereunder or now
or hereafter eXlst~ng, at la~ or In equ~ty or by statute or otherw~se may
be exerc1sed ~lthout exhaustIng and ~ithout regard to any other remedy
conferred or by any law.
706. Status Quo Ante In case any su~t. actIon or proceedIng
to enforce any r1ght or exercise any remedy shall be brought or taken and
then d~scontlnued or abandoned. then. and 1n every such case, Lessor and
~ts assignee and City shall be restored to lts and their former pos~tion
and r1ghts and remedles as 1f no such SUlt, action or proceed1ngs had
been brought or taken
29
.
.
ARTICLE VIII
AD~I~ISTRATIVE PROVISIONS
801. Preservatlon and Inspect~on of Documents All documents
recelved by Lessor or ~ts ass~gnee or C~ty under the provis~ons of th~s
Agreement shall be retalned in thelr respectlve possess~ons and shall be
subject at all reasonable t~me5 to the inspect~on of the other party
hereto and 1t5 asslgns, agents and representatives, any of whom may make
coples thereof
802 Partles ~n Interest Nothlng in thlS Agreement, expressed
or lmplled, lS lntended to or shall be construed to confer upon or to
glve to any person or party other than Lessor and lts asslgnee and City
any rlghts, remedies or clalms under or by reason of thlS Agreement or
any covenants, condltlon or stipulatlon hereof; and all covenants,
stlpulatlons, promises and agreements ln this Agreement contalned by or
on behalf of Lessor or Clty shall be for the sole ~,d exclusive beneflt
of Lessor and 1ts asslgnee and Clty.
803 No Recourse Under Agreement All covenants, stlpulatlons,
promlses, agreements and obllgatlons of the partles hereto contained 1n
thlS Agreement shall be deemed to be the covenants, stlpulations,
promlses, agreements and obllgatlons of the partles hereto, respectively,
and not of any member, offlcer, employee or agent of the partles hereto
ln an lndlvldual capaclty, and no recourse shall be had for the payment
of the Lease Payments or for any clalm based thereon or under thlS
Agreement agalnst any member, offlcer, employee or agent of the parties
hereto.
804. NotIces. All notlces, certlflcates or other
communlcatlons hereunder shall be sufflclently glven and shall be deemed
gIven when delIvered or depOSIted In the Un1ted States mall wlth postage
fully prepaid
If to Lessor:
Securlty Pac~fic National Bank
300 South Grand Avenue
21st Floor 8-211
Los Angeles, CA 90071
A~tn. RIchard H. Clark
If to C1ty
CIty of Santa Monlca
1685 MaIn Street
Santa Mon~ca, CA 90401-3295
Attn: Clty Manager
30
.
.
wlth a copy ~o.
Clty of Santa Monlca
1685 Maln Street
Santa Monlca, CA 90401-3295
Attn: City Attorney
Santa Monlca Alrport
3200 Alrport Avenue
Santa Monlca, CA 90405
Attn: Alrport Director
The partles hereto, by notlce glven hereunder, may, respectlvely,
designate dlfferent addresses to which subsequent notlces, certiflcates
or other communlcatlons wll1 be sent. A copy of all notlces to one party
to thlS Agreement shall be transmltted to the other party to thls
Agreement, and to the Trustee.
805 Blndlng Effect. Thls Agreement shall lnure to the beneflt
of and be blndlng upon Lessor and City and thelr respectlve successors
and asslgns
806. Severabl11ty. If anyone or more of the covenants, StlpU-
latlons, promlses, agreements or ob11gatlons provlded ln thls Agreement
on the part of Lessor or Clty to be performed should be deterrnlned by a
court of competent Jurlsdlctlon to be contrary to law, then such cove-
nant, stlpulatlon, promlse, agreement or obllgatlon shall be deemed and
construed to be severable from the remalnlng covenants, stlpulatlons,
promlses, agreements and obllgatlons hereln contained and shall in no way
affect the val1dity of the other provlslons of thlS Agreement
807. Headlngs Any headings precedlng the text of the several
Artlcles and Sectlons hereof, and any table of contents or marglnal notes
appended to coples hereof, shall be solely for convenience or reference
and sqall not constltute a part of thls Agreement, nor shall they affect
its meanlng, constructlon or effect.
808. Appllcable Law ThlS Agreement shall be governed by and
construed ln accordance wlth the laws of the State of Callfornla
809. Lessor and Clty Representatlves. ~~enever under the
provisions of thls Agreement the approval of Lessor or Clty is requ1red
or Lessor or C1ty are requlred to take some action at the request of the
other, such approval of such request may be given for Lessor by an
Authorlzed Offlcer of Lessor and for Clty by an Authorlzed Off1cer of
Clty, and any party hereto shall be authorlzed to rely upon any such
approval or request.
810. Further Assurances Lessor and City agree that they wlll,
from tlme to tlme, execute, acknowledge and de11ver, or cause to be
executed, acknowledged and dellvered, such supplements hereto and such
31
.
.
further lnstruments as may reasonably be requ1red for correcting any
1nadequate or incorrect descr1ptlon of the Slte and the Facillties hereby
leased or lntended so to be or for carrYlng out the expressed intention
of th1s Agreement.
811 Form of Certlflcate of Offlcers. Every certlficate w1th
respect to compllance ~lth a condlt10n or covenant provided for 1n this
Agreement and whlch is precedent to the tak1ng of any act10n under th1S
Agreement shall 1nclude
(a) A statement that the person maklng or glV1ng such
certiflcate has read such covenant or condltlon and the deflnltlons
hereln relat1ng thereto,
(b) A brlef statement as to the nature and scope of the
examlnatlon or lnvestlgatlon upon whlch the statements or opinlons con-
talned ln such cert1flcate are based;
(c) A statement that, in the oplnlon of the slgner,
slgner has made or caused to be made such exam1natlon or lnvestlgat10n as
1S necessary to enable the signer to express an informed oplnion as to
whether or not such covenant or cond1tlon has been compIled with, and
(d) A statement as to whether, in the oplnion of the
slgner, such condlt10n or covenant has been compIled w1th.
A certlf1cate may be based, lnsofar as 1t relates to legal
matters, upon a certlf1cate or op1n10n of or representat10ns by counsel,
unless the persons prov1dlng the certlflcate know that the certlf1cate or
representatlons w1th respect to the matters upon whlch the certlficate
may be based are erroneous, or 1n the exerClse of reasonable care should
have known that the same were erroneous.
812 Buslness Days. Any act or th1ng requ1red to be done or
exist on any date set forth herein wh1ch does not constltute a business
day ln any year shall be deemed to be done or to eXlst on such date if
such act or th1ng 1S done or exists on the next date whlch const1tutes a
business day of banks 1n the Clty of Los Angeles, Cal1fornia
32
.
.
IN WIT~ESS ~HEREOF, ~he part~es here~o have caused thlS Agree-
ment to be executed In thelr respectlve names by their duly authorized
off2cers as of the date flrst above wrltten.
SECtRITY PACIFIC NATIONAL BANK,
as Lessor
By
V~ce Presldent
By
Vlce Pres~dent
APPROVED AS TO FORX.
ClIT OF SA~rrA tfO'\ICA,
as Lessee
Robert M Myers
Cny Attorney
By.
C~ty ~anager
[SEAL]
Attest
en}' Clerk
33
~
.
EXHIBIT A (LEGAL
.
DESCRIPTION)
LEGAL OFSCRIPTtON
SANTA MONICA AIRPORT
ADMJNlSTRA nON AND SPECIAL TV F.B.O.
PARCEL
Commendng at the most southerly corner of Tract No. )4609 in the City of Santa
Monica, County of Los Angeles, filed in Book 199, Pages' and 6, in Office of the
County Records of said County; thence South 34047'.59" East along the nort~asterIy
city lImns lme, City of Santa Monica 280.62 feet; thence South .,,021'18" West
757.73 feetj thence South ",038'42" East 70.5.1,5 feet to the TRUE POINT OF
BEGll"NlNG for thIS parcel; thence South "14021'18" West 7.56.'0 feet; thence South
4.5038'42" East 2.50.00 feet to the begmning of a curve concave northerly having a
radIUS of .57..50; thence easterly along said curve through a central angle of 90000'oon
an arc dIstance of 90.32 feet; thence North 44'021'18" East 636.'0 feet the beginning of
a curve concave northwesterly having a radiUS of 212..50 feet; thence northwesterly
aloT'g sale curve through a. central angle of 1,006'17" an arc distance of 63.44 feet;
thence f\:orth 45038'42" \\ e . 298.10 feet to the TP'JE POlr\T OF BEGINNING.
"
..
Lease Payment
Dat.e
Sept.ember I, 1986
Sept.ember I, 1987
September I, 1988
Sept.ember I. 1989
September I. 1990
September I. 1991
Sept.ember I, 1992
September I, 1993
September 1, 1994
September 1. 1995
September I, 1996
September I, 1997
September I, 1998
September 1, 1999
September I. 2000
September I. 2001
Sept.ember 1, 2002
September I, 2003
September I. 2004
September 1, 2005
September 1, 2006
September I. 2007
.
Interest
Component
* Not to exceed $525,000
Lease Payments
PrinClpal
Component
[to come)
35
.
EXHIBIT B
Lease
payment*
Stipulated Value
of Ground Lease
And Fac:lhties
. 1
.
.
TRUST AGREEHENT
RELATIKG TO AIRPORT FACILITIES
by and among
.
BAKK OF AMERICA KATIONAL TRUST A~ SAVINGS ASSOCIATION.
as Trustee
and
THE CITY OF SA~~A MO~ICA
and
SECCRITY PACIFIC NATIONAL BANK.
as Lessor
Dated as of October I, 1985
101.
102
103
104
201.
202.
301.
302
401.
402.
403.
404.
405.
406.
407.
408
409.
.
.
TABLE OF CONTEt\'TS
ARTICLE I
RECITALS A~ REPRESENTATIO~S
Ground Lease. .
Lease Agreement
Asslgnment Agreement.
Condltlons Precedent Satlsfled
ARTICLE II
DEFIKITIO~S A~D RCLES OF CONSTRUCTION
Deflnltlons
Rules of Constructlon
ARTICLE III
APPOI~TMEKT OF TRUSTEE
Appolntment of Trustee
Acceptance of Appolntment and Trust
ARTICLE IV
ESTABLISH~E~T AND ADMINISTRATION OF FUNDS AKD ACCOCNTS
Alrport Faclllties Trust Fund . . .
Establlshment of Acqulsltlon and Constructlon Account;
Payment of Acqulsltion and Construction Costs
Establlshment and Appllcatlon of Dellvery Costs Account
Establlshment and Appllcatlon of Lease Payment Account
Establlshment and Appllcatlan of Reserve Account
Establlshment and Appl1catlon of Speclal Redemptlon
Account
No Vnauthorlzed Transfers . .
Deposit and Investment of Moneys in Accounts
Credlt Agalnst Lease Payments . .
i
Page
1
1
1
1
2
6
6
7
7
7
10
10
11
12
12
12
14
SOL
502.
503.
60l.
602.
603.
604.
605.
606.
607.
608.
609.
610.
61l.
612.
613.
614.
615.
616.
617.
618
70l.
702.
703.
704
705.
.
.
Page
ARTICLE V
THE TRlJSTEE
Trustee, Dutles, Removal and Resignatlon
Compensatlon of the Trustee
Protec~lon ~o the Trustee .
14
15
15
ARTICLE VI
CERTIFICATES. TERMS A~D PROVISIONS
Prepara~lon of Cer~lflcates
Form; Denomlnatlon, ~edlum of Payment
Date of Certlflcates
Payment of Princlpal and Interest wlth Respect
to Certlflcates
Place of Payment
Numbers, Legends
Executlon
Transfer and Exchange of Certlflcates
Regulatlon wlth Respect to Exchange and Transfers
Certlflcate Reglster
Temporary Certlflcates "
Certlflcates Mutlla~ed, Lost, Destroyed or Stolen
EVldence of Slgnatures of Certiflca~e Owners and
OwnershlP of Certlflcates
Redemptlon
Redemptlon Fund
Notlce of Redemptlon
Payment on Redemptlon of Certlflcates
Partial Redemptlon of Cert1flcates
16
17
17
17
18
18
18
18
19
19
19
20
21
21
22
23
23
24
ARTICLE VII
COVENA~TS: LIMITATION OF LIABILITY
Clty to Perform Lease Agreement .
Lessor to Perform Lease Agreement
Actlon on Default . . . .
No Ob11gatlon by C1ty to O~ners .
No Obllgatlon wlth Respect to Performance by Trustee
24
24
24
24
25
11
706.
707
708.
80l.
802.
803.
804
805
806
807.
808.
809.
810.
.
No Liabl1lty to ~ners for Payment
No Respons~blllty for Sufflclency
Indemnlflcation ~o Trustee
ARTICLE VIII
.
Page
25
25
25
A~END~EKT: DEFEASANCE AD~1INISTRATIv~ PROVISIONS
Amendment .
Defeasance
Recordlng and Fll1ng.
Trustee to Keep Records .
Notlces . . . . .
Callforula Law
Severablhty.
Blndlng on Successors
Headlngs.
Counterparts
Exhlblt A' Form of Certlflcate of Partlclpatlon
ill
25
26
27
27
27
28
28
28
28
28
.
.
11679 00000002/091136-L
TRUST AGREn-fE"lT
RELATING TO AIRPORT FACILITIES
THIS TRUST AGREEME\T RELATI~G TO AIRPORT FACILITIES (the
IrAgreementlt) is made and entered lnto as of October 1, 1985, by and among
BANK OF AMERICA ~ATIONAL TRUST A~D SAVINGS ASSOCIATION, a natlonal trust
and savlngs assoclatlon under the laws of the Unlted States of Amerlca
and quallfied to accept trusts of the type hereln set forth (herein
called "Trustee"), SECURITY PACIFIC KATIO'iAL BA'\K, a natlonal banklng
assoclatlon, (hereln called "Lessor"), and the CITY OF SANTA !'1OI\ICA, a
charter Clty and munlclpal corporatlon organlzed and operating under the
laws of the State of Cahfornla (hereln called nClty");
WITNESSETH.
In conslderatlon of the mutual covenants herein contained and for
other valuable conslderatlon, the partles hereto do hereby agree as
follows
ARTICLE I
RECITALS AND REPRESE~lATIONS
101
Lease,
agreed
Ground
Ground Lease. City and Lessor have entered into the Ground
whereby Clty has agreed to lease the Slte to Lessor and Lessor has
to lease the Slte from Clty for the conslderatlon stated in the
Lease.
102
Agreement,
Facl1ltles
Facll1tles
Lease Agreement. Lessor and Clty have entered lnto the Lease
whereby Lessor has agreed to sublease the Slte and lease the
to Clty and Clty has agreed to sublease the Site and lease the
from Lessor and to make Lease Payments therefor.
103. Asslgnment Agreement. For the purpose of obtalnlng the moneys
required to be deposlted by lt wlth the Trustee, Lessor has asslgned and
transferred its rlghts and lnterest ln the Lease Agreement to the
Trustee, pursuant to the Asslgnment Agreement, and In consideration of
such asslgnment and the executlon of thls Agreement, the Trustee has
agreed to execute and del~ver Certlflcates, each eVldenc~ng an interest
ln the Lease Payments. as set forth in such Cert~f1cates_
104. Condltlons Precedent Satlsf~ed. All things, cond1tlons and
acts requlred by law to eXlst, happen and be performed precedent to and
In connectlon wlth the executlon and enterlng lnto of this Agreement do
eXlst, have happened and have been performed ln regular and due tlme,
.
.
form and manner as required by la~ and the partles hereto are now duly
empowered to execute and enter lnto thlS Agreement.
ARTICLE I I
DEFI~ITIO~S AKD ReLES OF COKSTRvCTION
201. Deflnltlons The terms deflned In thlS Sectlon 201 shall have
the meanlngs, for the purpose of thlS Agreement, hereln speclfled, as
follows:
AcqUlsltlon and Constructlon Account The term ItAcquisltlon and
Constructlon Account" means the account by that name estab11shed under,
and held by the Trustee pursuant to, Sectlon 402 of thlS Trust Agreement.
Acquisltlon and Constructlon Costs The term ItAcqulsltlon and Con-
structlon Costs,t means all costs of payment of, or relmbursement for,
acqulsltlon, construct1on and lnstallatlon of the Facllltles, lncludlng
but not Ilmlted to, archltect, englneer, project manager and constructlon
supervis10n costs, constructlon contractor payments, and costs of feasi-
bl1lty, envlronmental and other reports, bUllderst rlsk lnsurance
premlums, lnltlal hazard and llablllty lnsurance premlums, tltle
lnsurance costs, lnspectlon cos~s, permlt fees and flllng and recordlng
costs, and, ln addltlon, Dellvery Costs to the extent that the amount on
deposlt 1n the Dellvery Costs Account are lnsufflclent to pay all
Dellvery Costs ln full
It It h
Asslgnment Agreement. The term Asslgnment Agreement means t e
Asslgnment Agreement Relatlng to Alrport Facillties, dated as of
October 1, 1985, by and between Lessor and the Trustee, as now or here-
after amended.
Authorlzed Gfflcer The term tlAuthor1zed Offlcerlt, when used wlth
respect to Lessor means any Vlce Presldent of Lessor or any other offlcer
of Lessor who lS deslgnated by the Lessor as an Authorlzed Gfflcer for
purposes of the Lease Agreement. The term ftAuthorlzed Gfflcer," when
used wlth respect to Clty, means the ~ayor, C1ty Manager, Clty Flnance
Dlrector or Alrport Director or thelr deputles or asslstants or any other
offlcer or employee of City who is des1gnated by the Clty CounG11 or the
City Manager as an Authorlzed Offlcer for purposes of thlS Agreement.
Certlflcate Reglster The term t1Cert1flcate Reglstertl means the
books for reglstratlon malntalned by the Trustee pursuant to Sectlon 610
of the Trust Agreement.
2
.
.
Cert~f~cates The term "Cert~f~catesrr means the cert~f~cates of
partlclpat~on prepared and del~vered by the Trustee pursuant to the Trust
Agreement.
Clty. The term "C~ty't means the Clty of Santa Monlca, Callforn~a.
Dellvery Costs The term "Dell very Coststl means all costs of pay-
ment of or relmbursement for executlon, sale and dellvery of the Lease
Agreement and the Certiflcates, lncludlng, but not l~m~ted to, costs pa~d
or incurred by Clty, Lessor or the Trustee for fl11ng costs, prlntlng
costs, reproduction and blndlng costs, fees and charges of the Trustee,
flnanclng dlscounts, legal fees and charges and re~mbursements, flnanclal
and other professlonal consultant fees and charges and re~mbursements.
audltors fees and charges and relmbursements, costs of ratlng agencies or
cred~t ratlngs, fees for execut1on, registrat1on, transportat~on and
safekeep1ng of Certlflcates, munlclpal bonds lnsurance premlums, ~f any,
and other charges and fees ln connect~on wlth the forego~ng.
Dellvery Costs Account The term "Dellvery Costs Account" means the
account by that name establlshed under and held by the Trustee pursuant
to Sect~on 403 of the Trust Agreement.
Event of Default.
default under the Lease
Lease Agreement
The term t1Event of Defaulttl means an event of
Agreement as set forth 1n Sectlon 701 of the
Facl1~t~es The term ftFacllitles" means the airport fac~l~t~es
located and to be located on the Slte conslst~ng generally of a hangar
and an adminlstrat~on bUlld~ng.
Federal Securltles. The term "Federal Securit1estt means Un~ted
States Treasury notes, bonds, b1115 or certiflcates of lndebtedness or
obllgatlon5 for WhlCh the full falth and credlt of the Unlted States are
pledged for the payment of prlnclpal and lnterest, lncludlng Unlted
States Treasury (book entry) certlflcates, notes and bonds, state and
local government serles.
Lease Agreement. The term tlLease Agreement" means the Lease Agree-
ment Relatlng to Alrport Facllltles, dated as of October 1 1985, by and
between Lessor as lessor, and City, as lessee, as now or hereafter
amended.
Lease Payment Account. The term uLease Payment Accounttl means the
account by that name establlshed under, and held by the Trustee pursuant
to. Section 404 of the Trust Agreement
Lease Payments. The term tlLease Paymentsft means lease payments
payable by Clty for the use of the S~te and the Facllltles pursuant to
the Lease Agreement
3
.
.
Lessor The term "Lessor" means Secur~ty Pac~flc Natlonal Bank, a
natlonal banklng aSSoclatlon, as Lessor under the Lease Agreement.
Net Proceeds. The term l1~et Proc.eeds", when used w~th respect to
any ~nsurance or condemnat~on award, means the gross proceeds from the
lnsurance or condemnat~on award w~th respect to whlch that term is used
remalnlng after payment of all expenses incurred in the collectlon of
such gross proceeds.
Outstandln~. The term "Outstandlng" when used with reference to the
Certlflcates and as of any partlcular date means all Certlflcates
theretofore delivered except. (a) any Certiflcate cancelled by the
Trustee at or before sald date and (b) any certlflca~e in 11eu of or ln
Substltutlon for whlch another certlflcate shall have been dellvered
pursuant to the Trust Agreement.
Owner The term "Ol.o.iner" or "Certlflcate Owner" or "Owner of
Certlflcateslt or any slmilar term when used wlth respect to the
Cer~lflcates. means any person who shall be the reglstered Ok~er of any
Outstandlng Certlflcate.
Payment Date. The term "Payment Date" means Aprll 1 and October 1
of each year commenc~ng wlth Apr~l 1, 1986.
Perm.1tted Encumbrances. The term "Permltted Encumbrances" means 1f
and to the extent permltted by law and by any POllCY gUldellnes promul-
gated by Clty
(1) Ad valorem taxes and assessments for the current f1scal
year of City.
(11) Easements, rlghts-of-way, mlneral r1ghts and other rlghts,
covenants, conditlons of restrlctlons which ln the Judgment of Clty do
not lmpalr or lmpede or otherwlse adversely affect construction or oper-
atlon of the Facll1tles or access to the Facl1ltles by Lessor or its
asslgnee.
(iil) Lease Agreement.
(iv) The Asslgnment Agreement.
Permltted Investments. The term tlpermltted Investments" means:
(i) Federal Secur~tle5;
(li) Obllgatlons of the Export-Import Bank of the United
States, the Unlted States Postal Service, the Government Natlonal
Mortgage Assoc~atlon, the Federal National Mortgage ASsoclatlon, the
Federal Farm Credlt Bank, the Federal Flnanclng Bank, the Federal
Intermed~ate Credlt Banks, the Federal Banks for Cooperatlves, the
4
.
.
Federal Land Banks, the Farmers Home Admlnlstratlon and the Federal Home
Loan ~ortgage Gorporatlon, the Student Loan ~arketlng Assoc1at1on or any
agency or lnstrumentality of the federal government ~hich shall be
establlshed for the purposes of acqu1rlng the obllgatlons of the
foregolng or otherW1se provldlng flnanclng therefor,
(iii) Project notes lssued by publlC agencles or munlcipalities
and fully secured as to the payment of both prlnc1pal and interest by a
requls1t1on or payment agreement w1th the Un1ted States;
(lV) ~egot1able cert1flcates of deposit or tlme deposlts (In-
cludlng, wlthout llmltat1on, certlflcates of deposlt) lssued by any bank,
organlzed under the laws of any State of the Un1ted States of Amerlca or
any nat10nal bank1ng aSSOClat10n lnclud1ng the Trustee, prov1ded that
such deposlts shall be (1) contlnuously and fully lnsured by the Federal
Deposlt Insurance Corporatlon, or (11) issued by any bank organized under
the laws of any state of the United States, or any natlonal banklng asso-
clatlon (lncludlng the Trustee), whlch is rated, or whose general obliga-
tlons are rated, Aa or better by Moody.s Investors Service, Inc., or
(lil) any bank, trust company or savlngs and loan association
continuously and fully secured by such securltles as are described above
1n clauses (1) or (li) of thls deflnltlon, which securlties shall have a
market value (exclus1ve of accrued lnterest) at all t1mes at least equal
to the prlnclpal amount of such certlflcates of deposlt;
(v) Any repurchase agreement w1th any bank or trust company
organlzed under the laws of any state of the United States or any
nat10nal bank1ng assoclatlon (lnclud1ng the Trustee), or government bond
dealer reportlng to, tradlng wlth and recognlzed as a prlmary dealer by,
the Federal Reserve Bank of New York, whlch agreement lS secured by any
one or more of the secur1tles descrlbed In clauses (1) or (li) of th1s
deflnltlon, provlded the underlYlng securltles are requlred by the
repurchase agreement to be held by any such bank, trust company or
pr1mary dealer havlng a comblned cap1tal and surplus of at least
5500,000,000, and prov1ded the securltles are marked to market at least
every two weeks and malnta1ned on such marked to market bas1s at a market
value not less than the amount so lnvested, and
(Vl) Bllls of exchange or tlme drafts drawn on and accepted by
a commerclal bank, other~ise known as bankers acceptances, whlch are
el1glble for purchase by the Federal Reserve System. Such bankers
acceptances may not exceed 181 days maturlty.
Pr1ncipal Office. The term "Prlnclpal Offl.ce" means the prlnclpal
corporate trust offlce of the Trustee in Los Angeles, Cal1fornla.
Redemptlon Fund. The term "Redemptlon Fund" means the fund by that
name establ1shed under, and held by the Trustee pursuant to, Section 615
of thls Trust Agreement.
5
.
.
Reserve Account. The term "Reserve Accounttl means the account by
that name establlshed under, and held by the Trustee pursuant to,
Sectlon 405 of thls Trust Agreement.
Reserve Requlrement The term "Reserve Requirement" means an amount
equal to the largest of the annual Lease Payments as shown ln Exhibit B
to the Lease Agreement.
Slte. The term "Site" means the real property more partlcularly
descr1bed ln Exhib1t B attached to the Lease Agreement
Speclal Redemptlon Account The term "Spec1al Redemptlon Accounttl
means the account by that name establ1shed under, and held by the Trustee
pursuant to, Sectlon 406 of this Trust Agreement.
Trust Agreement The term tlTrust AgreementU means the Trust Agree-
ment Relatlng to Alrport FaC1l1tles, dated as of October 1, 1985, by and
among the Trustee, Lessor and Clty, as now or hereafter amended
Trustee The term "Trustee" means Bank of America l\'at1onal Trust
and Savlngs Assoclatlon or 1ts successors 1n 1nterest act1ng as Trustee
under the Trust Agreement
202. Rules of Constructlon. Words of the masculine gender shall be
deemed and construed to 1nclude correlat1ve words of the fem1n1ne and
neuter genders. Unless the context otherW1se lndlcates, words lmportlng
the slngular number shall include the plural number and vice versa, and
words 1mport1ng persons shall lnclude corporatlons and aSsoc1atlons,
1nclud1ng publlc bod1es, as well as natural persons.
The terms "hereby,IT tlhereof," "hereto,1I "hereln," "hereunder,1I and
any slm1lar terms, as used In th1s Agreement, refer to thlS Agreement.
ARTI CLE I II
APPOINT~E~~ OF TRUSTEE
301. Appo1ntment of Trustee. In cons1deration of the recltals
herelnabove set forth and for other valuable cons1deratlon, Lessor and
C1ty hereby appolnt the Trustee to recelve, hold, lnvest and dlsburse the
Lease Payments to be pald to 1t pursuant to the Lease Agreement ln trust
to have and to hold for the beneflt of the Certlflcate Owners for credlt
to the various funds and accounts establ1shed by th~s Agreement, to pre-
pare, execute, del~ver and deal w1th the Certlflcates, and to apply and
d1sburse the Lease Payments to the Owners of Certiflcates; and to perform
certaln other funct~ons; all as here1nafter prov~ded and subject to the
terms and cond~tlons of th1S Agreement.
6
.
.
302. Acceptance of Appolntment and Trust. In considerat1on of the
compensatlon herelnafter prov1ded for, the Trustee accepts the appoint-
ment and trust above referred to subJect to the terms and condit1ons of
thlS Agreement.
ARTICLE IV
ESTABLISHME~T A~ ADMINISTRATION OF FUNDS AND ACCOUNTS
401 Alrport Faclllt1es Trust Fund There 1S hereby establ1shed
with the Trustee a speclal trust fund to be deslgnated the HA1rport
Fac1lltles Trust Fund" The Trustee shall keep said Alrport Fac1l1tles
Trust Fund separate and apart from all other funds and moneys held by it
W1thln the Alrport Fac1lltles Trust Fund. there are hereby establlshed
the Acqulsltlon and Constructlon Account more partlcularly descr1bed In
Sectlon 402. the Dellvery Costs Account more partlcularly described ln
Sectlon 403, the Lease Payment Account more partlcularly descTlbed In
Sectlon 404, the Reserve Account more partlcularly descrlbed ln Sec-
tlon 405 and the Special Redemptlon Account more partlcularly descrlbed
In Sectlon 406. On the date of dellvery of the Lease Agreement, the
Trustee, as assignee of Lessor under the Asslgnment Agreement, agrees to
deposlt. from the proceeds of the Certlflcates, an amount equal to esti-
mated Dellvery Costs in the Dellvery Costs Account, an amount equal to
1nterest accrulng on Certlflcates for a perlod of two and one-half years
ln the Lease Payment Account, an amount equal to the Reserve Requlrement
ln the Reserve Account, and the rema!nder of such proceeds 1n the ACqU1-
sltlon and Construct1on Account
402. Establlshment of Acqulsltion and Construction Account;
Payment of Acqulsltion and Constructlon Costs.
(a) Withln the Alrport Facll1ties Trust Fund. there is establlshed
by Sect10n 401 a speclal account to be deslgnated IIAcqulsition and Con-
structlon Accountt,. The Trustee shall keep the Acqu~s~tion and Construc-
t~on Account separate and apart from all other funds and accounts held by
lt and shall adm~nlster the Acquls1tion and Construction Account as pro-
Vlded in this Sectlon 402
(b) Amounts in the Acquis~tlon and Construction Account shall be
disbursed for Acquls1tlon and Construct1on Costs. Subject to the
requlrements of subsectlon (c). dlsbursements from the Acquls1tlon and
Constructlon Account shall be made by the Trustee upon rece1pt of a
certlflcate requestlng dlsbursement executed by an Authorlzed Officer of
Lessor or lts agent. Each such certificate shall'
(i) set forth the amounts to be dlsbursed for payment or relm-
bursement of prev10us payments of Acqu~slt1on and Construct1on Costs and
the person or persons to whom sald amounts are to be dlsbursed;
7
.
.
(11) state that the amounts to be disbursed constitute Acquisi-
tlon and Constructlon Costs as sald term lS deflned in the Lease
Agreement, that said amounts are requlred to be dlsbursed pursuant to a
contract entered into therefor by Lessor and were necessarily and
reasonably incurred; and that sald amounts are not being paid 10 advance
of the time, lf any, fixed for payment;
(111) state that no amount set forth in the certlflcate was
lncluded ln any certlflcate requesting dlsbursement prevlously flIed with
the Trustee pursuant to thls Section;
(iv) state that the amount remainlng in the Acquisltlon and
Construction Account) together wlth estlmated lnterest earnings thereon,
will) after payment of the amount set forth ln the certlflcate requesting
dlsbursement) be sufflClent to pay all remainlng Acquisition and
Construction Costs as then estlmated;
(v) state that, if liquidated damages are to be 1mposed
through wlthholdlng payment from contractors) the Trustee shall Wlthdraw
from the Acquls1tlon and Construction Account and transfer to the Trustee
for deposlt 1n the Lease Payment Account, and for appllcation as a credlt
agalnst Lease Payments) an amount equal to said liquldated damages;
(Vl) state that no Event of Default or event which, w1th the
passage of time or giving of notlce or both would constitute an Event of
Default, has occurred and lS contlnulng; and
(Vll) state that no mechanics 11ens or stop notlces have been
rece1ved or flIed wlth respect to the Fac1l1ties, except for llens or
claims as to WhlCh Clty has set aSlde or caused to be set aside reserves
adequate for the payment thereof, provided that upon any proceedings to
foreclose such 11ens or clalIDs Lessor or its agent will promptly payor
cause to be pa1d such liens or claims unless contested ln good falth by
Clty by appropriate proceedings.
(c) Pr10r to the 1nltls1 dlsbursement of funds from the Acquisition
and Constructlon Account follow1ng recordatlon of the Lease Agreement)
City shall deposlt wlth the Trustee:
(i) the tltle insurance policy required by Section 509 of the
Lease Agreement;
(li) the oplnl0n of counsel to Clty stat1ng that all approvals,
consents, 11censes, certlflcates and permlts, WhlCh are conditions prece-
dent to the acquisitlon, constrllctlon and lnstallatlon of the Facilities,
of any government or agency or bureau thereof) lnclud1ng City. havlng
Jurlsd1ction with respect to the Facilltles have been obtalned,
8
.
.
(~~~) complete plans and speclflcat~ons for the constructlon of
the Facllltles;
(~v) the certlflcate of an Authorlzed Offlcer of the C~ty
statlng that such Authorlzed Offlcer has rev~ewed the plans and spec~-
f~catlons for the construction of the Facillties, that such plans and
speclflcations represent the complete plans and speclf~catlons for the
Facll1tles (except as such cert~flcate may ind1cate) and that the Slte on
wh~ch the Facll~t1es are to be constructed pursuant to such plans and
speclf~catlons is the Site descr~bed ln Exhlblt A attached to the Lease
Agreement; and
(v) a fully executed contract for the constructlon of the
Facihties.
(d) Each certlflcate requestlng disbursement whlch 1S submitted
pursuant to subsect~on (b) and whlch relates to dlsbursement for con-
struct~on or lnstallat~on of a portlon of the Facllitles shall be accom-
panled by the cert~flcate of an Authorlzed Offlcer of the City approVlng
the certlflcate requestlng dlsbursement and certlfying that insofar as
such cert~f~cate relates to payment for work, materlals, equlpment or
supplles, such work was actually performed, or such materials, equipment
or supplies were actually installed in furtherance of the construction
and lnstal1atlon of the Facilltles or delivered to the Site for such
purpose, or dellvered for storage or fabricatlon at a place approved by
Lessor In add1tlon, each certlflcate requestlng dlsbursement for con-
structlon of a port~on of the FaCll~t~es represented by a contract there-
for shall, prlor to the lnltlal dlsbursement (made after the date of
recordation of thlS Agreement) under such contract be accompanled by the
certlficate of an Authorlzed Offlcer of the Clty stating that such Autho-
rlzed Offlcer has reVlewed the flnal plans and speciflcatlons for sald
portlon of the Facl1lt1es and that the contract for constructlon thereof
1S ln accordance w1th sald plans and spec~flcations,
(e) Upon the earlier of (i) the date of receipt of the cer~if1cate
of an Author~zed Offlcer of Lessor that the construction of the Faclll-
tles has been substant1ally completed In accordance wlth the plans and
speclflcations therefor or (11) Aprl1 2, 1988, the Trustee shall transfer
any amounts remaining ~n the Acquislt10n and Construct~on Account lnto
the Lease Payment Account and shall close the Acquls1t~on and Con-
struct10n Account. Upon transfer of S81d amounts to the Lease Payment
Account, sald amounts shall be segregated lnto a separate subaccount and
appl1ed as a credlt agalnst the pr1nclpal component of the Lease Payments
due by C~ty follow~ng the date of such depos~t In success~ve order untl1
full disbursement of said amounts, provided that lf prlor to August 15,
1986, the Trustee shall not have rece~ved the documents requlred by sub-
sect~on (c), such amounts shall be transferred to the Spec1al Redemptlon
Account and applled to redeem Cert1flcates ln whole pursuant to
Sect10n 614(b). Upon such transfer the Trustee shall prov~de wrltten
9
.
.
not1ce to City of the amount of such transfer While held in such sub-
account, sa1d amounts shall not be 1nvested at a yield 1n excess of the
yield w1th respect to the Certif1cates Wh1Ch 1S produced by the Lease
Agreement.
403. Establ1shment and Appl1cat1on of Del1very Costs Account
(a) W1th1n the A1rport Facil1t1es Trust Fund, there 1S established
by Sect10n 401 a spec1al account to be des1gnated the "Delivery Costs
Account" The Trustee shall keep the Del1very Costs Account separate and
apart from all other funds and accounts held by 1t and shall admln1ster
the Dellvery Costs Account as prov1ded 1n th1S Sectlon 403.
(b) Amounts 1n the De11very Costs Account shall be dlsbursed for
Delivery Costs D1sbursements from the Dellvery Costs Account shall be
made by the Trustee upon receipt of a cert1f1cate request1ng dlsbursement
executed or approved by an Authorlzed Offlcer of City. Subject to sub-
sect10n (c) hereof, each such cert1flcate shall
(i) set forth the amounts to be d1sbursed for payment or re1m-
bursewent of preVlOus payments of Del1very Costs and the person or
persons to ~hom sa1d amounts are to be dlsbursed;
(11) state that the amounts to be d1sbursed const1tute Dellvery
Costs, that sald amounts are requ1red to be dlsbursed pursuant to a con-
tract entered lnto therefor by or on behalf of Lessor or C1ty, or were
necessarlly and reasonably 1ncurred, and that sald amounts are not belng
pa1d ln advance of the tlme, lf any, f1xed for payment,
(i1i) state that no amount Set forth in the cert1f1cate was
1ncluded 1n any certlf1cate request1ng d1sbursement previously flIed wlth
the Trustee pursuant to th1s Sectlon. and
(iv) state that the amount remainlng in the Delivery Costs
Account w1ll, after payment of the amount set forth 1n the Cert1flcate
request1ng dlsbursement. be sufflc1ent to pay all remaln1ng De11very
Costs as then estlmated
(c) Upon the earl1er of (1) the date of recelpt of a Certlflcate
executed by an Authorlzed Off1cer of Clty stat1ng that all Del1very Costs
have been pa1d or provislon for pa}~ent thereof has been made or
(ii) Aprl1 I, 1986, the Trustee shall transfer any amounts rema1nlng In
the Dellvery Costs Account to the Acqulsltlon and Constructlon Account
and the Delivery Costs Account shall be closed.
404 Establlshment and Appl1cat1on of Lease Payment Account.
(a) w1th1n the Alrport Facillt1es Trust Fund, there 1S establlshed
by Sectlon 401 a separate account to be deslgnated the "Lease Payment
10
.
.
Account", Such account shall be malntained by the Trustee untll the
Lease Payments are pald ln full pursuant to the terms of the Lease Agree-
ment. Lease Payments paid to the Trustee, as asslgnee of Lessor pursuant
to the Lease Agreement and to the Asslgnment Agreement, shall be
deposited by the Trustee ln the Lease Payment Account
(b) The Trustee shall withdraw from the Lease Payment Account, on
each Payment Date, that amount of the annual Lease Payment due on the
September 1 prlor to such Payment Date as wlIl be sufficient for the
purpose of, and shall cause the same to be applled to, the payment of
prlnclpal and lnterest payments due wlth respect to the Certlflcates on
such Payment Date.
(d) Whenever there has been a prepayment, for any reason, of Lease
Payments, the Trustee shall prepare and transffilt to Clty and Lessor a
revlsed Lease Payment schedule reflectlng such prepayment, whlch schedule
shall be labeled "Amended Exhlblt B to Lease Agreement"
405. Establlshment and Appllcatlon of Reserve Account.
(a) Wlthln the Alrport Facll1tles Trust Fund, there lS establlshed
by Sectlon 401 a separate account to be deslgnated the "Reserve Account."
Such account shall be maintalned by the Trustee untll the Lease Payments
are pald ln full pursuant to the terms of the Lease Agreement.
(b) If on any Payment Date the amounts ln the Lease Payment Account
are less than the Lease Payments then due, the Trustee shall transfer
from the Reserve Account to the Lease Payment Account an amount
sufflClent to make up such deflclency In the event of any such
transfer, the Trustee shall, wlthln flve (5) days after maklng such
transfer, provlde wrltten notice to City of the amount and date of such
transfer and Clty shall thereupon pay dellnquent Lease Pa}~ents.
(c) Moneys In the Reserve Account shall be (1) applled as a credlt
agalnst the last remalnlng lnstallments of Lease Payments and for that
purpose shall be transferred to the Lease Payment Account by the Trustee
not later than the flrst day of the month prlor to the Payment Dates
pertalnlng to such lnstallments, or (il) used for the purpose of maklng
up deficlencles ln the Lease Payment Account ln the event that moneys ln
the Lease Payment Account are less than the Lease Payments then due on
any Payment Date, and for the latter purpose moneys may be wlthdrawn from
the Reserve Account and transferred to the Lease Payment Account, as
provlded ln subsectlon (b)
(d) If on any Pa}~ent Date, the amount of all payments due and
payable with respect to the Certlflcates exceeds the amount on hand ln
the Lease Payment Account, taklng lnto account any transfers made from
the Reserve Account pursuant to subsectlon (c), the Trustee shall apply
the moneys on hand thereln flrst to the payment of all lnterest past due
11
.
.
with respect to all Certificates, and second to the payment of that por-
t10n of the unpa1d pr~nc~pal balance of each Certificate which is then
past due, pro rata if necessary, Upon recelpt of any delinquent Lease
Payment with respect to wh1ch moneys have been advanced from the Reserve
Account, such Lease Payment shall be depos1ted in the Reserve Account.
406. Establishment and Appl~catlon of Special Redemption Account.
(a) With1n the A1rport Facil1t1es Trust Fund, there lS established
by Section 401 a spec1al account to be designated the IISpecial Redemption
Account, II The Trustee shall keep the Special Redempt10n Account separate
and apart from all other funds and accounts held by it and shall admlnis-
ter the Speclal Redemptlon Account as prov~ded in th1s Sect10n 406.
(b) On the date of closing of the sale of the Cert~ficates,
shall pay to the Trustee, from any legally available funds (other
proceeds of the sale of the Cert1flcates). the sum of $
the Trustee shall deposlt such sum 1n the Spec1al Redemption
C~ty
than
, and
Account.
(c) Amounts 1n the Special Redemption Account shall be used to
redeem Cert1flcates in whole in the event of mandatory redemption pur-
suant to Sectlon 6l4(b) and for no other purpose.
(d) If'at any time pr10r to August 15, 1986 the Trustee shall have
rece1ved the documents requ1red by Sectlon 402(c), and if all other sums
payable by City hereunder shall be paid, the Trustee shall promptly pay
any amounts (lncludlng ~nterest or other lncome as provided ln Sect~on
408(b)) remain~ng ~n the Special Redempt~on Account to the City and
shall close the Special Redemptlon Account.
407. No Unauthor~zed Transfers No amount shall be withdrawn or
transferred from or pald out of any fund or account except as in this
Agreement expressly prov1ded.
408 Depos~t and Investment of Moneys in Accounts.
(a) All moneys held by the Trustee in any of the funds or accounts
establlshed pursuant to thls Agreement shall be deposited or lnvested In
Permitted Investments. Such investments shall be made at the dlrectlon
of the Clty or, 1n the absence of t~mely directlon as prov1ded below, In
Permitted Investments selected by the Trustee ~n its sole discretion,
and shall be held by the Trustee. The Trustee shall make investments in
Perm~tted Investments ~n accordance with written or telephone lnstructions
(confirmed the next day in writ~ng) prov~ded by an Authorized Officer of
the City not less than two (2) bus1ness days pr10r to the date on whlch
each 1nvestment 18 made, provided that such instructions are not incons1s-
tent wlth the Trustee's f1duciary obl1gatons hereunder, Moneys in the
Special Redempt10n Account shall be 1nvested 1n Permitted Investments
matur1ng not later than September 30, 1986.
12
.
.
(b) All lnterest and other lncorne recelved by the Trustee on
lnvestment of the Lease Payment Account or Redemptlon Fund shall, prlor
to the date of recelpt of the certlflcate referenced ln Sectlon 4.02(e)
hereof, be transferred on or prlor to August 31 of each year, to the
Acqulsltlon and Constructlon Account and, after sald date, shall be
retalned ln the Lease Payment Account or Redemptlon Fund and be applled
as set forth ln Sectlon 404 and Sectlon 615 hereof, respectlvely,
provlded, however, that in the event that amounts on deposit ln the
Reserve Account are less than the Reserve Requlrement, sald lnterest or
income recelved after the date of recelpt of the certiflcate referenced
ln Sectlon 402(e) hereof, shall be deposlted ln the Reserve Account untll
there lS on deposlt ln the Reserve Account an amount equal to the Reserve
Requlrement All lnterest and other lncorne recelved by the Trustee on
lnvestment of the Reserve Account shall be retalned ln the Reserve
Account ln the event that amounts on deposit ln the Reserve Account are
less than the Reserve Requlrement. In the event that amounts then on
deposlt ln the Reserve Account equal or exceed the Reserve Requlrement,
such excess shall, prlor to the date of receipt of the certlflcate
referenced ln Sectlon 402(e) hereof, be transferred to the Acqulsltlon
and Construction Account and, follo~lng sald date. be transferred to the
Lease Payment Account Transfers to the Lease Payment Account shall be
made by the Trustee on or prior to August 31 of each year, commenclng
wlth the first of such dates followlng the date of receipt of the
certlflcate referenced ln Sectlon 402(e) hereof, and shall be applled as
set forth hereln Provlded that there are no dellnquent Lease Paj~ents,
amounts retalned or deposlted ln the Lease Payment Account pursuant to
thls subsectlon (b) shall be applied as a credlt agalnst the Lease
Payments due from Clty pursuant to the Lease Agreement on the Payment
Date followlng the date of deposit. At the tlme of deposlt of said
moneys ln the Lease Payment Account, the Trustee shall. pursuant to Sec-
tion 409, report the amount of sald credit to Clty. All lnterest or
other lncome derived from lnvestments of the Acquisition and Construction
Account. the Dellvery Costs Account and the Speclal Redemptlon Account
shall be deposited In the Acqu1s1tlon and Construction Account. the
Dellvery Costs Account, and the Speclal Redemptlon Account, respect1vely,
untl1 sald accounts are closed pursuant to Sectlons 402, 403 and 406
hereof. respectlvely.
(e) The Trustee may act as prlnclpal or agent in making or d1spos-
lng of any lnvestment. The Trustee shall not be liable for any loss
resulting from the making or dlSposltion of any investment made 1n
compllance wlth thlS Seetlon. and any such losses shall be charged to the
account wlth respect to walch such lnvestment was made.
Investments In any and all funds and accounts may be commingled in a
separate fund or funds for purposes of maklng. holdlng and disposing of
lnvestments. notwlthstandlng provlsions hereln for transfer to or holdlng
ln or to the credit of partlcular funds or accounts of amounts recelved
or held by the Trustee hereunder. provlded that the Trustee shall at all
13
.
.
times account for such lnvestments strlctly ~n accordance wlth the funds
and accounts to WhlCh they are credlted and otherWlse as provlded ln this
Indenture
409. Credlt A~alnst Lease Payments On or prlor to August 31 of
each year, the Trustee shall report to Clty the amount of the credlt
agalnst Lease Payments avallable to Clty under the Lease Agreement. Such
cred~t shall be an amount equal to the sum of (~) the amount of ~nterest
and other income earned on the Lease Pa}~ent Account (provlded there lS
then on deposlt In the Reserve Account an amount equal to the Reserve
Requ1rement) since the date of the previous report made by the Trustee
pursuant to thlS Sectlon 409, plus (~~) the amount of ~nterest and ether
income earned on the Reserve Account (provlded there is then on depos~t
ln the Reserve Account an amount equal to the Reserve Requlrement) Slnce
the date of the prevlous report made by the Trustee pursuant to thlS
Sect~on 409, plus (~ll) the amount, ~f any, then on deposlt ~n the Lease
Payment Account In addlt~on to the credlt referenced ln the precedlng
sentence, the Trustee and Lessor acknowledge that, pursuant to Sectlon
403 of the Lease Agreement, there shall be applled as a cred~t agalnst
Lease Payments payable on Pay~ent Dates prior to the date of recelpt of
the certlflcate referenced ln Sectlon 402(e) hereof, an amount equal to
the amount then on deposlt ln the Lease Payment Account and that the
amount ln the Reserve Account shall be applied as a credlt agalnst the
last Lease Payments due prlor to the exp~rat~on of the term of the Lease
Agreement In the event that the total amount of the credlt exceeds the
Lease Payment due on the Payment Date followlng sa~d report, the amount
of sald excess shall be applied as a credlt agalnst the next subsequent
Lease Payments.
ARTICLE V
THE TRCSTEE
501. Trustee, Dutles~ Removal and Reslgnatlon. By executlng and
dellvering thls Agreement, the Trustee accepts the dutles and obllgatlons
of the Trustee provlded ln thlS Agreement, but only upon the terms and
conditlons set forth ln thls Agreement.
Lessor and Clty may by wrltten agreement between themselves, or the
~~ers of a maJorlty in aggregate prlnclpal amount of all Certlf~cates
Outstandlng may by wr~tten request, remove the Trustee lnltlally a party
to th~s Agreement and any successor thereto and may appolnt a successor
Trustee, but any such successor shall be a bank or trust company do~ng
bus~ness and havlng an offlce in Los Angeles, California, havlng a com-
blned capltal (excluslve of borrowed capltal) and surplus of at least
Flfty Mllllon Dollars ($50,000,000) and subject to superv~slon or examl-
natlon by federal or state authorlty. If such bank or trust company
publlshes a report of condltlon at least annually, pursuant to law or to
14
.
.
the requlremenLs of any supervlsing or examlning authorlty above referred
to, then for the purposes of thlS Sectlon the comb1ned capltal and sur-
plus of such bank or trust company shall be deemed to be lts combined
cap1tal and surplus as set forth 1n lts most recent report of condition
so publlshed.
The Trustee may at any tlme reslgn by glving wrltten not1ce of
reslgnatlon by mall postage prepald to Lessor and Clty and to the
Cert1flcate ~'ners at thelr addresses shown on the Certiflcate Reg1ster
Said not1ce shall be ma1led not less than nlnety (90) days prior to the
proposed effectlve date of res1gnatlon. Cpon receivlng such notlce of
reslgnatlon, Clty shall promptly appo1nt a successor Trustee by an
lnstrument In wrltlng, provlded, however, that in the event that C1ty
does not appo1nt a successor Trustee wlLhln Slxty (60) days follow1ng
recelpt of such notice of reslgnatlon, Lessor may appolnt a successor
Trustee and In the event that Lessor does not appolnt, wlthln thirty (30)
days thereafter, such successor Trustee, the reslgnlng Trustee may
pet1tlon the appropr1ate court hav1ng jur1sdlct1on to appolnt a successor
Trustee Any reslgnatlon or removal of the Trustee and appolntment of a
successor Trustee shall become effectlve upon acceptance of appo1ntment
by the successor Trustee
502. Compensat1on of the Trustee Clty shall from time to time, on
demand, pay to the Trustee reasonable compensation for its serV1ces and
shall re1mburse the Trustee for all lts advances and expendltures,
lncluding but not 11mlted to advances to and fees and expenses of
lndependent appraisers, accountants, consultants, counsel, agents and
attorneys-at-law or other experts employed by it ln the exerC1se and
performance of lts powers and duties hereunder.
503 Protectlon to the Trustee The Trustee shall be protected and
shall 1ncur no Ilab1l1ty 1n act1ng or proceedlng 1n good falth upon any
resolut1on, notlce, telegram, request, consent, walver, cert1flcate,
statement, affldavit, voucher, bond, requisitlon or other paper or docu-
ment WhlCh it shall in good falth bel1eve to be genulne and to have been
passed or signed by the proper board or person or to have been prepared
and furnlshed pursuant to any of the prov1slons of th1S Agreement, and
the Trustee shall be under no duty to make any 1nvest1gatlon or lnqu1ry
as to any statements conta1ned or matters referred to 1n any such lnstru-
ment, but may accept and rely upon the same as conclus1ve eVldence of the
truth and accuracy of such statements. The Trustee may consult with
counsel wlth regard to legal questions and the opinlon of such counsel
shall be full and complete author1zatlon and protect1on 1n respect of any
act10n taken or suffered by 1t hereunder ln good fa1th 1n accordance
therew1th
Whenever 1n the admlnlstration of ltS dutles under this Agreement,
the Trustee shall deem lt necessary or desirable that a matter within the
knowledge and control of C1ty or Lessor be proved or establlshed pr10r to
15
.
.
tak~ng or suffer~ng any actlon hereunder, such matter (unless other
eVldence ln respect thereof be hereln speclflcally prescribed) shall be
deemed to be concluslvely proved and establlshed by the certificate of an
Authorlzed Offlcer of C~ty or Lessor and such certlflcate shall be full
warranty to the Trustee for any actlon taken or suffered under the
provlslons of thlS Agreement upon the faith thereof, but in lts
dlscretlon the Trustee may, In lIeu thereof, accept other eVldence of
such matter or may require such additional evidence as to it may seem
reasonable.
The Trustee may buy, sell, own, hold and deal ln any of the Certlfl-
cates provlded pursuant to th1S Agreement, and may Jo~n in any act~on
whlch any Owner may be entitled to take wlth l~ke effect as ~f the
Trustee were not a party to thIS Agreement. The Trustee, eIther as
prlnclpal or agent, may also engage ln or be 1nterested ln any fInancIal
or other transactlon w~th Clty and may act as deposltory, trustee, or
agent for any commlttee or body of Owners of Certlflcates or other
obl~gatlons of the Clty as freely as if ~t were not Trustee hereunder.
The Trustee may execute any of the trusts or powers hereof and per-
form the dutles required of lt hereunder by or through attorneys, agents,
or recelVers, and shall be entItled to adv~ce of counsel concern~ng all
matters of trust and lts duty hereunder, and the Trustee shall not be
answerable for the negl~gence or mlsconduct of any such attorney, agent,
or recelver selected by lt wlth reasonable care. The Trustee shall not
be answerable for the exerClse of any dlscretion or power under thlS
Agreement or for anythlng whatever ln connection wlth the funds and
accounts establlshed hereunder, except only for Its own wll1ful mlscon-
duct or negllgence or breach of duty.
The parties hereto acknowledge that any recitals hereln contalned
are not made by the Trustee
ARTICLE VI
CERTIFICATES TER~S AND PROVISIONS
601. Preparatlon of Certiflcates. The Trustee ~s hereby directed,
upon wrltten request from Clty executed by an Authorlzed Offlcer of Clty,
to prepare, execute and dellver to PaineWebber Incorporated, In an aggre-
gate prlnclpal amount of Dollars ($ )
evidenclng und~vlded ownershlp lnterests ln the Lease Payments to be paid
by Clty under the Lease Agreement, as set forth 1n such Certlflcates
Clty hereby certlfies, recltes and declares that all things, cond1tlons
and acts requlred by the constltutlon and statutes of the State of Cali-
tornla and the Lease Agreement and this Agreement to exist, to have
happened and to have been performed precedent to and in the delIvery of
16
.
.
th1S Cert1f1cate, eX1st, have happened and have been performed ln due
tlme, form and manner as requlred by law.
602 Form, Denomlnatlon, ~led1um of Payment The Cert1ficates shall
be del1vered 1n the form of fully reglstered Cert1ficates without coupons
1n the denom1nat1on of $5,000 each or any whole multlple thereof (Wh1Ch
form shall be substantlally ln the form set forth ln Exh1blt A hereto
attached and by thlS reference hereln lncorporated). The Certlflcates
shall be payable 1n lawful money of the Unlted States of Amer1ca whlch at
the tlme of payment 1S legal tender for the payment of public and private
debts
603 Date of Certlf1cates
October 1, 1985
The Certif1cates shall be dated as of
604 Payment of Prlnc1pal and Interest with Respect to Cert1flcates.
The prlnc1pal of the Certlflcates shall be payable from the prlnc1pal
component of Lease Payments on October 1 In each of the years and ln the
amounts set forth below Interest w1th respect to the Certlf1cates shall
be payable seMlannually on Apr1l 1 and October 1 of each year, commenclng
on Apr11 1, 1986, to and lncludlng the date of pr1nclpal payment or
redenptlon, whlchever lS earller Interest wlth respect to the Certlfi-
cates 1S payable from the Payment Date lmmediately preced1ng the date of
authentlcat10n thereof, unless such date of authentlcatlon 1S a Payment
Date, 1n Wh1Ch event 1nterest shall be payable from such Payment Date, or
unless such date of authentlcatlon 1S after the flfteenth day of the
month preced1ng a Payment Date and prlor to such Payment Date, in whlch
event 1nterest shall be payable from such Payment Date, or unless such
date of authentlcatlon is on or before ~arch 15, 1986, III Wh1Ch event
1nterest shall be payable from October 1, 1985, provlded, however, that
If as of the date of authent1cat1on of any Certlflcate 1nterest wlth
respect thereto 1S ln default, such 1nterest shall be payable from the
Payment Date to wh1ch 1nterest has prev10usly been pald or made ava1lable
for payment. Sa1d 1nterest shall represent the port1on of Lease Payments
deslgnated as lnterest comlng due on the September 1 pr10r to each of
said October 1 and Aprll 1 dates, computed at the rates set forth below
17
.
.
Year
Prlnclpal
Amount
Interest
Rate
Year
Prlnclpal
Amount
Interest
Rate
1986
1987
1988
1989
1990
1991
1992
1993
-0-
-0-
1994
1995
1996
1997
1998
1999
2006
2007
605. Place of Payment The pr1nclpal wlth respect to all Certlfl-
cates shall be payable at the Prlnclpal Offlce of the Trustee. Interest
~Ith respect to the CertIfIcates shall be payable by check or draft of
the Trustee malled to the Owners thereof provlded, however, that the
O\.'ners of the CeTtlilcates shown all the Certlflcate Register on the flf-
teenth day of the month precedlng the Payment Date shall be deemed to be
the Owners of the CertIflcates on saId Payment Date for the purpose of
the payment of lnterest.
606. Numbers; Legends The Certlflcates may be numbered by such
method as shall be determined by the Trustee. The CertIfIcates may con-
taln or have endorsed thereon such provIsions, speclflcatlons and
descrIptlve words not lnconslstent WIth the provIs1ons of thlS Agreement
as may be necessary or desirable to comply WIth custom, or otherwlse, as
may be determlned by City prior to the delIvery thereof.
607. Executlon. The CertIfIcates shall be executed in the name of,
and by, the Trustee, as trustee under thlS Agreement, by the manual
SIgnature of an authorlzed offlcer of the Trustee.
608. Transfer and Exchange of Certificates
(a) The reglstratlon of each Certlflcate shall be transferable only
upon the CertifIcate RegIster, whlch shall be kept for that purpose at
the Prlnclpal Offlce of the Trustee, upon surrender thereof together wlth
a wrltten lnstrument of transfer satisfactory to the Trustee duly exe-
cuted by the Owner or hlS duly authorlzed attorney Upon the
registration of the transfer, and the surrender, of any such Certlflcate,
the Trustee shall prepare. in the name of the transferee, a new
Certlflcate or Certlflcates. of the same aggregate princlpal amount and
prlnclpal Payment Date as the surrendered Certlficate.
(b) Eertif1cates may be exchanged at the PrinCIpal Office of the
Trus~ee for a 11ke aggregate principal amount of Certlf1cates of other
authorized denomlnatlons payable as to prlnclpal on the same Payment Date
as the prlnclpal of the exchanged Certlflcates. Upon the request for
18
.
.
exchange, and the surrender, of any Certlflcates, the Trustee shall pre-
pare ln the name of the O~ner requestlng exchange a new Certiflcate or
Certlf1cates of the same aggregate prlnc1pal amount and prlncipal Payment
Date as the Certlflcate belng exchanged
609. Regulatlon wlth Respect to Exchange and Transfers. In all
cases of reglstratlon of transfer or exchange of Certlficates. the Trus-
tee shall execute and dellver Certif1cates 1n accordance w1th the provl-
Slons of thlS Artlcle. All Certlflcates surrendered in any transfer or
exchange shall forthwith be cancelled and returned to Clty by the
Trustee Notwlthstandlng any other prOV1S1on of this Agreement, the cost
of preparlng each new Certlflcate upon the flrst reglstratlon of transfer
or exchange followlng dellvery pursuant to Sectlon 601 hereof, and any
other expenses of Clty or the Trustee 1ncurred ln connection therewith
(except any appllcable tax. fee or other governmental charge other than
one 1mposed by C1ty) shall be paid by Clty. The Trustee shall not be
obllged to make any such reglstrat10n of transfer or exchange of
Certlflcates durlng the flfteen (15) days next precedlng Aprl1 1 or
October 1 of any year, or durlng the flfteen (15) days next preced1ng the
malllng of a not1ce of redempt1on, or of any Certiflcate called for
redemptlon.
610 Certif1cate Reglster
(a) The Trustee shall keep or cause to be kept at lts Prlnclpal
Offlce a Certlflcate Reglster. whlch shall at all tlmes be open to
inspectlon by Clty and Owners of Certlflcates; and, upon presentatlon for
such purpose. the Trustee shall. under such reasonable regulations as lt
may prescrlbe, reglster the transfer or cause to be reglstered the
transfer on the Certlflcate Register, Certiflcates as herBlnbefore
provlded
(b) The Trustee shall deem and treat the person in whose name any
Outstandlng Certlflcate shall be reglstered upon the Certlflcate Reglster
as the absolute O~ner of such Certlflcate, whether such Cert~flcate shall
be overdue or not, for the purpose of rece~vlng payment of. or on account
of, the princlpal and lnterest payments wlth respect to such Certlflcate
and for all other purposes. and all such payments so made to any such
Owner or upon hlS order shall be valld and effectual to satlsfy and dlS-
charge the llabllity upon such Certiflcate to the extent of the sum or
sums so pald, and nelther Clty nor the Trustee shall be affected by any
notice to the contrary.
611 Temporary Certlflcates Pendlng preparation of the deflnltlve
Certiflcates, any Certlficates dellvered under thlS Agreernent may be
initially dellvered ln temporary form exchangeable for deflnitlve Cer-
tlflcates ~hen ready for dellvery The temporary Certlflcates may be
prlnted, I1thographed or typewritten. shall be of such denomlnations as
may be determlned by City, shall be Wlthout coupons and may contain such
19
.
.
reference ~o any of the provls~ons of this Agreement as may be appropri-
ate Every temporary Certificate shall be executed by the Trustee and be
dellvered by the Trus~ee upon the same conditlons and In substantlally
the same manner as def~n~tlve Certlflcates. If the Trustee dellvers
temporary Certificates, ~t shall execute and furnlsh deflnitlve Certifi-
cates wlthout delay and, thereupon, the temporary Certlflcates shall be
surrendered for cancellatlon at the Prlnclpal Offlce of the Trustee and
the Trustee shall dellver in exchange for such temporary Certiflcates an
equal aggregate prlnclpal amount of def~nltlve Certlflcates of authorlzed
denomlnatlons and of the same prlnclpal Payment Date and lnterest rate or
rates Untll so exchanged, the temporary Certlflcates shall be entltled
to the same beneflts under thlS Agreement as defln~tive Cert~flcates
dellvered pursuant hereto.
612. Certlflcates Mutllated, Lost, Destroyed or Stolen. If any
Certlflcate shall become mutllated, the Trustee, at the expense of the
Owner of sald Gertlflcate, shall execute and dellver a new Certlflcate of
llke tenor, prlnclpal Payment Date and number ln exchange and subst~tu-
tlon for the Certlflcate so mutllated, but only upon surrender to the
Trustee of the Certlflcate so mutllated. Every mutl1ated Certlflcate so
surrendered to the Trustee shall be cancelled by it and elther destroyed
or dellvered upon the order of City.
If any Certlficate shall be lost, destroyed or stolen, eVldence of
such loss, destructlon or theft may be submltted to the Trustee, and, lf
such eVldence 1S satlsfactory to the Trustee and lf an indemnity satis-
factory to the Trustee shall be glven, the Trustee, at the expense of the
Certlflcate Owner, shall execute and dellver a new Gertlflcate of llke
tenor and prlnclpal Payment Date and numbered as the Trustee shall deter-
mlne ln lleu of and ln Substltutlon for the Certlficate so lost,
destroyed or stolen.
The Trustee may requlre payment by the Owner of an approprlate fee
for each new Certlflcate dellvered under thlS Sectlon and of the expenses
whlch may be lncurred by the Trustee 1n carrYlng out the duties under
thlS Sectlon 612 Any Certlflcate dellvered under the prOV1Slons of this
Sectlon ln 11eu of any Certlficate alleged to be lost, destroyed or
stolen shall be equally and proportlonately entltled to the beneflts of
th1s Agreement wlth all other Cert1flcate5 dellvered under thlS
Agreement. The Trustee shall not be requlred to treat both the orlginal
Gertlflcate and any dupllcate Gertlf1cate as belng Outstandlng for the
purpose of determ1nlng the prlncipal amount of Certlflcates whlch may be
dellvered hereunder or for the purpose of determlnlng any percentage of
Certlficates Outstandlng hereunder, but both the orlg1nal and dupllcate
Certlflcate shall be treated as one and the same.
Notwithstandlng any other provls1on of this Section 612, In lleu of
dellverlng a new Gert1flcate for WhlCh prlnclpal has or 15 about to
become due for a Gertlflcate whlch has been mutllated, lost. destroyed or
20
.
.
stolen, the Trustee may make payment of such Certlflcate in accordance
wlth its terms
613. EVldence of Slgnatures of Certlficate ~tners and Ownershlp of
Certlflcates. Any request, direct1on, consent, revocation of
consent, or other instrument ln wrltlng requ1red or permltted by thlS
Agreement to be signed or executed by Certlf1cate Owners may be ln any
number of concurrent lnstruments of slmllar tenor, and may be slgned or
executed by such Certlflcate Owners ln person or by thelr attorneys or
agents appolnted by an lnstrument ln writlng for that purpose. Proof of
the executlon of any such lnstrument, or of any lnstrument appointlng any
such attorney or agent, and of the o~~ershlp of Certlflcates shall be
sufflclent for any purpose of thlS Agreement (except as otherwise hereln
provlded), lf made In the fol1o~lng manner:
(a) The fact and date of the executlon by any Certlflcate Owner or
his attorney or agent of any such lnstrument and of any lnstrument
appolntlng any such attorney or agent, may be proved by a certlflcate,
whlch need not be acknowledged or verlfied, of an offlcer of any bank or
trust company located wlthln the Cnlted States of Amerlca, or of any
notary publlc, or other offlcer authorlzed to take acknowledgements of
deeds to be recorded In such Jurlsd1ct1ons that the persons signing such
lnstruments acknowledged before hlm the executlon thereof Where any
such 1nstrument is executed by an offlcer of a corporatlon or assoclatlon
or a member of a partnershlp on behalf of such corporatlon, aSSoclatlon
or partnershlp, such cert1flcate shall also constltute sufflClent proof
of hlS authorlty
(b) The fact of the ownershlp of Certlflcates by any Certlflcate
Owner and the amount, the princlpal Payment Date and the numbers of such
Certlficates and the date of his ownershlP of the same shall be proved by
the Certiflcate Reglster held by the Trustee under the provis1ons of thlS
Agreement.
614.
Redemptlon.
(a) The Cert1flcates are subject to mandatory redemptlon ln whole
or In part on any Payment Date (but not ln a total redemptlon amount of
less than $5,000 at anyone tlme) , ln lnverse order of Payment Date and
by lot as to any prlnclpal Payment Date, wlthout premlum, at the prln-
clpal amount, together w1th accrued 1nterest to the Payment Date flxed
for redempt10n from (1) the Net Proceeds of lnsurance or condemnat1on in
an amount of $5,000 or more depos1ted wlth the Trustee pursuant to the
prOV1Slons of Sect10ns 508(a), 508(b), 510(a) and 510(b) of the Lease
Agreement, and (11) amounts rece1ved by the Trustee upon an Event of
Default and termlnatlon of the Lease Agreement
(b) The Certlflcates are subject to mandatory redemption in whole
on October I, 1986, w1thout prem1um, at the pr1nc1pal amount, together
21
.
.
wlth accrued lnterest to such date, from amounts In the Special
Redemptlon Account, ln the event that the documents requlred by
Sectlon 402(c) shall not have been deposlted wlth the Trustee prlor to
August 15, 1986.
(c) In addltlon to redemptlon pursuant to subsectlons (a) and (b)
of thls Sectlon 614, the Certlficates havlng a prlncipal Payment Date on
and after October I, 1996 are subject to redemptlon In whole or In part
ln lnverse order of prlnclpal Payment Date and by lot Wlthln a princlpal
Payment Date on any Payment Date on or after October I, 1995, at the
prlnclpal amount payable wlth respect thereto, together wlth the premlum
set forth below (expressed as a percentage of the total amount redeemed),
and accrued lnterest to the Payment Date flxed for redemption from the
proceeds of optlonal prepayments of Lease Payments made by Clty pursuant
to the Lease Agreement:
Payment Date of Redemptlon Premlum
October 1, 1995 or Aprl1 1, 1996 2-1/2%
October 1, 1996 or Apnl 1, 1997 20'
'0
October 1, 1997 or Apnl I, 1998 1-1/2%
October I, 1998 or Apr il I, 1999 1%
October I, 1999 and Apnl 1, 2000 1/2%
October 1, 2000 and thereafter -0-
(d) Redemptlon by lot shall be ln such manner as the Trustee shall
determlne. provlded. however, that the portlon of any Certificate to be
redeemed shall be ln the prlnclpal amount of $5.000 or any multlple
thereof, and that ln selectlng portlons of Certlflcates for redemptlon,
the Trustee shall treat each such Certlflcate as representlng that number
of Certlflcates WhlCh 1S obtalned by dlvlding the prlnclpal amount wlth
respect to such Certlflcate by $5.000.
(e) Upon redemptlon pursuant to thls Sectlon, the Trustee shall, In
accordance with Sectlon 404(c) hereof, provlde Clty wlth a reVlsed
schedule of Lease Payments whlch schedule shall take lnto account such
redempt10n and shall be and become for all purposes thereafter Exh1blt B
to the Lease Agreement.
615. ~edemptlon Fund Moneys to be used for redemption of Certifi-
cates shall be transferred by the Trustee from the Lease Payment Account
(or, In the case of redempt~on pursuant to Sectlon 614(b), from the
Speclal Redemption Account) and deposlted 1n a Redempt10n Fund~ Wh1Ch
shall be a special fund to be held ln trust by the Trustee, separate and
apart from all other funds Sa1d moneys shall be set aSlde In the
Redemptlon Fund solely for the purpose of redeem1ng the Certlf1cates ln
advance of thelr prlncipal Payment Date and shall be applled on or after
the Payment Date designated for redempt10n to the payment of princ1pal
of. premlUID, if any, and lnterest (from the last Payment Date) wlth
22
.
.
respect to, the Certlflcates to be redeemed upon presentatlon and
surrender of such Certiflcates
616. ~otice of Redemptlon When redemptlon lS authorlzed or re-
qUlred pursuant to the provlslons hereof (except when redemptlon lS
requlred follo~lng an Event of Default and termlnatlon of the Lease
Agreement), the Trustee shall glve to the Certlflcate ~ners notlce at
the expense of the Clty of the redemptlon of the Certlflcates. Such
notice shall speclfy: (a) that the whole or a deslgnated portlon of the
Certlflcates 1S to be redeemed, (b) the Payment Date of redemptlon, and
(c) the place or places ~here the redemptlon will be made. Such notlce
shall further state that on the speclfled date of redemption there shall
become due and payable wlth respect to each Certlflcate or portlon
thereof to be redeemed, the prlnclpal wlth respect thereto and premlurn,
lf any, together wlth lnterest accrued from the next precedlng Payment
Date to ~hlCh lnterest has been pald and that from and after such date of
redemptlon lnterest with respect thereto shall cease to accrue and be
payable
Notlce of such redemptlon shall be glven (at the expense of City) by
mall, postage prepald, not more than Slxty (60) days nor less than thlrty
(30) days prlor to sald date of redemptlon, to the Owners of any
Certlflcates WhlCh are to be redeemed Such mal ling shall not be a condl-
tlon precedent to such redemptlon, and fallure to mail any such not1ce,
or any defect ln such notlce as mailed, shall not affect the valldlty of
the proceedlngs for the redemptlon of the Certlflcates
617. Payment on Redemptlon of Certlflcates Notlce having been
glven as aforesa1d, and the moneys for the redemption, lncludlng interest
accrued from the next precedlng Payment Date to the appllcable date of
redemptlon, havlng been set aSlde ln the Redemptlon Fund, the
Certlflcates to be redeemed shall become due and payable on said date of
redemptlon. and, upon presentatlon and surrender thereof at the offlce or
offlces speclfled ln said notlce. said Certlflcates shall be pald at the
unpaid prlnclpal amount ~lth respect thereto, plus any such unpald and
accrued lnterest to sald date of redemptlon, sald lnterest to be pald in
accordance wlth Sectlon 605 hereof.
If, on sald Payment Date of redemptlon, moneys for the redemptlon of
all the Certlflcates to be redeemed, together wlth lnterest to sald Pay-
ment Date of redemptlon. shall be held by the Trustee so as to be aval1-
able therefor on such Payment Date, and, lf notlce of redempt10n thereof
shall have been glven as aforesald. then, from and after sald Payment
Date, interest wlth respect to the Cert1flcates to be redeemed shall
cease to accrue and become payable. If said moneys shall not be so
avallable on sald Payment Date, lnterest wlth respect to such
Certlflcates shall continue to be payable untll paid at the same rates as
1t would have been payable had the Certlficates not been called for
redemptlon All moneys held by or on behalf of the Trustee for the
23
.
.
redempt10n of part1cular Certlf1cates shall be held In trust for the
account of the OWners of the Gertlf1cates so to be redeemed.
618 Partial Redempt10n of Certlf1cates Upon surrender of any
Certlficate redeemed 1n part only, the Trustee shall execute, and dellver
to the Owner thereof; at the expense of Glty, a new Certlflcate or Gertl-
flcates of authorlzed denomlnatlon equal In aggregate prlnclpal amount to
the unredeemed portlon of the Certlflcate surrendered and of the same
lnterest rate and the same prlnclpal Payment Date. Such partlal redemp-
tlon shall be valld upon payment of the amount thereby requlred to be
pald to such Owner, and City, Lessor and the Trustee shall be released
and dlscharged from all l1abll1ty to the extent of such payment.
ARTICLE VII
COVENAKTS' LI~ITATIO~ OF LIABILITY
701. Cl~Y to Perform Lease Agreement Clty covenants and agrees
wlth the Owners of the Certlficates, to perform all obllgatlons and
dutles lmposed on lt under the Lease Agreement to the extent so lmposed
702. Lessor to Perform Lease Agreement Lessor covenants and agrees
wlth the ~Tners of the Certlflcates, to perform all obllgatlons and
dut1es lmposed on 1t under the Lease Agreement to the extent so lmposed
703. Actlon on Default Upon the occurrence of an Event of Default
by Clty under Sectlon 701 of the Lease Agreement, and 1n each and every
such case durlng the contlnuance of such Event of Default, the Trustee
shall, with respect to any Event of Default other than an Event of
Default pursuant to subsectlon (b) of Section 701 of the Lease Agreement,
and may, wlth respect to an Event of Default pursuant to sald subsectlon
(b) of Sectlon 701 of the Lease Agreement (or shall, ~n the event of a
request therefor by the Owners of not less than twenty-five percent (25%)
~n aggregate pr1nc~pal amount with respect to Certlflcates at the time
Outstandlng), upon notlce ln wrltlng to Clty exerClse the remed1es
provlded in the Lease Agreement wh1ch remedles have been asslgned to the
Trustee pursuant to the Asslgnment Agreement.
704. No Obl1gatlon by Clty to Owners. Except for the payment of
Lease Payments when due In accordance wlth the Lease Agreement and the
performance of the other covenants and agreements of Clty contained ~n
said Lease Agreement; C1ty shall have no obllgatlon or llabllity to any
of the other partles or to the Owners of the Certiflcates wlth respect to
thls Agreement or the terms, execut1on, dellvery or transfer of the Cer-
tlflcates, .or the dlstrlbutlon of Lease Payments to the Owners by the
Trustee.
24
.
.
705. ~o Obllgatlon wlth Respect ~o Performance by Trustee. Except
as otherWlse provlded hereln, nelther Clty nor Lessor shall have any
obligatlon or 11abl1lty to any of the other partles, or to the Owners of
the Certiflcates with respec~ to the performance by the Trustee of any
duty lmposed upon lt under thlS Agreement.
706 ~o Llablllty to Owners for Payment. Except as provided ln thls
Agreement. ne~ther Lessor nor the Trustee shall have any obllgatlon or
11ablllty to the Owners of the Certiflcates wlth respect to the payment
of the Lease Payments by Clty when due, or wlth respect to the per-
formance by Clty of any other covenants made by lt ln the Lease
Agreement
707 No Responslblllty for Sufficiency. The Trustee shall not be
responslble for the sufflclency of ~he Lease Agreement or of the
asslgnment made to lt pursuant to the Asslgnment Agreement. or for the
value of or tltle to the FaCll1tles
708 Indemnlflcatlon to Trustee. City shall indemnlfy and save the
Trustee harmless from and agalnst all clalffis, losses and damages, lnclud-
lng legal fees and expenses, arlslng out of (1) the use. malntenance,
condltlon or management of. or from any work or thlng done on, the
Facllltles by Clty, (11) any breach or default on the part of Clty ln the
performance of any of its obligatlons under this Agreement, (111) any act
of negllgence of City or of any of ltS agents. contractors, servants,
employees or llcensees wlth respect to the Facllltles, (lV) any act of
negllgence of any asslgnee or lessee of Clty or of any of ltS agents,
contractors, servants. employees or 11censees wlth respect to the Faclll-
tles, or (v) the constructlon or lnstallatlon of the Facl11tles or the
authorlzatlon of payment of the Acqulsltlon and Constructlon Costs by
Clty, all to the extent permltted by law. Indemnlflcatlon for any tort
mentloned in thlS Sectlon shall be Ilmlted to the extent and In the
amounts provlded by Callfornla law. No indemnlflcatlon wl11 be made
under this Sectlon or elsewhere in thlS Agreement for wl11ful mlsconduct
or gross negllgence, by the Trustee. ltS offlcers. agents, employees,
successors or asslgns.
ARTICLE VIII
AMEKD~NT; DEFEASANCE, ADMIKISTRATIVE PROVISIONS
801. Amendment ThlS Agreement may be amended ln wrltlng by agree-
ment among all of the partles. but no such amendment shall become effec-
tlve as to the Owners of Certlflcates then Outstandlng unless and untl1
approved by a majority ln aggregate prlnclpal amount wlth respect to
Certiflcates Outstanding, provlded that no such amendment shall impalr
the rlght of any Owner to receive his proportlonate share of any Lease
Payment In accordance wlth hlS Certlflcate Notwlthstanding the
25
.
.
forego1ng, th1S Agreement and the r1ghts and obligations prov1ded thereby
may also be mod1f1ed or amended at any time without the consent of any
Owners of the Cert1flcates, but only (1) for the purpose of cur1ng any
amb1gu1ty, or of cur1ng, correct1ng or supplementing any defect1ve pro-
V1S1on conta1ned 1n th1S Agreement, or (2) 1n regard to quest10ns ar1s1ng
under th1S Agreement ~hlCh the C1ty may deem necessary or des1rab1e and
not lncons1stent ~lth thlS Agreement, prov1ded that no such amendment
shall adversely affect the 1nterests of the Owners of the Cert1f1cates,
prov1ded that Lessor, C1ty and the Trustee may rely 1n enter1ng into any
such amendment hereof upon the opln1on of recogn1zed counsel whose
opln1on lS acceptable by under~r1ters 1n the marketing of tax-exempt
obl1gat10ns of pol1t1cal subd1vls1ons stat1ng that the requirements of
th1S sentence shall have been met w1th respect to such amendment
802. Defeasance If all Outstand1ng Cert1flcates shall be pa1d and
d1scharged 1n anyone or more of the follow1ng ways
(a) by well and truly paying or caus1ng to be pa1d the pr1n-
c1pal w1th respect to and lnterest w1th respect to all Cert1ficates
Outstand1ng, as and when the same become due and payable;
(b) by depos1ting w1th the Trustee, 1n trust, at or before
matur1ty, moneys 1n an amount Wh1Ch, together w1th the amounts then on
depos1t in the Lease Payment Account and the Reserve Account, are fully
suff1c1ent to pay all Certlf1cates Outstand1ng, lnclud1ng all pr1nc1pal
and 1nterest w1th respect thereto,
(c) by depos1t1ng ~lth the Trustee, 1n trust, Federal Secur1-
t1es 1n such amount as w1ll, together wlth the 1nterest to be rece1ved
thereon and moneys then on depos1t 1n the Lease Payment Account and the
Reserve Account, 1f requ1red, together ~lth the 1nterest to be rece1ved
thereon, be fully suff1C1ent to pay and d1scharge all Certlf1cates
(lnclud1ng all pr1nc1pal and lnterest) at or before the1r respectlve
pr1nc1pal Payment Dates, or
Cd) by deposlting with the Trustee, under an escrow deposlt
and trust agreement, security for the payment of all Lease Payments as
more part1cularly descr~bed 1n Sect~on 408 of the Lease Agreement, sa1d
secur1ty to be held by the Trustee, as agent for Clty, and to be appl1ed
by the Trustee to Lease Payments representing the obllgatlon of C1ty
under the Lease Agreement as descr1bed in Sect10n 408 of the Lease
Agreement;
not~lthstand~ng that any Certlflcates shall not have been surrendered for
payment, all obl~gatlons of Lessor, the Trustee and City under this
Agreement wlth respect to all Outstand1ng Gertlflcates shall cease and
term1nate. except only the obl1gatlon of the Trustee to payor cause to
be pa~d, from Lease Payments pald by or on behalf of C1ty from deposits
pursuant to paragraphs (b) through Cd) of th1S Sect1on, to the Owners of
26
.
.
the CertlfIc8tes not so surrendered and pald all sums due with respect
thereto, and that ln the event of deposlts pursuant to paragraphs (b)
through (d) of th~s Sect lon, the Cert~flcates shall contInue to represent
dIrect and proportionate Interests of the Owners thereof in Lease
Payments under the Lease Agreement.
Any funds held by the Trustee, at the tIme of one of the events
described in subsections (a) through (d) above, WhICh are not requIred
for the payment to be made to Owners, or for payments to be made to the
Trustee by CIty, shall be paid over to CIty.
803. Recording and FilIng. The Trustee shall not be responsIble for
the record~ng or fIlIng of the Lease Agreement or ASSIgnment Agreement or
of any flnanclng statements, continuatIon statements, supplemental
Instruments or documents.
804. Trustee to Keep Records The Trustee shall keep books and
records of all moneys receIved and d~sbursed under this Agreement, whIch
shall be avaIlable for Inspection by the City or Lessor, or the~r respec-
tive appOInted audItors or agents, or fIve percent (5%) in aggregate
pr~ncIpal amount of Certlf~c8te Owners or theIr respective deSIgnees, at
any reasonable tIme during regular bUSIness hours.
805. NotIces All wrItten notIces, certIfIcates. reports or state-
ments to be gIven under th~s Agreement shall be given by mall or personal
delIvery to the party entItled thereto, WIth a copy to each of the other
partIes to thIS Agreement, at its address set forth below, or at such
address as the partIes may prOVIde to the other parties in wrltlng from
t~me to time. NotIce shall be effective upon deposit in the UnIted
States mail, postage prepaId or, in the case of personal delivery, upon
delivery, to the address set forth below:
If to Lessor:
Security Pacific NatIonal Bank
300 South Grand Avenue,
21st Floor 8-211
Los Angeles, CA 90071
AttentIon Richard H. Clark
If to CIty:
City of Santa Monlca
1685 MaIn Street
Santa Mon1ca, CA 90401-3295
AttentIon: City Manager
wlth a copy to:
Clty of Santa Monlca
1685 Main Street
Santa Mon~ca, CA 90401-3295
AttentIon: CIty Attorney
27
.
.
Santa Monlca Alrport
3200 A~rport Avenue
Santa Monlca, CA 90405
Attent~on A~rport D~rector
If to Trustee:
Bank of Amerlca Nat~onal Trust and
and Savlngs Assoc~ation
555 South Flower Street
F~fth Floor
Los Angeles, CA 90071
Attentlon' Corporate Trust #8510
806 Cal~fornla Law. ThlS Agreement shall be construed and governed
ln accordance wlth the laws of the Srate of Callfornla
807. SeverabIllty. Any prov~slon of thIS Agreement found to be
prohIbIted by law shall be Ineffectlve only to the extent of such proh~-
b~tlon, and shall not inval~date the rema~nder of this Agreement.
808. B~nd~ng on Successors. ThIs Agreement shall be b~ndlng upon
and ~nure to the benef~t of the partles and theIr respective successors
and asslgns
809. Headlngs. HeadIngs preceding the text of the several Art~cles
and SectIons hereof, and the table of contents, are solely for
convenIence of reference and shall not constItute a part of thIS
Agreement or affect ltS meanIng, constructlon or effect.
810. Counterparts. This Agreement may be executed ~n counterparts
and each of sa~d counterparts shall be deemed an orIginal for all
28
.
.
purposes of th~s Agreement. All of such counterparts taken together
shall be deemed to be one and the same lnstrument.
I~ ~ITKESS WHEREOF, the partIes have executed thls Agreement by
thelr off~cers thereunto duly authorIzed as of the date and year fIrst
wr~tten above.
TRCSTEE:
BAKK OF AMERICA NATIONAL TRUST A~D
SAVIKGS ASSOCIATION
By
Vlce Presldent
LESSOR
SECCRITY PACIFIC NATIOKAL BAKK
By
Vlce Pres~dent
By
Vlce Pre::'Ident
CITY'
APPROVED AS TO FORM:
CITY OF SA~TA ~OKICA
By
Robert M ~yers
CIty Attorney
Mayor
Attest
CIty Clerk
29
.
.
EXHIBIT A
(Form of CertlfIcate of PartIc~patIon)
CERTIFICATE OF PARTICIPATION
(AIRPORT FACILITIES)
EVIdenc~ng a Proportionate Interest of the Owner Hereof In
Lease Payments to be Made
by the
CITY OF SANTA MOKICA
(Cal1forn~a)
to
SECCRITY PACIFIC ~ATIO~AL BA~K
$
THIS IS TO CERTIFY THAT:
lS the reglstered owner (the ttOwner) of th~s Cert1f~cate of Partlclpatlon
(the ttCertIfIcate") and IS entItled to receIve on October 1, (the
"CertIf~cate Payment Date")
DOLLARS
ThIS CertIfIcate eVldences an undlvided proportIonate Interest ln the
r~ght to receIve certaIn Lease Payments under, and as defIned In, that
certaIn Lease Agreement Relatlng to A~rport FaCIlItIes, by and between
SecurIty Paclflc Natlonal Bank, a nat~onal bankIng assoc~atlon
("Lessor"), and the C~ty of Santa Non~ca, a charter c~ty and mun~cIpal
corporatlon duly org8nlzed and operat~ng under the laws of the State of
Callfornla (the "Clty"), dated as of October 1, 1985 (the "Lease Agree-
ment"), the Lease Payments to be made thereunder havlng been ass~gned to
Bank of AmerIca NatIonal Trust and SaVIngs Assoclatlon, as trustee (the
"Trusteeu), havlng a princ~pal corporate trust off~ce In Los Angeles,
Californla (saId prlnclpa1 corporate trust offlce belng hereln referred
to as the "PrIncIpal OffIce") The aforesa~d payment 15 payable subject
to the terms of the Lease Agreement and represents a portIon of the Lease
Payments deSIgnated as pr~nc~pal com~ng due on and prIor to the CertIf~-
cate Payment Date. The Owner ~s also entltled to recelve, subject to the
terms of the Lease Agreement, sem~annual1y on Aprll 1 and October 1 of
each year (hereInafter referred to as the "Payment Dates"), commencing
Apr11 I, 1986, to and lncludlng the CertIflcate Payment Date or the
A-I
.
.
Payment Date of redemptIon, whIchever 15 earl~er, the Owner's
proportionate share of the Lease Payments designated as ~nterest comIng
due wIth respect to each of the Payment Dates, prov1ded that Interest
Wlth respect hereto shall be payable from the Payment Date next precedIng
the date of authentlcatIon of th~s CertlfIcate unless (i) this
CertIf1cate IS authent~cated on a Payment Date, ~n wh~ch event interest
shall be payable from such Payment Date. or (l~) thlS Certlf1cate is
authent~cated after the close of busIness on the fIfteenth day of the
month Immediately precedIng a Pa}~ent Date and prior to such Payment
Date, ~n whIch event lnterest shall be payable from such Payment Date, or
(liI) thIS Certlflcate ~s authenticated on or before March IS, 1986, in
which event ~nterest shall be payable from October 1, 1985. SaId share
lS the result of the multipllcation of the pr~ncIpal amount hereof by the
rate of
percent (_____~).
SaId amounts are payable In lawful money of the Unlted States of Amer~ca,
whIch at the tlme of payment lS legal tender for the payment of publIC
and prIvate debts. The amounts representIng pr~nclpal are payable at the
PrIncIpal Offlce of the Trustee and the amounts representlng lnterest are
payable by check or draft of the Trustee maIled on each Payment Date to
the ~ner of record on the f1fteenth day of the month precedlng the Pay-
ment Date.
REFERE~CE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS CERTIFI-
CATE SET FORTH O~ THE REVERSE HEREOF WHICH FURTHER PROVISIONS SHALL FOR
ALL PCRPOSES HAVE THE SA~E EFFECT AS IF SET FORTH IN THIS PLACE.
The Trustee has no oblIgat~on or lIabIlIty to the CertlfIcate Owners
to make payments of princ~pal or lnterest WIth respect to the
CertlfIcates. The Trustee's sole obligatIons are to admInIster, for the
benefIt of the CertIficate Owners, the varIOUS funds and accounts
establIshed under the Trust Agreement.
The City has certlfied, reCIted and declared that all acts, condI-
tlons and thlngs requIred by the constItutIon and statutes of the State
of CalIforn~a, the Lease Agreement and the Trust Agreement to exist, to
have happened and to have been performed precedent to and ln the delivery
A~2
.
.
of thIs Cert~f~cate, eXIst, have happened and have been performed ~n due
tIme, form and manner as requIred by law
IN WITKESS WHEREOF, thlS CertIfIcate has been executed by the manual
s~gnature of the Trustee all as of the date set forth below
AuthentIcaLion Date
BA~K OF A~ERICA NATIO~AL TRUST
AND SAVINGS ASSOCIATION.
as Trustee
By:
Authorlzed Off~cer
A-3
.
.
Reverse Slde of Form of Cert~f~cate of Part~c~patlon)
CERTIFICATE OF PARTICIPATION
(AIRPORT FACILITIES)
EVIdenclng a ProportIonate Interest of the Owner Hereof in
Lease Payments to be ~ade
by the
CITY OF S~lA MO~ICA
(CalIfornIa)
to
SECURITY PACIFIC NATIOKAL BAN~
The City 1S authorlzed to enter ~nto the Lease Agreement by
Cal~forn~a Government Code SectIon 37350. The Lessor has asslgned Its
rIghts to Lease Payments to the Trustee pursuant to an AssIgnment Agree-
ment Relatlng to A~rport FaCII~tIes, by and between the Lessor and the
Trustee, dated as of October 1, 1985 ('the "Ass~gnment Agreement") and a
Trust Agreement relatlng to AIrport Fac~l~tIes, by and among the Trustee,
the Lessor and the CIty, dated as of October 1, 1985 (the "Trust
Agreement") .
ThlS Cert~fIcate has been executed by the Trustee pursuant to the
terms of the Trust Agreemen't. Cop~es of the Lease Agreement, the AssIgn-
ment Agreemenr and the Trust Agreement are on fIle at the off~ce of the
C~ty and at the Pr~nc~pal Offlce of the Trustee, and reference to the
Lease Agreement, the AssIgnment Agreement, and the Trust Agreement and
any and all amendments to said agreements, is made for a description of
the pledges and covenants of the CIty securIng the Lease Payments, the
nature, extent and manner of enforcement of such pledges and covenants,
the r~ghts and remedles of the Owners of the CertifIcates with respect
thereto and the terms and cond~tlons upon wh~ch the CertIficates are
dellvered thereunder, To the extent and In the manner permItted by the
terms thereof, the provlslons of the Lease Agreement and the Trust Agree-
ment may be amended by the partles thereto w~th the wrltten consent of
the Owners of at least a majOrIty ~n prInClpal amount w~th respect to the
Cert~fIcates then outstandIng, or wIthout such consent wIth respect to an
amendment not adversely affectlng the ~nterests of the Owners of the
Cert~flcates.
The registratIon of thIS CertIf~cate shall be transferable only upon
the CertIf~cate reglster, wh~ch shall be kept for that purpose at the
PrInCIpal Offlce of the Trustee, upon surrender hereof together with a
wrItten lnstrument of transfer satlsfactory to the Trustee duly executed
by the Owner of thIS CertIficate or hlS duly authorlzed attorney Upon
the reg~stratlon of the transfer and the surrender of thIS CertIflcate,
the Trustee shall provide In the name of the transferee, a new fully
A-4
.
.
reglstered CertifIcate or Cert1fIcates of the same aggregate prlnc1pal
amount and prlnclpal Payment Date as the surrendered Certlf~cate.
The CertifIcates are delIvered in the form of fully regIstered
Certiflcates ln denom~nat~ons of $5,000 each or any ~ntegral multlple
thereof, and upon surrender thereof at the Prlnc1pal OffIce of the Trus-
tee w~th a written request of exchange satisfactory to the Trustee duly
executed by the Owner or his attorney duly authorlzed in writing, may. at
the optlon of the Owner thereof. be exchanged for an equal aggregate
pr1nc1pal amount of Certificates of any other author~zed denom1natIons
and of the same prIncIpal Payment Date.
The Certlf~cates are subject to mandatory redemptlon ln whole or ln
part from tIme to tIme. ~n inverse order of princlpal Payment Date and by
lot Wlth1n a prlnclpa1 Payment Date, on any Payment Date, w1thout
premIum, at the prIncIpal amount thereof, together with accrued lnterest
to the date f1xed for redemptlon from (1) the Net Proceeds of 1nsurance
or condemnatlon, as deflned and described 1n the Lease Agreement, and
(ll) amounts received by the Trustee upon an Event of Default (as def1ned
in the Lease Agreement) and upon termInatlon of the Lease Agreement.
In addlt~on, the Cert~f1cates are subject to redemptlon In whole on
October 1, 1986, at the prIncIpal amount thereof, together wIth accrued
1nterest to such date, from amounts transferred from the Special Redemption
Account under the Trust Agreement upon faIlure to satlsfy the cond1tlons
to the 1n~tlal d~sbursement from the AcquIs~tion and Construction Account
prIor to August 15, 1986, pursuant to the Trust Agreement.
In addItIon, the Certlf~cates havlng a prlncipal Payment Date on and
after October I, 1996 are subject to redemptIon 1n whole or ln part in
inverse order of prlnclpal Payment Date and by lot W1th1n a pr~nclpal
Payment Date on any Payment Date on or after October I, 1995, at the
prlncipal amount payable wlth respect thereto. together with the prem~um
set forth below, (expressed as a percentage of the total amount
redeemed), and accrued Interest to the Payment Date fixed for redemption
from the proceeds of optlonal prepayments of Lease Payments made by Clty
pursuant to the Lease Agreement:
Payment Date of Redemptlon PremIum
October I, 1995 and Aprll I, 1996 2-1/2%
October 1. 1996 and Aprll 1, 1997 2%
October I, 1997 and Apnl 1, 1998 1-1/2'%
October I, 1998 and Apnl I, 1999 1%
October I, 1999 and Apr11 1, 2000 1/2%
October 1, 2000 and thereafter -oP
A-5
~
.
.
Redemption by lot shall he In such manner as the Trustee shall
determ1ne; prov1ded, however, that the portlon of any CertIfIcate to be
redeemed shall be in the prIDc1pal amount of $5,000 or any mult1ple
thereof, and that ln selectIng portIons of CertIfIcates for redemptIon,
the Trustee shall treat each such CertIfIcate as representIng that number
of Certificates ~h~ch is obtalned by div1ding the pr~nc~pal amount of
such certIf~cates by 55,000.
When redemptIon 1S author1zed or requ1red (except when redempt~on IS
requIred follow1ng an Event of Default under, and as deflned In. the
Lease Agreement and except mandatory slnk~ng fund redemptlon), the Trust-
ee shall gIve to the Owners notIce at the expense of the City of the
redempt~on of the Certlf1cates Such notIce shall specIfy: (a) that the
whole or a designated portlon of the Cert1flcates is to he redeemed,
(b) the Payment Date of redemptlon. and (c) the place or places where the
redempt~on will be made, Such not~ce shall further state that on the
specIfIed date of redempt~on there shall become due and payable wIth
respect to each CertifIcate or port~on thereof to be redeemed. the prIn-
cipal w~th respect thereto, premIum, lf any, and lnterest accrued from
the next precedIng Payment Date to whIch Interest has been pald to sald
Payment Date of redemptIon, and that from and after such Payment Date of
redempt10n Interest shall cease to accrue and be payable.
~otice of such redempt~on shall be malled, postage prepaId. not more
than slxty (60) days nor less than thlrty (30) days prIor to sa~d Payment
Date of redemptIon, to the Owners of any Certlflcates whose Cert~flcates
are to be redeemed Such malllngs shall not be a condltIon precedent to
such redemptIon, and fallure so to mail any such not1ce, or any defect in
such notlce as malled, shall not affect the val1d1ty of the proceedings
for the redemptlon of the Certif~cates,
The oblIgat~on of the CIty to make Lease Payments under the Lease
Agreement lS a speclal obllgatIon, subject to annual approprlat~ons of
the CIty whIch appropr~at~ons the CIty 1n the Lease Agreement has cove-
nanted to make
The obl~gat~on of the CIty under the Lease Agreement does not con-
stItute a debt of the Lessor, of the Trustee, of the Clty, of the State
of Callfornla or of any other polltlcal subd~vision of the State or a
pledge of the faIth and credIt of the CIty or of the Lessor, of the
Trustee, of the State of Callfornla or of any other pol1tlcal subd1vision
of sald State.
A-6
.
.
~
(Form of Assignment)
ASSIGN~E~T
For value received the unders~gned
do(es) hereby sell, aSSIgn and transfer unto
the w~th~n-ment~oned Certlf~cate and hereby
irrevocably const~tute(s) and appo~nt(s)
attorney, to transfer the same on the CertIflcate reglster of the Trustee
wlth full power of substltution ln the prem1ses.
Dated
Slgnature Guaranteed
Note' The slgnature(s) on thIS
Ass~gnment must correspond w~th the
name(s) as wr~tten on the face of the
wlthIn-mentloned CertIf~cate 1n every
part~cular WIthout alteratlon or
enlargement or any change whatsoever
A-]
.
.
11679 00000002j091999-L
CERTIFICATE PURCHASE AGREEMENT
Relatlng To
CITY OF SANTA MONICA
$
Certlflcates of Partlclpatlon
(Munlclpal Alrport ProJect)
October
, 1985
Bank of Amerlca Natlonal Trust
and Savlngs ASSoclatlon
Corporate Trust Department
555 South Flower Street
Flfth Floor
Los Angeles, Callfornla 90017
Clty of Santa Monlca
1685 Maln Street
Santa Monlca, Callfornla 90401-3295
Attentlon: Clty Manager
Ladles and Gentlemen:
The underslgned (hereln called the "Underwrlter")
offers to enter lnto the followlng agreement wlth Bank of
Amerlca Natlonal Trust and Savlngs Assoclatlon, as trustee
(the "Trustee") under that certa1n trust agreement by and
among the Trustee, Securlty Paclflc Natlonal Bank (the
"Lessor") and the Clty of Santa Monlca, Callfornia (the
"Clty"), dated as of October I, 1985 (the "Trust Agreement"),
and as asslgnee under that certaln asslgnment agreement by
and between the Lessor and the Trustee dated as of October I,
1985 (the "Asslgnment Agreement"), pursuant to WhlCh the
Lessor has asslgned to the Trustee all the Lessor's rlghts to
recelve rental payments from the Clty under that certaln
lease agreement by and between the Lessor and the Clty dated
as of October I, 1985 (the "Lease Agreement"), and wlth the
Clty WhlCh, upon wrltten acceptance of thlS offer by the
Trustee and the Clty, wlll be b1nd1ng upon the Trustee and
the Clty and upon the Underwr1ter. Th1S offer 1S made sub-
Ject to such wrltten acceptance on or before 5:00 p.m.,
Callforn1a tlme, on October , 1985, or at such other t1me
and date as shall be mutually agreed upon 1n wrlt1ng by the
partles hereto, and, If not so accepted, w1ll be subJect to
.
.
wlthdrawal by the Underwrlter upon notlce dellvered to the
Trustee and the Clty at any tlme prlor to such acceptance.
1. Purchase and Sale. Upon the terms and condltlons
and upon the basls of the representatlons, warrantles and
agreements set forth hereln, the Underwrlter hereby agrees to
purchase from the Trustee, and the Trustee hereby agrees to
sell and dellver to the Underwrlter, the $
aggregate prlnclpal amount of Clty of Santa Monlca Certlfl-
cates of PartlclpatloD (MuDlclpal Alrport ProJect) (hereln-
after called the "Certlflcates") The Cert1f1cates shall be
dated October I, 1985, shall bear lnterest from thelr date,
payable on the dates and at the rates set forth 1n the Trust
Agreement and the OfflClal Statement (as here1nafter deflned),
and shall mature on the dates set forth 1D the Trust Agree-
ment and the OfflClal Statement.
The purchase prlce for such Certlflcates shall be
$ , plus accrued lnterest on such Certlflcates
from October I, 1985, to the date of the payment and dellvery
of the Certlf1cates pursuant to Paragraph 7 hereof (such pay-
ment and del1very and the other actlons contemplated hereby
to take place at the tlme of such payment and dellvery belng
hereln sometlmes called the "Closlng").
The Prellmlnary Offlclal Statement dated October
1985, lnclud1ng the cover page and Appendlces thereto, relat-
ing to the Certlflcates (the "Prellmlnary Offlc1al State-
ment"), as amended to conform to the terms of thlS Cert1flcate
Purchase Agreement and w1th such changes and amendments to
the date hereof as have been mutually agreed to by the Trus-
tee, the Clty and the Underwr1ter, as 1nd1cated on Exh1blt A
attached hereto, 1S herelnafter called the "Off1clal State-
ment." Capltal1zed terms used hereln and not otherwlse
deflned shall, unless the context otherW1se requlres, be as
deflned 1n the Off1c1al Statement.
On the date of executlon of th1s Cert1flcate Pur-
chase Agreement, the Underwr1ter shall dellver to the Trustee
a cert1fled or bank cashler's check ln the amount of $100,000
payable to the order of the Trustee. Such check lS del1vered
as securlty for the performance by the Underwrlter of lts
obllgatlons to purchase, accept dellvery of and pay for the
Certlf1cates at the Clos1ng, and, ln the event of the Under-
wrlter's compllance wlth such obllgatlons, such check shall
be returned to the Underwrlter at the Closlng. In the event
the Trustee and the C1ty do not accept th15 offer, such check
shall be lmmed1ately returned to the Underwr~ter. In the
2
.
.
event the Trustee falls to dellver the Certlflcates at the
Closlng or ln the event the Trustee and the Clty are unable
to satlsfy the condltlons of the obllgatlons of the Under-
wrlter to accept dellvery of and to pay for the Certlflcates,
as set forth ln thls Certlflcate Purchase Agreement (unless
walved by the Underwrlter), or ln the event such obllgatlons
of the Underwrlter are termlnated for any reason permltted by
thls Certlflcate Purchase Agreement, such check shall lmmedl-
ately be returned to the Underwrlter. In the event that the
Underwrlter falls (other than for a reason permltted here-
under) to accept dellvery of and to pay for the Certlflcates
at the Closlng as hereln provlded, such check shall be en-
dorsed to the Clty, and the proceeds thereof shall be re-
talned by the Clty as and for full llquldated damages for
such fallure and for any default hereunder on the part of the
Underwrlter, and, except as set forth ln Paragraph 9 hereof,
no party hereto shall have any further rlghts agalnst the
others hereunder.
2. The Certlflcates. The Certlflcates shall be as
descrlbed ln, and shall be lssued and secured under the pro-
VlSlons of, the Trust Agreement substantlally ln the form
prevlously submltted to the Underwrlter, wlth only such
changes as shall be mutually agreed upon by the Trustee, the
Clty and the Underwrlter. The Certlflcates shall be payable
and shall be subJect to redemptlon as provlded ln the Trust
Agreement.
3. Offerlng. It shall be a condltlon to the Trustee's
obllgatlons to sell and dellver the Certlf1cates to the
Underwrlter, and to the Underwrlter's obllgatlons to pur-
chase, to accept dellvery of and to pay for the Certlflcates,
that the entlre prlnclpal amount of the Certlflcates autho-
rlzed by the Trust Agreement shall be lssued, sold and deliv-
ered by the Trustee and purchased, accepted and pald for by
the Underwrlter at the Closlng. The Underwrlter agrees to
make a bona flde publlC offerlng of all of the Certlflcates,
at not ln excess of the lnltlal publlC offerlng prlce or
Yleld set forth on the cover page of the Offlclal Statement,
plus lnterest accrued thereon from the date of the Certlfl-
cates, WhlCh prlce or Yleld may be changed from tlme to tlme
by the Underwrlter after the lnltlal publlC offerlng.
4. Use of Documents. The Trustee and the Clty hereby
authorlze the use by the Underwrlter of the Lease Agreement,
the Asslgnment Agreement, the Trust Agreement, the Ground
Lease dated as of October I, 1985 (the "Ground Lease"),
between the Clty, as lessor, and the Lessor, as lessee, the
Agency Agreement (as deflned ln the Off~Clal Statement) and
3
.
.
the Off~c1al Statement, ~nclud~ng any supplements or amend-
ments thereto, and the lnformatlon thereln contalned, In
connectlon wlth the publlC offerlng and sale of the Cert~fl-
cates. The Trustee and the Clty consent to the use by the
Underwrlter pr~or to the date hereof of the Prel~mlnary Off~-
clal Statement, In cennect~on wlth the publ~c offerlng of the
Cert~f~cates.
5. Representatlons, Warrantles and Agreements of the
C~ty. The Clty hereby represents, warrants and agrees as
follows:
(a) The C~ty lS a munlclpal corporatlon and charter
clty duly organlzed and valldly eXlstlng under the laws of
the State of Callfornla and the Clty Charter and has, and at
the date of the Closlng wlll have, full legal rlght, power
and authorlty (1) to enter lnte the Lease Agreement, the
Trust Agreement, the Ground Lease, the Agency Agreement and
thls Certlflcate Purchase Agreement; (11) to cause the Trustee
to sell and dellver the Certlf1cates to the Underwrlter as
provlded here1n; and (111) to carry out and consummate the
transactlons contemplated by the Lease Agreement, the Trust
Agreement, the Ground Lease, the Agency Agreement, the Offl-
clal Statement and thlS Certlflcate Purchase Agreement;
(b) By offlclal actlon of the Clty prlor to or
concurrently wlth the acceptance hereof, the Clty has duly
authorlzed and approved the executlon and dellvery of, and
the performance by the Clty of the obllgatlons on 1ts part
conta1ned ln, the Lease Agreement, the Trust Agreement, the
Ground Lease, the Agency Agreement and thlS Certlflcate Pur-
chase Agreement, and the consumrnatlon by lt of all other
transactlons contemplated by the Offlclal Statement and thlS
Certlflcate Purchase Agreement; the resolutlon of the Clty
approvlng the executlon and dellvery of the Lease Agreement,
the Trust Agreement, the Ground Lease, the Agency Agreement
and thlS Certlflcate Purchase Agreement and approvlng the
Off~clal Statement were duly adopted at meet~ngs of the Clty
Councll of the C~ty WhlCh were called and held pursuant to
law and w~th all publlC notlce requlred by law and at WhlCh a
quorum was present and actlng throughout; the Lease Agree-
ment, the Trust Agreement, the Ground Lease, the Agency
Agreement and th1S Cert~f1cate Purchase Agreement const1tute
legal, valId and blndlng obllgatlons of the Clty enforceable
In accordance WIth the terms thereof, subJect to the proVl-
Slons of bankruptcy or other s1rnl1ar laws affectlng credl-
tors' rIghts generally; and the obllgat1on of the Clty to
make the rental payments under the Lease Agreement IS a gen-
eral fund obllgatlon payable by the Clty from annual appro-
4
.
.
prlatlons of the Clty subJect only to the prOV1Slons of the
Lease Agreement perm1ttlng the appllcatlon thereof on the
terms and condltlons set forth In the Lease Agreement;
(c) The C1ty 1S not 1n breach of or default under
any appl1cable const1tutlonal or charter prOVIs1on, law or
adm1nlstratlve regulat10n of the State of Cal1fornla or the
UnIted States or any applIcable Judgment or decree or any
loan agreement, Indenture, bond, note, ordInance, resolutIon,
agreement or other 1nstrument to WhICh the CIty IS a party or
to WhIch the C1ty or any of the property or assets of the
CIty are otherw1se subJect, and no event has occurred and IS
contInUIng WhICh constItutes or WIth the passage of tIme or
the gIvIng of not1ce, or both, would constItute a default or
event of default under any such Instrument; and the executIon
and delIvery of the CertIfIcates, the Lease Agreement, the
Trust Agreement, the Ground Lease, the Agency Agreement and
thIS CertIfIcate Purchase Agreement and complIance WIth the
prOVISIons on the CIty's part contaIned thereIn WIll not
conflIct WIth or constItute a breach of or default under any
constItutIonal prOVISIon, law, prOVISIon of the Charter of
the C1ty, adm1n1stratlve regulatIon, Judgment, decree, loan
agreement, Indenture, bond, note, ordInance, resolutIon,
agreement or other 1nstrument to Wh1Ch the C1ty IS a party or
to WhIch the CIty or any of the property or assets of the
CIty are otherWIse subJect, nor w1ll any such executIon,
del1very, or compl1ance result 1n the creatIon or Impos1t1on
of any 11en, charge or other securIty Interest or encumbrance
of any nature whatsoever upon any of the property or assets
of the CIty or under the terms of any such law, regulat10n or
Instrument, except as prOVIded under the Lease Agreement;
(d) All approvals, consents and orders of, or
f111ngs WIth, any governmental authorIty, legIslatIve body,
board, agency or comm1SS1on haVIng Jurlsd1ctIon Wh1Ch would
constItute a condIt10n precedent to, or the absence of WhICh
would mater1ally adversely affect, the due performance by the
C1ty of 1ts oblIgat10ns under thIS CertIfIcate Purchase
Agreement, the Lease Agreement, the Ground Lease, the Agency
Agreement or the Trust Agreement have been duly obtaIned,
except for such approvals, consents and orders as are stated
as yet to be obtaIned In the OffICIal Statement or as may be
requ1red under the Blue Sky or securItIes laws of any state
In connect10n WIth the offerIng and sale of the Certlf1cates;
(e) The CertIfIcates conform to the descrlpt10ns
thereof conta1ned In the Off1clal Statement under the capt10n
liTHE CERTIFICATES OF PARTICIPATIONII; and the Lease Agreement,
the Ground Lease, the Agency Agreement and the Trust Agree-
5
.
.
ment conform to the descr1pt1ons thereof conta1ned 1n the
Off1c1al Statement;
(f) Except as descr1bed ~n the Off1clal Statement,
as of the date hereof there 1S no act~on, sUlt, proceed1ng,
1nqu1ry or ~nvest1gat1on, at law or 1n egu~ty, before or by
any court, government agency, publlC board or body, pend1ng
or, to the best knowledge of the Clty, threatened aga1nst the
C1ty, affect1ng the corporate eX1stence of the Clty or the
t1tles of 1ts off1cers to thelr respectlve off1ces, or
affect1ng or seek1ng to proh1b1t, restraln or en]Oln the
execut~on or del1very of the Lease Agreement, the Ground
Lease, the Agency Agreement or the Trust Agreement or 1n any
way contest~ng or affect1ng the val1d1ty or enforceab1l1ty of
the Certlf1cates, the Lease Agreement, the Trust Agreement,
the Ground Lease, the Agency Agreement or thlS Cert1f1cate
Purchase Agreement, or contest1ng the tax-exempt status of
the Cert~f~cates, or contest~ng 1n any way the completeness
or accuracy of the Prel1IDlnary Offlclal Statement or the
Off1c1al Statement or any supplement or amendment thereto, or
contest1ng the powers of the C1ty or any author~ty for the
lssuance of the Cert~f1cates, the execut10n and del1very of
the Lease Agreement, the Trust Agreement, the Ground Lease,
the Agency Agreement or th1S Certlf1cate Purchase Agreement,
nor, to the best knowledge of the C1ty, lS there any baS1S
therefor, where1n an unfavorable dec1s1on, rullng or f1ndlng
would mater~ally adversely affect the valld~ty or enforce-
ab1llty of the Certlf1cates, the Lease Agreement, the Trust
Agreement, the Ground Lease, the Agency Agreement or th1S
Cert1f1cate Purchase Agreementj
(g) The C1ty w1ll furnlsh such lnformatlon, exe-
cute such 1nstruments and take such other act10n ln coopera-
t10n w1th the Underwrlter as the Underwrlter may reasonably
request In order (1) to qual1fy the Certlflcates for offer
and sale under the Blue Sky or other secur1t1es laws and
regulat10ns of such states and other ]urlsdlctlons of the
Un1ted States as the Underwr1ter may des1gnate and (11) to
determ1ne the el1g1b1l1ty of the Cert1f1cates for lnvestment
under the laws of such states and other )urlsdlctlons and
w1ll use 1ts best efforts to cont1nue such qual1flcatlons 1n
effect so long as requlred for the d1str1but1on of the Cer-
t1flcateSj prov1ded, however, that the C1ty shall not be
requlred to execute a general consent to serV1ce of process
or qual1fy to do bus1ness 1n connect1on wlth any such qual1-
f1cat1on or determlnat10n 1n any ]ur1sd1ct1on;
(h) As of the date thereof, the Prel1mlnary Off1-
clal Statement dld not contaln any untrue statement of a
6
.
.
materIal fact or omIt to state a mater1al fact requlred to be
stated thereln or necessary to make the statements there1n,
In the llght of the CIrcumstances under WhICh they were made,
not mIsleadlng;
(1) At the tIme of the CIty'S acceptance hereof
and (unless an event occurs of the nature descrIbed ln sub-
paragraph (k) of thIS Paragraph 5) at all tImes subsequent
thereto up to and 1nclud1ng the date of the Closlng, the
OffIcIal statement does not and w1ll not contaIn any untrue
statement of a mater1al fact or omlt to state a materlal fact
requlred to be stated thereln or necessary to make the
statements there1n, In the lIght of the CIrcumstances under
WhlCh they were made, not mIslead1ng;
(J) If the OfflClal Statement 15 supplemented or
amended pursuant to subparagraph (k) of th1S Paragraph 5, at
the tIme of each supplement or amendment thereto and {unless
subsequently agaln supplemented or amended pursuant to such
subparagraph) at all tImes subsequent thereto up to and
1nclud1ng the date of the ClOSIng, the Off1C1al Statement as
so supplemented or amended WIll not conta1n any untrue state-
ment of a materIal fact or omlt to state a mater1al fact
requ1red to be stated thereln or necessary to make the state-
ments thereIn, 1n the lIght of the c1rcumstances under whIch
they were made, not mIsleadIng;
(k) If between the date of thlS Cert1f1cate Pur-
chase Agreement and the date of the Clos1ng any event shall
occur or Clrcumstance shall eXIst Wh1ch m1ght or would cause
the OffIc1al Statement, as then supplemented or amended, to
contaIn any untrue statement of a mater1al fact or to omIt to
state a materIal fact requIred to be stated thereln or neces-
sary to make the statements there1n, 1n the llght of the
circumstances under Wh1Ch they were made, not m1s1eadIng, the
C1ty shall notlfy the UnderwrIter thereof, and If In the
op1n1on of the Underwrlter such event requlres the prepara-
tIon and publIcatIon of a supplement or amendment to the
Offlclal statement, the C1ty WIll from the proceeds of the
sale of the Cert1f1cates supplement or amend the Off1c1al
Statement In a form and In a manner approved by the Under-
wr1teri and
(1) The CIty WIll not take any actlon Wh1Ch w111
cause 1nterest on the Cert1flcates to be subject to federal
Income taxat1on.
7
.
.
6
Trustee.
follows:
Representat2ons, Warrant2es and Agreements of the
The Trustee represents, warrants and agrees as
(a) The Trustee ~s a nat20nal banklng assoc2at2on,
duly organIzed and valldly eXlstlng under the laws of the
Un2ted States and has, and at the date of the Clos1ng w1ll
have, full legal r2ght, power and author2ty (1) to enter 2nto
the Trust Agreement, the Ass1gnment Agreement and th1s Cer-
t1flcate Purchase Agreement; (12) to sell, lssue and delIver
the Certlf2cates to the Underwrlter as prov1ded hereln and
pursuant to the Trust Agreement; and (111) to carry out and
consummate the transact10ns contemplated by the Trust Agree-
ment, the ASSIgnment Agreement and th1S Cert1flcate Purchase
Agreement;
(b) The Trustee 1S duly authorlzed to execute and
del1ver and to perform the obl1gat1ons on 1tS part conta1ned
1n the Trust Agreement, the Asslgnment Agreement and thlS
Cert1f2cate Purchase Agreement; and to consummate all other
transact10ns contemplated by the Offlclal Statement and thls
Cert2f2cate Purchase Agreement; the Trust Agreement, the
Asslgnment Agreement and th2s Certlflcate Purchase Agreement
constltute legal, valld and blndlng obl2gatlons of the Trustee
enforceable 2n accordance w2th the terms thereof, subJect to
(1) the appl2cat2on of lnsolvency, reorganlzat1on, arrangement,
moratorlum or slmllar laws of general appl2cat1on affect2ng
credltors' rlghts; or (11) the appl1cat2on of pr1nc1ples of
equ2ty, 1f equ1table remed2es are sought;
(c) No consent, approval, authorIzatIon or other
act10n by any governmental or regulatory authorIty haVIng
Jur1sd1ct1on over the Trustee that has not been obtalned 15
or w1ll be requlred for the execut10n and dellvery of the
CertIf1cates or the consummat1on by the Trustee of the other
transactIons contemplated by thlS Cert1f2cate Purchase Agree-
ment and the Off2c1al Statement, except as may be requIred
under the state secur1t1es or Blue Sky laws 1n connect2on
WIth the dIstrIbut10n of the CertIf1cates by the UnderwrIter;
(d) To the best knowledge of the Corporate Trust
Department of the Trustee, the execut20n and del1very by the
Trustee of thIS Certlflcate Purchase Agreement, the Trust
Agreement, the Cert1flcates and the ASSIgnment Agreement and
compl1ance wlth the terms thereof w1ll not confl1ct w1th or
result 1n a v1olat1on or breach of any law or any rule, regu-
latIon, order or decree of any court or governmental agency
or body havlng Jur1sdlct1on over the Trustee or any of lts
act1V1t1es or propert2es or (except w2th respect to the l1en
8
.
.
of the Trust Agreement) result ~n the creat~on or ~mpos~t~on
of any l~en, charge or other secur~ty ~nterest or encumbrance
of any nature whatsoever upon any of the property or assets
of the Trustee;
(e) To the best knowledge of the Corporate Trust
Department of the Trustee, there 15 no act~on, su~t, proceed-
lng, lnqUlry or 1nvest~gatlon, at law or ~n equ~ty, before or
by any court or governmental agency, publ~c board or body
pend~ng or threatened aga~nst or affect~ng the ex~stence of
the Trustee or seek~ng to prohlb~t, restra~n or en]Oln the
execut10n and del~very of the Cert~f~cates or the collect~on
of revenues pledged or to be pledged to pay the prlnclpal of
and 1nterest on the Certlflcates, or the pledge thereof, or ln
any way contestlng or affectlng the valldlty or enforceabll-
lty of the Certlflcates, the Trust Agreement, the Ass~gnment
Agreement or thlS Certlflcate Purchase Agreement or contest-
lUg the powers of the Trustee or lts author1ty to enter luto,
adopt or perform 1ts obl1gatlons under any of the foregolng,
whereln an unfavorable declslon, rul1ng or flnd1ng would
adversely affect the transactlons contemplated hereby and by
the Off1c1al Statement, or WhlCh, In any way, would adversely
affect the val1d1ty of the Certlflcates, the Trust Agreement,
the Asslgnment Agreement, thlS Certlflcate Purchase Agreement
or any agreement or 1nstrument to wh1ch the Trustee lS a
party and whlch 1S used or contemplated for use In the con-
summatlon of the transactlons contemplated hereby and by the
Off1clal Statement or the exemptlon from taxatlon as set
forth hereln;
(f) SubJect to the proVlslons of the Trust Agree-
ment, the Trustee wlll apply the proceeds from the Certlfl-
cates to the purposes speclfled 1n the Trust Agreement; and
(g) Wlthln the scope of lts trust obllgat1ons
lmposed by the Trust Agreement, the Trustee agrees to cooper-
ate wlth the Underwrlter and lts counsel ln endeavor~ng to
qual~fy the Certlflcates for offer1ng and sale under the
securitles or Blue Sky laws of such Jurlsdlct~ons of the
Unlted States as the Underwrlter may request; provlded, how-
ever, that the Trustee wlll not be regulred to execute a
speclal or general consent to serV1ce of process or quallfy
as a forelgn corporat~on In connectlon wlth any such quallf~-
cat~on In any ]urlsd~ctlon 1n Wh1Ch 1t 1S not now so subJect
or be requlred to take any act~on WhlCh would (1) subJect 1t
to serVlce of process 1n any Jur~sdlct~on In WhlCh 1t lS not
now so subJect or (11) result In lts d01ng buslness In another
)urlsdict1on.
9
.
.
The execut~on and del~very of th~s Certlf1cate Pur-
chase Agreement by the Trustee shall constltute a representa-
t~on by the Trustee to the C1ty and the Underwrlter that the
representatlons and warrant1es contalned 1n thls Paragraph 6
are true as of the date hereof; provlded, however, that 1t 1S
spec1f1cally understood and agreed that the Trustee makes no
representatlons or warrantles as to the f1nanclal pos1t10n or
bUS1ness cond1tlon of the Clty or any other party to the
agreements or 1nstrurnents descrlbed here1n and does not rep-
resent or warrant ln any respect as to any of the statements,
1nformat1on (flnanclal or otherwlse), act10n taken or to be
taken, representat~ons or cert~f1cat~ons furnlshed, or to be
made and furnlshed, by the Clty or any other partles to the
agreements or 1nstrurnents descr~bed here~n 1n connect~on wlth
the execution and dellvery of the Certlflcates or any such
statements or lnformatlon (f~nanc1al or otherw1se) conta~ned
ln the Prel1mlnary Offlclal Statement or the Off1clal State-
ment or as to the cornpl~ance of the Certlf1cates or any
act~ons descr1bed here~n w~th appllcable securlt~es or tax
laws and regulat1ons; and provlded further that no dlrector,
off~cer or employee of the Trustee shall be 1ndlv~dually
llable for the breach of any representatlon or warranty made
by the Trustee 1n th1S Paragraph 6.
7. Closlng. At 9.00 a.m , Callforn1a t1me, on
November ,1985, or such other date as may be mutually
agreed upon by the Trustee, the Clty and the Underwrlter, the
Trustee w1l1, subJect to the terms and condltlons hereof,
dellver the Cert1f1cates to the Underwrlter ln deflnltlve
form, duly executed and authentlcated by ltS authorlzed off1-
cer(s), and the Trustee and the C1ty w~ll dellver to the
Underwrlter the other documents herelnafter mentloned, and
the Underwr~ter w1ll, subJect to the terms and cond~t~ons
hereof, accept such dellvery and pay the purchase prlce of
the Certlflcates as set forth ln Paragraph 1 hereof by clearlng
house funds, check or Wlre to the Trustee. Dellvery and pay-
ment as aforesa1d shall be made at the off1ces of Morr1son &
Foerster, Spec1al Counsel, 333 South Grand Avenue, SUlte 3800,
Los Angeles, Cal1fornla, or such other place as shall have
been mutually agreed upon by the Trustee, the Clty and the
Underwrlter. The Certlflcates shall be pr1nted or lltho-
graphed on steel engraved borders (provlded that the Under-
wr1ter, In 1tS dlscretlon, may accept temporary Certiflcates
1f deflnltlve Certlflcates are to be dellvered subsequent to
Clos1ng), shall be prepared and dellvered as Cert1flcates
reg1stered In such names as the Underwrlter may request at
least flve bUSlness days pr~or to the date of Closlng, and,
1f the Underwrlter shall so request, shall be made avallable
to the Underwrlter at least one buslness day before the
Clos1ng, for purposes of 1nspect1on and packag1ng.
10
.
.
8. Clos~n9 Cond~tlons. The Underwrlter has entered
lnto thlS Certlflcate Purchase Agreement In rellance upon the
representat~ons and warrant~es of the Clty and the Trustee
contalned herelD, and ln rellance upon the representatlons
and warrantles to be conta1ned In the documents and lnstru-
ments to be del1vered at the Closlng and upon the performance
by the Clty and the Trustee of the1r obl1gatlons hereunder,
both as of the date hereof and as of the date of the Closlng.
Accordlngly, the Underwrlter' 5 obllgat1ons under thlS Cer-
tlflcate Purchase Agreement to purchase, to accept dellvery
of and to pay for the Certlflcates shall be cOndlt1oned upon
the performance by the Clty and the Trustee of the1r obl1ga-
tlons to be performed hereunder and under such documents and
lnstruments at or prlor to the Closlng and shall also be
subJect to the followlng add1t1onal condltlons:
(a) The representat~ons and warrantles of the
Trustee and the Clty contalned hereln shall be true, complete
and correct on the date hereof and on and as of the date of
the Closlng, as If made on the date of the Clos1ng;
(b) At the tlme of the Closlng, the Offlc1al
Statement shall not have been supplemented or amended, except
as may have been agreed to by the Underwrlter;
(c) At the Closlng Date, the Cert1f1cates, the
Lease Agreement, the Trust Agreement, the Asslgnment Agreement,
the Ground Lease, the Agency Agreement, thlS Cert1flcate
Purchase Agreement, the Offlclal Statement and all other
agreements, documents and lnstruments descr1bed 1n the Offlclal
Statement as elther belng In eXlstence at the date of executlon
hereof or to be executed and ln eX1stence pr10r to or at the
t1me of the Closlng shall have been duly authorlzed, executed,
1ssued and dellvered by the respectlve partles thereto, 1n
substantlally the forms heretofore presented to the Underwrlter,
w1th only such changes as shall have been agreed to ln wrlt1ng
by the Underwrlter, and sald agreements, documents and lnstru-
ments shall be ln full force and effect and shall not have
been amended, modlfled or supplemented except as shall have
been agreed to ~n wr~tlng by the Underwrlter; and the Under-
wr1ter shall have recelved, 1n approprlate form, eVldence
thereof;
(d) The Underwrlter shall have the rlght to terml-
nate 1tS obllgatlons under thlS Certlflcate Purchase Agree-
ment to purchase, to accept dell very of and to pay for the
Cert1f1cates by notlfYlng the Clty and the Trustee of 1tS
elect10n to do so If, after the executlon hereof and pr10r to
the Clos1ng, (1) the marketablllty of the Cert1f1cates or the
11
.
.
market prlce thereof, In the oplnlon of the Underwrlter, has
been materlally adversely affected by an amendment to the
Const1tutlon of the Un1ted States or by any leg1slatlon
enacted by the Un1ted States or by any decls10n of any court
of the Unlted States or by any rul1ng or regulat10n (f1nal,
temporary or proposed) on behalf of the Treasury Department
of the Unlted States, the Internal Revenue SerVlce or any
other author1ty of the Un1ted States affectlng the federal
tax status of the C1ty, 1ts property or lllcome, or the lnter-
est on lts obl1gat1ons (lncludlng the Lease Agreement);
(11) the Unlted States shall have become engaged ~n hoStll1-
t~es WhlCh have resulted 1n a declarat10n of war or a natlonal
emergency, (~~~) there shall have occurred a general suspen-
s~on of trad~ng on the New York Stock Exchange or the decla-
rat~on of a general bank1ng moratorlum by any authorlty of
the Un1ted States, the State of New York or the State of
Cal~forn1a; (~v) there shall eXlst any event or c~rcumstance
wh~ch 1n the op1n1on of the Underwrlter elther (~) makes
untrue or lncorrect 1n any mater~al respect any statement or
~nformat1on conta1ned ~n the OfflClal Statement or (e) 1S not
reflected In the Off1c~al Statement but should be reflected
there1n to make the statements and lnformat1on contalned
there1n not mlsleadlng In any materlal respect; (v) an
adverse event occurs ln the affa1rs of the Trustee, the C1ty
or the Lessor wh~ch, ln the op1n1on of the Underwrlter,
requ~res or has requlred a supplement or amendment to the
OfflC1al Statement; (Vl) the rat1ng of the Cert1flcates shall
have been downgraded or w~thdrawn by a natlonal ratlng ser-
Vlce WhlCh, 1n the oplnlon of the Underwr1ter, materlally
adversely affects the market pr1ce of the Cert1f1cates;
(V1l) any amendment to the Const1tut1on of the Unlted States,
any leg~slat1on enacted by the Un1ted States, any decls~on of
any court of the Unlted States, or any order, rullng, regula-
t10n or offlclal statement lssued or made by or on behalf of
the Securlt1es and Exchange Commlsslon, or any other govern-
mental agency hav1ng Jurlsd~ctlon of the subJect matter, has
the effect that obl1gatlons of the general character of the
Cert1flcates, or the Certlflcates, ~ncludlng any underlYlng
arrangements, are not exempt from the reglstratlon requlre-
ments of the Securlt1es Act of 1933, as amended, or that the
Trust Agreement lS not exempt from qual1f~cat~on under the
Trust Indenture Act of 1939, as amended;
(e) At or pr~or to the Clos1ng, the Underwr1ter
shall have recelved coples of each of the follow~ng documents:
(1) The Offlc1al Statement, and each supplement or
amendment, 1f any, thereto, executed on behalf of the C1ty by
1tS C~ty Manager;
12
.
.
(2) The Lease Agreement, Ass~gnment Agreement,
Trust Agreement, Ground Lease and Agency Agreement, each duly
executed and del~vered by the respect~ve part~es thereto,
w~th such supplements or amendments as may have been agreed
to ~n wr1t~ng by the Underwr~ter;
(3) The resolut~on approv~ng the Trust Agreement,
Lease Agreement, Agency Agreement and Ground Lease, cert~f~ed
on the date of the Clos1ng by the C~ty Clerk under the seal
of the C~ty as hav~ng been duly adopted by the C~ty and as
be1ng ~n effect, w~th such supplements or amendments as may
have been agreed to by the Underwr~ter,
(4) An unqual~f~ed op~n~on, dated the date of the
Clos~ng and addressed to the C~ty and the Trustee, of
Morr~son & Foerster, Spec~al Counsel, 1n substant~ally the
form attached to the Off~c~al Statement as Append~x A;
(5) An opln~on, dated the date of the Clos1ng and
addressed to the Underwr1ter, of Morr1son & Foerster, Spec~al
Counsel, to the effect that:
(1) The Underwrlter may rely upon the opln~on
of Morr1son & Foerster, In substant1ally the form attached to
the Offlc~al Statement as Append1x A, to the same extent as
lf such op~n~on were addressed to It;
(~~) The statements conta~ned 1n the Offlclal
Statement under the capt~ons "THE CERTIFICATES OF PARTICIPA-
TION," "SECURITY FOR THE CERTIFICATES," "THE LEASE AGREE-
MENT," "THE ASSIGNMENT AGREEMENT," "THE TRUST AGREEMENT,II
"THE GROUND LEASE," and "THE AGENCY AGREEMENT," lnsofar as
such statements purport to summarlze certaln provls1ons of
the Cert~f~cates, the Lease Agreement, the Ass1gnment Agree-
ment, the Trust Agreement, the Ground Lease or the Agency
Agreement, present a fa1r and accurate summary of such
provl s~ ons;
(111) Noth1ng has come to such counsel's atten-
t~on that would lead them to belleve that the Offlclal State-
ment, as of the date of the Closlng, conta~ns an untrue
statement of a mater1al fact or om~ts to state a mater~al
fact requ~red to be stated thereln, ~n the llght of the Clr-
cumstances under WhlCh they were made, to make the lnforma-
t10n conta~ned there1n not m1sleadlng (except such counsel
need express no Vlew as to flnanClal statements and the sta-
t~stlcal data conta~ned ln the Offlclal Statement); and
13
.
.
(IV) The CertIfIcates are exempt from regIS-
tratIon pursuant to the SecurItIes Act of 1933, as amended,
and the Trust Agreement IS exempt from qualIfIcatIon pursuant
to the Trust Indenture Act of 1939, as amended;
(6) An opInIon, dated the date of the ClOSIng and
addressed to the UnderwrIter, of Robert M Myers, Esq., CIty
Attorney of the CIty, to the effect that:
(1) The CIty IS a munIcIpal corporatIon duly
organIzed and valIdly eXIstIng under the laws of the State of
CalIfornIa and the CIty Charter and has, and at the date of
the ClOSIng WIll have, full legal rIght, power and authorIty
(1) to enter Into the Trust Agreement, the Lease Agreement,
the Ground Lease, the Agency Agreement and thIS CertIfIcate
Purchase Agreement; (11) to cause the Trustee to sell and
delIver the CertIfIcates to the UnderwrIter as prOVIded hereIn;
and (Ill) to carry out and consummate the transactIons con-
templated by the Trust Agreement, the Lease Agreement, the
Ground Lease, the Agency Agreement, the OffICIal Statement
and thIS CertIfIcate Purchase Agreement;
(11) By offICIal actIon of the CIty prIor to
or concurrently WIth the acceptance hereof, the CIty has duly
author1zed and approved the executIon and del1very of, and
the performance by the CIty of the oblIgatIons on Its part
contaIned In, the Lease Agreement, the Trust Agreement, the
Ground Lease, the Agency Agreement and thIS CertifIcate Pur-
chase Agreement, and the consummatIon by It of all other
transactIons contemplated by the Off1Clal Statement; the
Lease Agreement, the Trust Agreement, the Ground Lease, the
Agency Agreement and thIS CertIfIcate Purchase Agreement
constItute legal, valId and bIndIng oblIgatIons of the CIty
enforceable In accordance WIth the terms thereof, subJect to
the prOVISIons of bankruptcy or other SImIlar laws affectIng
credItors' rIghts generally; and the oblIgatIon of the CIty
to make the rental payments under the Lease Agreement IS a
general fund oblIgatIon of the CIty, subJect only to the
prOVISIons of the Lease Agreement permIttIng the applIcatIon
thereof on the terms and condItIons set forth In the Lease
Agreement;
(~~1) The Clty 16 not In breach of or default
under any applIcable constltutlonal or charter prOVISIon, law
or admInIstratIve regulatlon of the State of CalIfornIa or
the UnIted States or any appllcable Judgment or decree or any
loan agreement, Indenture, bond, note, ordlnance, resolutIon,
agreement or other Instrument to WhIch the CIty 1S a party or
to Wh1Ch the CIty or any of the property or assets of the
14
.
.
.
Clty are otherWlse subject, and no event has occurred and 1S
contlnulng Wh1Ch constltutes or wlth the passage of tlrne or
the glv1ng of not1ce, or both, would const1tute a default or
event of default under any such 1nstrument; and the executlon
and dellvery of the Certlflcates, the Lease Agreement, the
Trust Agreement, the Ground Lease, the Agency Agreement and
thlS Certlflcate Purchase Agreement and compllance wlth the
provlslons on the Clty'S part contalned thereln wlll not
confllct wlth or constltute a breach of or default under any
constltutlonal provlslon, law, aclmlnlstratlve regulatlon,
Judgment, decree, loan agreement, 1ndenture, bond, note,
ord1nance, resolutlon, agreement or other lnstrument to WhlCh
the Clty 1S a party or to WhlCh the C1ty or any of the prop-
erty or assets of the Clty are otherwlse subject, nor wlll
any such executlon, del1very, or compllance result 1n the
creat10n or lmposltlon of any 11en, charge or other securlty
1nterest or encumbrance of any nature whatsoever upon any of
the property or assets of the Clty or under the terms of any
such law, regulatlon or lnstrument, except as provlded under
the Lease Agreement;
(lV) All approvals, consents and orders of, or
f111ng5 w1th, any governmental author1ty, leglslatlve body,
board, agency or commlSSlon havlng Jurlsdlctlon whlch would
const1tute a condlt1on precedent to or the absence of WhlCh
would materlally adversely affect the due performance by the
Clty of ltS obl1gatlons under thlS Certlflcate Purchase
Agreement, the Trust Agreement, the Lease Agreement, the
Ground Lease or the Agency Agreement have been duly obtalned,
except for such approvals, consents and orders as are stated
as yet to be obta1ned 1n the Off1clal Statement or as may be
requ1red under the Blue Sky or securlt1es laws of any state
10 connect10n wlth the offer1ng and sale of the Certlflcates;
(v) Except as descrlbed 1n the Off1clal
Statement, there 1S no actlon, SU1t, proceedlng, lnqulry or
lnvest1gat10n, at law or 1n equ1ty, before or by any court,
government agency, publlC board or body, pend1ng or, to h1S
best knowledge after due lnqulry, threatened agalnst the
Clty, affectlng the corporate eXlstence of the Clty or the
t1tles of 1tS offlcers to the1r respectlve off1ces, or
affectlng or seeklng to prohlb~t, restra1n or enJo1n the
executlon or dellvery of the Certlflcates, the Lease Agree-
ment, the Trust Agreement, the Ground Lease, the Agency
Agreement or th1S Certlflcate Purchase Agreement, or 1n any
way contest1ng or affect1ng the val1d1ty or enforceabll1ty of
the Cert1f1cates, the Lease Agreement, the Trust Agreement,
the Ground Lease, the Agency Agreement or th15 Certlflcate
Purchase Agreement, or contest~ng the tax-exempt status of
15
.
.
the Cert~f~cates, or contest1ng ~n any way the completeness
or accuracy of the Prel1m1nary Off1C1al Statement or the
Off~c~al Statement or any supplement or amendment thereto, or
contest1ng the powers of the Clty or any author1ty for the
1ssuance of the Cert1f1cates, the execut10n and del~very of
the Lease Agreement, the Trust Agreement, the Ground Lease,
the Agency Agreement or th~s Cert1f1cate Purchase Agreement,
or the due performance by the C1ty of the transact10ns con-
templated there1n and here~n, nor, to h1S best knowledge, 15
there any bas1s therefor, whereln an unfavorable decls1on,
rul1ng or flndlng would mater1ally adversely affect the
val1dlty or enforceabll1ty of the Certlflcates, the Lease
Agreement, the Trust Agreement, the Ground Lease, the Agency
Agreement or thlS Certlflcate Purchase Agreement;
(Vl) As of the date thereof, the Prellm1nary
Offlclal Statement d1d not contaln any untrue stateMent of a
materlal fact or omlt to state a materlal fact requlred to be
stated there1n or necessary to make the statements thereln,
In the 11ght of the Clrcumstances under WhlCh they were made,
not mls1ead1ng; and
(Vl1) The Offlclal Statement does not contaln
any untrue statement of a materlal fact or omlt to state a
materlal fact requlred to be stated thereln or necessary to
make the statements thereln, 1n the 11ght of the Clrcum-
stances under WhlCh they were made, not mlsleadlng;
(7) An op1nlon, dated the date of the Closlng and
addressed to the Underwr1ter, of Jensen, Rust & Doyle, coun-
sel for the Trustee, to the effect that:
(1) The Trustee 1S a corporatlon organlzed
and ex~stlng as a natlonal banklng aSSOclatlon under the laws
of the Unlted States;
(il) The Trustee has taken all corporate
actlon necessary to undertake the dutles and obllgat1ons of
Trustee under the Trust Agreement and to authorlze 1n such
capaclty the executlon and del~very of the Asslgnment Agree-
ment; and
(111) The Trustee has all necessary trust
powers requlred to carry out the trust created by the Trust
Agreement;
(8) An op2nlon, dated the date of the Clos2ng and
addressed to the Underwrlter, the Clty and the Trustee of
16
.
.
Sheppard, Mull1n, R1chter & Hampton, Los Angeles, Cal1forn1a,
counsel to the Lessor, to the effect that:
(1) The Lessor 1S a corporat1on organ1zed and
eKlst1ng as a nat10nal banklng assoclat~on under the laws of
the Un1ted Statesi
(11) The execut1on, dellvery and performance by the
Lessor of the Lease Agreement, the Ground Lease, the Agency
Agreement, the Trust Agreement and the Asslgnment Agreement
(A) have each been duly authorlzed by all necessary actlon by
the Lessor and all necessary act10n by any governmental au-
thorlty, body, board, agency or commlSS1on havlng Jur1sd1c-
tlon and (B) wlll not v10late any requ1rement of law. No
consent or author1zatlon of, flllng wlth, notlce to, or other
act by or In respect of, any other Person 1S requlred In
conneet1on wlth the executlon, dellvery or performance by the
Lessor or the valldlty or enforceablllty agalnst the Lessor
of the Lease Agreement, the Ground Lease, the Agency Agree-
ment, the Trust Agreement and the Asslgnment Agreementi
(111) Each of the Lease Agreement, the Ground Lease,
the Agency Agreement, the Trust Agreement and the Asslgnment
Agreement has been duly executed and del1vered by the Lessor,
and each of the Lease Agreement, the Ground Lease, the Agency
Agreement, the Trust Agreement and the Asslgnment Agreement
constltutes a legally valld and b1ndlng obllgatlon of the
Lessor, enforceable agalnst the Lessor ln accordance wlth 1tS
terms except as such enforeeabillty may be llmlted by lnsol-
veney, reorganlzatlon, rnorator1um or other laws relat1ng to
or 11mltlng cred1tors' rlghts generally or by equ1table prln-
clples of general appl1cablllty, and
(lV) The proVls1ons of the Asslgnment Agreement are
effectlve to transfer all rlght, tltle and 1nterest of the
Lessor ln the Lease Agreement, except for eertaln rlghts to
1ndemnlf1catlon, to the Trusteei
(9) A certlfleate, dated the date of the Closlng,
slgned by the Clty Manager, 1n substantlally the form attached
hereto as Exhlblt Bi
(10) The general resolutlon of the Trustee autho-
rlzing the executlon and dellvery of certaIn documents by
certain offIcers of the Trustee, whlch resolutlon author~zes
the executlon and dellvery of the Cert1fIcates, the Trust
Agreement, the ASSIgnment Agreement and th1S CertIf1cate
Purchase Agreementi
17
.
.
(11) Arb~trage cert~f~cat~ons by the C~ty ~n form
and substance acceptable to Spec~al Counsel;
(12) Ev~dence from Standard and Poor's Corporat~on
and Moody's Investors Serv~ce, Inc. that the Cert~f~cates
have been rated" "and" ," respectlvely;
(13) Such add~t~onal legal op~n~ons, cert~f~cates,
~nstruments and other documents as the Underwr~ter may rea-
sonably request to ev~dence the truth and accuracy and ade-
quacy, as of the date hereof and as of the date of the
Closlng, of the representat~ons and warrant~es of the Clty
and the Trustee contalned here~n and of the statements and
lnformat~on conta~ned In the Offlclal Statement and the due
performance or sat~sfact~on by the Clty, the Lessor and the
Trustee on or prlor to the date of the Clos~ng of all the
respect~ve agreements then to be performed and cond~t~ons
then to be sat~sf~ed by the Clty, the Lessor, and the Trustee.
All of the op~n~ons, letters, cert~f~cates, ~nstru-
ments and other documents ment10ned above or elsewhere 1n
th~s Cert~f~cate Purchase Agreement shall be deemed to be In
compl1ance w~th the prov~s~ons hereof 1f, but only ~f, they
are ~n form and substance sat1sfactory to the Underwrlter.
If the C1ty and the Trustee shall be unable to
sat~sfy the cond1t~ons to the obl1gat1ons of the Underwr~ter
to purchase, to accept del~very of and to pay for the Cer-
t~f~cates conta1ned 1n th~s Cert1f1cate Purchase Agreement,
or ~f the obl~gat~ons of the Underwr1ter to purchase, to
accept del~very of and to pay for the Cert~f~cates shall be
term~nated for any reason perm1tted by th1s Cert~f~cate Pur-
chase Agreement, th~s Cert~f1cate Purchase Agreement shall
term~nate and ne~ther the Underwr1ter, the Trustee nor the
C~ty shall be under any further obl1gat~on hereunder, except
that the respect1ve obllgat10ns of the C1ty, the Trustee and
the Underwr~ter set forth 1n Paragraph 9 hereof shall con-
t~nue 1n full force and effect.
9. Expenses. (a) The Underwr1ter shall be under no
obl1gat10n to pay, and the Trustee shall pay solely from
proceeds of the sale of the Cert~f1cates any expenses ~nc~-
dent to the Trustee's, the Lessor's and the C1ty'S obl~gat1ons
hereunder, 1nclud~ng, but not l~m~ted to, (~) the ~n~t1al fees
and d1sbursements of the Trustee and Lessor and the1r respec-
t~ve counsel; (11) the fees and dlsbursements of any eng~neers,
accountants, and other experts, consultants or adV~sors re-
ta~ned by the Clty; (111) the fees, ~f any, for Cert1f~cate
rat~ngs; (~v) the cost of preparat~on, pr~nt~ng and d1strlbu-
18
.
.
tIon of the Prellmlnary Offlclal Statement and OffIclal
Statement; (v) the cost of preparatIon and prIntIng of the
Certlflcates; (Vl) the cost of preparatlon of any Blue Sky
Memorandum; (Vl1) the fees and dlsbursements of Speclal
Counselj and (Vl11) the cost of debt serVIce Insurance premI-
ums, If any.
(b) The Underwrlter shall pay (1) all advertIsIng
expenses In connectIon wlth the publIC offerlng of the CertI-
fIcates, and (11) all other expenses Incurred by 1t 1n con-
nectlon wIth the publIc offerIng of the Cert1f1cates, 1nclud-
Ing the fees and dIsbursements of counsel retaIned by the
UnderwrIter, If any.
10. Not1ces. Any notIce or other commun1catlon to be
glven to the Trustee or the C1ty under thlS Certlflcate Pur-
chase Agreement may be gIven by dellverlng the same In wr1t-
Ing at the respectIve addresses set forth above (wIth, In
the case of any notlce to the CIty, cop1es to the C1ty
Attorney, AIrport Dlrector and Finance D1rector), and any
notlce or other commun1catlon to be glven to the UnderwrIter
under thlS CertifIcate Purchase Agreement may be glven by
dellverlng the same In wr1tlng to Pa1neWebber Incorporated,
PubllC Flnance Department, 100 Callfornla Street, 12th Floor,
San FrancIsco, CalIfornIa 94111.
11. Partles ln Interest. ThIS Cert1f1cate Purchase
Agreement IS made solely for the benefIt of the Trustee, the
Clty and the UnderwrIter (lnclud1ng the successors or asslgns
of the UnderwrIter), and no other person shall acqulre or
have any rlght hereunder or by vlrtue hereof. All of the
representatlons, warrantles and agreements of the Clty and
the Trustee contalned In thIS Certlflcate Purchase Agreement
shall remaIn operatlve and In full force and effect, regard-
less of (1) any InvestIgatIons made by or on behalf of the
Underwr1ter; (11) delIvery of and payment for the CertifI-
cates pursuant to thIS CertIfIcate Purchase Agreement;
and (111) any termlnatlon of thIS CertIfIcate Purchase
Agreement.
12. EffectIveness. ThIS CertIflcate Purchase Agreement
shall become effectIve upon the acceptance hereof by the
Trustee and by the CIty CounCIl of the CIty and shall be
valld and enforceable at the t~me of such acceptance.
13. Counterparts. ThIS Certlflcate Purchase Agreement
may be executed ln any number of counterparts, all of WhlCh
taken together shall constItute one agreement, and any party
hereto may execute thIS CertIf~cate Purchase Agreement by
SIgnIng any such counterpart.
19
.
.
14. Headlngs. The headlngs of the Paragraphs of thls
Certlflcate Purchase Agreement are lnserted for convenlence
only and shall not be deemed to be a part hereof.
Very truly yours,
PAINEWEBBER INCORPORATED
By
Authorlzed Slgnature
Approved as to Form:
Robert M. Myers, Esq.
Clty Attorney
Agreed and Accepted:
Thls
day of October, 1985
CITY OF SANTA MONICA
By
Clty Manager
Attest:
By
Clty Clerk
[Seal]
Agreed and Accepted:
Thls
day of October, 1985
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION
By
(Authorlzed Offlcer)
20
.
.
[OFFICIAL STATEMENT]
To BC== S.0 PPL-L ~j)
~ ---
!~~" {-1t-<. Y'-ZlJel1b.er
A-I
EXHIBIT A
.
.
EXHIBIT B
CERTIFICATE
The underslgned Clty Manager of the Clty of Santa
Monlca, Callfornla (the "Clty"), hereby certlfJ..es that:
1. The representatJ..ons and warrantles of the Clty
contalned ln the Certlflcate Purchase Agreement dated
October , 1985, between the Clty, Bank of Amerlca Nat10nal
Trust and Savlngs Assoclat1on, as Trustee, and the Under-
wrlter named thereln (the "CertJ..flcate Purchase Agreement")
wlth respect to the sale of $ 1n aggregate
prlnclpa1 amount of Certlflcates of Partlclpatlon (Mun1clpal
Alrport ProJect) (the "Cert1f1catestl) are true and correct 1n
all rnater1al respects on and as of the date hereof.
2. Except as descr1bed 1n the Off1c1al Statement,
no actlon, SUlt, proceedlng, lnqulry or lnvestlgatlon, at law
or 1n equlty, before or by any court, government agency,
publlC board or body, 1S pendlng or, to the best of my knowl-
edge, threatened agalnst the Clty, affectlng the corporate
eXlstence of the Clty or the t1tles of lts offlcers to thelr
respectlve offlces, or a~fect1ng or seeklng to prohlblt,
restraln or enJoln the executJ..on or dellvery of the Certlf1-
cates, the Lease Agreement, the Ground Lease, the Agency
Agreement or the Trust Agreement, or 1n any way contestlng or
affectlng the valldlty or enforceablllty of the Certlflcate
Purchase Agreement, the Certlflcates, the Lease Agreement,
the Ground Lease, the Agency Agreement or the Trust Agree-
ment, or contestlng the tax-exempt status of the Certlflcates,
or contestJ..ng J..n any way the completeness or accuracy of the
Prellmlnary Offlclal Statement or the Offlclal Statement or
any supplement or amendment thereto, or contestlng the powers
of the Clty or any authorlty for the lssuance of the Certlf1-
cates, the execut10n and dellvery of the Lease Agreement, the
Trust Agreement, the Ground Lease, the Agency Agreement or
the Certlf1cate Purchase Agreement, or the due performance by
the Clty of the transactlons contemplated thereln, nor, to
the best of my knowledge, 1S there any basls therefor, whereln
an unfavorable dec1s1on, rullng or f1nd~ng would materlally
adversely affect the valld1ty or enforceab1l1ty of the Cer-
tlflcates, the Lease Agreement, the Trust Agreement, the
Ground Lease, the Agency Agreement or the Certlf~cate Pur-
chase Agreement.
3. To the best of my knowledge, no event affectlng
the Clty has occurred Sloce the date of the Offlclal State-
B-1
.
.
ment WhlCh should be dlsclosed ln the Offlclal Statement so
that the Offlclal Statement wlll not contaln any untrue
statement of a materlal fact or omlt to state a materlal fact
requlred to be stated there1n or necessary to make the state-
ments there1n, In the llght of the clrcumstances under WhlCh
they were made, not mlslead1ng, and WhlCh has not been dlS-
closed 1n a supplement or amendment to the Offlclal Statement.
4. The Clty has complled wlth all the agreements
and sat1sfled all the condltlons on 1ts part to be performed
or sat1sf1ed at or prlor to the date hereof pursuant to the
Certlflcate Purchase Agreement.
5. All cap1tallzed terms employed hereln WhlCh are
not deflned hereln shall have the same meanlngs as 1n the
Certlflcate Purchase Agreement.
, 1985.
Clty Manager
B-2
.
.
11679 00000002/091268-L
GROUND LEASE
THIS GROUND LEASE 15 made and entered Into as of
October 1, 1985, by and between the CITY OF SANTA MONICA, a
munlclpal corporatIon organIzed and operatlng under the laws
of the State of Callfornla and the Clty Charter (as and here-
Inafter called "CIty"), and SECURITY PACIFIC NATIONAL BANK, a
natlonal banklng aSSoclatlon (as and hereInafter called
"Lessee")
WIT N E 5 SET H
WHEREAS, Clty IS the owner of that certaln land
located 1n the County of Los Angeles, State of Callfornla,
more partlcularly descr1bed ln Exhlblt A attached hereto and
made a part hereof, and Lessee 1S desirous of leaSIng sald
land from C1ty on the terms and condltlons herelnafter set
forth
NOW, THEREFORE, ~n cons~deratlon of the pre~lses
and the respect1ve undertaklngs of the partles herelnafter
set forth, It 1S hereby agreed as follows
1. Def~nltlons_ As used hereIn, the followlng
terms have the followlng meanlngs'
A "Agreement" means that certaln "Lease Agree-
menT Relatlng to AIrport Fa!:'lll tIes" dated as of October 1,
198~, by and between Clty, as sublessee of the Slte and
lessee of the Facllltles, and Lessee, as sublessor of the
s~te and lessor of the FacIlltles, as now or hereafter
amended.
B "Facllltl€S" means the FacIIltles as defIned
1n the Agreement
C. "SIte" means the land descrlbed In ExhIbIt A
attached hereto and all easements, llcenses, prlvlleges,
rIghts and appurtenances related thereto There are cur-
rently no bUlldlngs, structures or Improvements now sItuated
or erected on the SIte
D. "Sublease" means any lease, sublease, lIcense
or conceSSlon agreement (other than thls Ground Lease)
Involvlng the use or occupancy of the SIte or any part
thereof, lncludlng, wlthOUt 11mltatIon, the Agreement
E. "Rent" Includes the "Base Rent" and "AddI-
t1.onal Rent" (both as hereInafter def1.ned).
2. Lease of the Slte. C1ty hereby leases to
Lessee, and Lessee hereby takes and h1.res from Clty, the
S~te, l.n conslderat1.on of the rents, covenants and agree-
ments, and upon the terms and condlt1ons set forth here1.n,
subJect to any and all eXIstIng and future encumbrances,
condltlons, covenants, easements, restrlctlons, r1ghts-of-
way, and all other eXlst1ng and future matters of any nature
affect1ng the S1te (1n each case whether or not of record)
durl.nq the "Term" (as here1nafter def1ned), such matters as
\~
.
.
.
may be dIsclosed by an InspectIon or survey, and all zon~ng,
land Use, subd~v1sion, and all other laws. rules, regulatlons
and Judlclal or admln1stratlve orders now or hereafter
applIcable to the Slte or any part thereof or any use Dr
occupancy thereof (herein collectIvely called "Exceptlons")
3, Term. The term of thlS Lease ("Term") shall
commence on the date hereof and termlnate on the earlIer of
(l) October 1, 2007, Dr (II) the date upon Wh1Ch all "Lease
Payments" (as deflned ln the Agreement) shall have been paid
In full or (Ill) the date upon Wh1Ch the Agreement shall have
been term1nated for any reason whatsoever, unless termInated
earlIer in accordance With the provlslons hereof
4. Rent As rental for the SIte, Lessee shall
pay the sums hereinafter set forth
A. Base Rent Lessee shall pay to CIty durIng
tJ-.e Term a mlnlmum net annual rent ("BasE! Rent") In the
amount of One Dollar (S1) per year, WhICh Base Rent 1S pay-
able as more fully descrlbed In Paragraph 4C below
B, Addltlonal Rent Lessee shall also payor
cause to be paId wlthout notlce, except as may otherwlse be
requIred 1n th1s Ground Lease, and WIthout abatement, deduc-
tlon or set-off. as addltlonal rent ("Addltlonal Rent"). any
addltIonal sums, Imposltlons, costs, expenses and other pay-
ments wh1ch Lessee assumes or agrees to pay ~n any of the
prov1sIons of thIS Ground Lease, and 1n the event of any
nonpa~~ent th~reof, CIty shall have (In addItIon to all other
r1ghts and remedIes) all the rIghts and remedIes prOVIded f~r
here~n or by law In the case of nonpayment of rent
C Re~t Pal~ents. All payments of Base Rent,
AddltIonal Rent and other payments requlred to be made to
Clty shall be In lawful money of the Unlted States of Amerlca
and shall be pald to CIty at CIty's address for not~ces set
forth 1n Paragraph 34 or at such other place as CIty may
deslgnate by notlce ln wrltlng from tIme to tlme and may be
made by check or draft payable to the order of such payee,
WhlCh check or draft must be pald In full when presented.
All payments of Base Rent shall be made Without deduct10n or
offset and wlthout not~ce In annual Installments 1n advance
on October 1 of each and every year durlng the Term, com-
menc~ng on the date of executlon of thlS Lease (the "Rent
Commencement Date"). If the Rent Co~~encement Date shall be
a day other than October 1, Base Rent for the year 1n WhICh
the Rent Commencement Date occurs shall be apportIoned and
shall be pald on such Rent Commencement Date. Notwlthstand-
~ng any dIspute between Lessee and C1ty. Lessee shall make or
cause to be made each and all Rent payments when due and
shall not w~thhold or permlt to be WIthheld any Rent payments
pendIng the f1nal resolutIon of such dIspute nor shall Lessee
assert nor permIt to be asserted any rIghts to setoff or
counterclalm agaInst the obl1gat1on to make Rent payments as
set forth here1n.
D. Net Lease It 1s the purpose and Intent of
C1ty and Lessee that Rent payable hereunder shall be abso-
lutely net to CIty so that this Ground Lease shall YIeld to
Clty the Rent speCIfIed, free of any charges, assessments, or
2
.
.
~mposltlons of any kInd charged. assessed. or Imposed on or
agaInst the S~te, and WIthout abatement. counterclaIm. deduc-
tIon. defense. deferment or set-off by the Lessee. except as
hereIn speCIfIcally otherwlse provlded, and Clty shall not be
expected or requIred to pay any such charge, assessment or
~mposlt~on. or be under any obllgatlcn or lIabIlIty hereunder
except as hereln expressly set forth, and that all costs.
expenses and oblIgatIons of any kInd relatIng to the
ma~ntenance and operatIon of the SIte, IncludIng all altera-
tlons. repaIrs and replacements as hereInafter prOVIded.
wh~ch may arIse or become due durIng the Term shall be paId
by Lessee Lessee covenants that It WIll remaIn obl~gated
under thIS Ground Lease In accordance WIth Its terms and WIll
take no actIon to termlnate. reSCInd or aVOId thIS Ground
Lease for any reason, notwlthstandlng the bankruptcy. Insol-
vency, reorganIzatIon, composlt~on, readJustment, lIquIda-
tIon. dIssolutIon, WIndIng-up or other proceedIng affectIng
CIty or any actIon w~th respect to thls Ground Lease WhICh
may be take~ by any trustee or receIver of CIty In any such
proceedIng. or by any court In any such proceedIng. Lessee
waIves all rIghts WhICh may at any tIme eXIst by law to qUIt.
termInate or surrender thIS Ground Lease or all or any part
of the SIte. or to any abatement, dImInutIon or reductIon of
rent or any other sums payable by Lessee under thIS Ground
Lease Lessee expressly waIves the prOVISIons and benefIts
of SectIons 1932(2) and 1933(4) of the CalIfornIa CIVIl Code,
and any sImllar statute or rule of law now or hereafter ln
effect WhICh would relIeve the Lessee from any oblIgatIons to
pay Rent or other sums under thIS Ground Lease on account of
any damage or destructlon to the S~te NothIng In th~s Para-
graph 4D shall constItute a waIver by Lessee of Its rIght to
brlng an Independent cause of actIon agalnst CIty for any
default or breach by CIty under thIS Ground Lease or under
any other agreement to WhICh Clty and the Lessee may be par-
tIes; prOVIded, however, that no such cause of actIon shall
under any CIrcumstances entItle the Lessee to offset. abate,
deduct from or defer the pa~ent of Rent, or such other sums
as are payable by It under th~s Ground Lease.
5. Use of T~e SIte.
A. Lessee shall have the rIght durIng the Term
hereof to construct the FaCIlItIes and to use the SIte In
accordance WIth the prOVISIons of the Agreement.
B. Lessee shall well and truly keep. observe and
perform, or cause to be kept. observed and performed. all
valId and lawful OblIgatIons or regulatIons now or hereafter
Imposed on lt by contract. or prescrIbed by any law of the
UnIted States, or of the State of CalIfornIa, or by any offI-
cer, board or commISSIon haVIng Jur~sdIctIon or control. as a
condItIon of the contInued enJoyment of any and every rIght.
prIVIlege or franchIse now owned or hereafter acquIred by
Lessee, Including Its rIght to eXIst and carryon bUSIness as
a natIonal banking assocIation. to the end that such rIghts,
prIVIleges and franchIses shall be maIntaIned and preserved,
and shall not become abandoned. forfeIted or In any manner
ImpaIred.
6. UtllItles. All rnalntenance and repalr of the
SIte and the FacilIties shall be the responsIbIlIty of
3
.
.
Lessee, and Lessee shall pay for, or otherwlse arrange for
the payment for, any necessary utlllty servIces supplIed to
the Slte and the Facllltles, all costs of operatlon of the
SIte and the FaCIlItIes and all costs of repaIr and
replacement of the SIte and the FaCIlItIes resultIng from
ordlnary wear and tear or want of care on the part of Lessee.
In exchange for the rent payments hereln prOVIded, CIty
agrees to prOVIde only the SIte.
7 Taxes. Lessee WIll payor cause to be paId
all taxes, assessments and other governmental charges, If
any, that may be leVIed, assessed or charged upon the SIte or
the FaCll1tles or any part thereof, promptly as and when the
same shall become due and payable, prOVIded, however, that
Lessee shall not be reqUIred to pay any such tax, assessment,
or charge If the valIdIty thereof shall concurrently be
contested In good fa~th by approprIate proceedlngs, and If
Lessee shall set aSlde, or cause to be set aSIde, reserves
deemed by It to be adequate WIth respect thereto and prOVIded
further, that Lessee, upon the cow~encernent of any proceed-
Ings to foreclose the lIen of any such tax, assessment, or
charge, WIll forthwlth pay, or cause to be paId, any such
tax, assessment or charge, unless contested In good faIth as
aforesaId. Lessee WIll not suffer the Slte or the Facllltles
or any part thereof to be sold for any taxes, assessments or
other charges whatsoever, or to be forfeIted therefor. Noth-
~ng hereIn contaIned shall be deemed to Impose any IIabll~ty
to pay taxes, assessments or charges where none 1S Imposed by
law,
8 Insurance. At all tlmes durIng the Term of
thlS Ground Lease, Lessee shall procure alj maIntaIn or cause
to be procured and ma1ntaIned Insurance aga1nst the hazards
and llabIlltles, and In the amounts, set forth In the Agree-
ment Cert1f1cates of all pol1c1es eVldenc1ng such Insurance
shall be delIvered to C1ty, WIthout demand All polICIes of
1nsurance prov1ded for hereln shall be 1n such form and
lnclude such deduct1bles, endor5e~ents and wa1vers and be
wlth such 1nsurance compan1es as shall be set forth In the
Agreement. All such pol1cles shall name CIty and Lessee as
lnsureds thereunder, and shall prOVIde that the sa~e may not
be cancelled or amended wlthout at least th1rty (30) days
prIor wr1tten notIce belng glven by the Insurer to all In-
sureds thereunder,
9. No Warrant1es by Clty Lessee acknowledges
that Lessee has full kncwledge of all matters pertaIn1ng to
the S1te, Includ1ng, but not lImlted to, the cond1t1on of
tltle to the same and the phys1cal cond1tlon of the same, and
that Lessee 1S leaslng the SIte "AS IS." Clty makes no war-
ranty of any klnd or nature, express, 1mplled, or otherwIse,
or any representatIons or covenants of any k1nd or nature 1n
connectIon wlth the tItle to or condltlon of the S1te or any
part thereof, and Clty shall not be llable for any latent or
patent defects thereln or be obllgated 1n any way whatsoever
to correct or repalr any such latent or patent defects.
10. Restoratlon and Ma1ntenance
A, Lessee shall operate, malntaln and preserve,
or cause to be operated, ma1ntalned and preserved, the Slte
4
.
.
and the FaCIlItIes In good repalr and workIng order and wIll
operate or cause to be operated the SIte and the FacIl1tIes
ln an efflclent and economIcal manner.
B. CIty shall have no oblIgatlon to make any
repaIrs, decoratIng, replacements, restoratIons, alteratIons,
addltlons or Improvements whatsoever unto or about the SIte
and the FacIIlt1es or any part thereof, or to restore the
same or any part of the same 1n the event of 1ts loss,
destruct10n or damage, and Lessee hereby wa1ves any rIght It
may have to make repaIrs at the expense of Clty whIch may be
prov]ded for by any applIcable present or future law or
JudICIal deCISIon, 1ncludlng, WIthout Ilmltatlon, the
provls1ons of CalIfornIa CIVIl Code S~ 1932, 1933, 1941 and
1942.
11, Interference Lessee shall have no claIm
agaInst CIty for any d~~age, nor shall Lessee (except as
otherWIse expressly here1n prOVIded) be released from any of
the terms, covenants or prOVIsIons of thIS Ground Lease
should Lessee's posseSSIon of the SIte or any part thereof be
d1sturbed or Interfered WIth or affected 1n any wanner by
reason of the acts or omISSIons of any person, or by reason
of the enactment or adoptIon of any law, ordInance or regula-
tlon or by reason of any other act of any gover~~ental
author1ty, prOVIded, however, that the foregoIng shall not
lImIt C1ty'S lIabIlIty for CIty'S wrongful Interference WIth
the rlghts of Lessee under thIS Ground Lease
12. LIens Lessee shall keep or cause to be kept
the SIte and the FacIllt1es and all part5 thereof free from
Judgments, from mechanlcs' and r,:>terl almen I s lIens and,
except as to ExceptIons, free from all lIens, cla1ws, demands
and encumbrances of whatsoever nature or character, to the
end that the SIte and the FaC1Iltles may at all tImes be
malnta1ned and preserved, and Lessee shall keep or cause to
be kept the SIte and FaCIlItIes free from any claIm or lla-
b1llty Wh1ch. In the Judgment of CIty m1ght ImpaIr or Impede
the operatIon of the S~te and the FacIl1t1es, prov1ded, how-
ever, that Lessee shall not be requIred to pay any such
lIens. claIms or demands If the valIdIty thereof shall con-
currently be contested ~n good faIth by approprIate proceed-
Ings, and If Lessee shall set aS1de or cause to be set aSIde
reserves deemed by It to be adequate w1th Iespect thereto and
prOVIded further, that Lessee upon the commencement of any
proceedIngs to foreclose the lIen of any such charge or
claIm, WIll forthw~th payor cause to be paId any such charge
or claIm unless contested In good faIth as aforesaId CIty,
at Its optIon (after fIrst glvlng Lessee ten (10) days' wr1t-
ten notIce to comply therew1th and faIlure of Lessee to so
comply WIthIn saId ten-day perIod) may defend agaInst any and
all act10ns or proceedIngs 1n WhICh the valld1ty of thIS
Ground Lease IS or mIght be quest1oned, or may payor com-
prom~se any claIm or demand asserted In any such actIons or
proceedIngs, prOVIded. however. that, In defend1ng aga1nst
such actIons or proceedIngs or In paY1ng or compromIsIng such
claIms or demands, C1ty shall ~n no event be deemed to have
wa1ved or released Lessee from llabll1ty for or on account of
any of Its covenants and warrantIes conta1ned here1n, or from
1ts lIabIlIty hereunder to defend the valIdIty of th1S Ground
::;
t,
.
.
Lease and the pledge hereln made to perform such covenants
and warrantles.
13. Encumbrances or Sales Except as to Excep-
tIons, Lessee will not create or suffer to be created any
mortgage, pledge, llen, charge or encumbrance upon the Slte
or FaClllties or any part thereof, or upon any real or per-
sonal property essentlal to the operation of the Slte or the
FaC111ties Lessee will not sell or otherwise d1spose of the
Site or the FaCIlitIes Dr any property essentlal to the
proper operatIon of the Slte or the Facl1Ities, except as
otherWlse provlded herein.
14. Prosecution and Defense of SUits Lessee
shall promptly, upon request of Clty, from time to tlme take
or cause to be taken such action as may be necessary or
proper to remedy or cure any defect In or cloud upon the
title to the Slte or the Facllltles whether now eXisting or
hereafter developlng and shall prosecute all such SUitS,
actlons and other proceedlngs as may be appropriate for such
purpose and shall Indemnify or cause to be lndemnlfled CIty
and Its aSSIgns for all loss, cost, damage and expense,
lncludlng reasonable attorneys' fees, wh~ch they or any of
them may lncur by reason of any such defect, cloud, SUlt,
actIon or proceedings
15. Recordat~on and Flling Lessee shall record
and flle, or cause to be recorded and flIed, a memorandum of
thlS Ground Lease and all such supplemental Instruments and
other documents a~ may be requ1red by law (together With
whatever else may be necessary or be reasonably required by
Clty or ltS aSSignee), ln such manner, at such tlmes and ln
such places as may be required by law In order fully to pre-
serve and protect the rlghts of City hereunder.
16 Wa~ver of Laws_ Lessee shall not at any tIme
lnslst upon or plead 1n any manner whatsoever, or claim or
suffer or take the benef~t or advantage of any stay or exten-
Slon law now or at any tIme hereafter In force wh~ch may
adversely affect the covenants and agreements conta~ned
hereln and the beneflt and advantage of any such law or laws
15 hereby expressly walved by Lessee to the extent that
Lessee may legally make such walver.
17. ComplIance wlth Cond1t1ons Precedent, Upon the
date of del~very of this Ground Lease, all condltions, acts
and th~n9s requlred by law or by thIS Ground Lease to have
happened or to have been performed precedent to or 1n the
executIon hereof shall ex~st, have happened and have been
performed, and th1S Ground Lease shall be wlthln every llmIt
prescr~bed by law.
18. Power to Enter lnto Ground Lease. Lessee ~s
duly authorIzed pursuant to the law to enter Into thlS Ground
Lease. The provls~ons of th15 Ground Lease are and wlll be
the val1d and legally enforceable obllgatlons of Lessee ln
accordance WIth their terms
19_ Further Assurances Whenever and so often as
requested so to do by any party, the other party wlll, upon
written request by such party followlng reasonable notIce,
6
.
.
execute and delIver or cause to be executed and delIvered all
such other and further instruments, documents or assurances,
and do or cause to be done all such other and further thIngs,
as may be necessary or reasonably requIred In order to fur-
ther and more fully to vest 1n such party all rIghts, lnter-
est, powers, benefIts, prlv1leges and advantages conferred or
Intended to be conferred upon such party hereunder.
20 Condemnatlon, Damage or DestructIon
A, In the event of damage or destructIon to the
SIte or the FaC1lltles or any part thereof or In the event a
proceed1ng In emInent doma1n or condemnatIon 15 lnstltuted
agaInst the SIte or the Facl11tles or any part thereof, the
Agreement shall elther cont1nue or term1nate pursuant to the
terms of the Agreement; If the Agreement termInates (Lessee
acknowledlng that CIty, as sublessee of the Slte and lessee
of the Faclllt1es, shall have the optIon, at lts sole dlscre-
tlon, to exerC1se or not exerCIse any rlghts c~ntalned In the
~greement), thIS Ground Lease shall also termlnate and all
"Net Proceeds" (as def1ned 1n the Agreement) of any Insurance
or conde~~atlon award shall be allocated 1n accordance WIth
the provls~ons of the Agreement If the Agreement does not
termInate (Lessee acknowledlng that CIty, as sublessee of the
SIte and lessee of the FaCllltles, shall have the optlon, at
lts sole d1scretlon, to exerCIse or not exerC1se any rIghts
contaIned In the Agreement), the provls1ons of the Agreement
WIth respect to repa1rs or restorat10n and the allocatlon of
Net Proceeds of any Insurance or conde~~at1on award shall
govern. Notwlthstand~ng the foregolng, In the event that for
any reason the Agreement has been termInated and thIS Gro~nd
Lease IS contlnu1ng, Lessee shall not be entItled to the Net
Proceeds of any lnsurance or condemnatIon award or any
portIon thereof and all of the same shall be the property of
Clty.
21. ASSIgnment and SublettIng by Lessee Other
than as contenplated by the Agreement, Lessee shall not
(1) aSSIgn or otherwIse transfer thls Ground Lease or any
part thereof or ~nterest thereln, or permIt the same to be
assIgned or otherwIse transferred, or (11) enter Into Sub-
lease(s) for the use and occupancy of the S~te or leases for
the use and occupancy of the FaCllltles or portIons thereof,
whether voluntarIly or Involuntarlly, by operatIon of law or
otherWIse.
22. Default,
A. Events of Default. The followlng shall be
"Events of Default" hereunder and the term "Event of Default"
shall mean, whenever 1t IS used here1n, anyone or more of
the follow1ng events,
(a) FaIlure by Lessee to pay any Rent
requ~red to be pa1d hereunder at the tIme speCIfIed here~n
and the cont~nuatlon of saId faIlure for a per10d of thlrty
(30) days after wrItten notIce spec1fYlng such fa~lure and
requestIng that 1t be remedIed has been given to Lessee by
C1ty, unless CIty shall agree ln wrItIng to an extens10n of
such perIod prlor to 1tS eXpIratlon, or
7
.
.
(b) Fa11ure by Lessee to observe and perform
any covenant, condlt1on or agreement on 1ts part to be
observed or performed, other than as referred to 1n clause
(a) of th1S Paragraph 22, for a perIod of th1rty (30) days
after wr1tten notIce spec1fY1ng such fa1lure and request1ng
that 1t be remedIed has been gIven to Lessee by C1ty, unless
C1ty shall agree 1n wr1t1ng to an extens10n of such t1rne
pr10r to Its exp1ratlon; provIded, however, 1f the fa1lure
stated 1n the not1ce cannot be corrected w1thln the applIca-
ble per1od, C1ty wlll not unreasonably w1thhold 1ts consent
to an extens10n of such t1me 1f correctIve act10n IS Inst1-
tuted by Lessee w1thln the appllcable per10d and dI11gently
pursued untIl the default 1S corrected, or
(c) A court haVIng Jurlsd1ct1on In the prem-
Ises shall enter a decree or order for re11ef 1n respect of
Lessee In an 1nvoluntary case under any app11cable
bankruptcy, Insolvency or other sIm1lar law now or hereafter
~n effect, or appo~ntlng a receIver, lIquIdator, ass1gnee,
custodIan, trustee, sequestrator (or slm~lar offICIal) of
Lessee or for any substantIal part of Its property, or
orderIng the wlnd~ng up or llquldat10n of Its affaIrs, and
such decree or order shall remaIn unstayed and In effect for
a perIod of slxty (&0) days; or
(d) Lessee shall commence a voluntary case
under any appl~cable bankruptcy, 1nsolvency or other SImIlar
law now or hereafter 1n effect, or shall consent to the entry
of an order for rpllef In an Involuntary case under any such
law, or shall consent to the appOIntment of or takIng posses-
SIon by a receever, lIquIdator, aSSIgnee, trustee, custodIan,
sequestrator (or s1mllar offICIal) of Lessee or for any sub-
stantIal part of ItS property, or shall make any general
ass1grument for for the benefIt of credItors, or shall fall
generally to pay its debts as they become due or shall take
any corporate actIon 1n furtherance of any of the foregOIng
B. RemedIes on Default.
(1) Upon the happenIng of any of the Events
of Default spec1fIed above, C1ty may exerCIse any and all
remed1es avaIlable pursuant to law or granted pursuant to
thIS Ground Lease, In the event of an Event of Default,
Lessee shall. as hereIn expressly prOVIded, contInue to
remaIn lIable for the payment of Rent and damages for breach
hereof and the performance of all cond1t1ons here1n contaIned
and, 1n any event, such Rent payments and damages shall be
payable to the C1ty at the t1me and 1n the manner set forth
In paragraphs (a) and (b) of th1s subsectIon.
(a) In the event that CIty does not
elect to termInate th1S Ground Lease pursuant to
paragraph (b) below, Lessee agrees to and shall remaIn lIable
for the payment of Rent payments and the performance of all
cond1tlons herein contaIned and shall reIMburse City for any
defICIency ar15Ing out of the relett1ng of the SIte and the
Fac1l1tles, or, In the event that CIty or 1tS ass1gnee 15
unable to relet the 51te and the Fac11It1es, then for the
full amount of the Rent pa}~ent5 to the end of the term of
thIS Ground Lease, but saId Rent payments or def1clency shall
be payable only at the same t1me and 1n the same manner as
8
"
.
.
prO.rd'd h.r.rn. Oot~rth.t'ndrng .ny 'uit rn Unla~ful
d.tarn.r. or other~r... br.ught by Crty for tbe purpose Of
Obt'rnrog PO....Sl.n .f the Sit. and the Facrlrtr.. .r the
'X.rCrs. .f any Oth'r r.m'dy by the Crty. t,ss.e hereby
rrre.oCably 'Ppornts Crty as the agent 'nd attorneY-rn_f'ct
.f Less.. to enter upon 'nd r'"et the Site and the Facrlrtr..
rn the '.'nt of defaUlt by L..s... L,ssee h.r.by .xempts and
.gr.es t. sa.e harmless Crty fr.m 'ny Costs. loss or d"'ge
~h.tsoe.er .rr.rng or occ'sroned by any 'uch entry uPon 'nd
lettrng of the Srte 'nd the F,crlrtre.. e.cept for 'ny 'uch
co.t.. 10.. .r d.m.g. .ri'rng fr.m the gross neglrgenc. or
~rllful mrsConduct of Crty. LeSsee her'by ~'r.e. .ny and all
cl.rms fOr d~"g.s cau"d by Crty rn takrng Po'sessron of the
Srt. and the F.crlrtre.. for .11 cl'rm. for dam.g.s that may
r'sUlt from the destructron of Or rnJury to the S'te and the
Facrlrtr.s. 'nd .11 clarms for d..ag.s to or loss of any
property beloogrng to LeSsee that may be ro or Upon the S'te
and the F,crl,tres. except for d.m.ge. or loss .rrsrng from
the gross n.glrgence or ~rllful mr'Conduct of C,ty Lessee
.gre.. th,t the terms of th,. Grouod L.... con.trtUte full
'nd ,uffrcr.nt notrc. of the rrght Of Crty to r.let the Srt.
'nd the F,c'"rtres "rthout eifectrng , 'urrend.r of th,s
GroUnd L..... 'nd furth.r agr.e. that no act. of Crty Or ,to
a'.rgn.e rn 'ff'ct'ng 'uch r'".ttrng 'hall con.trtute a
.urrend'r or term'u.tron of thr. Ground L.... rrre,pectrve of
the term for ~hrch 'uch relettrng r. m'd.. Or of the term.
and condrt,on. of SUch r".ttrng. or other~rs.. but that. on
the COntt.ry, rn the eVent of SUch d.faUlt by Les.... th,
r'ght to term'nat. th,s Ground Lease 'hall v.st rn Crty to be
eff.ct'd rn the Sol. and '.elu.rve mann.r h.r.rnafter
proV~ded for 1n Paragraph (b) below.
(bl Upon.n Ev.nt of D'f,ult. Crty may.
at rt. OPt'on. termrnat. thr. Ground Le'.e fOllo'rng t'n (10)
days. 'trtten notrc. th.r,of to Less.e. In the 'v'nt of t'r_
.rnatrnn Of thr. Grnund t.... hy Crty on 'CCOunt of an Event
of Default (and not.,th.tandrng 'ny r".tt'ng Of the S"e and
the Y.crlrtre.). L..... nev.rtheless agte.. to p'Y to Crty
," Cost.. 10.. Or dam.g.. hO'soever .r"rng or OCCUrtrng
Payable at the .a.e trm. 'nd rn the 'ame .aon.r a. rn the
cas. of P'Ym.nt of '.nt P'Ym'nt. h.r,under. City m.y t.let
the Srte 'nd the Facrlrtre.. Mon.y. recer.ed frnm 'uch
r"ett'ng and 'ny ,urplu. r,c.r.'d by C,ty fro. 'uch r"et_
t'ng 'hall b. the abSOlute PtoP'rty of Crty and Le".e .h,""
h... no rrght or elarm th.reto N.rther Uotrce to p'Y rent
or to delrver up PO.....ron of the Srt. and the F'c"rtr..
g'ven pursuant to la~ nor .ny proc"drng rn unla"ful d.tarner
t'k.n by Crty Sh"l of rt..lf op'r.t. to t'rmrn.te thrs
Ground Leas.. 'nd no t.rmrn.tron Of thr. Ground Le.se on
aCCOunt of d.f.ult by Les... 'h'll b. or b.co.. 'f[.ctrve by
oP.r.tron of I.,. or oth.rwr... unle.s and Untrl c.ty shall
h,ve gr..n ~rrtt'n notre. to t..s.. of the '"ectron au the
P'rt of Crty to termrn.t. this Ground L'ase.
(C) SUits at L." or rn E it 'nd M.ndamus. In
'ddrt,on to the remedr.. .et forth aha... rn ea.. one or more
Of the E.ent. of Default .hall h'Pp.n. then 'nd rn ,very ,uch
e.s.. Crty Sh.ll b. entItled tn Proce.d to prot'ct and
en fore. the rrghts v.sted rn Crty by thr. Ground L.ase by
'uch approprrat. JUdrer.l prne"drng as Crty Shall deem mn.t
'ff,ctU.l to prot'et 'nd enfore. any 'Uch rrght. 'rth'r by
9
.
.
su~t In equ~ty or by actlon at law, whether for the $pec~f~c
performance of any covenant or agreement contained In thIS
Ground Lease, or to enforce any other legal or equItable
rIght vested ~n C~ty by thIS Ground Lease or by law The
prOVIsIons of th~s Ground Lease and the dutIes of Lessee and
of the members, off~cers and employees thereof shall be
enforceable by CIty by mandamus or other approprIate SUIt,
actIon or proceed~ng In any court of competent Jurlsdlctlon
(1) W~thout llmitlng the generallty of the
foregolng, C~ty shall have the rIght:
(a) AccountIng By actIon or sUlt In
equlty to requlre the Lessee and lts offlcers, agents and
employees to account as the trustee of an express trust.
(b) InJunctlon By actIon or SUlt 1n
eT~lty to enJOIn any acts or thIngs WhICh may be unla~ful or
ln v1olatlon of the r~ghts of CIty
(c) Mandamus By mandamus or other
SUlt, actlon or proceedIng at law or ~n equlty to enforce lts
or thelr r1ghts agalnst Lessee and Its and any of ltS offI-
cers, agents, and employees, and to compel It or them to
perform and carry out Its and thelr dutles and obllgatlons
under the la~ and Its and theIr covenants and agreements w~th
CIty as prOVIded hereIn.
D Non-Walver. Nothlng ln thIS Paragraph 22 or
In any other provlslon of th~s Ground Lease shall affect or
ImpaIr the obllgatlon of Lessee to pay the Rent payments, as
here1n prov1ded. No delay or om1SSlon of CIty to exerCIse
any rlght or power arlslng upon the happenIng of any event of
default shall lmpalr any such rIght or power or shall be
construed to be a walver of any such event of default or any
acqulescence thereIn, and every power and remedy glven by
th1s Pa~agraph 22 to CIty may be exerclsed from tlme to t1me
and as often as shall be deemed expedlent by C1ty.
E. Remedles not ExclusIve. No remedy hereln or
by law conferred upon or reserved to Clty IS 1ntended to be
exclusIve of any o~~er remedy, but each such remedy 1S c~-
ulat1ve and 1n addlt10n to every other remedy, and every
remedy glven hereunder or now or hereafter eX1stIng, at law
or In eqlllty or by statute or otherwlse may be exerc1sed
wlthout exhaustIng and WIthout regard to any other remedy
conferred by any law.
F. Status Quo Ante In case any su~t, act~on or
proceedIng to enforce any rlght or exerCIse any remedy shall
be brought or taken and then dIscontlnued or abandoned, then,
and In every such case, CIty and Lessee shall be restored to
~ts and the1r former pos1tlon and rIghts and remedIes as If
no such sUlt, actlon or proceedlngs had been brought or
taken.
10
~
.
.
23. Vestlng of FaCIlItIes and Other Property
and Interests, Removal of Personal Property
A. DurIng the Term hereof, the FaCIlItIes shall
be, as between CIty and Lessee, the property of Lessee, but
Lessee shall have no rIght to remove the same from the Slte
WIthout Clty's pr10r wr~tten consent. However, upon the
exp1ratIon or sooner termInatIon of thIS Ground Lease,
Lessee's rIght, tItle and Interest In the FaCIlItIes shall
automatIcally, wlthout compensat1on to Lessee, vest Solely 1n
CIty. In addItIon, upon and as of the eXpIratIon or sooner
termlnat10n of th1S Ground Lease, all ~ntangIble property
selected by CIty WIthIn SIxty (60) days after such termIna-
t10n and o~~ed or held by Lessee at such term1nat~on 1n con-
nectIon w1th the Slte or the FaCIlItIes or any part thereof
shall automatlcally, WIthout compensatIon to Lessee, vest
solely In C1ty
Nothlng hereIn conta1ned shall be deemed to requlre
CIty to succeed to Lessee's Interest 1n any such 1ntang1ble
property, nor to become oblIgated or lIable thereunder In any
respect or at all, except as selected by CIty. In no event
Wlll CIty be 11able for any default of Lessee under the
Agreement or In connect1on WIth any such IntangIble property
WhICh occurred prIor to the later of the termInat10n of thIS
Ground Lease or the select10n of the partIcular Item of
Intanglble property by CIty as aforesaId wlth respect to
WhICh such default relates. Lessee shall upon CIty'S demand
del~ver to CIty such ass1gnments, deeds, Instruments and
documents as Clty shall request to confIrm Clty'S ownershIp
of the Facllltles and the other 1tems acqulred by Clty as
aforesa~d.
24. PreservatIon and Inspectlon of Documents. All
documents rece1ved by CIty or Lessee under the provlsions
hereof shall be retalned In the respectlve posseSSIon of CIty
or Lessee, as the case may be, and shall be subJect at all
reasonable tlmes to lnspectlon by the other party hereto and
Its ass1gns, agents and representat~ves, any of whom may make
coples thereof,
25 Part~es In Interest NothIng hereIn expressed
or lmplled IS Intended to or shall be construed to confer
upon or to gIve to any person or party other than Clty and
Lessee any rIghts, remedles or claIms under or by reason
hereof or any covenants, condltlon or stlpulatlon hereof; and
all covenants, stIpulatIons. promIses and agreements hereln
contalned by or on behalf of Clty or Lessee shall be for the
sole and excluslve benefIt of CIty and Lessee.
26. No Reco~rse Under Ground Lease. All
covenants. stIpulatIons, promlses, agreements and obl1gatloPs
of the partIes hereto contaIned hereIn shall be deemed to be
the covenants, stlpulatlons, prom1ses, agreements and
obllgat1ons of the partIes hereto, respectIvely, and not of
any member, off~cer, employee or agent of the part1es hereto
In an lndlvldual capaclty, and no recourse shall be had for
the payment of the Rent pa~~ents or for any clalm based
thereon or hereunder agalnst any member, offIcer, employee or
agent of the part~es hereto
~~
t,
.
.
27. BIndIng Effect. ThlS Ground Lease shall Inure
to the benefIt of and be blndlng upon CIty and Lessee and
thelr respectIve successors and assIgns.
28. SeverabIlIty. If anyone or more of the cove-
nants, stIpulatIons. promIses, agreements or oblIgatIons
prOVIded hereIn on the part of CIty or Lessee to be performed
should be determIned by a court of competent Jurlsdlctlon to
be contrary to law. then such covenant. stIpulatIon. promIse,
agreement or obllgat~on shall be deemed and construed to be
severable from the remaInIng covenants, stIpulatIons. prom-
Ises, agreements and oblIgatIons hereIn contaIned and shall
In no way affect the valldlty of the other prOVISIons hereof.
29. HeadIngs Any headIngs precedIng the text of
the several ArtIcles and SectIons hereof, and any table of
conter.ts or margInal notes appended to caples hereof. shall
be solely for convenlence or reference and shall not con-
stItute a part hereof. nor shall they affect Its meanIng.
constructIon or effect,
30. ApplIcable Law. ThlS Ground Lease shall be
governed by and construed In accordance WIth the laws of the
State of Callfornla,
31
tlflcate WIth
nant prOVIded
of any actIon
Form of Cert~flcate of OffIcers. Every cer-
respect to complIance wIth a condItIon or cove-
for hereIn and WhICh IS precedent to the takIng
hereunder shall Include:
(a) A statement that the person makIng or
gIVIng such certIfIcate has read such covenant or condItIon
and the deflnltlons hereln relatIng thereto;
(b) A brlef statement as to the nature and
scope of the examInatIon or InvestIgatIon upon WhICh the
statements or opInIons contaIned In such certIfIcate are
based;
(c) A statement that, In the opInIon of the
sIgner, SIgner has made or caused to be made such examlnatlon
or InvestIgatIon as 15 necessary to enable the sIgner to
express an Informed opInIon as to whether or not such cove-
nant or condItIon has been complIed wlth, and
(d) A statement as to whether, In the opInIon
of the SIgner, such condltlon or covenant has been co~plled
WIth
A certIfIcate may be based, Insofar as It relates
to legal matters, upon a certIfIcate or opInIon of or repre-
sentatIons by counsel. unless the persons prOVIdIng the cer-
tIfIcate know that the certIfIcate or representatIons WIth
respect to the matters upon whIch the certIfIcate may be
based are erroneous, or In the exerCIse of reasonable care
should have known that the same were erroneous.
32. MIscellaneous.
(a) ThIS Ground Lease contaIns the entIre
agreement between the partIes respectIng the matters hereIn
12
~
.
.
Set forth and 'sper,ede, all Pr'or agreements between the
Partles hereto respeCtlng such matters.
Ib) T'me ,. of the e'.ence W'th respect to
all matt.r. ProV'ded 'n 'h,s Ground t.a.e.
Ic) "0 -a'ver hy City of any default of
te'See Or of any ,ven" c'rcum.tanc. or Cond't,on P'rm'tt,n.
C,ty to t'rm'nate th,s GrOund tease shall be 'mpl'ed Or
'nferred 'nd no -r't'.n -a'ver th'reof Shall con.t'tute a
wa,ver of any other default of Less.e or of any other event.
c'rcumstanc. or cond",on P.rm'tt,ng sUch term'nat'on.
-hether of the '''' or of any other nature Or tyPe and
-heth.r preced'ng, concurrent or ,uCC"d'ng, and no fa"ure
on the P'rt of C"y to e"rc'se any r'9ht " may have by the
terms h'reof or by la_ upon the def"'t of LeSsee, and no
delay 'n the e'erc'.e of 'uch r'9ht, shall preven, the "'r-
c'se ther,of by C,ty 't any t'm. when LeS'ee 'h"l Cont,n"e
to b. So 'n default 'nd no SUch f"'ur. or delay and no
wa,v.r of default shall operate as a va,ver of any eti,er
defaUlt, or,s a mOd'f'cat,on 'n any re'pec, of the prov,_
s'ens of th,s Ground Lea'e. The 'ub.equent ,ccept'nee of any
pa>~ent or Performanre pursuant to th,s Ground Lea'e (,nolud_
'n9, bu' net "."ed to, the acceptance Of "ent pur'uant to
th,. Ground t.a.e) sh"l not con.t,tUt. . wa'ver Of .ny pre-
v'ou. defaUlt hy Le"ee Or of any pre.,ou. event, c,rctim_
St.nce 0< Cond"'on or of any r'9ht ef C,ty to term,n.te th,.
Ground t.a'e on 'ccount Of Euch d'faUlt, eVent. c'rcumstanee
or cond't,on. other than the d.fault 'n the pa'~e"t or the
part'cular P.yment or the perform'nce of the part'cular mat-
ter "0 accepted. r'.ardl... Of C,ty'. knewled.e of 'he prev,_
ous defaUlt ox the pr.v,o,. event. c'rcumst.nce or Cond't,on.
at the t,.. of 'ccept'"g 'uch payment or perform,nce, nor
'hall Clty'O acceptance Of SUch pa}~ent or performance 'fter
term'n.t'on COnot'tut. a xe'n.tate"nt. ..ten"on Or r.neval
Of th,s Cround Le.ae Or reveca',ou Of any not'ce or other act
by Clty
(d) A. uS'd here'n, 'C,ty. m.an. the per-
oonls), partnerSh,p(.,. corporat'e"l., or ent'tYI'es, ~ho "
or are the owner Or owners of the "te at the t'me 'n que.-
t,on, Whether ""gu'ar or PlUral 'n numb'r 'nd Whethex n'med
'n th,s Ground L.a.e " C"y or hav'n. become the 'UCce'sor
ox oucceo,ors 'n ,nter..t of the '''e. In the event C,ty
con.eyS ,to int.re.t 'n the Site, then ,t 'hall thereUPon be
,uto.at,cally freed 'nd rel',ved fxom all Obl'.at'ono Und'r
th's Ground tease ~h'ch 'x"e or 'ccrue 'ftex the date of
SUCh Conveyance.
Ie) "teSsee. as USed here,n .e'no the per-
sonr,), partner'h,pI'), corpor.t,onlo) , or .nt'tYI'es) vho ,.
name. '5 Lessee 'n th,s Ground Leaoe and the per.on, ..xtner_
Sh,p. cOXporat,on or ent,ty Who at the t'me 'n que.t,on ,. ,
SUCCessor ox successoxs 'n interest of SUch Les.ee. whether
s,n'ulax ox PlUral 'n numbex; PXOv,ded, hovever, that L..s.,
do.o not ,nclud. any P.rsonls), paxtneroh'Pl.),
corporat'onls) ox ent'tYI,eo) cl".,n. Undex any 's"OUment
or other tranafer proh'b't.d by th,s Ground Le'se 'nd th,s
def'n't'on doe. not "t.r the prov,s,on. of th,o GrOund te.se
relat'n9 to ass'OUment or SU01.tt'n.. If there Shall he more
than on, peraon eonst,tut,n. Les.ee, the'r Obll.,t'on. sh"l
l3
~
.
.
be Jo~nt and several, and any notIce requIred or permItted by
the terms of thIS Ground Lease may be gIven by or to anyone
thereof, and shall have the same force and effect as If gIven
by or to all thereof.
(f) Each oblIgatIon of Lessee under thIS
Ground Lease constItutes both a covenant and a condItIon to
Its rIghts under thIS Ground Lease
(g) Nelther thIS Ground Lease nor anyth~ng
contaIned hereIn shall be deemed to make CIty In any way or
for any purpose a partner, )Olnt venturer or assocIate In any
relatIonshIp WIth Lessee other than that of landlord and
tenant. nor shall thIS Ground Lease or any prOVISIon thereof
be construed to authorIze eIther to act as agent for the
other except as expressly provIded In thls Ground Lease.
(h) The consent or approval by CIty to or of
ary act by the Lessee regu~rlng the CIty'S consent to
approval shall not be deemed to waIve or render unnecessary
CIty's consent or approval to or of any subsequent SImIlar
acts by the Lessee.
(I~ The locatIve adverbs "hereIn," "here-
under," "hereto," "hereby," "hereInafter," and lIke words
wherever the same appear hereIn, mean and refer to thls
Ground Lease In Its entIrety and not to any specIfIC para-
graph or subparagraph hereof unless otherwIse expressly
deSIgnated In context Reference In thIS Ground Lease to the
"oblIgatIons" of Lessee, and words of lIke Import, shall mean
the covenant~ to pay Rent under thIS Ground Lease and all
other covenants, agreements, terms, condItIons, IlmltatIons,
exceptIons and reservatIons conta~ned In thIS Ground Lease
appllcable to Lessee. The term "Lessee's oblIgatIons here-
under" and words of lIke Import shall mean all oblIgatIons to
thIS Ground Lease WhlCh are to be performed, observed or kept
by Lessee. The terms "lnclude" "InclUdIng" and SImIlar terms
shall be construed as ~f followed by the phrase "wlthout
beIng lImIted to."
()) No surrender to CIty of thIS Ground Lease
or of the SIte, or any part thereof or of any ~nterest
thereIn, shall be val~d or effectIve unless prOVIded for In
thIS Ground Lease or otherwIse agreed to and accepted In
wrltlng by CIty and no act by Clty or any representatIve or
agent of Clty, other than such a wrItten acceptance by Clty,
shall constltute an acceptance of any such surrender.
(k) The covenants and agreements of thIS
Lease cannot be altered, changed, modlf~ed or added to.
except In wr~tIng s~gn~d by CIty and Lessee.
33. Merger.
If both C1ty's and Lessee's estates In the S1te or
the FacIllt~e5 or both become vested In the same owner whIle
the the SIte or the Facllltles or the estate of CIty or
Lessee thereIn shall be subJect to one or more mortgages or
deeds of trust, thIS Ground Lease shall nevertheless not be
destroyed by the applIcatIon of the doctrIne of merger except
14
\.
.
.
at the electlon of the mortgagee or beneflclarles under all
such mortgages and deeds of trust.
34 Notlces.
Any notIce, demand or document WhlCh any party Is
requlred or may deSlre to glve to the other party shall be 10
wrltlng, and may be personally dellvered or glven or made by
UnIted States regIstered or certlfled mall, return recelpt
requested, addressed as follows'
To Lessee.
SecurIty PaCIfIC NatIonal Bank
330 South Grand Avenue
21st Floor 8-211
Los Angeles, Cal~fornla 90071
Attn: Rlchard H. Clark
To Clty.
Clty of Santa Monlca
1585 MaIn Street
Santa Monlca, CA 90401-3295
Attn: Clty Manager
WIth a copy to:
CIty of Santa MonIca
1685 Maln Street
Santa MonIca, CA 90401-3295
Attn' c~ty Attorney
Santa Monlca Alrport
3200 Alrport Avenue
Santa Monlca, CA 90405
Attn. Alrport Dlrector
subJect to the rlght of eIther party to deslgnate a dlfferent
address for ltself by notIce slmIlarly gIven. }L~y notlce,
de~and or document so glven by Un~ted States mall shall be
deemed to have been glven on the fIfth day after the same lS
deposlted 1n the Un1ted States mall as reglstered or cert1-
fled matter, addressed as above prOVIded, wlth postage there-
on fully prepald, except that any pa~~ents of Rent shall be
deemed to have been made only when actually recelved by City.
Any such notlce, demand or document not gIven by reglstered
or cert1f1ed mall as aforesa~d shall be deemed to be glven,
dellvered or made only upon receIpt of the same by the party
or partles to whom the same IS to be glven, dellvered or
made,
35. Offset Statements. Any party hereto shall
deliver to anv other party hereto, WIthin flfteen (15) days
after receipt of a wr~tten request therefor, an offset state-
ment statlng the date to WhlCh Rent has been paId. the amount
of any prepald Rent, and statlng whether such party has any
actual knowledge that thlS Ground Lease 15 not In full force
and effect, whether such party or any other party 15 In
default hereunder. and whether thIS Ground Lease has been
modifIed or amended.
36. Attorneys' Fees. In the event that eIther
City or Lessee falls to perform any of its obl1gations under
th~s Ground Lease or ln the event a dIspute arises concernIng
15
.
.
the meanIng or 1nterpretat1on of any prov1sIon of th1s Ground
Lease, the default1ng party or the party not preva111ng 1n
such dIspute, as the case may be. shall pay any and all costs
and expenses 1ncurred by the other party 1n enforcIng or
establ1sh~ng Its r1ghts hereunder. 1ncludlng. w1thout I1mlta-
t1on, court costs and reasonable counsel fees. The rIght of
C1ty or Lessee. as the case may be, to all costs and expenses
lncurred by It 1n enforclng or establlsh~ng lts r1ghts here-
under pursuant to the prOVlSlons of thIS Paragraph 36 shall
Include. wIthout 11mItatlon. all costs and expenses Incurred
by C1ty or Lessee, as the case may be (InCludIng, wlthout
lImItatIon, court costs and reasonable counsel fees) In the
enforcement of all oblIgatIons of Lessee or CIty, as the case
may be, under thIs Ground Lease or otherwIse wIth respect to
the SIte. whether or not legal actIon was commenced, and
IncludIng all such costs and expenses Incurred In an actIon
or part1cIpatlon 1n. or In connectIon Wlth, a case or pro-
ceedlng under Chapter 7 or 11 of the Bankruptcy Code, or any
successor statute thereto.
IN WITNESS wREREOF. the partIes have executed thIS
Ground Lease as of the day and year fIrst above wr1tten.
Approved as to form'
"Lessee"
SECu~ITY PACIFIC NATIONAL BANK
Robert M. Myers, Esg
C1ty Attorney
Pi
Vice PreSIdent
By
Vice President
"CIty"
CITY OF S~~7A MONICA
By
C1ty Manager
Attest'
City Clerk
16
.
.
EXHIBIT A (LEGAL DESCRIPTION)
LEGAL DF5CRJPTJON
SANTA MONICA ....IRPORT
....OMINISTRATJON ....ND SPECIAL TV F.B.O.
P....RCEL
Commencing at 1he mosl southerly Corner of Tract No 34609 In ,he Cny of Santa
Monica, County of Los Angeles, filed In Bool< 899, Pages' and 6, In Olflce of 1he
COlin:)' Records of said Count)', t~nce South 31/"7"9" fast along the northeasterly
city IImJts line, City of Santa Monica 280.1>21eet, thence South ,,~o21'J8" '"est
7'7.73Ieet, thence South ",038'/12" East 70',D feet to the TRUE POINT OF
BEGJP>..;N]:-':C fOf this parcel; thenc,,: South "4021'18" '''t'st 7'6,'0Ie!!t; thence South
45[>n'~2" East 2,O.OG le!!I to the beglnnmg of II CUfYt' concave northerly haymg a
radU5 or ,7,'Oj thence !!asterl)' <Ilong saJd curve 1hrough II central angle of 90000'00"
an lIrc dlstar-ce of 9D.32 feet; the 'lee North 1/4"021'18" Eut 636.'0 feet the beginning of
a curve co...cavl' northwesle-1r tHll/lng a rIIdJUS ol 212.50 feet; thenc!! nortl->westerly
a rong sa 'e' cu....e through II cel'tral lingle of 17006'17" en lire dIstance of 63."" fee ti
the"1ce ,':orth 4.'io38'~2" \t est 2'lS JO feel to the TF: UE POl"'T OF BEGINNING