HomeMy WebLinkAboutC-2696(B) - 30th St, 426 (Cannery Village Parking Lot) - Real Property Lease/Purchase Agreement 1988EXEMPT RECORDING REQUE51 PER 8$-19OW9
RECORDING REQUESTED BY AND GOVERNMENT CODE 6103 RECORDED IN OFFICIAL RECpgpS
_ WHEN RECORDED MAIL TO: OF ORANGE COUNTY, CALIFppKA
CITY OF NEWPORT BEACH EXEMPT -10 40 Aryl APR 2 6 '88
3300 Newport Boulevard C5
Newport Beach, CA 92663
X 7 -
Above area is for recording use only)
NO CONSIDERATION
BASE LEASE AliREE14EN`.r'
c LC�
THIS BASE LEASE AGREEMENT (the "Base Lease") is dated as of
February 15, 1988 by and between the City of Newport Beach, a
political subdivision of the State of California (the "City"), and
First Continental Financial Corporation, a corporation organized
and existing under and by virtue of the laws of the State of Texas
("FCFC").
WITNESSETH:
WHEREAS, the City owns certain real property more
particularly described in Exhibit A attached hereto (the "Site")
(together with the improvements now or hereafter placed or
constructed thereon, the "Site");
WHEREAS, the City desires to demolish and remove from the
Site the improvements presently located thereon and to acquire,
construct and operate on the Site a paved, metered parking
facility for the general public (the "Project");
WHEREAS, the City desires to finance its acquisition of. the
Site, and in connection therewith, the City proposes to lease the
Project to FCFC and lease -back the Site from FCFC, all as here-
inafter provided; and,
WHEREAS, FCFC desires to finance the acquisition of the
Project by the City in the manner proposed by the City, and in
connection therewith, desires to lease the Site from the City upon
the terms and condition contained herein.
WHEREAS, the City and FCFC have entered into that certain
Real Property Lease/Purchase Agreement (the "Lease/Purchase
Agreement"), dated as of February 15, 1988; and the City, FCFC and
Sovran Bank, N.A., as trustee (the "Trustee") have entered into
that certain Trust Indenture (the "Indenture"), dated as of
February 15, 1988, all for the purpose of giving effect to the
foregoing;
NOW, THEREFORE, for other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the
parties hereto hereby agree as follows:
Section 1. Lease of the Project. The City hereby leases the
Site to FCFC and FCFC hereby leases and hires the Site from the
City, on the terms and conditions hereinafter set forth.
Section 2. Term. (a) The term of this Base Lease shall
commence upon execution of this Base Lease, and, subject to the
other provisions hereof, shall end on the earliest of the follow-
ing dates:
(i) The day on which that certain Real Property
Lease/Purchase Agreement of even date herewith (the
"Lease/Purchase Agreement") by and between the City and FCFC
shall terminate after payment and performance of all
obligations of the City thereunder, including, without
limitation, the payment of all Lease Payments (as defined
therein);
(ii) The day on which the Lease/Purchase Agreement shall
terminate after exercise by City of its option to purchase
the interest of FCFC therein pursuant to the terms thereof,
and the payment and performance of all obligations of the
City thereunder, including without limitation the payment of
the applicable Concluding Payment Amount (as that term is
defined therein); or,
February 15, 2008.
(b) In the event of a termination of the Lease by the City
due to either a non -appropriation of funds pursuant to Section 7
thereof, or an event of default as defined therein, this Base
Lease shall terminate prior to February 15, 2008, on or after the
date of termination of the Lease, upon receipt by FCFC from the
sublease of FCFC's leasehold interest hereunder of amounts
sufficient to:
(i) reimburse FCFC for all administrative costs and
expenses, including reasonable attorneys fees, incurred by
FCFC as a result of the termination of the Lease and the
sublease of the Project; and
(ii) reimburse FCFC for all capital costs and expenses in
any manner incurred by FCFC with respect to the Project
reasonably necessary in order to render the Project suitable
for sublease for lawful purposes; and
(iii) pay to FCFC an amount which will equal the Concluding
Payment Amount of the Project under the Lease applicable on
February 15 of the fiscal year of the City for which the
Lease remains in effect as well as any other amounts owing
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ii •111��
under the Lease Agreement and unpaid by the City as of the
end of such fiscal year.
(c) The amounts referred to in sub -paragraph (b) above,
shall be known as the "Reimbursement Amount." The Reimbursement
Amount shall be recovered by allowing FCFC first to retain from
any sublease rentals an amount equal to 5% thereof, to allow for
ongoing administrative costs. FCFC shall be entitled to interest
on the outstanding Reimbursement Amount at the rate per annum
necessary to pay interest at the stated rates on all Outstanding
Certificates (as defined in the "Indenture") or in the event that
FCFC shall receive an opinion of an attorney or firm of attorneys
nationally recognized as bond counsel to the effect that such
interest is subject to federal income taxation, as a result of the
default or non -appropriation and the sublease of the Project, at
the highest rate allowed by applicable law during the period of
time from the last Lease Payment made in the last fiscal year of
the City for which the Lease was in effect until the time when the
full Reimbursement Amount is received from sublease rentals, and
any amounts distributed to FCFC pursuant to sub -paragraph (b)
above shall be credited first to the payment of such interest.
(d) In the event that the Lease is terminated by the City
for non -appropriation of funds necessary to pay Lease Payments in
any fiscal year or terminated by FCFC as a result of the
occurrence of an event of default by the City thereunder, any
amounts necessary to comply with the provisions of paragraphs (b)
or (c) above may be paid by the City. In any event, if the
Reimbursement Amount is received by FCFC, and FCFC's interest in
the Project has been subleased to any sublessee pursuant to any
subleases that are still in effect, this Base Lease shall not
terminate but FCFC shall assign and set over to the City all of
FCFC's interest in the Project granted under this Base Lease,
subject to all existing rights created in such sublessees of the
Project by any such subleases.
(e) In the event that the Lease is terminated by the City
for non -appropriation of funds necessary to pay Lease Payments in
any fiscal year or terminated as a result of the occurrence of an
event of default by the City thereunder, FCFC shall keep complete
and accurate records regarding any sublease of the Project and
shall, within thirty (30) days of the end of the fiscal year of
the City, deliver a written report to the City showing:
(i) all amounts received by FCFC from any sublease of the
Project;
(ii) an analysis as to whether FCFC has received the
Reimbursement Amount, with all supporting calculations; and
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(iii) the date, if any, in the next fiscal year of the City
on which FCFC expects to receive the Reimbursement Amount.
In the event that on the last day of any fiscal year of the
City FCFC has received the Reimbursement Amount, then all
rentals with respect to any sublease of the Project payable
after the close of such fiscal year shall be the property of
the City.
(f) In the event of the termination of this Base Lease and
sublease of the Project by FCFC, the City shall have the right, at
its own expense, to examine FCFC records insofar as they relate to
the Project. Such examination shall be made at FCFC's offices
during normal business hours.
(g) Upon termination of this Base Lease, FCFC shall quit and
surrender the Site in the same good order and condition as the
same was in at the time of commencement of the term hereunder,
reasonable wear and tear excepted. Any permanent improvements and
structures existing upon the Site at the time of termination of
this Base Lease shall remain thereon and title thereto shall vest
in the City.
Section 3. Rental. FCFC shall pay to the City the lump sum
of One Million Forty-nine Thousand Dollars ($1,049,000)
representing rental in advance for the Site for the term of this
Base Lease which funds have heretofore been deposited in the
Project Acquisition Fund established under the Indenture, and
shall be disbursed for the purposes and is subject to the terms
and conditions set forth in the Indenture.
Section 4. Purpose. FCFC shall use the Site solely for the
purpose of financing the acquisition of the Project by the City,
as well as for such purposes as may be incidental thereto;
provided, that in the event of default by the City under the
Lease/Purchase Agreement or a termination due to non -appropriation
thereunder, FCFC may use the Project for any purpose whatsoever
subject however to Section 2 above.
Section 5. Title. The City covenants that it is the owner in
fee of the Site and that there are no liens or encumbrances
against the Site other than those Permitted Incumbrances described
on Exhibit B attached hereto. City shall promptly obtain for the
FCFC title insurance on the Site in the form of a Leasehold Policy
of Title Insurance in an amount and issued by a title company
acceptable to FCFC.
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88-190009
Section 6. Assignments and Subleases. FCFC may assign its
rights under this Base Lease or sublet the Site without the
written consent of the City (i) in connection with any assignment
of FCFC's rights under the Lease/Purchase Agreement, or (ii) upon
the occurrence of an event of default under the Lease/Purchase
Agreement.
Section 7. Quiet Enjoyment. The City warrants that FCFC
shall at all times during the term of this Base Lease peaceably
and quietly have, hold and enjoy all of the Site.
Section 8. Leaseback To FCFC. The Lease provides that
contemporaneously with the execution hereof FCFC leases back to
the City and the City leases from FCFC the Site in accordance with
the terms thereof. The Lease includes the option in the City upon
payment of the Concluding Payment Amount or upon completion of all
Lease Payments to purchase FCFC's interest in the Project.
Section 9. Severability. If any one or more of the terms,
provisions, covenants or conditions of this Base Lease shall to
any extent be declared invalid, unenforceable, void or voidable
for any reason whatsoever by a court of competent jurisdiction,
the finding or order or decree of which becomes final, none of the
remaining terms, provisions, covenants and conditions of this Base
Lease shall be affected thereby, and each provision of this Base
Lease shall be valid and enforceable to the fullest extent
permitted by law.
Section 10. Notices. All written notices to be given under
this Base Lease shall be given by mail to the party entitled
thereto at its address set forth in the Lease/Purchase Agreement,
or at such address as the party may provide to the other party in
writing from time to time. Any such notice shall be deemed to
have been received seventy-two (72) hours after deposit in the
United States mail in registered form, with postage fully prepaid.
Section 11. Section Headings. All section headings
contained herein are for convenience of reference only and are not
intended to define or limit the scope of any provision of this
Base Lease.
Section 12. Execution. This Base Lease may be executed in
any number of counterparts, each of which shall be deemed to be an
original but all together shall constitute but one and the same
Lease. It is also agreed that separate counterparts of this Base
Lease may separately be executed by FCFC and City, all with the
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88-190009
EXHIBIT A
TO BASE LEASE AGREEMENT
Real Property Description
That certain tract of land lying the City of Newport Beach, Orange
County, California, and more particularly described as follows:
PARCEL 1:
Lots 12, 13, 14, 15, 16, and 17 in Block 230 of Lancaster's
Addition to Newport Beach, as shown on a map recorded in
Book 5, Page 14 of Miscellaneous Maps, in the Office of the
County Recorder of said county.
Except the Westerly 12.5 feet of said Lot 17.
A portion of said land is included within the area shown on
a map filed in Book 94, Page 7 of Parcel Maps, in the Office
of the County Recorder of said county.
g8-190009
EXHIBIT B
TO BASE LEASE AGREEMENT
Permitted Encumbrances
Real Property Lease/Purchase Agreement No. 87-034, dated February
15, 1988
88-190009
same force and effect as though the same counterpart had been
executed by both FCFC and the City.
Section 13. Successors. This Base Lease shall be binding
upon and inure to the benefit of the parties and their respective
successors and assigns.
IN WITNESS WHEREOF, the City and FCFC have caused this Base
Lease to be executed by their respective officers thereunto duly
authorized, all as of the day and year first above written.
(SEAL)
ATTEST:
( SEAL)
AT,T�E� ST :
NEWPORT BEACH, CALIFORNIA
By:
Name: X` // _j� /,�2 % �C.. li//�/ S%/1//V
Title : C / 7— Al AI
FIRST CONTINENTAL
FINANCIAL CORPORATION
By
Authorized Officer
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ACKNOWLEDGEMENT
STATE OF TEXAS §
COUNTY OF DALLAS §
•111'
On this the 11th day of April, 1988, appeared before me
Barbara A. Friedman, who acknowledged herself to be an Authorized
Officer of First Continental Financial Corporation and that, in
such capacity she executed the foregoing Base Lease Agreement for
the purposes set forth herein.
WITNESS my hand and official seal.
S E A L'u 2. y✓ �r`�
Notary Public, in and for
said County and State
%� c
My commission expires � — %
ACKNOWLEDGEMENT
STATE OF CALIFORNIA §
COUNTY OF ORANGE §
On this the 19th day of April, 1988,
ROBERT L. WYNN , who acknowledged himself to be an
Authorized Officer of the City of Newport Beach, California and
that, in such capacity he executed the foregoing Base Lease
Agreement for the purposes set forth herein.
WITNESS my hand and official seal.
S E A L
Notary ublic, n and for said
County and State
My commission expires
..••..
. OFFICIAL SEAL
DOROTHY L. PALEN
mom.
xaNOTARY
PUBLIC • CALIFORNIA
"a
PRINCIPAL OFFICE IN
ORANGE COUNTY
..
My Commission Exp. Apr. 51 1989
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TRUST INDENTURE
by and among
SOVRAN BANK, N.A.
and
FIRST CONTINENTAL FINANCIAL CORPORATION
and
THE CITY OF NEWPORT BEACH, CALIFORNIA
SECURING
$795,000
CERTIFICATES OF PARTICIPATION - LEASE RENTALS
(City of Newport Beach, California
Parking Facility Project)
Dated as of February 15, 1988
TABLE OF CONTENTS
PAGE
RECITALS................................................ 1
ARTICLE I - DEFINITIONS ................................. 3
Section 1.01 Definitions .......................... 3
Section 1.02 Interpretations ...................... 8
ARTICLE II - CONCERNING THE CERTIFICATES ................ 9
Section
2.01
Delivery .............................
9
Section2.02
3.02
Form .................................
9
Section
2.03
Terms ................................
9
Section
2.04
Place, and Manner of Payment .........
10
Section
2.05
Execution of Certificates ............
10
Section
2.06
Registration, Exchange and Transfer;
14
Section
3.07
Certificate Register ...............
10
Section
2.07
Mutilated, Destroyed, Lost or Stolen
15
Section
3.08
Certificates .......................
11
Section
2.08
Ownership of Certificates ............
12
Section
2.09
Settlement and Application of Proceeds
12
ARTICLE III - FUNDS ...................................... 12
Section
3.01
Creation of Funds ....................
12
Section
3.02
Disposition of Proceeds ..............
12
Section
3.03
Disposition of Other Moneys ..........
13
Section
3.04
Certificate Fund .....................
13
Section
3.05
Equipment Acquisition Fund ...........
13
Section
3.06
Reserve Fund .........................
14
Section
3.07
Discontinuance of Funds or Accounts;
Redemption of Certificates ..........
15
Section
3.08
Reports by Trustee ...................
15
Section
3.09
Rebate Account .......................
15
ARTICLE IV - SECURITY FOR DEPOSITS: INVESTMENTS OF FUNDS. 16
Section 4.01 Moneys are Trust Funds ............... 16
Section 4.02 Investment or Deposit of Funds ....... 16
Section 4.03 Valuation of Funds ................... 16
ARTICLE V - REDEMPTION OF CERTIFICATES .................. 16
Section
5.01
General .............................
16
Section
5.02
Disposition of Equipment .............
17
Section
5.03
General Provisions for Redemption.....
17
Section
5.04
Notice of Redemption .................
18
Section
5.05
Payment of Redemption Price ..........
18
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PAGE
ARTICLE VI - DEFAULTS UNDER THE LEASE .................. 19
Section
6.01
Legal Proceedings ....................
19
Section
6.02
Discontinuance of Proceedings ........
19
Section
6.03
Direction of Proceedings .............
19
Section
6.04
Limitations on Actions ...............
20
Section
6.05
Delays not to Impair Rights ..........
20
Section
6.06
Possession not Required ..............
20
ARTICLE VII - CONCERNING THE TRUSTEE ................... 21
Section
7.01
Acceptance of Trust ..................
21
Section
7.02
Certain Rights of Trustee ............
21
Section
7.03
Compensation for Services ...........
21
Section
7.04
Certain Exculpatory Provisions .......
21
Section
7.05
Notice of Default; Right to
Investigate .........................
22
Section
7.06
Liability of Trustee .................
22
Section
7.07
Trustee May Deal in Certificates and
Engage in Other Transactions ........
23
Section
7.08
Resignation ..........................
23
Section
7.09
Removal ..............................
23
Section
7.10
Appointment of Successor .............
23
Section
7.11
Acceptance of Trust by Successor
Trustee.............................
24
Section
7.12
Successor Corporation as Trustee .....
24
ARTICLE VIII - EVIDENCE ................................. 24
Section 8.01 Evidence on Which Trustee May Act .... 24
Section 8.02 Other Evidence ....................... 25
ARTICLE IX - AMENDMENTS AND MODIFICATIONS ................ 25
Section 9.01 Amendments Without Consent ............ 25
Section 9.02 Amendments Requiring Consent .......... 25
Section 9.03 Reliance on Counsel ................... 26
PAGE
ARTICLE X - MISCELLANEOUS ................................ 26
Section
10.01
Parties Interested ...................
26
Section
10.02
Unclaimed Moneys .....................
27
Section
10.03
Successors and Assigns ...............
27
Section
10.04
Effect of Invalid Provision ............
27
Section
10.05
Notices ...............................
27
Section
10.06
Descriptive Headings .................
27
Section
10.07
Separate Counterparts ................
28
Section
10.08
Governing Law ........................
28
SIGNATURE PAGE .......................................... 28
EXHIBIT "A" - FORM OF CERTIFICATES ...................... A-1
EXHIBIT "B" - FORM OF BASE LEASE ........................ B-1
THIS TRUST INDENTURE (this "Indenture"), dated as of
February 15, 1988, is executed by and between Sovran Bank, N.A.,
a national banking corporation organized and existing under the
laws of the United States of America and having its principal
corporate trust office in Richmond, Virginia (the "Trustee"),
First Continental Financial Corporation, a corporation duly
organized and existing under the laws of the State of Texas
("FCFC") and Newport Beach, California (the "Lessee") for the
benefit of the Registered Owners from time to time of the
Certificates (defined herein).
WITNESSETH:
WHEREAS, the Lessee is a body corporate and politic,
organized and existing under the laws of the State of California
(the "State"); and
WHEREAS, the Lessee is authorized under the laws of the
State to acquire real property and construct and operate parking
facilities to be used in connection with its governmental
purposes;
WHEREAS, the Lessee desires to acquire acquire a tract of
land (the "Site"), to demolish and remove the improvements
presently existing thereon, and to construct and operate a paved,
metered parking facility open to the general public (the
"Project");
WHEREAS, pursuant to a certain Base Lease (as defined
herein), the Lessee is leasing the Site to FCFC;
WHEREAS, pursuant to a certain Real Property Lease/Purchase
Agreement (the "Lease"), the Lessee is leasing the Project from
FCFC, which pursuant to the Lease has agreed to acquire and lease
the Project to the Lessee;
WHEREAS, in order to provide funds to acquire the Project,
the Trustee will issue the Certificates as contemplated herein
and pursuant to the terms hereof; and
WHEREAS, the proceeds of the sale of the Certificates will
be deposited in the funds established hereunder to further assure
the availability of funds to acquire the Project;
NOW, THEREFORE, THIS INDENTURE WITNESSETH, that in order to
secure the principal of, and interest and redemption premium, if
any, on the Certificates according to their tenor and effect, and
to declare the terms and conditions upon and subject to which the
Certificates are issued and secured, and for and in consideration
of the mutual covenants herein contained and of the purchase and
acceptance of Certificates by the Registered Owners, and
intending to be legally bound hereby, the Trustee, FCFC and the
Lessee have executed and delivered this Indenture, and by these
presents there is hereby created an irrevocable trust for the
benefit of the Registered Owners and their successors and
assigns, upon all amounts received from the sale of the Certif-
icates, and all proceeds thereof including the Project and any
and all Pledged Revenues (as hereinafter defined) and FCFC does
hereby sell, assign, transfer, set over, pledge, confirm and
grant unto the Trustee and its successors and assigns all of the
right, title and interest and obligations of FCFC in, to and
under the Base Lease and the Lease;
TO HAVE AND TO HOLD the same unto the Trustee, and its
successor or successors in the trust hereby created and its and
their assigns forever.
IN TRUST, NEVERTHELESS, upon the terms and trusts herein set
forth, and as specifically provided herein, for the benefit and
security of all present and future Registered Owners issued and
to be issued under this Indenture, without preference, priority
or distinction as to lien or otherwise of any one Certificate
over any other Certificate, except as otherwise specifically
provided herein, each and every Certificate issued and to be
issued hereunder to have the same right, lien and privilege under
and by virtue of this Indenture, and so that the principal of and
interest on all Certificates shall be secured hereby and here-
inafter specified and shall be subject also to all the provisions
hereof.
PROVIDED, HOWEVER, and these presents are upon the condition
that if there shall be paid or provided unto the Registered
Owners of all Certificates Outstanding hereunder, the principal,
interest and premium, if any, to become due in respect thereof,
at the times and in the manner stipulated therein and herein, and
there shall be kept, performed and observed, all and singular,
the covenants and promises in the Certificates and in this
Indenture expressed to be kept, performed and observed, according
to the true intent and meaning of this Indenture, then, upon such
final payment of principal, interest and premium, if any, having
been made or provided for as herein specified, this Indenture and
the estate and rights hereby granted shall cease, determine and
be void; otherwise to remain in full force and effect.
AND IT IS HEREBY COVENANTED AND AGREED by and between the
parties hereto that the terms and conditions upon which the
Certificates are to be executed, delivered, issued, secured,
received and accepted by all persons who shall, from time to
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time, be or become Registered Owners thereof, and the trusts and
conditions upon which the Trustee shall hold and keep its trust,
are as set forth herein.
ARTICLE I
DEFINITIONS
Section 1.01 Definitions. The terms and phrases defined in
this Article shall for all purposes of this Indenture, including
the preceding recitals and any Supplemental Indenture, have the
meanings herein specified unless the context clearly otherwise
requires.
"Authorized Officer" shall mean, with respect to the Lessee,
the Director of Finance of the Lessee, and with respect to FCFC
the President, Vice President or Chief Executive Officer of FCFC
and shall also mean any person designated by any such officer, in
writing, to the Trustee to deal with matters governed by this
Indenture, the Base Lease, or the Lease.
"Base Lease" shall mean that certain Base Lease, dated as of
February 15, 1988, by and between the City of Newport Beach,
California, as lessee, and FCFC, as lessor.
"Business Day" shall mean any day other than a Sunday, a
Saturday or any other day on which the Lessee or any banking
institution in the State or in the state in which the Trustee has
its principal corporate trust office is authorized by law or is
required by executive order to be closed.
"Certificate" or "Certificates" shall mean the "$795,000
Certificates of Participation - Lease Rentals (City of Newport
Beach Parking Facility Project)" initially issued hereunder and
any certificate issued in exchange, replacement or transfer
thereof pursuant to Article II hereof.
"Certificate Fund" shall mean the fund so designated which
is established pursuant to Section 3.01 hereof.
"Certificate Register" shall mean the books kept by the
Trustee for the registration, exchange and transfer of the
Certificates.
"Closing Statement" shall mean that statement required by
Section 3.02 hereof.
"Collateralized Deposits" shall mean certificates of
deposit, time deposits or other similar banking arrangements
issued by a bank, trust company or savings and loan association
-3-
the deposits in which are insured by the FDIC or the FSLIC which
also are fully secured and collateralized by Government
Securities held by (i) the Trustee, (ii) a Federal Reserve Bank,
or (iii) a bank which is a member of the FDIC and which has a
combined capital, surplus and undivided profits of not less than
$25,000,000, and such collateral securities have a fair market
value at all times equal to at least 100% of the amount of the
deposit.
"Cost" or "Costs," in connection with the issuance of the
Certificates and the Project, means all expenses which are
properly chargeable thereto under Generally Accepted Accounting
Principles, including, without limiting the generality of the
foregoing:
(a) Legal, accounting and other professional and
advisory fees;
(b) the fees of FCFC, underwriting discounts, printing
and engraving, insurance premiums and other expenses of
financing; and
(c) Costs necessary or desirable for the completion
and operation of the Project and other items necessary to
enable the Lessee to utilize the Project.
In the case of the redeeming of any Certificates, "Cost" includes
advertising and other expenses related to the such redemption.
Whenever Costs are to be paid hereunder, such payment may be made
by way of reimbursement to the Lessee or others who have paid the
same.
"Concluding Payment Amount" shall mean the term defined as
such in the Lease.
"Counsel" shall mean any attorney-at-law or firm thereof
selected by the Trustee.
"Dated Date" shall mean February 15, 1988.
"Distribution Date" shall mean, with respect to the
Certificates, August 15, 1988, and each February 15 and August 15
thereafter for so long as the Certificates are Outstanding.
"Eligible Investments" shall mean and include any of the
following securities:
(a) Government Securities;
(b) Insured Deposits;
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(c) Collateralized Deposits;
(d) Securities acquired and deposits made pursuant to
the Investment Agreement; and
(e) Any available security, note, fund or investment
contract, whatsoever that qualifies as a legal investment
for the funds of the Lessee under applicable law.
"FDIC" shall mean the Federal Deposit Insurance Corporation.
"FSLIC" shall mean the Federal Savings and Loan Insurance
Corporation.
"Financing Documents" shall mean the Certificates, the Base
Lease, the Lease, this Indenture and all other documents,
certificates, writings and representations delivered in
connection with the Project and the issuance of the Certificates.
"Project Acquisition Fund" shall mean the Fund so designated
which is established pursuant to Section 3.01 hereof.
"Fiscal Year" shall mean the fiscal period of the Lessee.
"Funds" shall mean the Project Acquisition Fund, Certificate
Fund and Reserve Fund and any accounts or subaccount thereof.
"Generally Accepted Accounting Principles" shall mean those
accounting principles applicable in the preparation of financial
statements, as promulgated from time to time by the Financial
Accounting Standards Board or such other body recognized as
authoritative by the American Institute of Certified Public
Accountants.
"Government Securities" shall mean direct and general
obligations of, or obligations the timely payment of principal of
and interest on which are unconditionally guaranteed by, the
United States of America.
"Indenture" shall mean this trust indenture, by and between
the Trustee, the Lessee and FCFC, as amended or supplemented from
time to time.
"Investment Agreement" shall mean each and all of the
Investment Agreements by and between FCFC and respectively,
Provident Bank - Dallas, Dallas, Texas, Provident Bank - Denton,
Denton, Texas and Desoto State Bank, Desoto, Texas, each dated as
of February 15, 1988.
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"Investment Instructions" shall mean the Investment Instruc-
tions delivered to the Trustee by an Authorized Officer of FCFC
on the date of the original delivery of the Certificates pursuant
to Section 3.02 hereof, as amended or superseded from time to
time.
"Insured Deposits" shall mean and include negotiable or non-
negotiable certificates of deposit, time deposits or other
similar banking arrangements, issued by any bank, trust company
or savings and loan association (including the Trustee and any
banks affiliated with the Trustee) the deposits of which are
insured by the FDIC or by the FSLIC, provided such issuing insti-
tution in any case has combined capital, surplus and undivided
profits of not less than $30,000,000.
"Lease" shall mean that certain Real Property Lease/
Purchase Agreement, dated as of February 15, 1988, by and between
FCFC and the Lessee.
"Lease Deposits" shall mean payments made or to be made, or
caused to be made, by or on behalf of the Lessee under the Lease
and which will be used to pay distributions of the principal of
and interest on the Certificates.
"Lease Payments" shall mean payments made or to be made, or
caused to be made, by or on behalf of the Lessee under the Lease
and which will be used to pay distributions of principal of and
interest on the Certificates.
"Lessee" shall mean Newport Beach, California, a political
subdivision of the State of California.
"Outstanding," in connection with the Certificates shall
mean, as of the time in question, all Certificates authenticated
and delivered under the Indenture, except:
(a) Certificates theretofore cancelled or required to
be cancelled hereunder;
(b) Certificates for which the payment or redemption
of which the necessary amount shall have been or shall
concurrently be deposited with the Trustee and be available
for payment thereof or for which provision for payment shall
have been made; provided that, if such Certificates are
being redeemed prior to maturity, the required notice of
redemption shall have been given or provisions satisfactory
to the Trustee shall have been made therefor; and
(c) Certificates in substitution for which other
Certificates have been authenticated and delivered.
In determining whether the Registered Owners of a requisite
aggregate principal amount of Certificates Outstanding have
concurred in any request, demand, authorization, direction,
notice, consent or waiver under the provisions hereof, unless all
Certificates Outstanding are so held, Certificates which are held
by or on behalf of the Lessee or any person controlling, con-
trolled by or under common control with the Lessee shall be dis-
regarded for the purpose of any such determination.
"Person" shall mean an individual, a corporation, a partner-
ship, an association, a joint stock company, a trust, any unin-
corporated organization, a governmental body, any other political
subdivision, municipality or municipal authority or any other
group or organization of individuals.
"Pledged Revenues," in addition to the funds and revenues
defined as such in the Lease, shall mean:
(a) any and all sums which may be deposited in any
Funds or accounts established under this Indenture (other
than the Rebate Account), which shall include all Lease
Payments and all amounts received by the Trustee from the
sale or leasing of the Project (other than fees and expenses
of the Trustee associated therewith) in the event the Lessee
defaults under the Lease and the Trustee repossesses the
Project as permitted by the Lease;
(b) interest earned on all Funds;
(c) all other amounts received by the Trustee from or
on behalf of the Lessee for deposit into any Fund (other
than amounts, if any, that are deposited into any Fund and
are to be used for the payment of fees and expenses of
parties pursuant to this Indenture), and the proceeds
received by the Trustee of any insurance coverages on and
condemnation awards in respect of any portions of the
Project, whether now existing or hereafter coming into
existence and whether now owned or held or hereafter
acquired by the Lessee; and
(d) all Eligible Investments acquired with the fore-
going.
"Project" shall have the meaning ascribed thereto in the
recitals hereof and in the Lease together with any and all
additions, modifications, attachments and replacements thereto.
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"Project Cost" shall mean the costs of purchasing or ac-
quiring the Project as set forth in the Lease.
"Rebate Account" shall mean the account so designated which
may be established by the Trustee pursuant to Section 3.09
hereof.
"Record Date" shall mean the date which is the 1st day of
the month in which any Distribution is made.
"Reserve Fund" shall mean the fund so designated which is
established pursuant to Section 3.01 hereof.
"Registered Owner" with respect to any Certificate shall
mean the person in whose name any Certificate is registered upon
the Certificate Register.
"Special Payment Date" shall mean, with respect to Outstand-
ing Certificates, the date set for payment of amounts due on
Certificates that were not paid when due on any Distribution
Date, which date shall be fixed by the Trustee whenever moneys
become available for the payment of such debt service.
"Special Record Date" means the date which is fifteen (15)
days prior to any Special Payment Date.
"State" shall mean the State of California.
"Supplemental Indenture" shall mean any indenture amending,
modifying or supplementing this Indenture made, signed and becom-
ing effective in accordance with the terms contained herein.
"Supplemental Lease Documents" shall mean any Supplemental
Lease and all documents, certificates, writings and representa-
tions executed or made in connection with the execution and
delivery thereof.
"Trustee" shall mean Sovran Bank, N.A., a national banking
association having its principal corporate trust office in
Richmond, Virginia, and its successor or successors as Trustee
under this Indenture.
Section 1.02. Interpretations. The words "hereof", "here-
in," "hereto," "hereby," and "hereunder" (except in the form of
the Certificates) refer to the entire Indenture. Words importing
persons include firms, associations and corporations; all words
importing the singular number include the plural number and visa
versa; and all words importing the masculine gender include the
feminine gender.
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ARTICLE II
CONCERNING THE CERTIFICATES
Section 2.01. Delivery. The Trustee is hereby authorized
to execute and deliver the Certificates to the purchasers thereof
in accordance with the Closing Statement but only upon receipt of
the purchase price of such Certificates as set forth in the
Closing Statement.
Section 2.02. Form. The Certificates shall be in the form
provided in Appendix "A" hereto.
Section 2.03. Terms. (a) The Certificates shall be
numbered consecutively from R-1 upward and shall be issued in
minimum denominations of $5,000 or integral multiples thereof.
(b) The Certificates shall be dated the Dated Date, unless
issued in exchange for Certificates in which case such
Certificates shall be dated as of the date so executed; provided
however, if the date of such exchange is a Distribution Date,
such Certificates shall be dated as of the date of such exchange.
(c) Interest shall be payable on the Certificates on each
Distribution Date from the later of the Dated Date or the date on
which interest was last paid on such Certificates.
(d) The Certificates shall bear interest at the annual
rates set forth below (calculated on the basis of a 30 -day month
and a 360 -day year) until payment of the principal amount or
redemption price thereof shall have been made or provided for at
or prior to maturity; and shall mature in amounts on the dates as
follows:
Maturity
Date Principal Interest
(February 15) Amount Rate
1989 $125,000 5.80%
1990 $135,000 6.10%
1991 $140,000 6.25%
1992 $150,000 6.40%
1993 $245,000 6.50%
(e) The Certificates shall be subject to redemption and to
certain other terms and conditions as are set forth in the form
thereof set forth as Appendix "A" hereto.
MIC
Section 2.04. Place, and Manner of Payment. (a) Distribu-
tions of interest on the Certificates issued and to be issued
hereunder shall be payable in lawful money of the United States
of America which at the time of payment is legal tender for the
payment of public and private debts therein.
(b) The final payment due on the Certificates shall be pay-
able at the principal corporate trust office of the Trustee upon
presentation and surrender of Certificates as the same shall be-
come due and payable.
(c) All payments due on the Certificates (other than the
final payment) shall be paid on each Distribution Date (or if any
such Distribution Date is not a Business Day, then on the
Business Day next succeeding such Distribution Date) by check or
draft mailed by the Trustee to the person in whose name a
Certificate is registered on the Certificate Register at the
close of business on the Record Date, and at the address
appearing on the Certificate Register; provided, however, if a
Registered Owner (i) prior to the relevant Record Date, requests
the Trustee to make payment on such Certificate in a manner other
than as set forth above, and the Trustee agrees to make such
payment in the manner requested, and (ii) reimburses the Trustee
in advance for any costs that the Trustee incurs in complying
with such request, the Trustee shall make payment on such
Certificate in accordance with such Registered Owner's request.
Section 2.05. Execution of Certificates. All Certificates
issued hereunder shall be executed by the manual signature of an
authorized officer of the Trustee.
Section 2.06. Registration, Exchange and Transfer; Certifi-
cate Register. (a) The Trustee shall keep or cause to be kept at
its principal corporate trust office books for the registration,
exchange and transfer of Certificates in the manner provided
herein so long as any of the Certificates shall remain
Outstanding. The Trustee shall serve as the registrar for the
purpose of registering, exchanging and transferring the
Certificates.
(b) No transfer of Certificates shall be valid unless made
by the Registered Owner in person or by his duly authorized
attorney at the principal corporate trust office of the Trustee,
upon surrender of such Certificates accompanied by a duly
executed instrument of transfer in form and with guaranty of
signature satisfactory to the Trustee. Upon such transfer a new
fully registered Certificate or Certificates of the same
maturity, in authorized denominations, and bearing the same rate-
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of interest shall be issued to the transferee. The Trustee shall
exchange, register or transfer or cause to be exchanged,
registered or transferred, Certificates, as herein provided, and
under such reasonable regulations as it may prescribe.
(c) At the option of the Registered Owner, Certificates may
be exchanged for other Certificates of any other authorized
denomination of a like aggregate principal amount and maturity,
upon surrender of the Certificates to be exchanged to the
Trustee. Whenever any Certificates are so surrendered for
exchange, the Trustee shall execute and deliver the Certificates
which the Registered Owner making the exchange is entitled to re-
ceive.
(d) Registration and transfer of registration of Certifi-
cates authorized under this Section shall be made without charge
to the Registered Owner of any Certificate; provided, however,
the Registered Owner, as a condition precedent to the exercise of
such privilege, shall pay any taxes, fees or other governmental
charges imposed thereon.
(e) The Trustee shall not be required (i) to issue or
transfer any Certificates during a period beginning on the fif-
teenth day next preceding any date of selection of Certificates
to be redeemed and ending at the close of business on the day on
which the applicable notice of redemption is mailed, or (ii) to
transfer any Certificates which have been selected or called for
redemption in whole or part.
Section 2.07. Mutilated, Destroyed, Lost or Stolen Certifi-
cates. (a) Upon receipt by the Trustee of evidence satisfactory
to it that any Outstanding Certificate has been mutilated,
destroyed, lost or stolen, and of indemnity satisfactory to it,
the Trustee shall execute and deliver a new Certificate of the
same series and same maturity and of like tenor in exchange and
in substitution for, and upon surrender and cancellation of, the
mutilated Certificate, or in lieu of and in substitution for the
Certificate so destroyed, lost or stolen.
(b) Any Registered Owner requesting that a new Certificate
be executed and delivered under the provisions of this Section,
shall pay the expenses, including counsel fees, which may be
incurred by the Trustee in connection with such transfer. In
case any such mutilated, destroyed, lost or stolen Certificate
has become or is about to become due and payable, the Trustee, in
its discretion, may, instead of issuing a new Certificate, make
the payment thereof when such payment is due.
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(c) Any Certificate issued under the provisions of this
Section in lieu of any Certificate alleged to be mutilated, de-
stroyed, lost or stolen, shall constitute an original, addi-
tional, direct and proportionate interest, whether or not the
Certificate so alleged to be mutilated, destroyed, lost or stolen
be at any time enforceable by anyone, and shall be equally and
proportionately entitled to the same benefits as the Certificate
being replaced.
Section 2.08. Ownership of Certificates. The Trustee shall
treat the Registered Owner of any Certificate as the absolute
owner of such Certificate for all purposes whether or not such
Certificate shall be overdue, and the Trustee shall not be af-
fected by any notice to the contrary. Any consent, waiver or
other action taken by the Registered Owner of any Certificate
shall be conclusive and binding upon such Registered Owner, his
heirs, successors or assigns, and upon all transferees of such
Certificates whether or not notation of such consent, waiver or
other action shall have been made on such Certificate or on any
Certificate issued in exchange therefor.
ARTICLE III
FUNDS
Section 3.01. Creation of Funds. (a) There are hereby
created and established "The City of Newport Beach, California
Parking Facility Project Certificate Fund," "The City of Newport
Beach, California Parking Facility Project Acquisition Fund" and
"The City of Newport Beach, California Parking Facility Project
Reserve Fund."
(b) There may be established, by Supplemental Indenture or
otherwise as permitted hereby, one or more separate subaccounts
to facilitate the administration of the trusts established
hereunder.
Section 3.02. Settlement and Application of Proceeds.
There shall be delivered to the Trustee at the time the
Certificates are executed and delivered a Closing Statement
executed by an Authorized Officer of FCFC showing: (a) the
amount of the proceeds of the sale of the Certificates, including
accrued interest, if any; (b) the amounts of accrued and
capitalized interest, if any, on the Certificates to be deposited
in the Certificate Fund; (c) the amount to be deposited in the
Project Acquisition Fund; (d) the amount to be deposited to the
Reserve Fund and (e) amounts payable with respect to the issuance
costs of the Certificates. The Closing Statement shall be
accompanied by the Investment Instructions, which shall contain a
statement with respect to the disposition of moneys received by
the Trustee pursuant to this Section.
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Section 3. 03. Disposition of Other Moneys. (a) All Lease
Deposits, if any, Lease Payments, and the payments of the
Concluding Payment Amount, if any, received by the Trustee,
together with any other funds received from the Lessee or from
any other Person for application to Lessee's obligations under
the Lease (other than moneys deposited to the Project Acquisition
Fund) shall be deposited by the Trustee to the Certificate Fund.
(b) Upon receipt of any delinquent Lease Payment with
respect to which moneys have been advanced from the Reserve Fund,
such Lease Payment shall be deposited in the Reserve Fund;
provided, however, that no other Lease Payments are then
delinquent in which event such moneys shall be applied to the
payment of the Certificates in accordance with the provisions of
this subsection.
Section 3.04. Certificate Fund. (a) On each Distribution
Date, the Trustee shall disburse to the Registered Owners (but
solely from and to the extent of moneys on deposit in the Funds
established hereunder) an amount sufficient to make all payments
of the principal of and interest on the Certificates becoming due
on such Distribution Date.
(b) If on any Distribution Date, the amount of all payments
due and payable on the Certificates exceeds the amount on hand in
the Certificate Fund, taking into account any transfers made from
the Reserve Fund, the Trustee shall apply the moneys on hand
therein first to the payment of all interest due with respect to
all Certificates, pro rata if necessary, and second to the
payment of that portion of the unpaid principal balance of each
Certificate which is then due, pro rata if necessary.
Section 3.05. Project Acquisition Fund. (a) There shall
be disbursed from the Project Acquisition Fund from time to time,
pursuant to written instructions signed by Authorized Officers of
FCFC and the Lessee amounts sufficient to pay, in whole or in
part, the Project Costs. In making any such disbursement, the
Trustee shall be fully protected in acting upon such written
instructions and shall not be required to verify or take any
other further action respecting the application of such
disbursement.
(c) On the earlier of January 15, 1991 or the date on which
the Trustee makes the final payment of the Project Costs, the
Trustee shall transfer any amounts remaining in the Project
Acquisition Fund (in integral multiples of $5,000) to the
Certificate Fund for redemption of Certificates on February 15,
1991, or if transferred earlier on the next succeeding D-istribu-
tion Date. If such transfer is made prior to January 15, 1991,
any amounts then remaining in the Project Acquisition Fund shall
ONE
be transferred also to the Certificate Fund to be applied to the
Distribution due on the next succeeding Distribution Date.
(d) No amount shall be withdrawn from or paid out of the
Project Acquisition Fund except as provided herein.
Section 3.06. Reserve Fund. (a) The Reserve Fund shall be
established in the original amount of $79,500.00 and maintained
by the Trustee until such time as (i) the Lease Payments are paid
in full pursuant to the terms of the Lease, (ii) the Lessee has
paid the entire Concluding Payment Amount in accordance with the
Lease, or (iii) this Indenture is terminated. The Trustee shall
apply moneys in the Reserve Fund as provided in this Section.
(b) If on any Distribution Date the amount in the
Certificate Fund shall be less than the amount required to pay
the Lease Payment in full, the Trustee shall withdraw from the
Reserve Fund to the extent necessary to make good the deficiency.
Any amounts transferred from the Reserve Fund pursuant to this
subsection shall not be considered payment in full of a Lease
Payment and shall, upon receipt of the delinquent Lease Payment,
be repaid from such Lease Payment to the Reserve Fund.
(c) Whenever the amount in the Reserve Fund, together with
the amount in the Certificate Fund, is sufficient to pay in full
all Outstanding Certificates in accordance with their terms, the
funds on deposit in the Reserve Fund shall be transferred to the
Certificate Fund. Any provision of this Indenture to the
contrary notwithstanding, so long as there shall be held in the
Certificate Fund an amount sufficient to pay in full all
Outstanding Certificates in accordance with their terms, no
deposits shall be required to be made into the Reserve Fund.
(d) Moneys in the Reserve Fund shall be used solely for the
purpose of:
(i) making up deficiencies in the Certificate Fund as
provided above;
(ii) in the event of the termination of the Lease Term
pursuant, the Trustee shall withdraw from the Reserve Fund
for deposit in the Certificate Fund to be applied to the
payment of Certificates, all amounts then credited to the
Reserve Account; or
(iii) in the event of the exercise by Lessee of its option
to purchase the Project pursuant to the Lease Agreement, the
Trustee shall withdraw from the Reserve Fund for deposit in
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the Certificate to be applied against the Option to Purchase
Concluding Payment Amount and the redemption of
Certificates; or
(iv) providing for the payment of all Lease Payments in
which event the Trustee shall transfer all amounts on
deposit in the Reserve Fund to the Certificate Fund to be
applied as a credit against the final Lease Payment due on
February 15, 1993.
Section 3.07. Discontinuance of Funds or Accounts; Redemp-
tion of Certificates. (a) In the event that the Lessee exercises
its option, if any, under the Lease to purchase the Project and
in connection therewith pays an amount sufficient, together with
the moneys in any one or more of the accounts created in Funds
established hereunder to redeem and pay all Outstanding Certifi-
cates, said accounts in said Funds may be discontinued and the
moneys therein applied toward such redemption or payment.
(b) Any balance remaining in any account in any such Fund
shall be paid by the Trustee to FCFC after all Certificates and
other sums required to discharge the lien of the Indenture in
respect of the Certificates shall have been paid or provision for
their payment shall have been made.
Section 3.08. Reports By Trustee. The Trustee shall
furnish to the Lessee and to FCFC, at least annually, a report on
the status of each of the Funds and accounts established under
this Article, showing at least the balance in each such Fund and
account as of the first day of the period, the deposits to
(including interest on investments) and the disbursements from
each such Fund and account, and the balance in each such Fund and
account on the last day of the report period.
Section 3.09. Rebate Account. (a) Upon receipt of written
instructions from an Authorized officer of the Lessee, the
Trustee shall establish a Rebate Account within the Certificate
Fund and shall make deposits and disbursements from the Rebate
Account in accordance with such written instructions. The
Trustee shall invest the Rebate Account pursuant to said written
instructions and shall deposit income from such investments
immediately upon receipt thereof in the Rebate Account.
(b) The written instructions delivered pursuant to this
Section shall be accompanied by an opinion of nationally
recognized bond counsel addressed to the Trustee to the effect
that the use of said written instructions will not cause the
interest on the Certificates to beome subject to Federal income
taxation.
51�
ARTICLE IV
SECURITY FOR DEPOSITS; INVESTMENTS OF FUNDS
Section 4.01. Moneys are Trust Funds. All moneys received
by the Trustee under this Indenture for deposit in any Fund
established hereunder (except moneys required to be deposited to
the Rebate Account) shall at all times be trust funds, held for
the benefit and security of the Registered Owners in accordance
with the provisions hereof.
Section 4.02. Investment or Deposit of Funds. (a) The
Trustee shall invest moneys held in the Funds established here-
under only in Eligible Investments.
(b) All investments made pursuant to this Section shall
mature or be subject to redemption at not less than the principal
amount thereof or the amortized cost of acquisition, whichever is
lower, and all deposits in time accounts shall be subject to
withdrawal without penalty not later than such dates and in such
amounts required to make distributions of the principal of and
interest on the Certificates on the Distribution Dates.
(c) The interest and income received upon such investments
and any interest paid by the Trustee or any other depository of
any Fund established hereunder, and any profit (net of losses)
resulting from the sale of securities, shall be added or charged
to the Certificate Fund.
(d) Whenever payment is to be made out of any Fund, the
Trustee shall sell such Eligible Investments as may be requested
or required to make the payment and restore the proceeds to the
Fund in which the Eligible Investments were held. The Trustee
shall not be accountable for any depreciation in the value of any
such investment or for any loss resulting from the sale thereof.
Section 4.03. Valuation of Funds. In computing the assets
of any Fund or account, investments and accrued interest thereon
shall be deemed a part thereof. Such investments shall be valued
at their amortized cost, except for United States Treasury
Obligations - State and Local Government Series, which shall be
valued at their principal amount.
ARTICLE V
REDEMPTION OF CERTIFICATES
Section 5.01. General The Certificates are subject to
redemption as provided in the form of the Certificates prescribed
in Exhibit "A" to this Indenture.
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Section 5.02 Disposition of Project. If the term of the
Lease is not renewed pursuant to the terms thereof for failure of
the Lessee to appropriate funds sufficient to pay the Lease
Payments when due during the next ensuing fiscal period, or if
the Certificates are called for redemption following an event of
default, the Trustee shall take whatever actions are reasonably
required to sell, lease, sublease or otherwise dispose of the
Project and shall, on each subsequent Distribution Date, credit
the proceeds of such sale, lease, sublease or other disposition
to the Certificate to be applied to pay the following items in
the following order of priority:
FIRST, for the payment of all fees, expenses and costs
incurred by the Trustee in connection with such sale, lease,
sublease or other disposition of the Project;
SECOND, for the payment of interest due on all Outstanding
Certificates, and if the amount available for such payment is
insufficient to pay all interest then owing and unpaid, the
amount available shall be distributed pro rata among all
Certificates Outstanding;
THIRD, for the payment of principal on all Outstanding
Certificates and if the amount available for such payment is
insufficient to pay the aggregate principal amount of all
Outstanding Certificates, the amount available shall be
distributed pro rata among all Certificates Outstanding without
preference of one maturity over another maturity; and
Section 5.03. General Provisions for Redemption. (a) When-
ever less than all the Certificates are to be redeemed, the Cer-
tificates to be redeemed shall be selected in inverse order of
maturity and by lot within maturity. In the case of a
Certificate having a denomination greater than $5,000, the
Trustee shall treat each such Certificate as representing such
number of separate Certificates, each of the denomination of
$5,000, as is obtained by dividing the actual principal amount of
such Certificate by $5,000.
(b) On the redemption of a portion of the principal amount
of such Certificates, the Trustee shall execute and cause to be
delivered, on the surrender of such Certificate, a new Certifi-
cate or Certificates, of any authorized denomination, as re-
quested by the Registered Owner, in aggregate principal amount,
having a maturity date and bearing interest at a rate equal to
and in exchange for the unredeemed portion of the principal of
the Certificate so surrendered. Such exchange shall be without
charge to the Registered Owner.
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Section 5.04. Notice of Redemption. (a) If Certificates
are to be redeemed as a result of a termination of the Lease
following an event of non -appropriation with respect thereto, the
Trustee shall cause a notice of redemption to be mailed to the
Registered Owners as soon as possible.
(b) Except as provided above, when Certificates are to be
redeemed, the Trustee shall cause a notice of redemption to be
mailed to the Registered Owners of Certificates at least ten (10)
but not more than thirty (30) days prior to the date fixed for
redemption.
(c) Each notice of redemption shall specify the maturities
and if less than all the Outstanding Certificates are to be
redeemed or tendered, the numbers, of the Certificates to be
redeemed, which may, if appropriate, be expressed in designated
blocks of numbers. Such notice shall also state the date fixed
for redemption, that on such date the Certificates called for
redemption will be due and become payable at the principal
corporate trust office of the Trustee and from and after such
date, interest thereon shall cease to accrue; provided, however,
that the Registered Owners of any Certificates to be redeemed may
file written waivers of notice with the Trustee, and if so
waived, such Certificates may be redeemed and all rights and
liabilities of said Registered Owners shall mature and accrue on
the date set for such redemption, without the requirement of
written notice.
(d) Each notice of redemption shall be deposited by the
Trustee in the United States mail with first class postage
prepaid and addressed to the Registered Owners called for
redemption at their addresses appearing upon the Certificate
Register.
(e) If at the time of mailing of notice of any redemption
by reason of purchase by the Lessee of the Project pursuant to
the Lease, the Lessee shall not have deposited with the Trustee
moneys sufficient to redeem all the Certificates called for
redemption, such notice shall state that it is conditional,
subject to the deposit of funds with the Trustee not later than
the redemption date, and such notice shall be of no effect unless
such moneys are so deposited.
Section 5.05. Payment of Redemption Price. Whenever
Certificates are to be redeemed, all redemption costs, including
the amounts necessary to pay all costs of required mailing, any
other costs incidental to the redemption and to pay the prin-
cipal, premium, if any, and all interest accrued and to accrue to
the date fixed for redemption, shall be set aside and held in
IMM
separate trust hereunder by the Trustee exclusively for such
purposes. Notice having been given in the manner hereinbefore
provided, or written waivers of notice having been filed with the
Trustee prior to the date set for redemption, the Certificates so
called for redemption shall become due and payable on the redemp-
tion date so designated and interest on such Certificates shall
cease to accrue from the redemption date whether or not the
Certificates shall be presented for payment. The principal
amount of all Certificates so called for redemption, together
with the accrued and unpaid interest thereon to the date of
redemption, shall be paid by the Trustee upon presentation and
surrender thereof.
ARTICLE VI
DEFAULTS UNDER THE LEASE
Section 6.01. Legal Proceedings. Upon the happening and
during the continuance of any event of default (an "Event of
Default") under the Lease, an event of default shall be deemed to
have occurred hereunder, and in every such case the Trustee in
its discretion may, and upon written request of the Registered
Owners of at least twenty five percent (25%) in aggregate
principal amount of the Certificates Outstanding, and upon
receipt of indemnity and advice of Counsel to its satisfaction,
shall, proceed to protect and enforce its rights and the rights
of the Registered Owners under the laws of the State or under
this Indenture by the exercise of any one or more of the remedies
provided for in the Lease.
Section 6.02. Discontinuance of Proceedings. In case any
proceeding taken by the Trustee on account of any Event of
Default under the Lease shall have been discontinued or abandoned
for any reason, or shall have been determined adversely to the
Trustee, then in every case the Lessee, the Trustee and the
Registered Owners shall be restored to their former positions and
rights hereunder and under the Lease, and all rights, remedies
and powers of the Trustee shall continue as though no such
proceedings had been taken.
Section 6.03. Direction of Proceedings. The Registered
Owners of a majority in aggregate principal amount of the Certi-
ficates Outstanding with respect to which an Event of Default
under the Lease has occurred shall have the right, by an instru-
ment in writing executed and delivered to the Trustee, after
furnishing indemnity satisfactory to the Trustee, to direct the
method and place of conducting all remedial proceedings to be
taken by the Trustee hereunder; provided that any such direction
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shall not be contrary to law or the provisions of this Indenture
and that the Trustee shall have the right to decline to follow
any such direction which, in the opinion of the Trustee, would be
unjustly prejudicial to the rights hereunder of the Registered
Owners of such Certificates not parties to such direction.
Section 6.04. Limitations on Actions. No Registered Owner
of any of the Certificates shall have any right to institute any
suit, action or proceeding in equity or at law for the enforce-
ment of this Indenture or for execution of any trust hereunder,
or for any other remedy hereunder, unless such Registered Owner
previously shall have given to the Trustee written notice of an
Event of Default, and unless the Registered Owners of not less
than a majority of the aggregate principal amount of the
Certificates Outstanding, shall have made written request to the
Trustee, after the right to exercise such powers or rights of
action shall have accrued, and shall have afforded the Trustee a
reasonable opportunity either to proceed to exercise the powers
granted in the Indenture or to institute such action, suit or
proceeding in its or their names, and unless also there shall
have been offered to the Trustee security and indemnity
satisfactory to it against the costs, expenses and liabilities to
be incurred therein or thereby, and the Trustee shall have
refused or neglected to comply with such request within a
reasonable time; and such notification, request and offer of in-
demnity are hereby declared in every such case, at the option of
the Trustee, to be conditions precedent to the execution of the
powers and trusts of this Indenture and to any action or cause of
action for the enforcement of this Indenture or for any other
remedy hereunder, it being understood and intended that no one or
more Registered Owners of any Certificates shall have any right
in any manner whatever by his or their action to affect, disturb
or prejudice the security of this Indenture, or to enforce any
right hereunder, except in the manner herein provided, and that
all proceedings at law or in equity shall be instituted and
maintained in the manner herein provided and for the ratable
benefit (subject to all of the terms, conditions and provisions
of this Indenture) of all Registered Owners.
Section 6.05. Delays not to Impair Ricrhts. No delay or
omission in respect of exercising any right or power accruing
upon any event of default under the Lease shall impair such right
or power or be a waiver of such default, and every remedy given
by this Article may be exercised from time to time and as often
as may be deemed expedient.
Section 6.06. Possession Not Required. All rights under
this Indenture, the Lease and the Certificates may be enforced by
the Trustee without the possession of any Certificate or the
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production thereof at the trial or other proceedings relative
thereto, and any proceeding instituted by the Trustee shall be
brought in its name for the ratable benefit of the Registered
Owners.
ARTICLE VII
CONCERNING THE TRUSTEE
Section 7.01. Acceptance of Trust. The Trustee accepts and
agrees to execute the trust hereby created, but only upon the
additional terms set forth in this Article, to all of which the
parties hereto and the Registered Owners, by their acceptance of
Certificates agree. The Trustee shall perform only such duties
as are specifically set forth in this Indenture and no implied
covenants or obligations shall be read into this Indenture
against the Trustee.
Section 7.02. Certain Rights of Trustee. (a) The Trustee
may execute any of the trusts or powers created hereby and
perform the duties required by it, by or through agents or
employees, shall be entitled to advice of Counsel concerning the
duties hereunder and shall not be answerable for the default of
misconduct of any such Counsel, agent or employee selected by it
with reasonable care.
(b) The Trustee may construe any provision of this
Indenture which may be ambiguous or inconsistent with any other
provision hereof, and any such construction made in good faith
shall be binding upon the Registered Owners.
Section 7.03. Compensation for Services. The Trustee shall
be paid a reasonable compensation by the Lessee for all services
to be rendered by it hereunder. The Trustee shall be reimbursed
by the Lessee from time to time for all of its reasonable
expenses and charges and those of its attorneys, agents and
employees incurred in and about the administration and execution
of the trusts and the performance of its powers and duties
hereunder.
Section 7.04. Certain Exculpatory Provisions. The Trustee
shall be under no duty or obligation to:
(a) indemnify any Person against losses suffered from any
authorized investment of any of the moneys on deposit with it
under this Indenture, it being responsible only for the safe-
keeping of the securities in which said moneys are invested and
the collection of interest thereon;
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(b) take any action in respect of any event of default
under the Lease (other than a default by the Lessee in the
payment of Lease Payments) in which event the Trustee shall take
such action as may be recommended by Counsel or otherwise, or
toward the execution or enforcement of any of the trusts hereby
created, or institute, appear in or defend any suit or other
proceeding in connection therewith, unless requested in writing
to do so by Registered Owners of a majority in aggregate
principal amount of the Certificates then Outstanding and unless
furnished, from time to time as often as it may require, with
security and indemnity satisfactory to it; or
(c) effect or renew any policy of insurance if the Lessee
fails to effect or renew such insurance in accordance with the
terms of the Lease.
Section 7.05. Notice of Default. The Trustee shall not be
required to take notice or be deemed to have knowledge of any
Event of Default (other than a default by the Lessee in the
payments of Lease Payments, in which event the Trustee shall be
deemed to have knowledge thereof) unless and until specifically
notified in writing of such default by FCFC or by the Registered
Owners of a majority in aggregate principal amount of the
Certificates Outstanding.
Section 7.06. Liability of Trustee. (a) The liability of
the Trustee for actions taken or omitted to be taken hereunder
shall be limited to its gross negligence or willful misconduct.
(b) The Trustee shall be protected and shall incur no
liability in relying, acting or proceeding, or in not relying,
not acting or not proceeding in good faith, upon any application,
resolution, notice, order, telegram, request, requisition,
consent, waiver, certificate, statement, affidavit, report,
opinion, voucher, bond or other paper or document which it shall
believe to be genuine and to have been passed, signed or
presented by the proper board or person, or to have been prepared
and furnished pursuant to any of the provisions of this
Indenture, and the Trustee shall be under no duty to make any
investigation or inquiry as to any statements or opinions
contained or matters referred to in any such instrument, but may
accept and rely upon the same as conclusive evidence of the truth
and accuracy of such statements and opinions.
(c) As a condition to the taking, suffering or omission of
any action hereunder, the Trustee may consult with Counsel and
the opinion of such Counsel shall be full and complete
authorization and protection in respect of any action taken,
omitted or suffered by the Trustee hereunder in good faith and in
accordance herewith.
-22-
(d) The Trustee shall not be bound to recognize any person
as the Registered Owner of any Outstanding Certificate unless and
until such Certificate is submitted to the Trustee for inspection
if required and his title thereto satisfactorily established if
disputed.
Section 7.07. Trustee May Deal in Certificates and Engage
in Other Transactions. The Trustee, its directors, officers,
employees or agents, may in good faith buy, sell, own, hold and
deal in any of the Certificates and may join in any action which
any Registered Owner may be entitled to take with like effect as
if the Trustee were not a party to this Indenture. The Trustee,
either as principal or agent, may also engage in or be interested
in other financial or other transactions with the Lessee or FCFC,
and may act as depositary, trustee or agent for any committee or
body of Registered Owners.
Section 7.08. Resignation The Trustee may resign and be
discharged of the trusts hereunder by executing an instrument in
writing assigning such trusts, specifying the date when such
resignation shall take effect, and filing the same with the
Lessee and FCFC not less than sixty (60) days before the date
when such resignation shall take effect; provided, however, that
any such resignation shall not take effect until a successor
trustee has accepted its appointment as such pursuant to the
provisions of this Indenture.
Section 7.09. Removal. The Trustee may be removed at any
time by an instrument in writing, filed with the Trustee,
appointing a successor trustee, executed by or on behalf of the
Registered Owners of a majority in aggregate principal amount of
the Certificates Outstanding.
Section 7.10. Appointment of Successor. (a) If the
Trustee shall be dissolved, or if its property or affairs shall
be taken under the control of any state or federal court or
administrative body, a vacancy shall forthwith and ipso facto
exist in the office of Trustee, and a successor may be appointed
by Lessee by an instrument in writing executed by an Authorized
Officer of Lessee; provided, however, that during the continuance
of an event of default under the Lease the right to appoint such
a successor may not be exercised by Lessee but instead may only
be exercised by the Registered Owners of a majority in aggregate
principal amount of the Certificates Outstanding by an instrument
in writing executed by and on behalf of such Registered Owners.
(b) Until a successor trustee shall be appointed by the
Registered Owners during the continuance of an event of default
under the Lease as herein authorized, FCFC, by an instrument in
-23-
writing, may appoint a trustee to fill such vacancy. Any new
trustee so appointed by FCFC shall immediately and without
further fact be superseded by a trustee appointed by the
Registered Owners in the manner above provided.
(c) Any successor trustee appointed pursuant to this
Article shall be an incorporated bank or trust company in good
standing, organized or authorized to transact business under the
laws of the United States or of any state, be authorized under
such laws to exercise corporate trust powers and be subject to
supervision or examination by a federal or state authority having
a reported capital and surplus of not less than $25,000,000.
Section 7.11. Acceptance of Trust by Successor Trustee.
Any successor trustee appointed hereunder shall execute, acknow-
ledge and deliver to FCFC and the Lessee an instrument accepting
such appointment, and thereupon, without any further act, deed or
conveyance shall become fully vested with all the estates, pro-
perty, rights, powers, trusts, duties and obligations of its
predecessor in the trust with like effect as if originally named
Trustee herein. Upon request of such successor trustee, the
predecessor Trustee shall execute and deliver an instrument
transferring to such successor trustee all the estate, property,
rights, powers and trusts hereunder of the predecessor Trustee,
and the predecessor Trustee shall pay over to the successor
trustee all moneys at the time held by it hereunder.
Section 7.12. Successor Corporation as Trustee. Any corpo-
ration into which any Trustee hereunder may be merged or with
which it may be consolidated, or any corporation resulting from
any merger or consolidation to which any Trustee hereunder shall
be a party, shall be the Trustee under this Indenture without the
execution or filing of any paper or any further act on the part
of the parties hereto, anything herein to the contrary notwith-
standing.
ARTICLE VIII
EVIDENCE
Section 8.01. Evidence on Which Trustee May Act. (a) Any
request, direction, consent or other instrument in writing
required or permitted by this Indenture to be signed or executed
by Registered Owners, may be in any number of concurrent
instruments of similar tenor and may be signed or executed by
such Registered Owners in person or by an agent appointed in
writing. The fact and date of the execution of any such
instrument and of the ownership of Certificates shall be
-24-
sufficient for any purposes of this Indenture and shall be con-
clusive evidence in favor of the Trustee with regard to any
action taken under such instrument, if the fact and date of the
execution by any Registered Owner, person or agent of any such
instrument is proven by the certificate of any officer in any
jurisdiction who, by the laws thereof, has power to take acknowl-
edgments within such jurisdiction to the effect that the
Registered Owner, person or agent signing such instrument
acknowledged before him the execution thereof.
(b) The ownership of Certificates shall be proven by the
Certificate Register kept under Article II.
Section 8.02. Other Evidence. Nothing contained in this
Article shall be construed as limiting the Trustee to the proof
hereinabove specified, it being intended that the Trustee may
accept any other evidence of the matters herein state which it
may deem sufficient. Any request, consent, waiver of notice or
vote of the Registered Owner of any Certificate shall bind every
future Registered Owner of the same Certificate in respect of
anything done or suffered by the Trustee in pursuance thereof.
ARTICLE IX
AMENDMENTS AND MODIFICATIONS
Section 9.01. Amendments Without Consent. The Trustee,
Lessee and FCFC may, from time to time and at any time, enter
into a Supplemental Indenture: (a) for any purpose not
inconsistent with the terms of this Indenture or to cure any
ambiguity or formal defect or omission in this Indenture or in
any Supplemental Indenture which may be defective or inconsistent
with any other provision contained herein, or to make such other
provisions in regard to matters or questions arising under the
Indenture which shall not be inconsistent with the provisions of
the Indenture and which shall not adversely affect the interests
of the Registered Owners; or (b) to grant to and confer upon
Registered Owners, or the Trustee, for the benefit of the
Registered Owners, any additional rights, remedies, powers,
authority or security that may be lawfully granted to or
conferred upon the Registered Owners or the Trustee.
Section 9.02. Amendments Requiring Consent. (a) Without
the consent of the parties hereto and of all of the Registered
Owners of all Certificates Outstanding, no modification or
amendment to this Indenture shall be made which would: (i) alter
the amount or payment date of any payment on the Certificates or
-25-
the redemption provisions thereof, (ii) modify the terms of pay-
ment or the right to enforce payment of the Certificates or
(iii) reduce the percentage of consenting Registered Owners set
forth below in this Section. Modification of the provisions
governing the administration of Funds hereunder which do not
impair the rights reserved above shall not be deemed to
constitute a modification of terms of payment.
(b) Subject to the foregoing limitations of this Section,
this Indenture may be modified or amended from time to time and
at any time with the written consent of FCFC and the Registered
Owners of not less than a majority in principal amount of
Certificates Outstanding.
(c) Modifications and amendments made under this Section
shall be made by a Supplemental Indenture which shall be executed
by the Trustee upon receipt of evidence satisfactory to the
Trustee of the consent thereto of FCFC and the Registered Owners
of the requisite principal amount of Certificates Outstanding;
provided, however, if such Supplemental Indenture shall adversely
affect the Trustee's own rights, duties or immunities under this
Indenture, the Trustee may, but shall not be obligated to, enter
into such Supplemental Indenture. It shall not be necessary for
the consent of the Registered Owners to approve the particular
form of any proposed Supplemental Indenture but only the
substance thereof.
Section 9.03. Reliance on Counsel. The Trustee is
authorized to join with Lessee and FCFC in the execution and
delivery of any Supplemental Indenture or amendment permitted by
this Article X and in so doing shall be fully protected by an
opinion of Counsel, that such Supplemental Indenture or amendment
is so permitted and that all things necessary to make it a valid
and binding agreement have been done.
ARTICLE X
MISCELLANEOUS
Section 10.01. Parties Interested. Nothing contained in
this Indenture, express or implied, is intended or shall be con-
strued to confer upon or give to any person, firm or corporation,
other than the parties hereto, the Lessee and the Registered
Owners, any right, remedy or claim under or by reason of this
Indenture or any covenant, condition or stipulation hereof; and
the covenants, stipulations and agreements in this Indenture
contained are and shall be for the sole and exclusive benefit of
the parties hereto, their successors and assigns, the Lessee and
the Registered Owners.
-26-
Section 10.02. Unclaimed Moneys. In the event that, within
five (5) years after the maturity or redemption date of any
Certificate, or interest claim appurtenant thereto, any amount
deposited or left with the Trustee with respect to such Certifi-
cate, or interest claim shall not have been claimed by the
Registered Owner thereof entitled thereto, the Trustee shall,
upon demand, pay over to the Lessee the amount not so claimed;
and the Trustee shall thereupon be relieved from all
responsibility from such amount to the Registered Owner of such
Certificate, or interest claim, and in the event of such payment
to the Lessee, the Registered Owner of such Certificate, or
interest claim shall have recourse only to the Lessee for an
amount equivalent to the amount paid over to the Lessee with
respect to such Certificate or interest claim, without interest.
Section 10.03. Successors and Assigns. All the covenants,
promises and agreements in this Indenture contained by or on
behalf of the Trustee and FCFC shall bind and inure to the
benefit of their respective successors and assigns, whether or
not so expressed.
Section 10.04. Effect of Invalid Provision. If any one or
more of the provisions of this Indenture or of the Certificates
shall, for any reason, be held to be illegal or invalid, such
illegality or invalidity shall not affect any other provisions of
this Indenture or of the Certificates, but this Indenture and the
Certificates shall be construed and enforced as if such illegal
or invalid provisions had not been contained therein.
Section 10.05. Notices. Any notice to, or other instrument
to be filed with, or demand upon (i) the Trustee may be served,
presented or made at the principal corporate trust office of the
Trustee at: P.O. Box 26904
Richmond, Virginia 23261
Attention: Corporate Trust Department
or such other address as shall then serve as its principal
corporate trust office in Richmond, Virginia, (ii) FCFC may be
served, presented or made at:
8080 North Central Expressway, Suite 850
Dallas, Texas 75206
or such other address as may be specified in writing by FCFC and
(iii) the Lessee may be served, presented or made at:
City of Newport Beach
P. 0. Box 1768
Newport Beach, California 92658-8915
Attention: City Attorney
or such other address as may be specified in writing by the
parties.
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r"
ACKNOWLEDGEMENT
STATE OF TEXAS
COUNTY OF DALLAS §
On this the Z; sr day of r 1988,
8AR6,91ZW , who acknowledged ) (her) self
to be an Authorized Officer of First Continental Financial Corpo-
ration and that, in such capacity (he) (she) executed the forego-
ing Real Property Lease/Purchase Agreement for the purposes set
forth herein.
WITNESS my hand and official seal.
S E A L
Com_ 7f'
N tary Public, in and for
said County and State
My commission expires %f� �—
ACKNOWLEDGEMENT
STATE OF CALIFORNIA §
COUNTY OF
J
On this the day of �Q, 1988,
- , LfU� , who acknowledged (him)i(her) self
to be an Authorized Officer of the City of Newport Beach,
California and that, in such capacity (he)(she) executed the
foregoing Real Property Lease/Purchase Agreement for the purposes
set forth herein.
WITNESS my hand and official seal.
S E A L Zo P�
Notary Public, i and for said
..... County and State
•` OFFICIAL SEAL
DOROTHY L. PALEN M commission expires 9�
�.' NOTARY PUBLIC - CALIFORNIA y p
PRINCIPAL OFFICE IN
�� • ORANGE COUNTY
My Commission Exp. Apr. 5, 1989
Section 10.06. Descriptive Headings. The descriptive head-
ings of the Articles and Sections of this Indenture are inserted
for convenience of reference only and shall not control or affect
the meaning or construction of any of the provisions hereof.
Section 10.07. Separate Counterparts. This Indenture may
be executed in any number of counterparts, each of which when so
executed and delivered shall be an original, but such counter-
parts shall together constitute but one and the same instrument.
Section 10.08. Governing Law. This Indenture and the
Certificates shall be governed by the laws of the State of
California.
IN WITNESS WHEREOF, Sovran Bank, N.A., as Trustee, First
Continental Financial Corporation and the City of Newport Beach,
California have each caused this Indenture to be executed and
their respective corporate seal to be hereunto affixed and
attested by their respective duly authorized officers, all as of
the day and year first above written.
TRUSTEE
Attest: jl
BY
Bv'Z-�� -�
Y= _����(- Authorized Officer
authorized Officer
(Corporate Seal)
FIRST CONTINENTAL FINANCIAL
CORPORATION
Attest:
By: B35'oma ' c'�S"
By: Authorized Officer
Authorizedffice
Attest:
LESSEE
BY:
Authorized Officer
544.
APPENDIX A
Form of Certificate
CERTIFICATE OF PARTICIPATION - LEASE RENTALS
(City of Newport Beach, California
Parking Facility Project)
Evidencing a Proportionate Interest of the Registered Owner
Hereof in Payments to be Made Pursuant to a Real Property
Lease/Purchase Agreement between First Continental
Financial Corporation and
THE CITY OF NEWPORT BEACH, CALIFORNIA
PRINCIPAL AMOUNT INTEREST RATE
REGISTERED OWNER:
MATURITY DATE
CUSIP
THIS IS TO CERTIFY THAT the above -referenced registered
owner of this Certificate of Participation (the "Certificate") is
the owner of a proportionate interest in the right to receive
those certain lease payments (the "Lease Payments") to be made by
the City of Newport Beach, California (the "Lessee") pursuant to
that certain Real Property Lease/Purchase Agreement, dated as of
February 15, 1988 (the "Lease"), by and between First Continental
Financial Corporation ("FCFC") and the Lessee. Certain rights of
FCFC in and to the Lease, including its right to receive all
Lease Payments thereunder, have been assigned to Sovran Bank,
N.A., as trustee (the "Trustee"), pursuant to that certain Trust
Indenture (the "Indenture"), dated as of February 15, 1988, by
and between the Trustee, FCFC and the Lessee. Payments of the
principal of and interest on the Certificates are to be dis-
tributed to the registered owners thereof by the Trustee pursuant
to the Indenture.
A-1
The registered owner of this Certificate is entitled to
receive certain amounts (the "Distributions") on each August 15
and February 15 (the "Distribution Dates"), commencing August 15
1988, until the Maturity Date of this Certificate set forth above
(the "Maturity Date"). The total amount of Distributions to be
made with respect to this Certificate shall be equal to the
principal amount of .this Certificate set forth above (the
"Principal Amount") plus interest on such Principal Amount at a
per annum rate equal to the interest rate set forth above (the
"Interest Rate"). Interest on the Principal Amount of this
Certificate shall be included in Distributions made on each
Distribution Date. The entire Principal Amount of this
Certificate shall be included in the final Distribution made on
the Maturity Date. Distributions are payable by check or draft
sent by United States mail, first class postage prepaid, or by
such other method, acceptable to the Trustee, requested by, and
at the risk and expense of, the registered owner, to the
registered owner hereof on the Distribution Dates at the address
on file with the Trustee; provided, that if any Distribution Date
shall not be a Business Day (as such term is defined in the
Indenture), then the Distribution shall be made on the next
succeeding Business Day; and provided further, that the payment
of the final Distributions indicated herein shall be made only
upon presentation and surrender of this Certificate at the
principal corporate trust office of the Trustee in Richmond,
Virginia or at the principal corporate trust office of any
successor Trustee.
This Certificate has been executed and delivered by the
Trustee pursuant to the terms of the Indenture. Copies of the
Indenture are on file at the principal corporate trust office of
the Trustee, and reference is hereby made to the Indenture and
any and all amendments thereto for a description of the security
for the Certificates, the nature, extent and manner of
enforcement of such security, the rights with respect thereto and
the other terms and conditions upon which the Certificates are
delivered thereunder.
To the extent and in the manner permitted by the terms of
the Indenture, the provisions of the Indenture may be amended by
the parties thereto, but no such amendment which would adversely
affect the registered owners of the Certificates shall become
effective as to such registered owners until approved by a
majority in aggregate dollar amount of such registered owners and
the Lessee; and provided further, that without the consent of the
Registered Owners of all Certificates Outstanding no such
amendment shall be made which would: (a) alter the amount or
payment date o -f any Distribution or the redemption provisions
hereof, (b) modify the terms of payment or the right to enforce
payment of the Certificates, or (c) reduce the percentage of
registered owners whose consent is required to modify or amend
the Indenture.
RWA
This Certificate is transferable by the registered owner
hereof, in person, or by his attorney duly authorized in writing,
at the principal corporate trust office of the Trustee, but only
in the manner, subject to the limitations and upon payment of the
charges provided in the Indenture and upon surrender and
cancellation of this Certificate. Upon such transfer a new fully
registered Certificate or Certificates, of the same Maturity Date
and authorized denomination or denominations will be issued to
the transferee in exchange therefor.
The Trustee may treat the registered owner hereof as the
absolute owner hereof for all purposes, and the Trustee shall not
be affected by any notice to the contrary.
The Certificates are subject to redemption, in whole or in
part, prior to their stated maturity as follows:
(i) on any date, without premium, in the event that
the term of the Lease is not renewed due to the failure of the
Lessee to appropriate sufficient funds to pay the Lease Payments
to become due during the next ensuing fiscal period;
(ii) on any date, without premium, in the event that
the Lessee defaults in its obligations under the Lease;
(iii) on any Distribution Date, without premium, in the
event that the Lessee elects to exercise its option to purchase
the Project and pay the applicable Concluding Payment Amount;
and,
(iv) on the earlier of February 15, 1991, or the
Distribution Date next succeeding the acquisition of all of the
Project, if and to the extent there remains any funds on deposit
in the Project Acquisition Fund on such date.
The terms governing the forgoing redemptions and any notice
required therefor are contained in the Indenture. If this
Certificate is called for redemption and payment is duly provided
therefor, as specified in the Indenture, any further payment
shall cease to accrue hereon from and after the date fixed for
redemption.
The Certificates evidence, inter alfa, an undivided and pro-
portionate interest in the Lease Payments paid by the Lessee
under the Lease and enjoy the benefits of the moneys held in
funds and accounts established pursuant to the Indenture, all of
which are subject to the provisions of the Indenture permitting
the application thereof - for or to the purposes and on the terms
A-3
and conditions set forth in the Indenture. THE OBLIGATION OF THE
LESSEE TO PAY LEASE PAYMENTS IS TERMINABLE AT THE SOLE OPTION OF
THE LESSEE AND DOES NOT CONSTITUTE A DEBT OF THE LESSEE OR THE
STATE OF CALIFORNIA WITHIN THE MEANING OF ANY CONSTITUTIONAL OR
STATUTORY LIMITATION NOR A LIABILITY OF OR A LIEN OR CHARGE UPON
FUNDS, OTHER THAN THE OFF STREET PARKING FUND (AS DEFINED IN THE
LEASE) AND CERTAIN FUNDS ESTABLISHED UNDER THE INDENTURE, OR
PROPERTY OF THE LESSEE OTHER THAN THE PROJECT (AS SUCH TERM IS
DEFINED IN THE LEASE), BEYOND ANY FISCAL PERIOD FOR WHICH THE
LESSEE HAS APPROPRIATED MONEYS TO PAY THE LEASE PAYMENTS.
The Trustee has no obligation or liability to the registered
owners of the Certificates for the payment of the Certificates
other than from certain funds established under the Indenture;
the Trustee's sole obligations with respect to such payment are
to administer, for the benefit of the registered owners of the
Certificates, the various funds and accounts established in the
Indenture.
This Certificate is dated:
IN WITNESS WHEREOF, this Certificate has been executed by
the manual signature of a duly authorized officer of the Trustee,
all as of
SOVRAN BANK, N.A., as Trustee
By:
(Authorized Signature)
A-4
ASSIGNMENT
FOR VALUE RECEIVED,
the undersigned do(es) hereby sell, assign, and transfer unto
(Name) (Address)
(Employer
Identification Number or Social Security Number)
the within -mentioned registered Certificate and hereby irrevocably
constitutes) and appoint(s)
attorney, to transfer the same on the Certificate Register of the
Trustee with full power of substitution in the premises.
Dated:
Note: The signature(s) on this Assign-
ment must correspond with the name(s) as
written on the face of the within regis-
tered Certificate in every particular
without alteration or enlargement or any
change whatsoever.
A-5
APPENDIX B
BASE LEASE AGREEMENT
THIS BASE LEASE AGREEMENT (the "Base Lease") is dated as of
February 15, 1988 by and between the City of Newport Beach, a
political subdivision of the State of California (the "City"), and
First Continental Financial Corporation, a corporation organized
and existing under and by virtue of the laws of the State of Texas
("FCFC").
WITNESSETH:
WHEREAS, the City owns certain real property more
particularly described in Exhibit A attached hereto (the "Site")
(together with the improvements now or hereafter placed or
constructed thereon, the "Site");
WHEREAS, the City desires to demolish and remove from the
Site the improvements presently located thereon and to acquire,
construct and operate on the Site a paved, metered parking
facility for the general public (the "Project");
WHEREAS, the City desires to finance its acquisition of the
Site, and in connection therewith, the City proposes to lease the
Project to FCFC and lease -back the Site from FCFC, all as here-
inafter provided; and,
WHEREAS, FCFC desires to finance the acquisition of the
Project by the City in the manner proposed by the City, and in
connection therewith, desires to lease the Site from the City upon
the terms and condition contained herein.
WHEREAS, the City and FCFC have entered into that certain
Real Property Lease/Purchase Agreement (the "Lease/Purchase
Agreement"), dated as of February 15, 1988; and the City, FCFC and
Sovran Bank, N.A., as trustee (the "Trustee") have entered into
that certain Trust Indenture (the "Indenture"), dated as of
February 15, 1988, all for the purpose of giving effect to the
foregoing;
NOW, THEREFORE, for other good
the receipt and sufficiency of which
parties hereto hereby agree as follows:
B-1
and valuable consideration,
is hereby acknowledged, the
Section 1. Lease of the Project. The City hereby leases the
Site to FCFC and FCFC hereby leases and hires the Site from the
City, on the terms and conditions hereinafter set forth.
Section 2. Term. (a) The term of this Base Lease shall
commence upon execution of this Base Lease, and, subject to the
other provisions hereof, shall end on the earliest of the follow-
ing dates:
(i) The day on which that certain Real Property
Lease/Purchase Agreement of even date herewith (the
"Lease/Purchase Agreement") by and between the City and FCFC
shall terminate after payment and performance of all
obligations of the City thereunder, including, without
limitation, the payment of all Lease Payments (as defined
therein);
(ii) The day on which the Lease/Purchase Agreement shall
terminate after exercise by City of its option to purchase
the interest of FCFC therein pursuant to the terms thereof,
and the payment and performance of all obligations of the
City thereunder, including without limitation the payment of
the applicable Concluding Payment Amount (as that term is
defined therein); or,
February 15, 2008.
(b) In the event of a termination of the Lease by the City
due to either a non -appropriation of funds pursuant to Section 7
thereof, or an event of default as defined therein, this Base
Lease shall terminate prior to February 15, 2008, on or after the
date of termination of the Lease, upon receipt by FCFC from the
sublease of FCFC's leasehold interest hereunder of amounts
sufficient to:
(i) reimburse FCFC for all administrative costs and
expenses, including reasonable attorneys fees, incurred by
FCFC as a result of the termination of the Lease and the
sublease of the Project; and
(ii) reimburse FCFC for all capital costs and expenses in
any manner incurred by FCFC with respect to the Project
reasonably necessary in order to render the Project suitable
for sublease for lawful purposes; and
(iii) pay to FCFC an amount which will equal the Concluding
Payment Amount of the Project under the Lease applicable on
February 15 of the fiscal year of the City for which the
Lease remains in effect as well as any other amounts owing
B-2
under the Lease Agreement and unpaid by the City as of the
end of such fiscal year.
(c) The amounts referred to in sub -paragraph (b) above,
shall be known as the "Reimbursement Amount." The Reimbursement
Amount shall be recovered by allowing FCFC first to retain from
any sublease rentals an amount equal to 5% thereof, to allow for
ongoing administrative costs. FCFC shall be entitled to interest
on the outstanding Reimbursement Amount at the rate per annum
necessary to pay interest at the stated rates on all Outstanding
Certificates (as defined in the "Indenture") or in the event that
FCFC shall receive an opinion of an attorney or firm of attorneys
nationally recognized as bond counsel to the effect that such
interest is subject to federal income taxation, as a result of the
default or non -appropriation and the sublease of the Project, at
the highest rate allowed by applicable law during the period of
time from the last Lease Payment made in the last fiscal year of
the City for which the Lease was in effect until the time when the
full Reimbursement Amount is received from sublease rentals, and
any amounts distributed to FCFC pursuant to sub -paragraph (b)
above shall be credited first to the payment of such interest.
(d) In the event that the Lease is terminated by the City
for non -appropriation of funds necessary to pay Lease Payments in
any fiscal year or terminated by FCFC as a result of the
occurrence of an event of default by the City thereunder, any
amounts necessary to comply with the provisions of paragraphs (b)
or (c) above may be paid by the City. In any event, if the
Reimbursement Amount is received by FCFC, and FCFC's interest in
the Project has been subleased to any sublessee pursuant to any
subleases that are still in effect, this Base Lease shall not
terminate but FCFC shall assign and set over to the City all of
FCFC's interest in the Project granted under this Base Lease,
subject to all existing rights created in such sublessees of the
Project by any such subleases.
(e) In the event that the Lease is terminated by the City
for non -appropriation of funds necessary to pay Lease Payments in
any fiscal year or terminated as a result of the occurrence of an
event of default by the City thereunder, FCFC shall keep complete
and accurate records regarding any sublease of the Project and
shall, within thirty (30) days of the end of the fiscal year of
the City, deliver a written report to the City showing:
(i) all amounts received by FCFC from any sublease of the
Project;
(ii) an -analysis as to whether FCFC has received the
Reimbursement Amount, with all supporting calculations; and
B-3
(iii) the date, if any, in the next fiscal year of the City
on which FCFC expects to receive the Reimbursement Amount.
In the event that on the last day of any fiscal year of the
City FCFC has received the Reimbursement Amount, then all
rentals with respect to any sublease of the Project payable
after the close of such fiscal year shall be the property of
the City.
(f) In the event of the termination of this Base Lease and
sublease of the Project by FCFC, the City shall have the right, at
its own expense, to examine FCFC records insofar as they relate to
the Project. Such examination shall be made at FCFC's offices
during normal business hours.
(g) Upon termination of this Base Lease, FCFC shall quit and
surrender the Site in the same good order and condition as the
same was in at the time of commencement of the term hereunder,
reasonable wear and tear excepted. Any permanent improvements and
structures existing upon the Site at the time of termination of
this Base Lease shall remain thereon and title thereto shall vest
in the City.
Section 3. Rental. FCFC shall pay to the City the lump sum
of Dollars ($ )
representing rental in advance for the Site for the term of this
Base Lease which funds have heretofore been deposited in the
Project Acquisition Fund established under the Indenture, and
shall be disbursed for the purposes and is subject to the terms
and conditions set forth in the Indenture.
Section 4. Purpose. FCFC shall use the Site solely for the
purpose of financing the acquisition of the Project by the City,
as well as for such purposes as may be incidental thereto;
provided, that in the event of default by the City under the
Lease/Purchase Agreement or a termination due to non -appropriation
thereunder, FCFC may use the Project for any purpose whatsoever
subject however to Section 2 above.
Section 5. Title. The City covenants that it is the owner in
fee of the Site and that there are no liens or encumbrances
against the Site other than those Permitted Incumbrances described
on Exhibit B attached hereto. City shall promptly obtain for the
FCFC title insurance on the Site in the form of a Leasehold Policy
of Title Insurance in an amount and issued by a title company
acceptable to FCFC.
B-4
Section 6. Assignments and Subleases. FCFC may assign its
rights under this Base Lease or sublet the Site without the
written consent of the City (i) in connection with any assignment
of FCFC's rights under the Lease/Purchase Agreement, or (ii) upon
the occurrence of an event of default under the Lease/Purchase
Agreement.
Section 7. Quiet Enjoyment. The City warrants that FCFC
shall at all times during the term of this Base Lease peaceably
and quietly have, hold and enjoy all of the Site.
Section 8. Leaseback To FCFC. The Lease provides that
contemporaneously with the execution hereof FCFC leases back to
the City and the City leases from FCFC the Site in accordance with
the terms thereof. The Lease includes the option in the City upon
payment of the Concluding Payment Amount or upon completion of all
Lease Payments to purchase FCFC's interest in the Project.
Section 9. Severability. If any one or more of the terms,
provisions, covenants or conditions of this Base Lease shall to
any extent be declared invalid, unenforceable, void or voidable
for any reason whatsoever by a court of competent jurisdiction,
the finding or order or decree of which becomes final, none of the
remaining terms, provisions, covenants and conditions of this Base
Lease shall be affected thereby, and each provision of this Base
Lease shall be valid and enforceable to the fullest extent
permitted by law.
Section 10. Notices. All written notices to be given under
this Base Lease shall be given by mail to the party entitled
thereto at its address set forth in the Lease/Purchase Agreement,
or at such address as the party may provide to the other party in
writing from time to time. Any such notice shall be deemed to
have been received seventy-two (72) hours after deposit in the
United States mail in registered form, with postage fully prepaid.
Section 11. Section Headings. All section headings
contained herein are for convenience of reference only and are not
intended to define or limit the scope of any provision of this
Base Lease.
Section 12. Execution. This Base Lease may be executed in
any number of counterparts, each of which shall be deemed to be an
original but all together shall constitute but one and the same
Lease. It is also agreed that separate counterparts of this Base
Lease may separately be executed by FCFC and City, all with the
B-5
same force and effect as though the same counterpart had been
executed by both FCFC and the City.
Section 13. Successors. This Base Lease shall be binding
upon and inure to the benefit of the parties and their respective
successors and assigns.
IN WITNESS WHEREOF, the City and FCFC have caused this Base
Lease to be executed by their respective officers thereunto duly
authorized, all as of the day and year first above written.
(SEAL)
ATTEST:
NEWPORT BEACH, CALIFORNIA
By:
Name:
Title:
(SEAL) FIRST CONTINENTAL
FINANCIAL CORPORATION
ATTEST:
By:
Authorized Officer
ACKNOWLEDGEMENT
STATE OF TEXAS §
§
COUNTY OF DALLAS §
On this the day of , 1988,
, who acknowledged (him)(her) self
to be an Authorized Officer of First Continental Financial Corpo-
ration and that, in such capacity (he)(she) executed the foregoing
Base Lease Agreement for the purposes set forth herein.
S E A L
WITNESS my hand and official seal.
Notary Public, in and for
said County and State
My commission expires
ACKNOWLEDGEMENT
STATE OF CALIFORNIA §
§
COUNTY OF §
On this the day of #1 1988,
who acknowledged (him)(her) self
to be an Authorized Officer of the City of Newport Beach,
California and that, in such capacity (he)(she) executed the
foregoing Base Lease Agreement for the purposes set forth herein.
S E A L
WITNESS my hand and official seal.
Notary Public, in and for said
County and State
My commission expires
B-7
EXHIBIT A
TO BASE LEASE AGREEMENT
Real Property Description
That certain tract of land lying in the City of Newport
Beach, Orange County, California, and more particularly described
as follows:
PARCEL 1:
Lots 12, 13, 14, 15, 16 and 17 in Block 230 of Lancaster's
Addition to Newport Beach, as shown on a map recorded in Book
5, Page 14 of Miscellaneous Maps, in the Office of the County
Recorder of said county.
Except the Westerly 12.5 feet of said Lot 17.
A portion of said land is included within the area shown on a
map filed in Book 94, Page 7 of Parcel Maps, in the Office of
the County Recorder of said county.
PARCEL 2:
An Easement for driveway purposes over the Westerly 12.5 feet
of Lot 17 in Block 230 of Lancaster's Addition to Newport
Beach, as per map recorded in Book 5, Page 14 of
Miscellaneous Maps, in the Office of the County Recorder of
said county.
am
EXHIBIT B
TO BASE LEASE AGREEMENT
Permitted Encumbrances
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INVESTMENT AGREEMENT
THIS INVESTMENT AGREEMENT (this "Agreement") is dated as of
the 15th day of February, 1988, by and between Provident Bank -
Dallas, Dallas, Texas ("the "Bank"), and First Continental
Financial Corporation, a Texas corporation ("FCFC").
WITNESSETH:
WHEREAS, FCFC and the City of Newport Beach, California,
(the "Lessee") have entered into that certain Real Property
Lease/Purchase Agreement, dated as of February 15, 1988 (the
"Lease") whereby FCFC has agreed to provide moneys for the
acquisition of a paved metered parking facility for use by the
general public (the "Project") described therein and to sell the
Project to the City;
WHEREAS, the City has agreed to purchase the Equipment from
FCFC and to make ten (10) semi-annual lease payments (the "Lease
Payments") all in the manner and upon the terms and conditions
set forth in the Lease;
WHEREAS, pursuant to the Lease the City has agreed to make
sixty (60) monthly lease payment deposits (the "Lease Deposits")
which together with interest earnings thereon will be used to
make the Lease Payments on the respective lease payment dates;
WHEREAS, the Lease Deposits will be remitted to the Sovran
Bank, N.A., as Trustee (the "Trustee"); under that certain Trust
Indenture, dated the date hereof, and credited to the Certificate
Fund required to be established thereunder;
WHEREAS, FCFC, for the benefit of the City, desires to
employ the Bank to provide for the investment of a portion of the
Lease Deposits from the date of deposit and thereby provide for a
minimum acceptable fixed rate of return for such investment;
WHEREAS, the Bank desires to be so employed pursuant to the
terms and conditions contained herein; and
WHEREAS, each of the parties hereto has authority to enter
into this Agreement and has taken all actions necessary to
authorize its execution by its officers signing it.
NOW THEREFORE, for good and valuable consideration the
receipt and sufficiency of which is hereby acknowledged, the
parties hereto hereby agree as follows:
7.02 (a)
ARTICLE I
AGREEMENT TO INVEST LEASE DEPOSITS
Section 1.01. Agreement to Disburse and Invest Lease
Deposits. The Bank hereby agrees to accept funds from the
Trustee, or from Provident Bank - Dallas, Dallas, Texas on behalf
of the Trustee from time to time during the term of this
Agreement and to invest such funds, as provided below; provided,
however, at no time shall the aggregate face amount of the total
funds invested hereunder, exceed $100,000. (It is anticipated
that funds deposited hereunder will be on or about the dates on
Appendix "A" hereto.)
Section 1.02. Monev Market Account. (a) FCFC shall
instruct the Trustee to remit a portion of the Lease Deposits
when due to .the Bank for deposit to a money market account (the
"Account") to be maintained at the Bank in the name of the Sovran
Bank, N.A., as Trustee, on behalf of the Registered Owners of the
Certificates of Participation - Lease Rentals (Newport Beach
Parking Facility)."
(b) Balances in the Account shall accrue interest at the
rate of 7.25% per annum.
Section 1.03. Transfers to Trustee. Without further notice
or instruction, the Bank shall exercise its best efforts to remit
by wire transfer to the Trustee on the business day immediately
preceding August 15, 1988 and each February 15, and August 15,
thereafter during the term hereof the amount set forth on
Appendix "A" hereto; provided however, if the Bank has on deposit
on such date insufficient funds to transfer the full amount set
forth on Appendix "A," then the Bank shall transfer all funds on
deposit in the Account.
Section 1.04. Supplemental Instructions. If the Bank
receives written notice from an Authorized Officer of FCFC
requesting that funds be transferred to the Trustee on a date or
in an amount other than as set forth on Appendix "A," then the
Bank hereby agrees to make such transfer on the date set forth in
such written notice. As used herein "Authorized Officer" shall
mean Barbara A. Friedman or another person so designated in
writing by FCFC.
Section 1.05. Book Entries and Certificates. The Bank
shall maintain adequate books and records showing the statement
of account for the Account.
Ira
Section 1.06. Indemnification of Bank. FCFC shall and
hereby agrees to indemnify and save the Bank harmless from and
against all claims, losses and damages, including legal fees and
expenses, arising out of (i) the use, maintenance, condition or
management of, or from any work or thing done in connection with,
the Equipment by the City, or (ii) any act of negligence of the
City or FCFC or of any of their officers, agents, contractors,
servants, employees, licensees or invitees in connection with the
Equipment. Indemnification for any tort mentioned in this Sec-
tion shall be limited to the extent and amounts permitted by law.
No indemnification will be made under this Section or elsewhere
in this Agreement for willful misconduct, gross negligence or
breach of duty under this Agreement by the Bank, or its officers,
agents, employees, successors and assigns.
Section 1.07. Term of Agreement. Unless earlier terminated
by the written agreement of the parties hereto, this Agreement
shall terminate on February 15, 1991. The total withdrawal of
all balances in the Account prior to February 15, 1991 shall not
in and of itself terminate this Agreement.
ARTICLE II
AMENDMENT; ADMINISTRATIVE PROVISIONS
Section 2.01. Amendment. The provisions of this Investment
Agreement may be amended in writing by agreement between both of
the parties hereto and acknowledged by the City.
Section 2.02. Assignment. The rights and duties of the
Bank under this Agreement shall not be assignable to any other
person or entity without the written consent of FCFC. The Bank
hereby acknowledges that FCFC has assigned its rights, title and
interest under this Investment Agreement to the Registered Owners
from time -to -time of the Certificates of Participation issued
under the Agreement.
Section 2.03. Notices. All written notices to be given
under this Agreement shall be given by mail to the party entitled
thereto at its address set forth below, or at such address as the
party may provide to the other party in writing from time to
time. Any such notice shall be deemed to have been received 72
hours after deposit in the United States mail in registered
form, with postage fully prepaid.
Addresses for Notices: TO: FCFC First Continental Financial
Corporation
8080 North Central
Expressway, Suite 850
Dallas, Texas 75206
Attn: Barry L. Friedman
-3-
TO: Bank Provident Bank - Dallas,
5429 LBJ Freeway
Lockbox 106
Dallas, Texas 75240
TO: Lessee City of Newport Beach
3300 Newport Boulevard
P.O. Box 1768
Newport Beach, California
Attn: Planning Department
TO: Trustee Sovran Bank, N.A.
707 E. Main Street, 3rd Flr
Richmond, Virginia 23219
Attn: Corporate Trust Dept
If by wire transfer to ABA
Routing #051000017, Attn:
Robert G. Horner, Corporate
Trust Department for
deposit to the City of
Newport Beach, California
Certificate Fund.
Section 2.04. Texas Law. This Agreement shall be construed
and governed in accordance with the laws of the State of Texas
and the United States of America.
Section 2.05. Severability. Any provision of this
Agreement found to be prohibited by law shall be ineffective only
to the extent of such prohibition, and shall not invalidate the
remainder of this Agreement.
Section 2.06. Binding on Successors. Subject to the
provisions of Section 2.02, this Agreement shall be binding upon
and inure to the benefit of the parties and their respective
successors and assigns.
Section 2.07. Headings. Heading preceding the text of the
Articles and Sections hereof are solely for convenience of
reference and shall not constitute a part of this Agreement or
affect its meaning, construction or effect.
-4-
IN WITNESS WHEREOF, the parties hereto have executed this
Investment Agreement by their officers thereunto duly authorized
as of the date and year first above written.
PROVIDENT BANK - DALLAS
By:
(Signature)
Name:
(Please Type)
Title:
(Please Type)
FIRST CONTINENTAL FINANCIAL
CORPORATION
By: r
Authorized Officer
-5-
j
Section Z _ 07 _ ntadimclu Reading the tart of the
zr-t�e!a and Sectio¢s hereof are solely for EmLience of
reference and sba31 not constitute a part of t7ls Agrecommt or
affect its seating, on or effect_
ISS iF, the parties hereto hale t this
s by their officers duly aaYtborized
as of the date and year first above writtelx_
ENT
(Signatsre;
Nastez Nils L_ Nlrstx+
(Pleas 'type)
Title z wive Vice Pzaat
(please Type;
• .a• a ; .-W ;
by=
itst Crised Qf C. -
-5-
APPENDIX A
TO
INVESTMENT AGREEMENT
(PROVIDENT BANK -DALLAS)
7.25%
PAYMENT
INTEREST
FUND
NUMBER
DATE
DEPOSIT
INCOME
---------
TRANSFER
---------
BALANCE
.......--
-------
1
---------
3/15/88
---------
1,389.35
0.00
1,389.35
2
4/15/88
1,369.35
8.39
2,767.09
3
5/15/88
1,369.35
16.72
4,153.16
4
6/15/88
1,369.35
25.09
5,547.60
5
7/15/88
1,369.35
33.52
6,950.47
6
8/15/88
1,369.35
41.99
2,150.12
6,211.69
7
9/15/88
1,369.35
37.53
7,618.57
8
10/15/88
1,369.35
46.03
9,033.95
9
11/15/88
1,369.35
54.58
10,457.88
10
12/15/88
1,369.35
63.18
11,890.41
11
1/15/89
1,369.35
71.84
13,331.60
12
2/15/89
1,369.35
80.55
14,630.25
151.25
13
3/15/89
1,369.35
0.91
1,521.51
14
4/15/89
1,369.35
9.19
2,900.05
15
5/15/89
1,369.35
17.52
4,286.92
16
6/15/89
1,369.35
25.90
5,682.17
17
7/15/89
1,369.35
34.33
7,085.85
18
8/15/89
1,369.35
42.81
1,767.75
6,730.26
19
9/15/89
1,369.35
40.66
8,140.28
20
10/15/89
1,369.35
49.18
9,558.81
21
11/15/89
1,369.35
57.75
10,985.91
22
12/15/89
1,369.35
66.37
12,421.63
23
1/15/90
1,369.35
75.05
13,866.03
24
2/15/90
1,369.35
83.77
15,267.75
51.40
25
3/15/90
1,369.35
0.31
1,421.06
26
4/15/90
1,369.35
8.59
2,799.00
27
5/15/90
1,369.35
16.91
4,185.26
28
6/15/90
1,369.35
25.29
5,579.90
29
7/15/90
1,369.35
33.71
6,982.96
30
8/15/90
1,369.35
42.19
1,356.00
7,038.50
31
9/15/90
1,369.35
42.52
8,450.37
32
10/15/90
1,369.35
51.05
9,870.78
33
11/15/90
1,369.35
59.64
11,299.76
34
12/15/90
1,369.35
68.27
12,737.38
35
1/15/91
1,369.35
76.96
14,183.69
36
2/15/91
1,369.35
85.69
15,356.00
282.73
37
3/15/91
1,369.35
1.71
1,653.79
38
4/15/91
1,369.35
9.99
3,033.13
39
5/15/91
1,369.35
18.33
4,420.80
40
6/15/91
1,369.35
26.71
5,816.86
41
7/15/91
1,369.35
35.14
7,221.36
42
8/15/91
1,369.35
43.63
918.50
7,715.84
43
9/15/91
1,369.35
46.62
9,131.80
44
10/15/91
1,369.35
55.17
10,556.32
45
11/15/91
1,369.35
63.78
11,989.45
APPENDIX A
TO
INVESTMENT AGREEMENT
(PROVIDENT BANK -DALLAS
7.25%
PAYMENT
INTEREST
FUND
NUMBER
DATE
DEPOSIT
INCOME
---------
TRANSFER
---------
BALANCE
---------
-------
46
---------
12/15/91
---------
1,369.35
72.44
13,431.24
47
1/15/92
1,369.35
81.15
14,881.73
48
2/15/92
1,369.35
89.91
15,918.50
422.49
49
3/15/92
1,369.35
2.55
1,794.40
50
4/15/92
1,369.35
10.84
3,174.59
51
5/15/92
1,369.35
19.18
41563.12
52
6/15/92
1,369.35
27.57
51960.04
53
7/15/92
1,369.35
36.01
7,365.40
54
8/15/92
1,369.35
44.50
438.50
8,340.74
55
9/15/92
1,369.35
50.39
91760.49
56
10/15/92
1,369.35
58.97.
11,188.81
57
11/15/92
1,369.35
67.60
12,625.76
58
12/15/92
1,369.35
76.28
14,071.39
59
1/15/93
1,369.35
85.01
15,525.75
60
2/15/93
1,369.35
93.80
16,988.50
0.40
APPENDIX B
TO
INVESTMENT AGREEMENT
(PROVIDENT BANK-DENTDN
7.25%
PAYMENT
INTEREST
FUND
NUMBER
DATE
DEPOSIT
INCOME
---------
TRANSFER
---------
BALANCE
.........
.......
1
.........
3/15/88
.........
6,252.12
0.00
6,252.12
2
4/15/88
6,162.12
37.77
12,452.01
3
5/15/88
6,162.12
75.23
18,689.36
4
6/15/88
6,162.12
112.91
24,964.40
5
7/15/88
6,162.12
150.83
31,277.35
6
8/15/88
6,162.12
188.97
9,675.57
27,952.86
7
9/15/88
6,162.12
168.88
34,283.86
8
10/15/88
6,162.12
207.13
40,653.12
9
11/15/88
6,162.12
245.61
47,060.85
10
12/15/88
6,162.12
284.33
53,507.30
11
1/15/89
6,162.12
323.27
59,992.69
12
2/15/89
6,162.12
362.46
65,836.13
681.13
13
3/15/89
6,162.12
4.12
6,847.37
14
4/15/89
6,162.12
41.37
13,050.86
15
5/15/89
6,162.12
78.85
19,291.83
16
6/15/89
6,162.12
116.55
25,570.50
17
7/15/89
6,162.12
154.49
31,887.11
18
8/15/89
6,162.12
192.65
7,954.88
30,287.00
19
9/15/89
6,162.12
182.98
36,632.11
20
10/15/89
6,162.12
221.32
43,015.55
21
11/15/89
6,162.12
259.89
49,437.55
22
12/15/89
6,162.12
298.69
55,898.36
23
1/15/90
6,162.12
337.72
62,398.20
24
2/15/90
6,162.12
376.99
68,704.88
232.42
25
3/15/90
6,162.12
1.40
6,395.95
26
4/15/90
6,162.12
38.64
12,596.71
27
5/15/90
6,162.12
76.11
18,834.94
28
6/15/90
6,162.12
113.79
25,110.85
29
7/15/90
6,162.12
151.71
31,424.68
30
8/15/90
6,162.12
189.86
6,102.00
31,674.66
31
9/15/90
6,162.12
191.37
38,028.15
32
10/15/90
6,162.12
229.75
44,420.02
33
11/15/90
6,162.12
268.37
50,850.51
34
12/15/90
6,162.12
307.22
57,319.85
35
1/15/91
6,162.12
346.31
63,828.28
36
2/15/91
6,162.12
385.63
69,102.00
1,274.03
37
3/15/91
6,162.12
7.70
7,443.85
38
4/15/91
6,162.12
44.97
13,650.94
39
5/15/91,
6,162.12
82.47
19,895.53
40
6/15/91
6,162.12
120.20
26,177.86
41
7/15/91
6,162.12
158.16
32,498.13
42
8/15/91
6,162.12
196.34
4,133.25
34,723.35
43
9/15/91
6,162.12
209.79
41,095.25
44
10/15/91
6,162.12
248.28
47,505.66
45
11/15/91
6,162.12
287.01
53,954.79
APPENDIX B
TO
INVESTMENT AGREEMENT
PROVIDENT BANK-DENTON
7.25%
PAYMENT
INTEREST
FUND
NUMBER
DATE
DEPOSIT
---------
INCOME
---------
TRANSFER
.........
BALANCE
---------
-------
46
---------
12/15/91
6,162.12
325.98
60,442.89
47
1/15/92
6,162.12
365.18
66,970.18
48
2/15/92
6,162.12
404.61
71,633.25
1,903.67
49
3/15/92
6,162.12
11.50
8,077.29
50
4/15/92
6,162.12
48.80
14,288.21
51
5/15/92
6,162.12
86.32
20,536.65
52
6/15/92
6,162.12
124.08
26,822.85
53
7/15/92
6,162.12
162.05
33,147.02
54
8/15/92
6,162.12
200.26
1,973.25
37,536.16
55
9/15/92
6,162.12
226.78
43,925.06
56
10/15/92
6,162.12
265.38
50,352.56
57
11/15/92
6,162.12
304.21
56,818.89
58
12/15/92
6,162.12
343.28
63,324.29
59
1/15/93
6,162.12
382.58
69,869.00
60
2/15/93
6,162.12
422.13
76,448.25
4.99
APPENDIX .0
TO
INVESTMENT AGREEMENT
(DESOTO STATE BANK
7.25%
PAYMENT
INTEREST
FUND
NUMBER
DATE
DEPOSIT
INCOME
TRANSFER
---------
BALANCE
---------
-------
1
---------
3/15/88
.........
6,252.12
.........
0.00
6,252.12
2
4/15/88
6,162.12
37.77
12,452.01
3
5/15/68
6,162.12
75.23
18,689.36
4
6/15/88
6,162.12
112.91
24,964.40
5
7/15/88
6,162.12
150.83
'31,277.35
6
8/15/88
6,162.12
188.97
9,675.56
27,952.87
7
9/15/88
6,162.12
168.88
34,283.87
8
10/15/88
6,162.12
207.13
40,653.13
9
11/15/88
6,162.12
245.61
47,060.86
10
12/15/88
6,162.12
284.33
53,507.31
11
1/15/89
6,162.12
323.27
59,992.70
12
2/15/89
6,162.12
362.46
65,836.12
681.15
13
3/15/89
6,162.12
4.12
6,847.39
14
4/15/89
6,162.12
41.37
13,050.88
15
5/15/89
6,162.12
78.85
19,291.85
16
6/15/89
6,162.12
116.55
25,570.52
17
7/15/89
6,162.12
154.49
31,887.13
18
8/15/89
6,162.12
192.65
7,954.87
30,287.03
19
9/15/89
6,162.12
182.98
36,632.14
20
10/15/89
6,162.12
221.32
43,015.58
21
11/15/89
6,162.12
259.89
49,437.58
22
12/15/89
6,162.12
298.69
55,898.39
23
1/15/90
6,162.12
337.72
62,398.23
24
2/15/90
6,162.12
376.99
68,704.87
232.47
25
3/15/90
6,162.12
1.40
6,395.99
26
4/15/90
6,162.12
38.64
12,596.75
27
5/15/90
6,162.12
76.11
18,834.98
28
6/15/90
6,162.12
113.79
25,110.89
29
7/15/90
6,162.12
151.71
31,424.73
30
8/15/90
6,162.12
189.86
6,102.00
31,674.70
31
9/15/90
6,162.12
191.37
38,028.19
32
10/15/90
6,162.12
229.75
44,420.06
33
11/15/90
6,162.12
268.37
50,850.56
34
12/15/90
6,162.12
307.22
57,319.90
35
1/15/91
6,162.12
346.31
63,828.33
36
2/15/91
6,162.12
385.63
69,102.00
1,274.08
37
3/15/91
6,162.12
7.70
7,443.89
38
4/15/91
6,162.12
44.97
13,650.99
39
5/15/91
6,162.12
82.47
19,895.58
40
6/15/91
6,162.12
120.20
26,177.90
41
7/15/91
6,162.12
158.16
32,498.18
42
8/15/91
6,162.12
196.34
4,133.25
34,723.39
43
9/15/91
6,162.12
209.79
41,095.30
44
10/15/91
6,162.12
248.28
47,505.71
45
11/15/91
6,162.12
287.01
53,954.84
APPENDIX .0
TO
INVESTMENT AGREEMENT
( DESOTO STATE BANK
7.25%
PAYMENT
INTEREST
FUND
NUMBER
DATE
DEPOSIT
INCOME
.........
TRANSFER
---------
BALANCE
---------
-------
46
---------
12/15/91
---------
6,162.12
325.98
60,442.94
47
1/15/92
6,162.12
365.18
66,970.23
48
2/15/92
6,162.12
404.61
71,633.25
1,903.71
49
3/15/92
6,162.12
11.50
8,077.34
50
4/15/92
6,162.12
48.80
-14,288.26
51
5/15/92
6,162.12
86.32
20,536.70
52
6/15/92
6,162.12
124.08
26,822.90
53
7/15/92
6,162.12
162.06
33,147.07
54
8/15/92
6,162.12
200.26
1,973.25
37,536.21
55
9/15/92
6,162.12
226.78
43,925.11
56
10/15/92
6,162.12
265.38
50,352.61
57
11/15/92
6,162.12
304.21
56,818.94
58
12/15/92
6,162.12
343.28
63,324.34
59
1/15/93
6,162.12
382.58
69,869.05
60
2/15/93
6,162.12
422.13
76,448.25
5.04
INVESTMENT AGREEMENT
THIS INVESTMENT AGREEMENT (this "Agreement") is dated as of
the 15th day of February, 1988, by and between Provident Bank -
Denton, Denton, Texas ("the "Bank"), and First Continental
Financial Corporation, a Texas corporation ("FCFC").
WITNESSETH:
WHEREAS, FCFC and the Newport Beach, California, (the
"Lessee") have entered into that certain Real Property
Lease/Purchase Agreement, dated as of February 15, 1988 (the
"Lease") whereby FCFC has agreed to provide moneys for the
acquition of a paved, metered parking facility for use by the
general public (the "Project") described therein and to sell the
Project to the City;
WHEREAS, the City has agreed to purchase the Equipment from
FCFC and to make ten (10) semi-annual lease payments (the "Lease
Payments") all in the manner and upon the terms and conditions
set forth in the Lease;
WHEREAS, pursuant to the Lease the City has agreed to make
sixty (60) monthly lease payment deposits (the "Lease Deposits")
which together with interest earnings thereon will be used to
make the Lease Payments on the respective lease payment dates;
WHEREAS, the Lease Deposits will be remitted to the Sovran
Bank, N.A., as Trustee (the "Trustee"); under that certain
Trust Indenture, dated the date hereof, and credited to the
Certificate Fund required to be established thereunder;
WHEREAS, FCFC, for the benefit of the City, desires to
employ the Bank to provide for the investment of a portion of the
Lease Deposits from the date of deposit and thereby provide for a
minimum acceptable fixed rate of return for such investment;
WHEREAS, the Bank desires to be so employed pursuant to the
terms and conditions contained herein; and
WHEREAS, each of the parties hereto has authority to enter
into this Agreement and has taken all actions necessary to
authorize its execution by its officers signing it.
NOW THEREFORE, for good and valuable consideration the
receipt and sufficiency of which is hereby acknowledged, the
parties hereto hereby agree as follows:
7.02(b)
ARTICLE I
AGREEMENT TO INVEST LEASE DEPOSITS
Section 1.01. Agreement to Disburse and Invest Lease
Deposits. The Bank hereby agrees to accept funds from the
Trustee, or from Provident Bank - Dallas, Dallas, Texas on behalf
of the Trustee from time to time during the term of this
Agreement and to invest such funds, as provided below; provided,
however, at no time shall the aggregate face amount of the total
funds invested hereunder, exceed $100,000. (It is anticipated
that funds deposited hereunder will be on or about the dates on
Appendix "A" hereto.)
Section 1.02. Money Market Account. (a) FCFC shall
instruct the Trustee to remit a portion of the Lease Deposits
when due to the Bank for deposit to a money market account (the
"Account") to be maintained at the Bank in the name of the Sovran
Bank, N.A., as Trustee, on behalf of the Registered Owners of the
Certificates of Participation - Lease Rentals (Newport Beach
Parking Facility)."
(b) Balances in the Account shall accrue interest at the
rate of 7.25% per annum.
Section 1.03. Transfers to Trustee. Without further notice
or instruction, the Bank shall exercise its best efforts to remit
by wire transfer to the Trustee on the business day immediately
preceding August 15, 1988 and each February 15, and August 15,
thereafter during the term hereof the amount set forth on
Appendix "A" hereto; provided however, if the Bank has on deposit
on such date insufficient funds to transfer the full amount set
forth on Appendix "A," then the Bank shall transfer all funds on
deposit in the Account.
Section 1.04. Supplemental Instructions. If the Bank
receives written notice from an Authorized Officer of FCFC
requesting that funds be transferred to the Trustee on a date or
in an amount other than as set forth on Appendix "A," then the
Bank hereby agrees to make such transfer on the date set forth in
such written notice. As used herein "Authorized Officer" shall
mean Barbara A. Friedman or another person so designated in
writing by FCFC.
Section 1.05. Book Entries and Certificates. The Bank
shall maintain adequate books and records showing the statement
of account for the Account.
Section 1.06. Indemnification of Bank. FCFC shall and
hereby agrees to indemnify and save the Bank harmless from and
against all claims, losses and damages, including legal fees and
expenses, arising out of (i) the use, maintenance, condition or
management of, or from any work or thing done in connection with,
the Equipment by the City, or (ii) any act of negligence of the
City or FCFC or of any of their officers, agents, contractors,
servants, employees, licensees or invitees in connection with the
Equipment. Indemnification for any tort mentioned in this Sec-
tion shall be limited to the extent and amounts permitted by law.
No indemnification will be made under this Section or elsewhere
in this Agreement for willful misconduct, gross negligence or
breach of duty under this Agreement by the Bank, or its officers,
agents, employees, successors and assigns.
Section 1.07. Term of Agreement. Unless earlier terminated
by the written agreement of the parties hereto, this Agreement
shall terminate on February 15, 1991. The total withdrawal of
all balances in the Account prior to February 15, 1991 shall not
in and of itself terminate this Agreement.
ARTICLE II
AMENDMENT; ADMINISTRATIVE PROVISIONS
Section 2.01. Amendment. The provisions of this Investment
Agreement may be amended in writing by agreement between both of
the parties hereto and acknowledged by the City.
Section 2.02. Assignment. The rights and duties of the
Bank under this Agreement shall not be assignable to any other
person or entity without the written consent of FCFC. The Bank
hereby acknowledges that FCFC has assigned its rights, title and
interest under this Investment Agreement to the Registered Owners
from time -to -time of the Certificates of Participation issued
under the Agreement.
Section 2.03. Notices. All written notices to be given
under this Agreement shall be given by mail to the party entitled
thereto at its address set forth below, or at such address as the
party may provide to the other party in writing from time to
time. Any such notice shall be deemed to have been received 72
hours after deposit in the United States mail in registered
form, with postage fully prepaid.
Addresses for Notices: TO: FCFC First Continental Financial
Corporation
8080 North Central
Expressway, Suite 850
Dallas, Texas 75206
Attn: Barry L. Friedman
TO: Bank Provident Bank - Denton
P.O. Box 50599
Denton, Texas 75206-0599
TO: Lessee City of Newport Beach
3300 Newport Boulevard
P.O. Box 1768
Newport Beach, California
Attn: Planning Department
TO: Trustee Sovran Bank, N.A.
707 E. Main Street, 3rd Flr
Richmond, Virginia 23219
Attn: Corporate Trust Dept
If by wire transfer to ABA
Routing #051000017, Attn:
Robert G. Horner, Corporate
Trust Department for
deposit to the City of
Newport Beach, California
Certificate Fund.
Section 2.04. Texas Law. This Agreement shall be construed
and governed in accordance with the laws of the State of Texas
and the United States of America.
Section 2.05. Severability. Any provision of this
Agreement found to be prohibited by law shall be ineffective only
to the extent of such prohibition, and shall not invalidate the
remainder of this Agreement.
Section 2.06. Binding on Successors. Subject to the
provisions of Section 2.02, this Agreement shall be binding upon
and inure to the benefit of the parties and their respective
successors and assigns.
Section 2.07. Headings. Heading preceding the text of the
Articles and Sections hereof are solely for convenience of
reference and shall not constitute a part of this Agreement or
affect its meaning, construction or effect.
IN WITNESS WHEREOF, the parties hereto have executed this
Investment Agreement by their officers thereunto duly authorized
as of the date and year first above written.
PROVIDENT BANK - DENTON
By:
(Signature)
Name:
Title:
(Please Type)
(Please Type)
FIRST CONTINENTAL FINANCIAL
CORPORATION
By:
Authorized Officer
ii,, Wrn=S MM73MVthe psrt;ieg bNMM- OMM=tAd this
Is�es#srat by tbeir of�ts7s t�a
as of the data and year fJxst above uriit m.
- !P
Mies rromidowt s csa
(Please -
_5..
APPENDIX A
TO
INVESTMENT AGREEMENT
PROVIDENT BANK-DENTON
7.25%
PAYMENT
INTEREST
FUND
NUMBER
-------
DATE
---------
DEPOSIT
---------
INCOME
---------
TRANSFER
BALANCE
1
3/15/88
6,252.12
0.00
---------
---------
6,252.12
2
4/15/88
6,162.12
37.77
12,452.01
3
5/15/88
6,162.12
75.23
18,689.36
4
6/15/88
6,162.12
112.91
24,964.40
5
7/15/88
6,162.12
150.83
31,277.35
6
8/15/88
6,162.12
188.97
9,675.57
27,952.86
7
9/15/88
6,162.12
168.88
34,283.86
8
10/15/88
6,162.12
207.13
40,653.12
9
11/15/88
6,162.12
245.61
47,060.85
10
12/15/88
6,162.12
284.33
53,507.30
11
1/15/89
6,162.12
323.27
59,992.69
12
2/15/89
6,162.12
362.46
65,836.13
681.13
13
3/15/89
6,162.12
4.12
6,847.37
14
4/15/89
6,162.12
41.37
13,050.86
15
5/15/89
6,162.12
78.85
19,291.83
16
6/15/89
6,162.12
116.55
25,570.50
17
7/15/89
6,162.12
154.49
31,887.11
18
8/15/89
6,162.12
192.65
7,954.88
30,287.00
19
9/15/89
6,162.12
182.98
36,632.11
20
10/15/89
6,162.12
221.32
43,015.55
21
11/15/89
6,162.12
259.89
49,437.55
22
12/15/89
6,162.12
298.69
55,898.36
23
1/15/90
6,162.12
337.72
62,398.20
24
2/15/90
6,162.12
376.99
68,704.88
232.42
25
3/15/90
6,162.12
1.40
6,395.95
26
4/15/90
6,162.12
38.64
12,596.71
27
5/15/90
6,162.12
76.11
18,834.94
28
6/15/90
6,162.12
113.79
25,110.85
29
7/15/90
6,162.12
151.71
31,424.68
30
8/15/90
6,162.12
189.86
6,102.00
31,674.66
31
9/15/90
6,162.12
191.37
38,028.15
32
10/15/90
6,162.12
229.75
44,420.02
33
11/15/90
6,162.12
268.37
50,850.51
34
12/15/90
6,162.12
307.22
57,319.85
35
1/15/91
6,162.12
346.31
63,828.28
36
2/15/91
6,162.12
385.63
69,102.00
1,274.03
37
3/15/91
6,162.12
7.70
7,443.85
38
4/15/91
6,162.12
44.97
13,650.94
39
5/15/91
6,162.12
82.47
19,895.53
40
6/15/91
6,162.12
120.20.
26,177.86
41
7/15/91
6,162.12
158.16
32,498.13
42
8/15/91
6,162.12
196.34
4,133.25
34,723.35
43
9/15/91
6,162.12
209.79
41,095.25
44
10/15/91
6,162.12
248.28
47,505.66
45
11/15/91
6,162.12
287.01
53,954.79
APPENDIX A
TO
INVESTMENT AGREEMENT
PROVIDENT BANK-DENTON
7.25%
PAYMENT
INTEREST
FUND
NUMBER
-------
DATE
---------
DEPOSIT
---------
INCOME
---------
TRANSFER
BALANCE
46
12/15/91
6,162.12
325.98
---------
---------
60,442.89
47
1/15/92
6,162.12
365.18
66,970.18
48
2/15/92
6,162.12
404.61
71,633.25
1,903.67
49
3/15/92
6,162.12
11.50
81077.29
50
4/15/92
6,162.12
48.80
14,288.21
51
5/15/92
6,162.12
86.32
20,536.65
52
6/15/92
6,162.12
124.08
26,822.85
53
7/15/92
6,162.12
162.05
33,147.02
54
8/15/92
6,162.12
200.26
1,973.25
37,536.16
55
9/15/92
6,162.12
226.78
43,925.06
56
10/15/92
6,162.12
265.38
50,352.56
57
11/15/92
6,162.12
304.21
56,818.89
58
12/15/92
6,162.12
343.28
63,324.29
59
1/15/93
6,162.12
382.58
69,869.00
60
2/15/93
6,162.12
422.13
76,448.25
4.99
INVESTMENT AGREEMENT
THIS INVESTMENT AGREEMENT (this "Agreement") is dated as of
the 15th day of February, 1988, by and between Desoto State Bank,
Desoto, Texas ("the "Bank"), and First Continental Financial
Corporation, a Texas corporation ("FCFC").
WITNESSETH:
WHEREAS, FCFC and the Newport Beach, California, (the
"Lessee") have entered into that certain Real Property
Lease/Purchase Agreement, dated as of February 15, 1988 (the
"Lease") whereby FCFC has agreed to provide moneys for the
acquition of a paved, metered parking facility for use by the
general public (the "Project") described therein and to sell the
Project to the City;
WHEREAS, the City has agreed to purchase the Equipment from
FCFC and to make ten (10) semi-annual lease payments (the "Lease
Payments") all in the manner and upon the terms and conditions
set forth in the Lease;
WHEREAS, pursuant to the Lease the City has agreed to make
sixty (60) monthly lease payment deposits (the "Lease Deposits")
which together with interest earnings thereon will be used to
make the Lease Payments on the respective lease payment dates;
WHEREAS, the Lease Deposits will be remitted to the Sovran
Bank, N.A., as Trustee (the "Trustee"); under that certain Trust
Indenture, dated the date hereof, and credited to the Certificate
Fund required to be established thereunder;
WHEREAS, FCFC, for the benefit of the City, desires to
employ the Bank to provide for the investment of a portion of the
Lease Deposits from the date of deposit and thereby provide for a
minimum acceptable fixed rate of return for such investment;
WHEREAS, the Bank desires to be so employed pursuant to the
terms and conditions contained herein; and
WHEREAS, each of the parties hereto has authority to enter
into this Agreement and has taken all actions necessary to
authorize its execution by its officers signing it.
NOW THEREFORE,. for good and valuable consideration the
receipt and sufficiency of which is hereby acknowledged, the
parties hereto hereby agree as follows:
7.02 (c)
ARTICLE I
AGREEMENT TO INVEST LEASE DEPOSITS
Section 1.01. Agreement to Disburse and Invest Lease
Deposits. The Bank hereby agrees to accept funds from the
Trustee, or from the Provident Bank - Dallas, Dallas, Texas on
behalf of the Trustee from time to time during the term of this
Agreement and to invest such funds, as provided below; provided,
however, at no time shall the aggregate face amount of the total
funds invested hereunder, exceed $100,000. (It is anticipated
that funds deposited hereunder will be on or about the dates on
Appendix "A" hereto.)
Section 1.02. Money Market Account. (a) FCFC shall
instruct the Trustee to remit a portion of the Lease Deposits
when due to the Bank for deposit to a money market account (the
"Account") to be maintained at the Bank in the name of the Sovran
Bank, N.A., as Trustee, on behalf of the Registered Owners of the
Certificates of Participation - Lease Rentals (Newport Beach
Parking Facility)."
(b) Balances in the Account shall accrue interest at the
rate of 7.25% per annum.
Section 1.03. Transfers to Trustee. Without further notice
or instruction, the Bank shall exercise its best efforts to remit
by wire transfer to the Trustee on the business day immediately
preceding August 15, 1988 and each February 15, and August 15,
thereafter during the term hereof the amount set forth on
Appendix "A" hereto; provided however, if the Bank has on deposit
on such date insufficient funds to transfer the full amount set
forth on Appendix "A," then the Bank shall transfer all funds on
deposit in the Account.
Section 1.04. Supplemental Instructions. If the Bank
receives written notice from an Authorized Officer of FCFC
requesting that funds be transferred to the Trustee on a date or
in an amount other than as set forth on Appendix "A," then the
Bank hereby agrees to make such transfer on the date set forth in
such written notice. As used herein "Authorized Officer" shall
mean Barbara A. Friedman or another person so designated in
writing by FCFC.
Section 1.05. Book Entries and Certificates. The Bank
shall maintain adequate books and records showing the statement
of account for the Account.
Section 1.06. Indemnification of Bank. FCFC shall and
hereby agrees to indemnify and save the Bank harmless from and
against all claims, losses and damages, including legal fees and
expenses, arising out of (i) the use, maintenance, condition or
management of, or from any work or thing done in connection with,
the Equipment by the City, or (ii) any act of negligence of the
City or FCFC or of any of their officers, agents, contractors,
servants, employees, licensees or invitees in connection with the
Equipment. Indemnification for any tort mentioned in this Sec-
tion shall be limited to the extent and amounts permitted by law.
No indemnification will be made under this Section or elsewhere
in this Agreement for willful misconduct, gross negligence or
breach of duty under this Agreement by the Bank, or its officers,
agents, employees, successors and assigns.
Section 1.07. Term of Agreement. Unless earlier terminated
by the written agreement of the parties hereto, this Agreement
shall terminate on February 15, 1991. The total withdrawal of
all balances in the Account prior to February 15, 1991 shall not
in and of itself terminate this Agreement.
ARTICLE II
AMENDMENT; ADMINISTRATIVE PROVISIONS
Section 2.01. Amendment. The provisions of this Investment
Agreement may be amended in writing by agreement between both of
the parties hereto and acknowledged by the City.
Section 2.02. Assignment. The rights and duties of the
Bank under this Agreement shall not be assignable to any other
person or entity without the written consent of FCFC. The Bank
hereby acknowledges that FCFC has assigned its rights, title and
interest under this Investment Agreement to the Registered Owners
from time -to -time of the Certificates of Participation issued
under the Agreement.
Section 2.03. Notices. All written notices to be given
under this Agreement shall be given by mail to the party entitled
thereto at its address set forth below, or at such address as the
party may provide to the other party in writing from time to
time. Any such notice shall be deemed to have been received 72
hours after deposit in the United States mail in registered
form, with postage fully prepaid.
Addresses for Notices: TO: FCFC First Continental Financial
Corporation
8080 North Central
Expressway, Suite 850
Dallas, Texas 75206
Attn: Barry L. Friedman
TO: Bank Desoto State Bank
P.O. Drawer 1125
Desoto, Texas
TO: Lessee State of Illinois
Department of Central
Management SErvices
715 Stratton Office Bldg
Springfield, Illinois 62706
Attn: Jane McCarthy
TO: Trustee Sovran Bank, N.A.
707 E. Main Street, 3rd Flr
Richmond, Virginia 23219
Attn: Corporate Trust Dept
If by wire transfer to ABA
Routing #051000017, Attn:
Robert G. Horner, Corporate
Trust Department for
deposit to the Illinois
Department of Central
Management Services
Certificate Fund.
Section 2.04. Texas Law. This Agreement shall be construed
and governed in accordance with the laws of the State of Texas
and the United States of America.
Section 2.05. Severability. Any provision of this
Agreement found to be prohibited by law shall be ineffective only
to the extent of such prohibition, and shall not invalidate the
remainder of this Agreement.
Section 2.06. Binding on Successors. Subject to the
provisions of Section 2.02, this Agreement shall be binding upon
and inure to the benefit of the parties and their respective
successors and assigns.
Section 2.07. Headings. Heading preceding the text of the
Articles and Sections hereof are solely for convenience of
reference and shall not constitute a part of this Agreement or
affect its meaning, construction or effect.
IN WITNESS WHEREOF, the parties hereto have executed this
Investment Agreement by their officers thereunto duly authorized
as of the date and year first above written.
DESOTO STATE BANK
By:
(Signature)
Name:
Title:
(Please Type)
(Please Type)
FIRST CONTINENTAL FINANCIAL
CORPORATION
By•
Authorized Officer
Iw w3L7szn ww=m , the Parties hereto havo ummmed this
Inv*stment h9mment by their Oftimm thereunto amI1► ivrth"ised
t& of the date and year first &bow! written.
1�Aa
VCKMo Scott
(please Ty"
CEO DeSoto State "Ok
(Please Tyw
I
APPENDIX A
TO
INVESTMENT AGREEMENT
DESOTO STATE BANK
7.25%
PAYMENT
INTEREST
FUND
NUMBER
DATE
DEPOSIT
---------
INCOME
TRANSFER
BALANCE
-------
1
---------
3/15/88
6,252.12
---------
0.00
---------
---------
6,252.12
2
4/15/88
6,162.12
37.77
12,452.01
3
5/15/88
6,162.12
75.23
18,689.36
4
6/15/88
6,162.12
112.91
24,964.40
5
7/15/88
6,162.12
150.83
31,277.35
6
8/15/88
6,162.12
188.97
9,675.56
27,952.87
7
9/15/88
6,162.12
168.88
34,283.87
8
10/15/88
6,162.12
207.13
40,653.13
9
11/15/88
6,162.12
245.61
47,060.86
10
12/15/88
6,162.12
284.33
53,507.31
11
1/15/89
6,162.12
323.27
59,992.70
12
2/15/89
6,162.12
362.46
65,836.12
681.15
13
3/15/89
6,162.12
4.12
61847.39
14
4/15/89
6,162.12
41.37
13,050.88
15
5/15/89
6,162.12
78.85
19,291.85
16
6/15/89
6,162.12
116.55
25,570.52
17
7/15/89
6,162.12
154.49
31,887.13
18
8/15/89
6,162.12
192.65
7,954.87
30,287.03
19
9/15/89
6,162.12
182.98
36,632.14
20
10/15/89
6,162.12
221.32
43,015.58
21
11/15/89
6,162.12
259.89
49,437.58
22
12/15/89
6,162.12
298.69
55,898.39
23
1/15/90
6,162.12
337.72
62,398.23
24
2/15/90
6,162.12
376.99
68,704.87
232.47
25
3/15/90
6,162.12
1.40
61395.99
26
4/15/90
6,162.12
38.64
12,596.75
27
5/15/90
6,162.12
76.11
18,834.98
28
6/15/90
6,162.12
113.79
25,110.89
29
7/15/90
6,162.12
151.71
31,424.73
30
8/15/90
6,162.12
189.86
6,102.00
31,674.70
31
9/15/90
6,162.12
191.37
38,028.19
32
10/15/90
6,162.12
229.75
44,420.06
33
11/15/90
6,162.12
268.37
50,850.56
34
12/15/90
6,162.12
307.22
57,319.90
35
1/15/91
6,162.12
346.31
63,828.33
36
2/15/91
6,162.12
385.63
69,102.00
1,274.08
37
3/15/91
6,162.12
7.70
7,443.89
38
4/15/91
6,162.12
44.97
13,650.99
39
5/15/91
6,162.12
82.47
19,895.58
40
6/15/91
6,162.12
120.20
26,177.90
41
7/15/91
6,162.12
158.16
32,498.18
42
8/15/91
6,162.12
196.34
4,133.25
34,723.39
43
9/15/91
6,162.12
209.79
41,095.30
44
10/15/91
6,162.12
248.28
47,505.71
45
11/15/91
6,162.12
287.01
53,954.84
APPENDIX A
TO
INVESTMENT AGREEMENT
DESOTO STATE BANK
7.25%
PAYMENT
INTEREST
FUND
NUMBER
DATE
DEPOSIT
INCOME
TRANSFER
BALANCE
-------
46
---------
12/15/91
.........
6,162.12
---------
325.98
---------
---------
60,442.94
47
1/15/92
6,162.12
365.18
66,970.23
48
2/15/92
6,162.12
404.61
71,633.25
1,903.71
49
3/15/92
6,162.12
11.50
8,077.34
50
4/15/92
6,162.12
48.80
14,288.26
51
5/15/92
6,162.12
86.32
20,536.70
52
6/15/92
6,162.12
124.08
26,822.90
53
7/15/92
6,162.12
162.06
33,147.07
54
8/15/92
6,162.12
200.26
1,973.25
37,536.21
55
9/15/92
6,162.12
226.78
43,925.11
56
10/15/92
6,162.12
265.38
50,352.61
57
11/15/92
6,162.12
304.21
56,818.94
58
12/15/92
6,162.12
343.28
63,324.34
59
1/15/93
6,162.12
382.58
69,869.05
60
2/15/93
6,162.12
422.13
76,448.25
5.04
OFFERING CIRCULAR
NEW ISSUE
No Rating Applied For
In the opinion of Special Tax Counsel, as of the
date of the execution and delivery of the Lease and based
upon the existing provisions of the Internal Revenue Code
of 1986, the regulations promulgated thereunder,
published revenue rulings and releases of the Internal
Revenue Service and existing court decisions, the com-
ponent of each Lease Payment designated as interest under
the Lease, and the allocable portion thereof in respect
of each Certificate, is not includible in gross income of
the recipient for federal income tax purposes. See "Tax
Exemption" herein.
$795,000
CERTIFICATES OF PARTICIPATION - LEASE RENTALS
(City of Newport Beach, California
Parking Facility Project)
Evidencing a Proportionate Interest of the
Owner Thereof in Lease Payments to be Made by
THE CITY OF NEWPORT BEACH, CALIFORNIA
for the Lease and Acquisition of a paved,
metered parking facility for use by the general public
pursuant to a Real Property Lease/Purchase Agreement with
FIRST CONTINENTAL FINANCIAL CORPORATION
Dated: February 15, 1988 Due: as shown below
The above described Certificates of Participation (the
"Certificates") are being issued to provide funds for the
acquisition of a paved, metered parking facility for use by the
general public (the "Project") by the City of Newport Beach,
California (the "City"), to fund a reserve fund, and to pay the
costs related to the issuance of the Certificates. (See "Source
and Use of Funds.") The Project site will be leased by the City
to First Continental Financial Corporation ("FCFC"), as lessor,
pursuant to a Base Lease. The Project will be leased to the City
pursuant to a Real Property Lease/Purchase Agreement (the
"Lease"), dated as of February 15, 1988, by and between the City
and FCFC.
The Certificates are issuable pursuant to a Trust
Indenture, dated as of February 15, 1988, by and among the City,
FCFC and Sovran Bank, N.A. (the "Trustee"), in fully registered
form in denominations of $5,000 or integral multiples thereof and
are payable at the principal corporate trust office of the
Trustee. Interest from the date of the Certificates is payable
on August. 15, 1988, and semi-annually thereafter on February 15
and August 15 of each year.
The Certificates are subject to redemption in whole or in
part, prior to maturity, without premium. (See "The Certificates
- Redemption.")
THE PAYMENTS DUE WITH RESPECT TO THE CERTIFICATES ARE
PAYABLE SOLELY FROM AMOUNTS PAYABLE BY THE CITY UNDER THE LEASE.
THE LEASE PAYMENTS ARE PAYABLE SOLELY FROM FUNDS BUDGETED AND
APPROPRIATED FOR SUCH PURPOSE BY THE CITY. THE OBLIGATION OF THE
CITY TO MAKE THE LEASE PAYMENTS DOES NOT CONSTITUTE AN INDEBTED-
NESS OF THE CITY WITHIN THE MEANING OF ANY CONSTITUTIONAL OR
STATUTORY LIMITATION AND DOES NOT CONSTITUTE A LIABILITY OF OR A
LIEN OR CHARGE UPON THE FUNDS OR PROPERTY OF THE CITY, EXCEPT
THE CITY'S OFF-STREET PARKING FUND AND THOSE FUNDS WHICH THE CITY
HAS BUDGETED AND APPROPRIATED TO PAY THE LEASE PAYMENTS DURING
ANY FISCAL PERIOD.
Maturity
Principal Amount
Rate
February
15,
1989
$125,000
5.80%
February
15,
1990
$135,000
6.10%
February
15,
1991
$140,000
6.25%
February
15,
1992
$150,000
6.40%
February
15,
1993
$245,000
6.50%
(Plus Accrued Interest)
The Certificates are offered when, as and if issued and are
subject to the approval of legality and of certain other legal
matters by Dorsey & Whitney, Minneapolis, Minnesota, Special Tax
Counsel. Certain legal matters will be passed upon for the City
by Robert Burnham, City Attorney. It is expected that the
Certificates will be available in New York, New York in defini-
tive form for delivery on or about February 25, 1988.
Dated: February 18, 1988
TABLE OF CONTENTS
Page
INTRODUCTION 1
SOURCES AND USES OF FUNDS 2
THE CERTIFICATES 3
THE CITY 4
FIRST CONTINENTAL FINANCIAL CORPORATION 8
THE BASE LEASE 8
THE LEASE 9
THE TRUST INDENTURE 13
RISK FACTORS 15
TAX EXEMPTION 16
OTHER LEGAL MATTERS 17
MISCELLANEOUS 17
APPENDICES
Appendix A - Financial Statement A-1
Placement Agent
FRIEDMAN L UZZAT TO & CO.
8080 N. Central Expressway, Suite 850
Dallas, Texas 75208
(214) 696-8046
$795,000
CERTIFICATES OF PARTICIPATION - LEASE RENTALS
(City of Newport Beach, California
Parking Facility Project)
Evidencing a Proportionate Interest of the
Owner Thereof in Lease Payments to be Made by
THE CITY OF NEWPORT BEACH, CALIFORNIA
for the Lease and Acquisition of
a paved, metered parking facility for use by the general public
pursuant to a Real Property Lease/Purchase Agreement
with
FIRST CONTINENTAL FINANCIAL CORPORATION
INTRODUCTION
This Offering Circular, including the cover page and appen-
dices hereto, is provided to furnish information with respect to
the sale and delivery of the above referenced Certificates of
Participation (the "Certificates") representing direct and
proportionate interests of the owners thereof (the "Owners") in
lease payments (the "Lease Payments") to be made by the City of
Newport Beach, California (the "City"). Said Lease Payments
represent the lease and acquisition price of a paved, metered
parking 'facility for use by the general public (the "Project") to
be leased and acquired pursuant to that certain Real Property
Lease/Purchase Agreement, dated as of February 15, 1988 (the
"Lease"), by and between the City and First Continental Financial
Corporation ("FCFC"). The proceeds of the Certificates will be
used to acquire approximately 1/3 acre of land, to demolish and
remove the improvements located thereon and to construct a paved
metered parking facility (the "Project"). The project is an
integral part of the City's plans to revitalize the Cannery
Village area, and the Project Site is designated for use as a
public parking facility on the Cannery Village Specific Area Plan
and other official documents of the City. The proceeds of the
Certificate will be additionally used to fund a reserve fund and
to pay the costs associated with the issuance of the Certifi-
cates. It is anticipated that either the Project site will be
purchased from the present owner thereof on or about April 1,
1988, or that on or about such date the City will proceed to
acquire the Project Site through its powers of condemnation
Demolition will commence shortly after acquisition of the site
and the Project will be completed within two months thereafter.
1988.
Pursuant to that certain Trust Indenture (the "Indenture")
dated as of February 15, 1988, by and among the City, FCFC and
the Trustee, all of the right, title and interest of FCFC under
the Lease and the Base Lease (see "The Base Lease") have been
assigned to the Trustee.
SOURCES AND USES OF FUNDS
SOURCES OF FUNDS:
Contribution by City $500,000.00
Par Amount of Certificates 795,000.00
Accrued Interest 1,382.22
TOTAL SOURCES $1,296,382.22
USES OF FUNDS:
Reserve Fund $79,500.00
Project Acquisition Fund 1,200,000.00
Placement Fees 3,975.00
Other Issuance Costs 12,907.22
TOTAL USES $1,296,382.22
-2-
THE CERTIFICATES
General
Certificates will mature and will bear interest on the dates
and at the rates set forth on the cover page of this Offering
Circular. Interest on the Certificates shall be payable on
August 15, 1988, and on each February 15 and August 15 thereafter
until maturity (each a "Distribution Date").
Certificates will be issued in registered form in denomina-
tions of $5,000 each or integral multiples thereof to be speci-
fied by the purchasers thereof. Certificates issued before
August 15, 1988, shall be dated as of February 15, 1988. Certif-
icates issued in exchange for Certificates shall be dated as of
the preceding Distribution Date unless such date of delivery
shall be a Distribution Date, in which case they shall be dated
as of such date of delivery. Principal and interest shall accrue
from the date of the Certificate or from the last Distribution
Date to which interest shall have been paid. Distributions of
interest will be payable by check or draft of the Trustee mailed
to the Owner of record on the fifteenth day prior to the
Distribution Date at the address on file with the Trustee. The
final payment due on the Certificates at maturity shall be
payable at the principal corporate trust office of the Trustee
upon presentation and surrender of the Certificates as the same
shall become due.
Certificates are transferable only on the certificate
register at the principal office of the Trustee upon
surrender of the Certificates together with a written instrument
of transfer satisfactory to the Trustee duly executed by the
registered Owner thereof or by his duly authorized attorney.
Certificates may be exchanged for an equal aggregate principal
amount of Certificates of the same maturity and of authorized
denominations. For every exchange or transfer of Certificates,
the Trustee may make a charge sufficient to reimburse it for
the cost of printing new Certificates and any tax, fee or other
governmental charges required to be paid with respect to such
exchange or transfer.
Redemption
The Certificates are subject to redemption, in whole or in
part, prior to their stated maturity as follows:
(i) on any date, without premium, in the event that
the term of the Lease is not renewed due to the failure of the
Lessee to appropriate sufficient funds to pay the Lease Payments
to become due during the next ensuing fiscal period;
-3-
(ii) on any date, without premium, in the event that
the Lessee defaults in its obligations under the Lease;
(iii) on any Distribution Date, without premium, in the
event that the Lessee elects to exercise its option to purchase
the Project and pay the applicable Concluding Payment Amount;
and,
(iv) on the earlier of February 15, 1991, or the
Distribution Date next succeeding the acquisition of all of the
Project, if and to the extent there remains any funds on deposit
in the Project Acquisition Fund on such date.
Notice of redemption shall be given as soon as practicable
by mailing first class postage prepaid copies thereof to the
Owners. If the Certificates are called for redemption and
payment therefor duly provided therefor on such date of redemp-
tion, interest on the Certificates to be redeemed shall cease to
accrue from and after the date fixed for redemption.
Security for the Certificates
Each Certificate represents a proportionate interest in
Lease Payments to be made by the City under the Lease. Pursuant
to the Base Lease, the City has granted FCFC a 20 -year leasehold
interest in the Project site. Pursuant to the Lease, the City
has granted to FCFC a security interest in the Project and in its
Off -Street Parking Fund to secure performance of the City's
obligation under the Lease. Pursuant to the Indenture, FCFC has
assigned its rights under the Lease and the Base Lease to the
Trustee for the benefit of the Owners of the Certificates. Upon
default by the City, the Trustee has the right to recover all
Lease Payments due by the City during the fiscal period in which
the default occurs, to enter and take possession of the Project
and to cause the Project to be sold, leased or subleased on
behalf of the Owners of the Certificates. (See "RISK FACTORS -
Uncertainty of Remedies.")
THE CITY
The City of Newport Beach, California, is a political
subdivision of the State of California, operating under a
Council -Manager form of government. The City's Financial
Statement for the Fiscal Year ended June 30, 1987, is included
herein as Appendix "B."
-4-
TABLE OF MISCELLANEOUS STATISTICAL INFORMATION
FISCAL PERIOD 1987-88
RESIDENTIAL POPULATION (January, 1988)
Permanent
70,606
Summer
100,000
TOURIST POPULATION
20,000 to 100,000 per day
AREA (January 1, 1987)
Square Miles
Land
13.87
Bay
1.90
Ocean
20.00
TOTAL SQUARE MILES
35.77
Acres
Land
8,876.8
Bay
1,216.0
Ocean
12,864.0
TOTAL ACRES
22,956.8
WATER FRONTAGE
Miles
Ocean 6.1
Harbor 25.4
TOTAL WATER FRONTAGE 31.5
ASSESSED VALUATION
Total $8,630,217,978
Per Capita 122,230
OPERATING REVENUE $75,288,960
OPERATING EXPENDITURES $52,140,240
CAPITAL IMPROVEMENTS $27,703,380
BONDS OUTSTANDING -0-
06M
E
J
TABLE OF MISCELLANEOUS STATISTICAL INFORMATION
FISCAL PERIOD 1987-88
(Continued)
NEWPORT HARBOR
Boats
Residential
Commercial Slips and Side Ties
Bay Moorings
CITY WATER SERVICE CONNECTIONS
NUMBER OF FIRE STATIONS
NUMBER OF CITY LIBRARIES
NUMBER OF PARKWAY TREES
RECREATIONAL ACREAGE
Ocean Water
Harbor Water
Parks
Beaches
TOTAL
STREETS AND ALLEYS
Improved
Unimproved
State Highway
DWELLING UNITS
January 1, 1987
Occupancy factor per dwelling unit
POPULATION DENSITY
Per Square Mile
Per Acre
EMPLOYEES
Regular Full Time
Total (Including Part -Time Seasonal)
M
Streets
187 miles
8 miles
11 miles
206 miles
9,000
1,230
2,119
1,221
23,372
6
4
20,000
Acres
12,864
1,216
107
224
14,411
Alleys
26 miles
2 miles
0 miles
28 miles
34,659
2
5,090.56
7.95
717
980
POPULATION (January 1)
CITY AREA - TOTAL
Square Miles)
DWELLING UNITS
BUILDING PERMITS
VALUATION
ASSESSED VALUATION
ASSESSED VALUATION
DCD rADTTA
OPERATING EXPENDITURES
MUNICIPAL TRENDS
A FIVE-YEAR COMPARISON OF GENERAL STATISTICS
1985-86 1986-87 1987-88
of % of % of
Actual Total Actual Total Estimated Total
67,125 67,841 70,606
35.77 35.77 35.77
33,263 33,377 34,659
178,846,581
7,365,380,961
109,726
PER CAPITA 706
EMPLOYEES PER 1,000 POP. 10.23
PERCENT OF GENERAL GOVERN-
MENT EMPLOYEES TO
OPERATING EMPLOYEES 9.22
CITY EXPENDITURES
4,320,412
GENERAL CITY OPERATIONS
General
4,315,697
Public Safety
22,565,066
Public Works
8,653,458
Libraries
1,814,306
Park and Recreation
2,709,777
Total General City
12
Operations
40,058,304
OTHER OPERATIONS
2,155,815
Scholarship
750
Balboa Yacht Basin
120,000
Oil and Gas
468,737
Total Other
43,323,660
Operations
589,487
ENTERPRISE OPERATIONS
--
Water
6,690,737
Marinapark
87,458
Total Enterprises
137,363
Operations
6,778,195
TOTAL ALL CITY
1
OPERATIONS
47,425,986
CAPITAL IMPROVEMENTS
13,093,923
TOTAL CITY EXPENDITURES
60,519,909
180,434,990 150,000,000
7,818,718,183 8,630,217,978
115,250 122,230
759 738
10.35 10.15
9.01 8.96
7
4,320,412
7
4,078,495
5
39
24,458,270
37
25,747,390
32
15
9,518,657
14
9,427,630
12
3
1,976,880
3
2,155,815
3
5
3,049,441
5
3,096,060
4
69
43,323,660
66
44,505,390
56
--
-0-
--
1,650
--
137,363
--
366,870
--
1
793,387
1
364,190
--
1
930,750
1
732,710
--
11
7,105,220
11
6,840,350
9
131,951
_
61,790
--
11
7,237,171
11
6,902,140
9
81
51,491,581
78
52,140,240
65
22
14,345,441
22
27,703,380
35
103
65,837,022
100
79,843,620
100
—7—
FIRST CONTINENTAL FINANCIAL CORPORATION
First Continental Financial Corporation was organized under
the laws of the State of Texas. FCFC's headquarters are located
at 8080 North Central Expressway, Suite 850, Dallas, Texas 75206.
Since its inception, FCFC has actively engaged in tax-exempt
financing throughout the United States. The President and Chief
Executive Officer of FCFC is Barry L. Friedman. Mr. Friedman has
been involved in the field of tax-exempt financing since 1977.
THE BASE LEASE
The following is a summary of certain provisions of the
Base Lease. This summary is qualified in all respects by
reference to the Base Lease for a complete description of the
rights and obligations of the parties thereto. Copies of the
Base Lease may be obtained from the Trustee.
General
The Base Lease is entered into by and between the City, as
lessor, and FCFC, pursuant to which FCFC is leasing the Project
Site from the City for a stated term of 20 years.
Term
The term of the Base Lease shall commence upon execution
thereof and shall end on the earliest of (a) the day on which the
Lease terminates after payment and performance of all obligations
of the City thereunder, including, without limitation, the
payment of all Lease Payments; (b) the day on which the Lease
shall terminate after exercise by City of its purchase option
thereunder; or (c) February 15, 2008.
Purpose
FCFC shall use the Project site solely for the purpose of
financing the acquisition of the Project by the City, as well as
for such purposes as may be incidental thereto; provided, that in
the event of default by the City under the Lease, FCFC may use
the Project for any purpose whatsoever.
THE T,F.A SR
The following is a summary of certain provisions of the
Lease. This summary is qualified in all respects by reference to
the Lease for a complete description of the rights and
obligations of the parties thereto. Copies of the Lease may be
obtained from the Trustee.
General
The Lease is entered into by and between the City, as
lessee, and FCFC, as lessor, pursuant to which FCFC is leasing
the Project to the City.
Lease Term
The Lease term commences on February 15, 1988, and ends
February 15, 1992. The Lease will terminate upon the earlier of
the expiration of the Lease term, the termination of the Lease by
the City due to nonappropriation, or the termination of the Lease
after exercise by the City of its option to purchase the Project.
Lease Payments and Deposits
The Lease requires, subject to annual appropriations, a
total of ten (10) Lease Payments commencing on August 15, 1988,
and continuing semi-annually thereafter on each February 15 and
August 15 until all Lease Payments have been made. To assure
payment of the Lease Payments, the City has agreed under the
Lease to make sixty (60) Lease Payment Deposits (the "Deposits")
commencing on March 15, 1988, and continuing thereafter on the
fifteenth day of each month during the term of the Lease. FCFC
will invoice the City for each of the Deposits due under the
Lease at least ten (10) days prior to its due date. Each of the
Deposits will be invested and applied, together with the interest
income thereon to make the Lease Payment when due.
Purchase Option
The City will have the option to purchase the Project on
at least 30 days prior written notice on February 15 of each year
during the term thereof by paying an amount which together with
amounts on deposit under the Indenture will be sufficient to pay
the principal of and interest on the Certificates due on such
date.
MIC
Covenants of Cit
The City will, at the City's own cost and expense, service,
repair and maintain the Project in good condition, repair,
appearance and working order for the purposes intended, ordinary
wear and tear excepted, and will replace any part of the Project
as may from time to time become worn out, lost, stolen,
destroyed, damaged or unfit for use.
There will be no abatement or reduction of the obligations
of the City to make payment of'the Lease Payments required under
the Lease except as expressly provided.
Nonappropriation of Funds
In the event no funds or insufficient funds are appropriated
and budgeted or are otherwise available by any means whatsoever
in any fiscal period for Lease Payments due under the Lease, then
the City will immediately notify FCFC or its assignee of such
occurrence and the Lease will terminate on the last day of the
fiscal period for which appropriations were received without
penalty or expense to the City of any kind whatsoever, except as
to the portions of Lease Payments for which funds will have been
appropriated and budgeted or are otherwise available. The City
will have no right to terminate the Lease if, during the fiscal
period that termination of the Lease would have otherwise
occurred, any funds are appropriated to it, or by it, for the
acquisition, retention or operation of the Project or any other
facilities (real or personal) or equipment performing functions
similar to the Project.
Nonsubstitution
During the Lease Term, the City will not give priority to
the application of funds for the acquisition, retention or
operation of any real or personal property or facilities
performing functions similar to the Project. If the City
terminates the Lease, the City has agreed not to purchase, lease,
rent or otherwise acquire the use of any real or personal
property or facilities performing functions similar to the
Project during the period commencing on the date of termination
of the Lease and ending on last day of the fiscal period follow-
ing the fiscal period during which the termination occurred.
-10-
Title
Subject to the Base Lease and the Lease, title to the
Project and all additions, repairs, replacements or modifications
thereto will rest with the City so long as the City is not in
default under the Lease and the Lease has not been terminated
pursuant to its terms.
Taxes, Other Governmental Changes, Utility Charges
The City shall pay all property and excise taxes and other
governmental charges of any kind whatsoever which are at any time
lawfully assessed or levied against or with respect to the
Project or any part thereof or the Lease Payments, which become
due during the term of the Lease. The City shall also pay when
due all gas, water, steam, electricity, heat, power, telephone,
and other charges incurred in the operation, maintenance, use,
occupancy and upkeep of the Project, and all special assessments
and charges lawfully made by any governmental body for public
improvements that may be secured by a lien on the Project;
provided that with respect to special assessments or other
governmental charges that may lawfully be paid in installments
over a period of years, the City shall be obligated to pay only
such installments as are required to be paid during the Lease
term as and when the same become due. The City shall not be
required to pay any Federal, state or local income, inheritance,
estate, succession, transfer, gift, franchise, gross receipts,
profit, excess profit, capital stock, corporate, or other similar
tax payable by FCFC, its successors or assigns, unless such tax
is made in lieu of or as a substitute for any real estate tax
upon the Project.
The City may, at the City's expense and in the City's name,
in good faith contest any such taxes, assessments, utility and
other charges and, in the event of any such contest, may permit
the taxes, assessments or other charges so contested to remain
unpaid during the period of such contest and any appeal therefrom
unless the Trustee shall notify the City that, in the opinion of
independent counsel, by nonpayment of any such items the interest
of the Trustee in the Project will be materially endangered or
the Project or any part thereof will be subject to loss or
forfeiture, in which event the City shall promptly pay such
taxes, assessments or charges or provide the Trustee with full
security against any loss which may result from nonpayment, in
form satisfactory to the Trustee.
-11-
Indemnification
They City shall defend, and indemnify FCFC against, and hold
FCFC harmless from, any and all claims, actions, proceedings,
expenses, damages or liabilities, including attorneys' fees,
court costs, judgments and interest thereon, arising out of, or
in any way related to, the Project, including, but not limited
to, its selection, purchase, delivery, possession, use,
operation, condition, or existence, provided, however, the City's
duty to defend, indemnify and hold FCFC harmless shall not extend
to claims or lawsuits arising out of the sole and exclusive
negligence, or willful misconduct, of FCFC or its employees. The
City shall, through its established program of self-insurance,
promptly investigate and process all claims for bodily injury or
property damage that are in any way related to the project. The
City shall notify FCFC, in writing, or any claim or loss that has
a reasonable judgment potential in excess of $100,000.00 and,
upon request, will make all information relative to the claim or
lawsuit available to FCFC.
Events of Default
Under the Lease, the term "Event of Default" means the
occurrence of any one or more of the following events:
(a) the City fails to make any Lease Payment (or any other
payment) as it becomes due in accordance with the terms thereof;
(b) the City fails to perform or observe any other
covenant, condition, or agreement to be performed or observed by
it thereunder and such failure is not cured within twenty (20)
days after written notice thereof; or,
(c) the discovery by FCFC that any statement, representa-
tion, or warranty made by the City in the Lease or in any writing
ever delivered by the City in connection therewith is false,
misleading, or erroneous in any material respect.
Remedies
Upon the occurrence of an Event of Default, and as long as
such Event of Default is continuing, the Trustee may, at its
option, exercise any one or more of the following remedies:
(a) By written notice to the City, declare an amount equal
to all amounts then due under the Lease and all remaining Lease
-12-
Payments due during the Lease Term to be immediately due and pay-
able, whereupon the same shall become immediately due and pay-
able;
(b) By written notice to the the City, request the City to,
at the City's expense, promptly return the Project to the Trustee
and the Trustee, at its option, may enter upon the Project and
take immediate possession thereof;
(c) Sell or lease the Project or sublease it for the
account of the City, holding* the City liable for all Lease
Payments and other payments due to the effective date of such
selling, leasing or subleasing and for the difference between the
purchase price, rental and other amounts paid by the purchaser,
lessee or sublessee pursuant to such sale, lease or sublease and
the amounts payable by the City thereunder; and,
(d) Exercise any other right, remedy or privilege which may
be available to it under applicable laws of the State of
California or any other applicable law or proceed by appropriate
court action to enforce the terms of the Lease or to recover
damages for the breach of the Lease or to rescind the Lease.
In addition, the City will remain liable for all covenants
and agreements under the Lease and for all legal fees and other
costs and expenses, including court costs, incurred by FCFC with
respect to the enforcement of any of the remedies listed above or
any other remedy available to FCFC.
THE TRUST INDENTURE
The following is a summary
of certain
provisions of
the
Indenture.
This summary is qualified
in
all respects
by
reference to
the Indenture for
a complete
description of
the
rights and
obligations of the
City, FCFC
and the Trustee
thereunder.
Copies of the Trust
Indenture may be obtained
from
the Trustee.
Application of Certificate Proceeds
There shall be delivered to the Trustee at the time the
Certificates are executed and delivered a closing statement
executed by an authorized officer of FCFC showing: (a) the
amount of the proceeds of the sale of the Certificates, including
accrued interest, if any; (b) the amounts of accrued and
capitalized interest, if any, on the Certificates to be deposited
in the Certificate Fund; (c) the amount to be deposited in the
Project Acquisition Fund; (d) the amount to be deposited to the
-13-
Reserve Fund and (e) amounts payable with respect to the issuance
costs of the Certificates. The closing statement shall be
accompanied by the investment instructions, which shall contain a
statement with respect to the disposition of moneys received by
the Trustee.
Project Acquisition Fund
Pending the acquisition of the Project site and the
subsequent construction and completion of the Project, the
Trustee will create and maintain a special fund to be designated
as "The City of Newport Beach, California Parking Facility
Project Acquisition Fund." The Trustee will disburse from the
Project Acquisition Fund from time to time, pursuant to written
instructions signed by FCFC and the City, amounts sufficient to
pay, in whole and in part, the Project Costs. In making such
disbursement, the Trustee may rely on such written instructions
without further investigation or inquiry. Upon the occurrence of
the earlier of January 15, 1991, or the final payment of the
Project Cost, the Trustee will transfer all funds on deposit in
the Project Acquisition Fund (in integral multiples of $5,000) to
the Certificate Fund for redemption of Certificates on February
15, 1991, or if transferred earlier on the next succeeding
Distribution Date. If such transfer is made prior to January 15,
1991, any amounts then remaining in the Project Acquisition Fund
shall be transferred also to the Certificate Fund to be applied
to the Distribution due on the next succeeding Distribution Date.
Reserve Fund
The Reserve Fund shall be maintained by the Trustee until
such time as (i) the Lease Payments are paid in full pursuant to
the terms of the Lease, (ii) the Lessee has paid the entire
Concluding Payment Amount in accordance with the Lease, or (iii)
the Indenture is terminated. If on any Distribution Date the
amount in the Certificate Fund shall be less than the amount
required to pay the Lease Payment in full, the Trustee shall
withdraw from the Reserve Fund to the extent necessary to make
good the deficiency. Any amounts so transferred from the Reserve
Fund shall not be considered payment in full of a Lease Payment
and shall, upon receipt of the delinquent Lease Payment, be
repaid from such Lease Payment to the Reserve Fund. Whenever the
amount in the Reserve Fund, together with the amount in the
Certificate Fund, is sufficient to pay in full all Outstanding
Certificates in accordance with their terms, the funds on deposit
in the Reserve Fund shall be transferred to the Certificate Fund.
-14-
Certificate Fund
On each Distribution Date, the Trustee shall disburse to the
Registered Owners (but solely from and to the extent of moneys on
deposit in the funds established hereunder) an amount sufficient
to make all payments of the principal of and interest on the
Certificates becoming due on such Distribution Date. If on any
Distribution Date, the amount of all payments due and payable on
the Certificates exceeds the amount on hand in the Certificate
Fund, taking into account any transfers made from the Reserve
Fund, the Trustee shall apply the moneys on hand therein first to
the payment of all interest due with respect to all Certificates,
pro rata if necessary, and second to the payment of that portion
of the unpaid principal balance of each Certificate which is then
due, pro rata if necessary.
RISK FACTORS
THE FOLLOWING CONSIDERATIONS OR OCCURRENCES COULD ADVERSELY
AFFECT THE ABILITY OF THE TRUSTEE TO PAY THE PRINCIPAL OF AND
INTEREST ON THE CERTIFICATES. THE CONSIDERATIONS OR OCCURRENCES
DESCRIBED IN THE FOLLOWING PARAGRAPHS SHOULD BE CAREFULLY WEIGHED
BY A POTENTIAL PURCHASER OF THE CERTIFICATES.
Non -Appropriation
In the event that the City fails to budget and have avail-
able sufficient funds to make the Lease Payments and to meet its
other obligations under the Lease, the City may elect not to
renew the Lease. In the event of such non -appropriation, the
obligation of the City to make further Lease Payments under the
Lease shall cease and the City shall have no further obligations
thereunder, other than to surrender the Project.
Uncertainty Of Remedies
In the event of a default by the City or a failure to budget
and have available sufficient funds to make Lease Payments under
the Lease, it is possible that the City would seek and obtain, on
the ground that the City could not properly function without the
Project, injunctive relief restraining FCFC or the Owners of
the Certificates from repossessing the Project or otherwise
enforcing their rights under the Lease. There is little or no
precedent in this area, therefore no prediction can be made as to
the extent to which such equitable relief might be available to
the City or the circumstances in which such equitable relief may
be granted.
-15-
Investment of Monies
The Deposits will be invested from the time that such
Deposits are received until the time they are required to be paid
transferred to the Trustee to pay Distributions when due. In the
event that payment of the Deposits is delinquent, the Trustee may
not have available sufficient monies to make Distributions when
due.
Disposition of Collateral
In the event that the Project is repossessed for any
reason, there can be no assurance that the Project can be
leased, sold or otherwise disposed of for a net amount equal to
the cost of disposition, the then outstanding aggregate principal
amount of the Certificates and accrued interest on the
Certificates to the date of redemption.
Failure to Acquire Project Site
It is anticipated that the City will acquire fee simple
title to the Project site on or about April 1, 1988, subject only
to the Base Lease, the Lease and the lien of the Indenture.
There is no assurance however that the Project site will be
acquired on such date or on any date prior to February 15, 1991.
(See "The Certificates - Redemption.") Failure to so acquire the
Project site may result in an event of non -appropriation or
otherwise cause the Certificates to be called for redemption
prior to maturity.
TAX EXEMPTION
On the date of original delivery of the Certificates, Dorsey
& Whitney, Minneapolis, Minnesota, Special Tax Counsel, will
render its legal opinion that, based upon federal laws, regula-
tions, rulings and decisions then in effect, the amount of each
Lease Payment designated as and comprising interest and received
by the registered Owners of the Certificates is not includable in
gross income of such recipients for United States income tax pur-
poses. Such opinion will further state that the interest portion
of each Lease Payment is includable in reported profits or book
income of corporations for the purpose of a corporate alternative
minimum tax for taxable years beginning after December 31, 1986,
and that such interest portion is also includable in the computa-
tion of alternative minimum taxable income for purposes of an
environmental tax imposed by Section 59A of Internal Revenue Code
of 1986 (the "Code") on corporations for taxable years beginning
after December 31, 1986. In the opinion of Dorsey & Whitney,
0i -IC
S4
such interest portion also may be includable in the income of
foreign corporation for purposes of the branch profits tax
imposed by Section 884 of the Code, and in the case of an insur-
ance company subject to the tax imposed by Section 831 of the
Code, for taxable years beginning after February 15, 1986, the
amount which would otherwise be taken into account as losses
incurred under Section 832(b) (5) of the Code must be reduced by
an amount equal to fifteen percent of such interest portion that
is received or accrued during the taxable year. Noncompliance by
the City with certain continuing requirements of the Code may
result in inclusion of such interest portion in gross income of
the registered Owners of the Certificates for United States
income tax purposes. Dorsey & Whitney will express no opinion as
to the validity and enforceability of the Lease, the Agreement or
the other documents contemplated thereby, and will rely upon the
legal opinion of Robert Burnham, City Attorney, as to the
matters stated therein.
OTHER LEGAL MATTERS
On the date of the original delivery of the Certificates,
Robert Burnham, City Attorney for the City, will render his
legal opinion that the Lease constitutes a valid and binding
obligation of the City, enforceable in accordance with its terms
except as such enforceability may be limited by applicable bank-
ruptcy, insolvency, moratorium, reorganization or similar laws,
from time to time in effect, and equitable principles.
MISCELLANEOUS
Any statements in this Offering Circular involving matters
of opinion or estimates, whether or not expressly so stated, are
intended as such and not as representations of fact. No repre-
sentation is made that any of such statements will be realized.
This Offering Circular is not to be construed as a contract or
agreement between the City and the Owners and has not been
authorized or executed by the City. This Offering Circular is
submitted only in connection with the sale of the Certificates
and may not be reproduced or used in whole or in part for any
other purpose.
-17-
Appendix A
FINANCIAL STATEMENT
For the Fiscal Year Ended June 30, 1987
Intentionally Omitted
ARBITRAGE AND TAX CERTIFICATE
We, the undersigned do hereby certify that we are the duly
qualified M/q and ei-ry MAN46-E2 , respectively,
of Newport Beach, California (the "City"), and that in our
official capacity as such officers we are familiar with the
execution and delivery, on behalf of the City of Newport Beach,
California of that certain Real Property Lease/Purchase Agreement
No. 87-0340 (the "Lease"), dated as of February 15, 1988, by and
between First Continental Financial Corporation, as lessor (the
"Lessor"), and the City. This Certificate is being issued
pursuant to Section 148 of the Internal Revenue Code of 1986 (the
"Code"), and Treasury. Regulations, Sections 1.103-13, 1.103-14
and 1.103-15 promulgated thereunder (the "Regulations"). The
following facts, estimates and circumstances are in existence on
the date of this Certificate or are reasonably expected to occur
hereafter.
1. Under the Lease, the Lessor will lease and sell to the
City a certain paved, metered municipal parking facility (the
"Project") and the City is required to lease and purchase the
Project from the Lessor by making Lease Payments, comprised of
both principal and interest, on the dates and in the amounts set
forth in Exhibit "B" to the Lease, subject to the terms and
conditions of the Lease.
2. The Project is an integral part of the City's plans to
revitalize the Cannery Village area, and the Site is designated
for use as a public parking facility on the Cannery Village
Specific Area Plan and other official documents of the City.
3. For the purpose of meeting its obligations under the
Lease and to make available to the City the moneys required to
pay the costs of the Project, the Lessor will cause to be issued
pursuant to a Trust Indenture, dated as of February 15, 1988, by
and between the Lessor and Sovran Bank, N.A., as Trustee,
certificates of participation in the aggregate principal amount
of $795,000 (the "Certificates").
4. The net amount of proceeds received by.City on February
25, 1988 (the "Closing Date") as a result of the delivery of the
Lease and the sale of the Certificates will be $792,407.22 (the
"Net Proceeds") (principal amount of $795,000, less a placement
fee charged by Shearson Lehman Hutton, Inc. of $3,975, plus
accrued interest of $1,382.22, and is necessary to accomplish the
purposes set forth in paragraph 1 above.
5. An amount of the Net Proceeds equal to $79,500 will be
deposited on the date hereof in the Reserve Fund as a reasonably
required reserve for the payment of debt service under the Lease
Agreement. Such amount does not exceed the lesser of (i) 10% of
the proceeds of the issue, (ii) 125% of the average annual debt
service under the Lease Agreement, or (iii) the maximum annual
debt service under the Lease Agreement. Investment earnings on
amounts in the Reserve Fund will be immediately deposited upon
receipt in the Certificate Fund.
6. The remainder of the Net Proceeds ($712,907.22) will be
deposited on the date hereof in the Project Acquisition Fund and
will be expended on the acquisition of the Project on or before
February 15, 1991. In addition to the Net Proceeds, the City
will cause the sum of $500,000 to be deposited with the Trustee
for application as follows:
(a) $12,907.22 will be disbursed to First Continental
Financial Corporation to pay its fees and certain costs
associated with the issuance of the Certificates; and
(b) the balance thereof shall be deposited to the Project
Acquisition Fund applied in accordance with the terms
of the Indenture
7. Investment earnings on amounts in the Project
Acquisition Fund will be immediately deposited upon receipt in
the Certificate Fund.
8. The City intends to acquire the site of the Project
from the current owner thereof pursuant to a certain "Contract
for Sale of Real Property, the terms of which are being presently
negotiated. If the City is unable to so acquire the Project, the
City intends to exercise its powers of condemnation to acquire
the Project site. Proceeds of the Lease and the Certificates in
the approximate amount of $500,000 will be used to fund a portion
of the purchase price of the Project site and the remainder of
such purchase price will be funded directly by the City from
other legally available funds.
9. Work on the remaining portion of the Project will
proceed with due diligence to the completion thereof. The choice
of the date of delivery and principal amount of the Lease
Agreement was motivated by bona fide economic considerations,
IWAM
including market conditions and economies of issuance costs, and
not by potential arbitrage earnings with respect to unexpended
monies.
10. The City has incurred, or will incur within six months
of the date hereof, binding obligations involving expenditures in
excess of $100,000 for the acquisition of the Project.
11. The Certificate Fund will be used primarily to achieve
a proper matching of revenues of City and debt service under the
Lease Agreement within each year and will be depleted at least
once a year except for a reasonable carryover amount not to
exceed the greater of (i) one year's earnings on the Certificate
Fund, or (ii) one -twelfth of annual debt service under the Lease
Agreement.
12. Lease Payments will be paid from general revenues of
City. Since the general revenues of City for any year will
exceed the Lease Payments for such year, it is assumed that
current debt service will be paid entirely from current revenues.
Except for the Certificate Fund, and the Reserve Fund, City has
not created or established or caused to be created or
established, and will not create or establish or cause to be
created or established, any sinking fund or other similar fund
with respect to the Lease Agreement or the Certificates.
13. No portion of the amounts received from the delivery of
the Lease Agreement and the Certificates will be used as a
substitute for other funds which were otherwise to be used as a
source of financing for the acquisition of the Project, and which
have been or will be used to acquire, directly or indirectly,
obligations producing a yield in excess of the yield on the Lease
Agreement.
14. If, on the date which is 180 days after the date
thereof, unexpended Net Proceeds exceed the lesser of five
percent (5%) of the Net Proceeds or $100,000; or if, on the date
which is one year following the date hereof, the Net Proceeds
amounts deposited to the Project Acquisition Fund have not been
totally expended, the City shall take all steps as may be
required by special tax counsel selected by Lessor to comply with
the arbitrage rebate requirements of the Tax Reform Act of 1986,
including without limitation Section 148(f) thereof.
15. The Project has not been, and is not expected during
the term of the Lease, to be sold or otherwise disposed of by the
City.
-3-
16. To the best of the knowledge and belief of the under-
signed, the expectations of the City, as set forth above, are
reasonable; and there are no present facts, estimates and circum-
stances which would change the foregoing expectations.
17. The City has not been notified of the listing or pro-
posed listing of it by the Internal Revenue Service as an issuer
whose arbitrage certificates may not be relied upon.
WITNESS our hands as of the 15th day of February, 1988.
THE CITY:
Ne ort Beach, California
By:
ignature
Name: ROBERT L. WYNN
Title: —GiTY PLNNA6ER
By:
Signature
Name:
Title:
-4-
GENERAL CERTIFICATE OF
NEWPORT BEACH, CALIFORNIA
The undersigned do hereby certify that we are the duly
elected or appointed and acting officials of Newport Beach,
California (the "Lessee") holding the respective offices set
forth below our signatures and do hereby execute and deliver this
certificate for the benefit of all persons interested in that
certain Real Property Lease/Purchase Agreement No. 87-0340, dated
as of February 15, 1988 (the "Lease"), by and between the City
and First Continental Financial Corporation (the "Lessor").
Terms defined in the Lease are used in this certificate with the
same meanings as in the Lease. We do further certify as follows:
1. We are the duly chosen, qualified and acting officers
of the City for the offices shown beneath our signa-
tures, and in such capacities we are familiar with and
have personal knowledge of the matters hereinafter
stated.
2. The City is a political subdivision of the State of
California, duly created and existing under the
constitution and laws thereof.
3.
The following named
persons hold the
respective offices
appearing below and
the signatures
appearing opposite
their names are the
true and genuine
signatures of such
persons.
OFFICE
TITLE//
NAME
I'
-1
4. The Lease and all certificates and other documents,
(collectively, the "Financing Documents") to which the
City is a party, as executed and delivered have been
executed and delivered by the above mentioned duly
authorized officers of the City acting in their
official capacities.
5. To the best of our knowledge, (i) the representations
and warranties of the City in the Lease are true and
correct on and as of the date hereof as though made on
and as of the date hereof and (ii) the City has
complied with all terms on its part to be performed or
satisfied by it under the Lease at or prior to the date
hereof.
6. To the best of our knowledge no litigation is pending
or, to our knowledge, threatened in any court to
restrain or enjoin the issuance or delivery of the
Certificates or the payment of the Lease Payments, or
in any way contesting or affecting the validity of the
Certificates, the operating budget or the Lease, or
contesting the powers of the City or contesting the
authorization of the Certificates, the Lease or the
operating budget or the acquisition of the Project.
7. On the date hereof, each of the persons signing this
Certificate is the duly elected or appointed, qualified
and acting officer of the City holding the office set
forth below such person's signature, and each such
person's signature appearing below is true and genuine.
8. The City has taken all actions necessary to appropriate
or otherwise provide for all amounts required to be
paid under the Lease during the Lessee's current fiscal
period ending June 30, 1988 and the City has or expects
to have sufficient unexhausted funds to make such
payments as the same become due.
9. The Project will be used by the City only for the
purpose of performing one or more of its governmental
functions consistent with the permissible scope of its
authority. No portion of the Project will be leased to
or operated by any person in connection with a non-
governmental trade or business, nor will the City take
anv action which will cause the Certificates or the
Lease to become "Arbitrage Bonds" or "Private Activity
Bonds" as such terms are defined in the Code.
10. The Project is an integral part of the City's plans to
revitalize the Cannery Village area, and the Site is
designated for use as a public parking facility on the
Cannery Village Specific Area Plan and other official
documents of the City. The City has an immediate need
for and expects to make immediate use of substantially
all the Project, which is not temporary or expected to
diminish in the foreseeable future. The City intends
to acquire the Site, either through purchase from the
present owner thereof, pursuant to a "Contract for Sale
of Real Property" or, through the exercise of its
powers of condemnation.
11. The City will prepare or cause to be prepared and will
file or cause to be filed a Form 8038-G in the manner
and within the time provided by Section 149(e) of the
Internal Revenue Code of 1986.
12. The Federal Taxpayer Identification number of the City
is 95 6000 751 "-
WITNESS OUR HANDS AND THE OFFICIAL SEAL OF THE LESSEE as of
the 05-14 day of 1988.
yyy
Title:
ROBERT L. WYNN
Title: CITY MANAGER
(SEAL)
INCUMBENCY CERTIFICATE OF LESSOR
I, Dana Juergensen, do hereby certify that I am the duly elected
or appointed and acting Secretary of First Continental Financial
Corporation ("FCFC"), a corporation duly organized and existing
under the laws of the State of Texas, that I have custody of the
records of such company.
In connection with the financing by the City of Newport Beach,
California (the "Lessee") of certain equipment (the "Equipment")
pursuant to a certain Real Property Lease/Purchase Agreement,
dated as of February 15, 1988, by and between FCFC and Lessee, I
do further certify that:
1. FCFC is a corporation duly organized and validly
existing under the laws of the State of Texas, with all requisite
power and authority to own its properties and carry on its bus-
iness as now being conducted.
2. The following named persons hold the respective offices
appearing below and the signatures appearing opposite their names
are the true and genuine signatures of such persons:
OFFICE TITLE SIGNATURE
Chief Executive
Officer Barry L. Friedman
Vice President Barbara A. Friedman�s�ti_s,
The above named persons shall serve in such capacity until such
time as their successors shall have been appointed.
3. The Vice President and the President, and each of them,
have the authority on behalf of FCFC to execute and deliver all
documents and certificates required to be executed in connection
with the Lease, the issuance of the $795,000 Certificates of
Participation - Lease Rentals (City of Newport Beach, California,
Parking Facility Project) and the assignment of the Lease to the
registered, owners of the certificates.
IN WITNESS WHEREOF, I have duly executed this cert'ficate
and affixed the seal of FCFC hereto as of the aS'�day of
1988.
Dana Juergense Se etary
10.05
February 15, 1988
First Continental Financial Corporation
8080 N. Central Expressway; Suite 850
Dallas, Texas 75206
Re: Invoicing Procedure for Project Lease -Purchase
Agreement No. 87-0340, dated as of February 15, 1988
(the "Lease"), by and between Newport Beach,
California ("Lessee") and First Continental
Financial Corporation ("Lessor")
Gentlemen:
Reference is hereby made to the above-described Lease.
Outlined below is the procedure we have elected for
invoicing.
A. City requires the following number of invoice
copies:
two (2)
B. Address to submit invoices to:
City of Newport Beach
3300 Newport Boulevard
P.O. Box 1768
Newport Beach, California 92658-8915
Attn:
Tele:
C. For our internal processing, we require receipt
of the invoice at least 30 days prior to payment date.
First Continenta' 'inancial Corporation
February 15, 1988 -
Page 2 of 2
D. We require the following information on the
invoice for identification purposes:
Project Lease -Purchase Agreement No. 87-0340
Sincerely,
Newport Beach, California
S ig ature )
Name: ROBERT L. WYNN
(Please Type)
Title: CITY MANAGER
(Please Type)
CLOSING STATEMENT
February 22, 1988
This Closing Statement is delivered pursuant to Section 3.02 of
the Trust Indenture, dated as of February 15, 1988, by and
between First Continental Financial Corporation in favor of
Sovran Bank, N.A., as trustee (the "Trustee"), in connection with
the issuance and delivery of "$795,000 Certificates of
Participation - Lease Rentals (City of Newport Beach, California,
Parking Facility Project)" (the "Certificates").
On February 24, 1988 the Trustee will receive a wire transfer
from City National Bank, 3388 Via Lido, Newport Beach, California
92663 (Steve Stogsdill; (714) 675-9940) in the amount of $500,000
representing the City's contribution to the Project Costs. The
Trustee is directed to deposit such funds to the Project
Acquisition Fund.
The Purchase Price of the Certificates is $792,407.22 repre-
senting the par amount of the Certificates less a placement fee
of $3,975.00 plus accrued interest of $1,382.22. On February 25,
1988 (the "Closing Date"), Shearson Lehman Hutton, Inc. will
deliver to the Trustee immediately available funds in the amount
of the Purchase Price. The Trustee is authorized and directed to
deposit from such funds $79,500 to the Reserve Fund and to
deposit the remainder of such funds (totalling $712,907.22) to
the Project Acquisition Fund.
From the amounts deposited to the Project Acquisition Fund, the
Trustee is authorized and directed to make the following trans-
fers and disbursements:
1. $1,200,000 shall be invested in accordance with
the Investment Instructions delivered pursuant to
the Indenture
2. $12,907.22 shall be wire transferred to:
Deposit Guaranty Bank for deposit into the account
of First Continental Financial Corporation,
Account # 0109827, ABA Routing # 111000973.
FIRST CONTINENTAL FINANCIAL CORPORATION
By: `
Authorized Officer
1 1:
INVESTMENT INSTRUCTIONS
February 25, 1988
These investment instructions are delivered pursuant to Section
3.02 of the Trust Indenture (the "Indenture") dated as of
February 15, 1988, by and between First Continental Financial
Corporation ("FCFC") in favor of Sovran Bank, N.A., as trustee
(the "Trustee") in connection with the issuance of delivery of
$795,000 Certificates of Participation - Lease Rentals
(City of Newport Beach, California, Parking Facility Project):
1. The Trustee is hereby authorized and directed to invest
moneys deposited from time to time to the Certificate Fund
(as defined in the Indenture), and immediately upon such
deposit, with the Investment Bankds (as defined in the
Indenture), pursuant to and in accordance with Investment
Agreements, (as defined in the Indenture). All funds so
invested pursuant to this paragraph shall be transfered by
wire transfer to Provident Bank - Dallas, which shall
immediately transfer a pro rata amount of such transfer to
the other Investment Banks.
2. The Trustee is hereby authorized and directed to invest the
Reserve Fund ($79,500) in a Certificate of Deposit issued by
Provident Bank - Dallas, Dallas, Texas having a maturity of
February 15, 1993, and bearing interest at the rate of 9.0%
per annum.
3. The moneys remaining on deposit in the Project Acquisition
Fund, after making the disbursements described in the
Closing Statement (as defined in the Indenture), shall be
deposited in an Eligible Investment, consisting of:
Certificate of Deposit maturing April 1, 1988 at a rate
not less than 6.5%.
FIRST CONTINENTAL FINANCIAL CORPORATION
Authorized Officer
"Diffim%
THE STATE OF VIRGINIA
COUNTY OF RICHMOND
k
TRUSTEE'S CLOSING CERTIFICATE
The undersigned officer of Sovran Bank, N.A., Richmond,
Virginia (the "Trustee") hereby certifies as follows:
(1) That all capitalized terms used in this Certificate,
including this paragraph, have the same meanings defined for and
assigned to them in that certain Trust Indenture (the
"Agreement"), dated as of February 15, 1988, and executed between
Sovran Bank, N.A., and First Continental Financial Corporation
(FCFC) .
(2) That the Agreement has been properly executed and
delivered by the undersigned and both of such persons are duly
qualified officers of the Trustee having proper, lawful
authority to execute and deliver the Agreement and to bind the
Trustee thereto.
(3) That the execution and delivery and performance of its
obligations under the Agreement has been authorized by and are in
full conformity with the terms and requirements of all corporate
documents of the Trustee governing the same.
(4) That the following persons are authorized to
authenticate the Certificates, and the signature appearing
opposite their names and titles are true and correct specimens of
their signatures:
Name
ROBERT D. HORNER
KAREN NOONAN
Title
ASSiStant Vice Presicent
TRUST OFFICER
Specimen Signatures
(5) The purchase price for the Certificates, as provided
in the Closing Statement, has been received, and such moneys have
been deposited as provided in the Closing Statement.
10.06
(6) The Certificates, dated February 15, 1988, and serially
numbered R-1 through R- 55 inclusive, have this day been
authenticated and delivered to the Purchasers thereof, as set
forth in the Closing Statement.
IN WITNESS WHEREOF, the undersigned have executed this
certificate as of the ' ,�t/ day of n 19��.
SOVRAN BANK, N.A.,
as Trustee
By:
Name: fJ-12o L P/4-�. rn E 2
Title: Pre --S: L.'-+—