Loading...
HomeMy WebLinkAboutItem 4.11 Exhibit C Escrow Agreement (2) Brown & Wood Draft of 5/3/93 ESCROW AGREEMENT RELATING TO THE DEFEASANCE OF $17,230,000 1988 REFUNDING CERTIFICATES OF PARTICIPATION (CIVIC CENTER PROJECT) Evidencing the Proportionate Interests of the Owners thereof in Lease Payments to be Made by the CITY OF DUBLIN THIS ESCROW AGREEMENT, dated as of June 1, 1993, by and between the City of Dublin, California (the "City") and First Trust of California, National Association, as Escrow Agent (the "Escrow Agent") hereunder and as trustee with respect to the Refunded Certificates referred to below (the "Refunded Certificates Trustee") , W I T N E S S E T. H : WHEREAS, the City has previously authorized $17,230,000 1988 Refunding Certificates of Participation (Civic Center Project) (the "Refunded Certificates") , evidencing the proportionate interests of the owners thereof in lease payments to be made by the City as rental for a certain project pursuant to an Amended and Restated Lease Agreement, dated as of March 1, 1988 (the "Prior Lease") with Dublin Information, Inc. (the "Corporation") of which $15, 895,000 remains outstanding and executed pursuant to a Trust Agreement dated as of March 1, 1988 (the "Refunded Certificates Trust Agreement") , by and between the City and the Refunded Certificates Trustee; WHEREAS, the City has determined that $ aggregate principal amount of Certificates of Participation (1993 Civic Center Refunding Project) (the "Certificates") , evidencing the proportionate interests of the owners thereof in lease payments to be made by the City as rental for a certain project pursuant to a lease agreement with the Corporation shall be executed and delivered pursuant to a Trust Agreement, dated as of June 1, 1993, by and among the City, the Corporation and First Interstate Bank of California, as trustee, for the purpose of providing a portion of the funds to pay the principal of and interest and prepayment premium, if any, with respect to the Refunded Certificates to and including February 1, 1998; 1 84420001/7 EKITO figadl e . WHEREAS, by irrevocably depositing with the Escrow Agent moneys (as permitted by, in the manner prescribed by, and all in accordance with the Refunded Certificates Trust Agreement) which moneys will be used to purchase noncallable Federal Securities (as such term is defined in the Refunded Certificates Trust Agreement) satisfying the criteria set forth in Section 13 .01 of the Refunded Certificates Trust Agreement, the principal of and the interest on which when due will provide moneys which, together with the moneys, if any, deposited with the Escrow Agent at the same time pursuant to this Escrow Agreement, will be fully sufficient to pay and discharge the Refunded Certificates (including all principal and interest represented thereby and any prepayment premiums) , due with respect to the Refunded Certificates on and prior to February 1, 1998; WHEREAS, in order to obtain a portion of the moneys needed for such purposes, in addition to delivering its Certificates, the City has authorized the transfer of and, concurrently with the delivery of this Agreement, is transferring certain moneys from the funds established to secure the Refunded Certificates, which moneys shall be deposited in the escrow fund created hereunder, all as provided herein; NOW THEREFORE, in consideration of the mutual covenants and agreements herein contained, the City and the Escrow Agent agree as follows: SECTION 1. Deposit of Moneys . The City hereby deposits with the Escrow Agent in immediately available funds $ consisting of (a) $. representing a portion of the net proceeds of the sale of the Certificates and (b) $ representing the moneys transferred from the Reserve Fund held under the Refunded Certificates Trust Agreement, to be held in irrevocable escrow, by the Escrow Agent separate and apart from other funds of the City and the Escrow Agent in a fund hereby created and established to be known as the "Escrow Fund" and to be applied solely as provided in this Escrow Agreement. The moneys set forth above are at least equal to an amount sufficient to purchase the Federal Securities as provided in Section 2 hereof . SECTION 2 . Investment of Moneys . The Escrow Agent acknowledges receipt of the moneys described in Section 1 hereof and agrees immediately to invest such moneys in the Federal Securities set forth in Schedule A hereto and to deposit such Federal Securities in the Escrow Fund. All other amounts held in the Escrow Fund shall be held as cash except as provided in Section 3 or 4 herein. 2 84420001/7 SECTION 3 . Investment of Any Remaining Moneys. In the event that the Escrow Agent shall receive any payment of principal or interest from the Federal Securities prior to the date on which such payment is required for the purposes set forth herein, at the written direction of the City the Escrow Agent may reinvest the amount of such payment, or any portion thereof, in noncallable Federal Securities maturing not later than the date on which such payment or portion thereof is required for the purposes set forth in Section 5, as verified in a report prepared by an independent certified public accountant or firm of certified public accountants of favorable . national reputation experienced in the refunding of obligations of political. subdivisions and provided the City has obtained and delivered to the Escrow Agent an unqualified opinion of nationally recognized bond counsel that such reinvestment will not adversely affect the exclusion from gross income of interest represented by the Certificates or the Refunded Certificates for purposes of federal income taxation. Any interest income resulting from investment or reinvestment of moneys pursuant to this Section 3 which are not required for the purposes set forth in this Section 3 or Section 5, as verified in the letter of Ernst & Young, (the "Letter") originally obtained by the City with respect to the refunding of the Refunded Certificates or in any other report prepared by an independent certified public accountant or firm of certified public accountants of favorable national reputation experienced in the refunding of obligations of political subdivisions, shall be paid to the City promptly upon the receipt of such interest income by the Escrow Agent. SECTION 4 . Substitution of Securities. Upon the written request of the City, and subject to the conditions and limitations herein set forth and applicable governmental rules and regulations, the Escrow Agent shall sell, redeem or otherwise dispose of the Federal Securities, provided that there are substituted therefor from the proceeds of the Federal Securities: (a) direct general obligations of the United States of America (including obligations issued or held in book entry form on the books of the Department of the Treasury of the United States of America) ; and (b) obligations of any agency, department or instrumentality of the United States of America the timely payment of principal of and interest on which are fully guaranteed by the United States of America; but only after the City has obtained and delivered to the Escrow Agent (a) an unqualified opinion of nationally recognized bond counsel that such reinvestment will not adversely affect the exclusion from gross income of interest payable on the Refunded Certificates or the Certificates for purposes of federal income taxation, and (b) a report by a nationally recognized consulting firm or firm of certified public accountants to the 3 84420001/7 effect that such reinvestment will not adversely affect the sufficiency of the amounts of securities, investments and money in the Escrow Fund to pay when due principal or prepayment price of and interest with respect to the Refunded Certificates on the dates specified in the Refunded Certificates Trust Agreement and herein. The Escrow Agent shall not be liable or responsible for any loss resulting from any reinvestment or liquidation of reinvestment made pursuant to this Agreement and in full compliance with the provisions hereof . SECTION 5. Payment of Refunded Certificates . (a) Payment. From the maturing principal of the Federal Securities and the investment income and other earnings thereon and other moneys on deposit in the Escrow Fund, the Escrow Agent shall, on February 1 and August 1 of each year, to February 1, 1998 apply the amounts on deposit in the Escrow Fund to pay the interest and principal represented by the Refunded Certificates and on February 1, 1998, apply the amounts remaining on deposit in the Escrow Fund to pay the interest and principal represented by and prepayment premium of the Refunded Certificates . (b) Irrevocable Instructions to Provide Notice. The form of the notice required to be mailed or given pursuant to Section 3 . 03 of the Refunded Certificates Trust Agreement is attached hereto as Exhibit B. The City hereby irrevocably instructs the Escrow Agent (i) to mail a notice in the form attached hereto as Exhibit A to the owners of the Refunded Certificates that an irrevocable deposit has been made with the Escrow Agent and that the Refunded Certificates have been deemed to be paid all in accordance with the Refunded Certificates Trust Agreement; and (ii) to mail a notice of prepayment of the Refunded Certificates in accordance with Section 3 . 03 of the Refunded Certificates Trust Agreement as required to provide for the prepayment of the Refunded Certificates in accordance with this Section 5 . The Escrow Agent is hereby further instructed to mail a copy of the notices the forms of which are attached as Exhibit A and Exhibit B hereto to (i) the Securities Depositories (as hereinafter defined) , (ii) the Information Services (as hereinafter defined) and to publish such notices in The Bond Buyer or The Wall Street Journal . "Securities Depositories" shall mean The Depository Trust Company, 711 Stewart Avenue, Garden City, New York 11530, Fax-(516) 227-4039 or 4190; Midwest Securities Trust Company, 4 84420001/7 Capital Structured-Call Notification, 440 South LaSalle Street,, Chicago, Illinois 60605, Fax-(312) 663-2343; Philadelphia Depository Trust Company, Reorganization Division, 1900 Market Street, Philadelphia, Pennsylvania 19103, Attention: Bond Department, Fax-(215) 496-5058; and, in accordance with the then current guidelines of the Securities and Exchange Commission, to such other address and/or such other services providing information with respect to called bonds. "Information Services" shall mean Financial Information, Inc. 's "Daily Called Bond Service, " 30 Montgomery Street, 10th Floor, Jersey City, New Jersey 07302, Attention: Editor; Kenny S&P Information Services, "Called Bond Record, " 65 Broadway, 20th Floor, New York, New York 10006; Moody' s Investors Service "Municipal and Government Manual, " 99 Church Street, 1st Floor, New York, New York 10007, Attention: Municipal News Reports; and Standard and Poor' s Corporation, "Called Bond Record, " 25 Broadway, 17th Floor, New York, New York 10004; and, in accordance with then-current guidelines of the Securities and Exchange Commission, to such other address and/or such other services providing information with respect to called bonds . (c) Unclaimed Moneys. Any moneys which remain unclaimed for two years after the date such moneys have become due and payable hereunder shall, at the written request of the City, be repaid by the Escrow Agent to the City. (d) Priority of Payments. The owners of the Refunded Certificates shall have a lien on moneys and securities in the Escrow Fund which are allocable and sufficient to pay the Refunded Certificates including any prepayment premium thereon, in accordance with this Escrow Agreement verified by the Letter, until such moneys and such securities are used and applied as provided in this Escrow Agreement. (e) Termination of Obligation. As provided in the Refunded Certificates Trust Agreement, upon deposit of moneys with the Escrow Agent in the Escrow Fund as set forth in Section 1 hereof, the purchase of the various Federal Securities as provided in Section 2 hereof, notice of, or provision for notice of, prepayment having been given as set forth in Section 5(b) hereof, all obligations of the Corporation, the Refunded Certificates Trustee and the City with respect to the Refunded Certificates shall cease and terminate, except only the obligation of the Refunded Certificates Trustee to pay or cause to be paid, from lease payments paid by or on behalf of the City as provided in Section 5 hereof . 5 84420001/7 SECTION 6. Application of Certain Terms of Refunded Certificates Trust Agreement. All of the terms of the Refunded Certificates Trust Agreement relating to the making of payments of principal and interest represented by the Refunded Certificates are incorporated in this Escrow Agreement as if set forth in full herein. The procedures set forth in the Refunded Certificates Trust Agreement relating to the resignation and removal of the Refunded Certificates Trustee are also incorporated in this Escrow Agreement as if set forth in full herein and shall be the procedures to be followed with respect to any resignation or removal of the Escrow Agent hereunder. SECTION 7. Performance of Duties . The Escrow Agent agrees to perform only the duties set forth herein and shall have no responsibility to take any action or omit to take any action not set forth herein. SECTION 8. Escrow Agent' s Authority to Make Investments. Except as provided in Sections 2, 3 and 4 hereof, the Escrow Agent shall have no power or duty to invest any funds held under this Escrow Agreement or to sell, transfer or otherwise dispose of the moneys or Federal Securities held hereunder. SECTION 9 . Indemnity. The City hereby assumes liability for, and hereby agrees (whether or not any of the transactions contemplated hereby are consummated) to the extent permitted by law to indemnify, protect, save and keep harmless the Escrow Agent and its respective successors, assigns, agents, officers, directors, employees and servants, from and against any and all liabilities, obligations, losses, damages, penalties, claims, actions, suits, costs, expenses and disbursements (including reasonable legal fees and disbursements) of whatever kind and nature which may be imposed on, incurred by, or asserted against, the Escrow Agent at any time (whether or not also indemnified against the same by the City or any other person under any other agreement or instrument, but without double indemnity) in any way relating to or arising out of the execution, delivery and performance of this Escrow Agreement, the establishment hereunder of the Escrow Fund, the acceptance of the funds and securities deposited therein, the purchase of the Federal Securities, the retention of the Federal Securities or the proceeds thereof and any payment, transfer or other application of moneys or securities by the Escrow Agent in accordance with the provisions of this Escrow Agreement; provided, however, that the City shall not be required to indemnify the Escrow Agent against the Escrow Agent ' s own negligence or willful misconduct or the negligence or willful misconduct of the Escrow Agent ' s respective agents and employees or the willful breach by the Escrow Agent of the 6 84420001/7 terms of this Escrow Agreement. In no event shall the City or the Escrow Agent be liable to any person by reason of the transactions contemplated hereby other than to each other as set forth in this Section. The indemnities contained in this Section shall survive the termination of this Escrow Agreement. SECTION 10 . Responsibilities of Escrow Agent. The Escrow Agent and its agents and servants shall not be held to any personal liability whatsoever, in tort, contract, or otherwise,. in connection with the execution and delivery of this Escrow. Agreement, the establishment of the Escrow Fund, the acceptance of the moneys or securities deposited therein, the purchase of the Federal Securities, the retention of the Federal Securities or the proceeds thereof, the sufficiency of the Federal Securities to pay the Refunded Certificates or any payment, transfer or other application of moneys or obligations by the Escrow Agent in accordance with the provisions of this Escrow Agreement or by reason of any non-negligent act, non-negligent omission or non-negligent error of the Escrow Agent made in good faith in the conduct of its duties. The recitals of fact contained in the "Whereas" clauses herein shall be taken as the statements of the City, and the Escrow Agent assumes no responsibility for the correctness thereof or the correctness of any recitals or statements contained in the Certificates. The Escrow Agent makes no representation as to the sufficiency of the Federal Securities to accomplish the refunding of the Refunded Certificates or to the validity of this Escrow Agreement as to the City and, except as otherwise provided herein, the Escrow Agent shall incur no liability in respect thereof . The Escrow Agent shall not be liable in connection with the performance of its duties under this Escrow Agreement except for its own negligence, willful misconduct or willful breach, and the duties and obligations of the Escrow Agent shall be determined by the express provisions of this Agreement. The Escrow Agent shall be under no obligation to inquire into or be in any way responsible for the performance or nonperformance by the City of its obligations. The Escrow Agent may consult with counsel, who may or may not be counsel to the City, and in reliance upon the written opinion of such counsel shall have full and complete authorization and protection in respect of any action taken, suffered or omitted by it in good faith in accordance therewith. Whenever the Escrow Agent shall deem it necessary or desirable that a matter be proved or established prior to taking, suffering, or omitting any action under this Escrow Agreement, such matter may be deemed to be conclusively established by a certificate signed by an officer of the City. No provision of this Escrow Agreement shall require the Escrow Agent to expend or risk its own funds or incur any financial liability in the performance of its duties hereunder or in the exercise of any of its rights or powers (other than as expressly provided for herein) . 7 84420001/7 P SECTION 11. Amendments. This Escrow Agreement is made for the benefit of the City and the owners from time to time of the Refunded Certificates and it shall not be repealed, revoked, altered or amended without the written consent of all such owners, the Escrow Agent and the City; provided, however, that the City and the Escrow Agent may, without the consent of, or notice to, such owners, amend this Escrow Agreement or enter into such agreements supplemental to this Escrow Agreement as shall not adversely affect the rights of such owners and as shall not be inconsistent with the terms and provisions of this Escrow Agreement or the Refunded Certificates Trust Agreement, for any one or more of the following purposes: (i) to cure any ambiguity or formal defect or omission in this Escrow Agreement; (ii) to grant to, or confer upon, the Escrow Agent for the benefit of the owners of the Refunded Certificates, any additional rights, remedies, powers or authority that may lawfully be granted to, or conferred upon, such owners or the Escrow Agent; and (iii) to include under this Escrow Agreement additional funds, securities or properties. The Escrow Agent shall be entitled to rely conclusively upon an unqualified opinion of nationally recognized municipal bond attorneys with respect to compliance with this Section, including the extent, if any, to which any change, modification, addition or elimination affects the rights of the owners of the Refunded Certificates or that any instrument executed hereunder complies with the conditions and provisions of this Section. SECTION 12. Term. This Escrow Agreement shall commence upon its execution and delivery and shall terminate on the later to occur of either (i) the date upon which the Refunded Certificates have been paid in accordance with this Escrow Agreement or (ii) the date upon which no unclaimed moneys remain on deposit with the Escrow Agent pursuant to Section 5(c) of this Escrow Agreement. SECTION 13 . Compensation. The Escrow Agent shall receive its reasonable fees and expenses as previously agreed to by the Escrow Agent and the City; provided, however, that under no circumstances shall the Escrow Agent be entitled to any lien whatsoever on any moneys or obligations in the Escrow Fund for the payment of fees and expenses for services rendered or expenses incurred by the Escrow Agent under this Escrow Agreement. SECTION 14 . Severability. If any one or more of the covenants or agreements provided in this Escrow Agreement on the part of the City or the Escrow Agent to be performed should be determined by a court of competent jurisdiction to be contrary to law, such covenants or agreements shall be null and void and shall be deemed separate from the remaining covenants 8 84420001/7 and agreements herein contained and shall in no way affect the validity of the remaining provisions of this Escrow Agreement. SECTION 15 . Counterparts. This Escrow Agreement may be executed in several counterparts, all or any of which shall be regarded for all purposes as an original but all of which shall constitute and be but one and the same instrument. SECTION 16 . Governing Law. THIS ESCROW AGREEMENT SHALL BE CONSTRUED UNDER THE LAWS OF THE STATE OF CALIFORNIA. SECTION 17. Insufficient Funds . If at any time the moneys and investments in the Escrow Fund, including the anticipated proceeds of and earnings _thereon, will not be sufficient to make all payments required by this Escrow Agreement, the Escrow Agent shall notify the City in writing, immediately upon becoming aware of such deficiency, of the amount thereof and the reason therefor. The Escrow Agent shall have no further responsibility regarding any such deficiency. 9 84420001/7 IN WITNESS WHEREOF, the parties hereto have caused this Escrow Agreement to be executed by their duly authorized officers and their seals to be hereunto affixed and attested as of the date first above written. CITY OF DUBLIN FIRST TRUST OF CALIFORNIA, NATIONAL ASSOCIATION, as Escrow Agent and as Refunded Certificates Trustee By Authorized Signatory 10 84420001/7 SCHEDULE A FEDERAL SECURITIES MATURITY - PAR ACCRUED TYPE DATE COUPON AMOUNT COST INTEREST TOTAL COST 11 84420001/7 Exhibit A NOTICE OF DEFEASANCE $17,230, 000 1988 REFUNDING CERTIFICATES OF PARTICIPATION (CIVIC CENTER PROJECT) Evidencing the Proportionate Interests of the Owners thereof in Lease Payments to be Made by the CITY OF DUBLIN, CALIFORNIA NOTICE IS HEREBY GIVEN to the owners of the above-captioned certificates of participation (the "Certificates") , that the City of Dublin (the "City") has deposited with First Trust of California, National Association, as the Trustee (the "Trustee") for said Certificates, cash and obligations of the United States of America, the principal of and interest on which when due will provide moneys sufficient to pay: (a) on February 1 and August 1 of each year, to February 1, 1998, the interest and principal represented by said Certificates and (b) on February, 1, 1998, the interest and principal represented by, and, prepayment premium with respect to said Certificates . In accordance with that certain Trust Agreement, dated as of March 1, 1988, by and among the City, Dublin Information, Inc. and the Trustee for said Certificates, all obligations of the City with respect to the Certificates shall cease and terminate and all payments of interest and principal represented by, and prepayment premium with respect to such Certificates shall be paid only from moneys on deposit with the Trustee and available as aforesaid. DATED this day of June, 1993 . FIRST TRUST OF CALIFORNIA, NATIONAL ASSOCIATION A-1 84420001/7 Exhibit B NOTICE OF PREPAYMENT $17,230,000 1988 REFUNDING CERTIFICATES OF PARTICIPATION (CIVIC CENTER PROJECT) Evidencing the Proportionate Interests of the Owners thereof in Lease Payments to be Made by the CITY OF DUBLIN, CALIFORNIA NOTICE IS HEREBY GIVEN to the owners of the above-captioned Certificates of Participation (the "Certificates") of the City of Dublin (the "City") in accordance with that certain Trust Agreement dated as of March 1, 1988, by and among the City, Dublin Information, Inc. and First Trust of California, National Association, as Trustee, with respect to the above-referenced Certificates, that the Certificates, each dated as of March 1, 1988, maturing on and after February 1, 1999 in the amount of $ , as more fully described below, have been called for prepayment on February 1, 1998. Certificates to be prepaid: • Certificate CUSIP Interest Maturity Number Number Rate, Date Owners of the Certificates should present said Certificates on the prepayment date at the following address: First Trust of California, National Association On February 1, 1998, the Certificates to be prepaid will be payable at a prepayment price of 101% of the principal amount plus accrued interest to such date. From and after February 1, B-1 84420001/7 i 1998, interest represented by the Certificates to be prepaid will cease to accrue. DATED this day of First Trust of California, National Association B-2 84420001/7