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14-0916_ORRICK, HERRINGTON & SUTCLIFFE_Second Amended and Restate AgreementSECOND AMENDED AND RESTATED AGREEMENT FOR BOND COUNSEL SERVICES THIS SECOND AMENDED AND RESTATED AGREEMENT (this "Agreement") is entered into as of September, 2014, between the CITY OF SAN JUAN CAPISTRANO (the "Issuer") and ORRICK, HERRINGTON & SUTCLIFFE LLP ("Bond Counsel"), and amends and restates the Amended and Restated Agreement for Bond Counsel Services, entered into as of April 1, 2014, between the Issuer and Bond Counsel (the "Amended Agreement"). Recitals A. Issuer desires to engage the services of bond counsel in connection with a proposed (i) issuance of revenue bonds by the San Juan Capistrano Financing Authority or the San Juan Basin Authority backed by installment payments or lease payments to be made by the Issuer or (ii) execution and delivery of certificates of participation evidencing interests in installment payments to be made by the Issuer (in either case, the "Bonds"), to be sold for the purpose of refunding all or a portion of the San Juan Capistrano Public Financing Authority Revenue Certificates of Participation, Series 2002, and/or refunding all or a portion of the San Juan Basin Authority Lease Revenue Bonds (Groundwater Recovery Project), Issue of 2002, each issued to fund certain water system capital improvement projects (the "Projects"). B. Bond Counsel possesses the necessary professional capabilities and resources to provide the legal services required by Issuer as described in this Agreement. C. Issuer and Bond Counsel entered into an Agreement for Bond Counsel Services, dated June 4, 2013 (the "Original Agreement"). D. Due to unforeseen developments, the Issuer and Bond Counsel amended and restated the Original Agreement by entering into the Amended Agreement. E. Work has resumed on the Bond financing. F. The Amended Agreement provides as follows: "For legal services rendered from and after the [resumption of work on the Bond financing], Bond Counsel will be paid such fee as Bond Counsel and the Issuer shall determine, in good faith, to be fair and appropriate. The determination of [such amount] shall take into account the amount of additional time expected to be required to be expended to complete the issuance of the Bonds and the $101,729 of time expended and disbursements incurred by Bond Counsel in providing services under the Original Agreement prior to September 1, 2013." G. Issuer and Bond Counsel have determined that the fee to be paid to Bond Counsel set forth in this Agreement is fair and appropriate. H. The Issuer and Bond Counsel desire to amend the Amended Agreement as provided in this Agreement. Agreements Scope of Services. Bond Counsel shall perform the following legal services: (1) Analysis of the validity of the Bonds under State of California law and the exclusion of interest on the Bonds from gross income under federal tax law. (2) Consultation with representatives of the Issuer, including Rutan & Tucker, LLP ("Issuer Counsel"), Fieldman, Rolapp & Associates, and others, with respect to the timing, terms, and legal structure of the proposed Bonds. (3) Preparation of documents to be adopted or entered into by the Issuer, the San Juan Capistrano Public Financing Authority or the San Juan Basin Authority required for the authorization, sale and issuance of the Bonds, including preparation of the resolutions approving the issuance of the Bonds, any indenture or trust agreement providing for the issuance of the Bonds, any purchase contract providing for the sale of the Bonds and any installment sale agreement or lease entered into by the Issuer backing the Bonds (the "Major Legal Documents"). (4) Attendance at such meetings or hearings of the Issuer and working group meetings or conference calls as Issuer may request. (5) Preparation of final closing papers to be executed by the Issuer, the San Juan Capistrano Public Financing Authority or the San Juan Basin Authority required to effect delivery of the Bonds (including the Tax Agreement) and coordination of the Bond closing. (6) Rendering of Bond Counsel's customary form of final legal opinion to the issuer of the Bonds on the validity of the Bonds and the tax-exempt status of interest thereon. (7) Preparation and dissemination of closing transcripts. (8) Such legal services with respect to outstanding debt obligations payable from the revenues of the Issuer's water enterprise (other than representation in any litigation or other legal or administrative proceeding, audit or investigation) as the Issuer shall request. Issuer shall have and will rely on Issuer Counsel to render day-to-day and ongoing general counsel legal services. Bond Counsel shall circulate documents to and coordinate its services with Issuer Counsel to the extent requested by Issuer or Issuer Counsel. Bond Counsel shall be entitled to assume that Issuer Counsel has reviewed all documents and matters submitted to Issuer for adoption or approval or to officers of Issuer for execution prior to such adoption, approval or execution. In rendering opinions and performing legal services under this Agreement, Bond Counsel shall be entitled to rely on the accuracy and completeness of information provided and certifications made by, and opinions provided by counsel to, Issuer and other parties and consultants, without independent investigation or verification. Knowledge of attorneys and non - attorneys at Bond Counsel's firm not working directly on the Bond issue will not be imputed to Bond Counsel nor shall there be any duty on the part of Bond Counsel to make any inquiry of such other attorneys or non -attorneys. Bond Counsel services are limited to those specifically set forth above. For example, Bond Counsel services do not include representation of Issuer or any other party to the transaction in Capistrano Taxpayers Association, Inc. v. City of San Juan Capistrano or any other litigation or other legal or administrative proceeding, audit or investigation involving any of the Bonds, the Projects or any related matter. Additionally, Bond Counsel services do not include the preparation, negotiation, content or validity of any agreements relating to the Projects other than the Major Legal Documents or any legal advice relating to the Projects or to water rights. Bond Counsel services also do not include any responsibility for compliance with federal or state securities laws, environmental, land use, real estate, insurance or similar laws or matters or (except as required for tax exemption of the Bonds) any tax laws, or for title to, recording, filing or perfection of security interests in real or personal property. Bond Counsel services do not include any financial advice or analysis or data or mathematical verification. Bond Counsel will not be responsible for the services performed or acts or omissions of any other transaction participant. Also, Bond Counsel services will not extend past the date of issuance of the Bonds and will not, for example, include services related to rebate or other post issuance tax compliance or continuing disclosure (although Bond Counsel may be available for separate engagement to provide either or both such services pursuant to separate contract) or otherwise related to the Bonds, Bond proceeds or the Project after issuance of the Bonds. 2. Fees and Expenses. A. Fees. Bond Counsel will be paid a fixed fee for the foregoing services of $120,000 if the Issuer proceeds with either the Water System Refunding or the SJBA Refunding only and $180,000 if the Issuer proceeds with both the Water System Refunding and the SJBA Refunding. The fixed fee is based, in part, upon the assumption that the terms, structure, size and schedule of the financing will conform to the description in Recital A of this Agreement, the scope of services will conform to the description thereof contained in Section 1 of this Agreement, the Water System Refunding and the SJBA Refunding will proceed on approximately the same schedule, the transaction will not have an extraordinary amount of problems/issues, Bond Counsel will not be required to make more than two out of town trips and will be required to attend no more than the usual number of meetings and conference calls, Bond Counsel will not be required to generate an inordinate amount of drafts of the Major Legal Documents, the Bonds will be privately placed, the structure of the transaction will not materially change (particularly after preparation of the Major Legal Documents has commenced), and the Bonds will be issued not later than December 31, 2014. If any part of this assumption is incorrect, or if any unusual or unforeseen circumstances arise, and occasions substantial additional work or responsibility on the part of Bond Counsel, Bond Counsel will be entitled to seek additional compensation in such amount as the Issuer and Bond Counsel shall mutually agree to be appropriate. B. Expenses. Bond Counsel will not charge for expenses customarily incurred by Bond Counsel in performing the bond counsel services described in Section 1 of this Agreement. Any filing, publication or printing costs required in connection with the Bonds shall be paid directly by Issuer, but if paid by the Bond Counsel on behalf of Issuer, shall be reimbursed to Bond Counsel on demand. C. Payment. Fees shall be payable by Issuer upon the issuance of the Bonds. Payment of all fees hereunder shall be entirely contingent upon issuance of the Bonds. 3. Termination of Agreement Legal Services and Other Obligations. This Agreement and all legal services to be rendered under it may be terminated at any time by written notice from either party, with or without cause. In that event, all finished and unfinished documents prepared for adoption or execution by Issuer, shall, at the option of Issuer, become its property and shall be delivered to it or to any party it may designate; provided that Bond Counsel shall have no liability whatsoever for any subsequent use of such documents. In the event of termination by Issuer, Bond Counsel shall be paid for all unpaid portions of the Hourly Component upon such termination and shall be paid the Contingent Component upon the issuance of any Bonds, unless the termination is made for cause, in which event compensation, if any, shall be adjusted in the light of the particular facts and circumstances involved in the termination. If not sooner terminated as aforesaid, this Agreement and all legal services to be rendered under it shall terminate upon issuance of the Bonds; provided that Issuer shall remain liable for any unpaid compensation or reimbursement due under Section 2 of this Agreement. Upon termination, Bond Counsel shall have no future duty of any kind to or with respect to the Bonds or the Issuer. This Agreement shall not be the basis of any breach of contract claim that would have the effect of extending the statute of limitations pertaining to legal malpractice to the statute of limitations pertaining to breach of contract. Except as state above, Bond Counsel retains the right to discard any files and materials. It is Bond Counsel's current policy (subject to change) to discard all files and materials after issuance of the Bonds (except the closing transcript until after the Bonds are paid or defeased) or following cessation of work on the financing without issuance of Bonds. 4. Nature of Engagement, Client Relationships With Other Parties. The role of bond counsel, generally, is to prepare or review the proceedings for issuance of the bonds, notes or other evidence of indebtedness and to provide an expert legal opinion with respect to the validity thereof and other subjects (usually including the tax status of interest thereon) addressed by the opinion. Consistent with the historical origin and unique role of bond counsel, and reliance thereon by the public finance market, Bond Counsel's role as bond counsel under this Agreement is to provide opinions and related legal services that represent an objective judgment on the matters addressed rather than the partisan position of an advocate. In performing its services as bond counsel in connection with the Bonds, Bond Counsel will act as special counsel to Issuer (as such and not any particular body, board, office or official) with respect to issuance of the Bonds; i.e., Bond Counsel will assist Issuer Counsel in representing Issuer but only with respect to validity of the Bonds and the Major Legal Documents as to the Issuer and tax status of interest on the Bonds, and in a manner not inconsistent with the role of Bond Counsel described in the first sentence of this section. Issuer acknowledges that Bond Counsel regularly performs legal services for many private and public entities in connection with a wide variety of matters. For example, Bond Counsel has represented, is representing or may in the future represent other public entities, underwriters, trustees, rating agencies, insurers, credit enhancement providers, lenders, contractors, suppliers, financial and other consultants/advisors, accountants, investment and swap providers/brokers, providers/brokers of derivative products and others who may have a role or interest in the Bond financing or the Projects or that may be involved with or adverse to Issuer in this or some other matter. Bond Counsel agrees not to represent any such entity in connection with the Bond financing, during the term of this Agreement, without the consent of Issuer. Given the special, limited role of bond counsel described above, Issuer acknowledges and agrees that no conflict of interest exists or would exist, and waives any actual or potential conflict of interest that might be deemed to arise, now or in the future, from this Agreement or any such other relationship that Bond Counsel may have had, have or enter into, and Issuer specifically consents to any and all such relationships. 5. Limitation of Rights to Parties. Nothing in this Agreement or in any of the documents contemplated hereby, expressed or implied, is intended or shall be construed to give any person other than Issuer and Bond Counsel any legal or equitable right or claim under or in respect of this Agreement, and this Agreement shall inure to the sole and exclusive benefit of Issuer and Bond Counsel. 6. Counterparts. This Agreement may be executed in any number of counterparts and each counterpart shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same Agreement. 7. Insurance. Bond Counsel advises that it does maintain errors and omissions insurance coverage applicable to the services to be rendered under this Agreement. Issuer and Bond Counsel have executed this Agreement by their duly authorized representatives as of the date provided above. CITY OF SAN JUAN CAPISTRANO By ?, Sam Allevato, Mayor ORRICK, HERRINGTON & SUTCLIFFE LLP Bv r Steplurn,f. Spitz, Partner APPROVED AS TO FORM: Hans Van Ligten, City Attorney