HomeMy WebLinkAboutPardee-Grossman Cottonwood Canyon - Reimbursement Agreement REIMBURSEMENT AGREEMENT
THIS REIMBURSEMENT AGREEMENT approved this 27th day of
March, 1990, by and between the City of Lake Elsinore (the
"City") , a City organized and existing under laws of the State of
California (the "State") , and Pardee - Grossman/Cottonwood Canyon,
a general partnership organized and existing under the laws of the
State ("Pardee") ;
W I T N E S S T H•
WHEREAS, the Project (as hereinafter defined) shall be
constructed pursuant to City' s Circulation Element of the General
Plan and to the transportation provisions thereof by Pardee; and
WHEREAS, the present estimated Construction Costs of the
Project are $13 , 686, 900 ; and
WHEREAS, the construction costs of the Project will be
initially defrayed with funds to be advanced by Pardee which
advances plus interest are to be reimbursed from the fees
collected by City in accordance with this agreement; and
WHEREAS, the parties recognize and acknowledge that
construction of the Project is dependent upon Pardee advancing the
necessary funds.
NOW, THEREFORE, in consideration of the terms and
conditions herein set forth, the City and Pardee DO HEREBY AGREE
AS FOLLOWS:
Section 1. 0 Definitions.
"Additional Interest" shall mean, with respect to each
fiscal year of the City, all interest actually accrued on Advances
made by Pardee for Construction Costs pursuant to this Agreement
during such Fiscal Year.
"Administrative Costs" shall mean 10% of the amount of
Construction Costs, payable to Pardee as the administrator of the
Project on the first business day of each month, and based on the
aggregate amount of the Construction Costs for the prior month.
"Advances" shall mean, collectively as of any date, (i)
all advances of funds made by Pardee pursuant to Section 3 . 1
hereof prior to such date; and (ii) all Additional Interest for
fiscal years of the City which have been completed prior to such
date.
"Agreement" shall mean this Reimbursement Agreement,
entered into by the City and Pardee, as contemplated and
authorized by Sections 66484 and 33514 . 9 of the Government Code.
"Construction Costs" shall mean the costs for the
construction and completion of the Project including, but not
— Contract and Agreement 654
limited to, the costs of assessment engineering; preliminary
traffic studies ; design ; engineering ; the services, reports and
studies of environmental and other consultants ; legal expenses;
right of way appraisal ; procurement and condemnation proceedings ;
preliminary engineering and topographic survey; right of way
acquisition; legal and financial consulting fees in developing the
road program; engineering design; soils engineering; construction
survey; engineering and soils support services during construction
phase ; permits; miscellaneous City, County and Caltrans fees;
reimbursable costs such as blueprinting and copying; and
Administrative Costs .
"Council" means the City Council of the City.
"Ordinance" means Ordinance No. 854 of the City adopted
pursuant to Sections 66484 and 66489 of t e Government Code which:
(a) permits City to require the payment of a fee for purposes of
defraying the actual or estimated cost of constructing bridges
ove'r waterways, railways, freeways, and canyons, or constructing
major thorough fares ; and (b) prescribes the procedure and
conditions to be complied with by City in order to enable City to
require the payment of such fees.
"Prime Rate" shall mean that variable rate of interest
equal to the prime rate as printed on the first business day of
each month in the Wall Street Journal , or in the event such rate
is not printed, the rate announced by a bank of the State agreed
upon by the City and Pardee, as the prime lending rate for such
bank.
"Project" means the design and construction, including
the preparation of the plans and specifications and the necessary
documents or reports as may be required for the widening,
straightening, and reprofiling (regrading) of Railroad Canyon Road
from Interstate 15 to a location near the north line of the
Cottonwood Hills Specific Plan, being a point where 4-lane paved
improvements exist; said length of road being approximately
12 , 500 feet. The Project includes, but is not limited to, traffic
detouring and signing, (including the potential construction of a
temporary road) grading and rock blasting, installation of curbs
and raised medians, grading of the roadbed to the ultimate
sections width (varies from 110 feet to 124 feet) , asphaltic
concrete paving, curbs, raised medians, storm drains, brow
ditches, slope planting, median landscaping, lighting, traffic
signal , signing, and striping.
"Resolution" means
77"" � No. 854 of the City
which permits the City to collect Reimbursement Yees for the
Project and to reimburse Pardee for certain costs related to the
Project.
"Reimbursement District" means the area set forth in the
"J%Vi" No. 854
"Reimbursement Fee" means collectively (i) that fee which
will be paid by developments within the Reimbursement District
pursuant to the Ordinance and the Resolution for the development
of any or all undeveloped property lying within the Reimbursement
District, as such fee may be amended and/or increased from time to
time, and (ii) the amounts, if any, available from a Mello Roos
Community Facilities District or other financing district formed
over all or a portion of Pardee ' s property.
Section 2 . 0 Construction of the Project. City and
Pardee agree that Pardee shall construct the Project and that
Pardee shall be paid the Administrative Fee from the Reimbursement
Fees for the services to be rendered in connection with the
construction of the Project. Pardee shall competitively bid the
construction contract for the Project and shall provide that the
contractor pay prevailing wages in connections with the
construction of the Project.
Section 3 . 0 Advancement of Funds and Reimbursement.
3 . 1 Advancement of Funds. Pardee undertakes and agrees,
from time to time, to advance the funds required to defray the
Construction Costs, when, as and if such funds are required up to
an aggregate principal amount not to exceed $9 , 000, 000; provided,
however, that funds will not be advanced to the extent any
Reimbursement Fees (including but not limited to Reimbursement
Fees payable by Pardee) are available to pay Construction Costs,
and such sums, to the extent available shall be used to pay
Construction Costs first. To the extent all Construction Costs
have been paid such Reimbursement Fees shall be applied as
provided in Section 3 . 5 hereof.
3 . 2 Maintenance of the Reimbursement District.
Collection of Fees and Formation of Mello Roos District.
(a) City undertakes and agrees to diligently comply with
such provisions of law as may be necessary to permit City to
charge and collect the Reimbursement Fees. City shall not, unless
and until all amounts due and owing under this agreement and the
Notes have been fully paid:
(i) amend or rescind the Ordinance of the Resolution
in any manner so as to reduce the amount of land within the
Reimbursement District or reduce the amount of the Reimbursement
District or reduce the amount of the Reimbursement Fees payable by
any owner of land within the Reimbursement District;
(ii) fail to collect the Reimbursement Fees when due;
(iii) fail to defend in good faith any legal
challenge to the establishment of the Reimbursement District
and/or the collection of the Reimbursement Fees.
In addition, City shall no later than the fifth business
day of each month provide Pardee with all Reimbursement Fees
collected during the prior calendar month and provide an accounting
of all Reimbursement Fees collected. Pardee shall apply all
Reimbursement Fees received as provided in Sections 3 . 1 and 3 . 5
hereof.
(b) City shall use its best efforts to form a Mello Roos
Community Facilities District or other financing district over all
or a portion of Pardee ' s property to pay for the construction of
the Project and/or to reimburse Pardee for the Advances. In that
regard, the City shall undertake all steps necessary (including
but not limited to those steps required by Section 33514. 9 of the
Government Code) -to assure that Pardee will be reimbursed for the
Advances to the extent a Mello Roos Community Facilities District
or other financing district is formed.
3 . 3 Execution and Delivery of the Note. The obligations
of City to repay the aggregate unpaid amount of the Advances and
interest thereon shall be evidenced by a promissory note in
substantially the form of Exhibit B attached hereto, dated the
date hereof, duly executed and delivered by City to Pardee (the
"Note") . The aggregate amount of the Advances shall be adjusted
at the end of each Fiscal Year of the City to include all
Additional Interest on all Advances for the prior Fiscal Year, and
the principal amount of the Note shall also be adjusted to include
all such Additional Interest as part of the principal of the Note.
Pardee shall endorse on the schedule attached to the Note
appropriate notations as provided therein to evidence the making
of and payments by City upon each Advance; provided, however, that
the failure to make or error in making such notation shall not
limit or otherwise affect the obligations of City hereunder or
under the Note. Pardee ' s obligations of City hereunder or under
the Note. Pardee' s notations shall be conclusive, absent manifest
error. The principal of the Note shall be prepayable in whole or
in part at any time by the City, upon three business days notice
to Pardee. Notwithstanding anything herein to the contrary, the
City shall have no obligation to make any payments on the Note or
pursuant to this Agreement, except from Reimbursement Fees
collected by the City. The Advances from time to time outstanding
under the Note shall bear interest at the Prime Rate plus 2% per
annum. Interest on the Note shall be computed on the basis of a
year of 365 days (or 366 days in leap year) and paid for actual
days elapsed and shall be calculated on the last day of each
fiscal year of the City.
3 . 4 Pardee Credits. Pardee shall be entitled on any
business day to claim, at its sole option, a credit against the
amount of any Reimbursement Fee which would otherwise be payable
by Pardee with respect to the development of its property lying
within the Reimbursement District, an amount up to the aggregate
amount of Advances outstanding on such business day; provided,
however, that the aggregate amount of the Advances shall be
reduced on the date any such Reimbursement Fee would be payable by
Pardee by the amount of each credit received in lieu of the
payment of any such Reimbursement Fee.
3 . 5 Reduction in Advances. The aggregate amount of
Advances shall be reduced on the fifth business day of each
calendar month by the amount of the Reimbursement fees received by
Pardee from the City for the prior calendar month, pursuant to
Section 3 . 2 hereof.
Section 4 . 0 Representations, Warranties and Covenants of
the City. The City represents and warrants to, and covenants with
Pardee that:
(a) The City is a city organized and operating pursuant
to the Constitution and laws of the State and has all necessary
power and authority to enter into and perform its duties under
this Reimbursement Agreement and the Note and, when executed and
delivered by the respective parties hereto, this Reimbursement
Agreement and the Note will each constitute the legal, valid and
binding obligations of the City enforceable in accordance with its
terms, except as enforceable in accordance with its terms, except
as enforcement hereof and thereof may be limited by bankruptcy,
insolvency or other laws affecting the enforcement of creditors '
rights generally and by the application of equitable principles if
equitable remedies are sought.
(b) The execution and delivery by the City of this
Reimbursement Agreement and the Note and compliance by the City
with the provisions hereof and thereof, will not conflict with, or
constitute a violation of or default under, the Constitution of
the State or any existing law, charter, ordinance, regulation,
decree, order or resolution applicable to the City, and will not
conflict with or result in a violation or breach of, or constitute
a default under, any contract, agreement, indenture, mortgage,
lease or other instrument to which the City is subject or by which
it is bound.
(c) There is no action, suit or proceeding of any court
or governmental agency or body pending or to the best knowledge of
the City, threatened against the City, in any way contesting or
affecting the validity of this Reimbursement Agreement, the
Reimbursement District, the Reimbursement Fees or the Note or
contesting the powers of the City to enter into or perform its
obligations under this Reimbursement Agreement or the Note or in
which a final adverse decision could materially adversely affect
the operations of the City or the consummation of the transactions
contemplated by this Reimbursement Agreement, the Resolution, the
Ordinance or the Note.
(d) The City is not in breach of or default under any
applicable law of administrative regulation of the State or the
United States or any applicable judgment or decree or any loan
agreement, indenture, bond, note, resolution, agreement or other
instrument to which the City is a party or is otherwise subject,
which breach or default would materially adversely affect its
ability to enter into or perform its obligations under this
Reimbursement Agreement, the Resolution, the Ordinance or the
Note, and no event has occurred and is continuing which, with the
passage of time or the giving of notice, or both, would constitute
a default or an event of default under any such instrument and
which would materially adversely affect the City' s ability to
enter into or perform its obligations under this Reimbursement
Agreement, the Resolution, the Ordinance or the Note.
(e) Except as specifically provided in the Conditions of
Approval of the Specific Plan for Cottonwood Hills and in the
resolution of approval for the Cottonwood Hills Phase I Vesting
Tentative Map, the City will not condition the approval of any
entitlements with respect to property of Pardee within the
boundaries of the Reimbursement District, including but not
limited to the issuance of final subdivision maps, building
permits, inspections, or certificates of occupancy, upon the
construction of the Project and will not seek other forms of
mitigation with respect to the Project, including, but not limited
to, the payment of money, the dedication of land, or the
application of an assessment, tax or requirements of any nature
against any property within the Reimbursement District (other than
the Reimbursement Fees) , whether or not permitted by present or
future State law, rulings, regulations, and court decisions if the
proceeds of such assessment, tax or requirement will be used to
finance or fund, directly of indirectly, the Project.
(f) The City has all necessary power and authority to
establish the Reimbursement District and levy and collect the
Reimbursement Fees and, the Resolution and the Ordinance
establishing the Reimbursement District were duly adopted and
have not been amended, modified or rescinded.
(g) The establishment of the Reimbursement District and
the Reimbursement Fees does not conflict with, or constitute a
violation of or default under, the Constitution of the State or
any existing law, charter, ordinance, regulation, decree, order or
resolution applicable to the City, and will not conflict with or
result in a violation or breach of, or constitute a default under,
any contract, agreement, indenture, mortgage, lease or other
instrument to which the City is subject or by which it is bound.
(h) To the best knowledge of the City there is no
action, suit or proceeding of any court or governmental agency or
body pending or threatened against the City in any way contesting
or affecting the validity of the Reimbursement District or
contesting the powers of the City to levy and collect the
Reimbursement Fees or in which a final adverse decision could
materially adversely affect the operations of the Reimbursement
District.
(i) The City is not in breach of or default under any
applicable law of administrative regulation of the State or the
United States or any applicable judgment or decree or any loan
agreement, indenture, bond, note, resolution, agreement or other
instrument to which the City is a party or is otherwise subject,
which breach or default would materially adversely affect the
City' s ability to collect the Reimbursement fees, and no event has
occurred and is continuing which, with the passage of time or the
giving of notice, or both, would constitute a default or an event
of default under any such instrument and which would materially
adversely affect the City' s ability to collect the Reimbursement
Fees.
(j ) The City shall perform such further acts and to
execute and deliver such further documents as may be reasonably
necessary to carry out the provisions of this Agreement, the
Ordinance, the Note and the Resolution.
(k) In order to maintain the exclusion from gross income
for Federal Income Tax purposes of the interest on the Note, the
City Covenants to comply with each applicable requirement of
Section 103 and Sections 141 through 150 of the Internal Revenue
Code at 1986, as amended.
Section 5. 0 Conditions to Effectiveness.
The obligations of Pardee under this Agreement have been
undertaken in reliance on, and shall be subject to, the due
performance by the City of its covenants and agreements to be
observed and performed hereunder and to the accuracy of the
representations and warranties of the City herein on the date
hereof. Pardee ' s obligations to make Advances under this
Agreement shall be subject to, at the option of Pardee, the
satisfaction of the following conditions precedent:
Section 5. 1 First Advance. In the case of the first
Advance made on or before the date hereof, Pardee shall have
received the following, each duly executed and in form and
substance satisfactory to Pardee:
(a) This Agreement.
(b) The Note.
(c) Certified copies of the Resolution and the
Ordinance.
(d) A certificate, signed by an authorized
representative of the City, affirming the accuracy of the
representations and warranties contained in this Agreement.
(e) Certified copies of the resolution (the "Authorizing
Resolution ") of the Council authorizing the execution, delivery
and performance of this Agreement and the Note.
(f) Certificate of the Clerk of the Council certifying
the names and offices of the officers of the Council authorized to
sign this Agreement and the Note, together with the true
signatures of such officers.
(g) An opinion of counsel to the City in form and
substance satisfactory to Pardee and its counsel addressed to
Pardee, to the effect that:
(i) the City is duly organized and validly existing
under the Constitution and the laws of the State;
(ii) the Resolution, the Ordinance and the
Authorizing Resolution have each been duly adopted at a meeting of
the Council which was called and held pursuant to law and with
all public notice required by law and at which a quorum was
present and acting throughout, and that the Resolution, the
Ordinance and the Authorizing Resolution are each in full force
and effect and have not been modified, rescinded or amended.
(iii) there is no action, suit, proceeding or
investigation at law or in equity before or by any court or
governmental agency or body, pending or, to the best knowledge of
such counsel threatened against the City in any way contesting or
affecting the validity of the Reimbursement District, the
Reimbursement Fee, this Agreement or the Note or contesting the
powers of the Council to enter into or perform its obligations
under this Agreement, the Note, the Resolution or the Ordinance;
(iv) to the best knowledge of such counsel after
reasonable investigation, the execution and delivery of this
Agreement and the Note, compliance with the provisions of this
Agreement, the Resolution, the Ordinance and the Note under the
circumstances contemplated hereby and thereby do not and will not
in any material respect conflict with or constitute on the part of
the City a breach of or default under any agreement or other
instrument to which the City is a party or by which it is bound or
any existing law, regulation, court order or consent decree to
which the City is subject;
(v) this Agreement and the Note have been duly
authorized, executed and delivered by the City and, assuming due
authorization, execution and delivery by Pardee of the
Reimbursement Agreement, each constitute legal, valid and binding
obligations of the City enforceable in accordance with its terms,
except as the enforcement hereof may be limited by bankruptcy,
insolvency or other laws affecting the enforcement of creditors '
rights generally and by the application of equitable principles if
equitable remedies are sought;
(vi) no authorization, approval, consent or other order
of the State or any local agency of the State, other than such
authorizations, approvals and consents which have been obtained,
is required for the valid authorization, execution and delivery by
the City of the Note and this Agreement;
(vii) the City is not in breach of or default under any
applicable law or administrative regulation of the State or the
United States or any applicable judgment or decree or any loan
agreement, indenture, bond, note, resolution, contract or other
instrument to which the City is a party or is otherwise subject,
which breach or default would materially adversely affect the
City' s ability to perform its obligations under this Agreement,
the Note, the Resolution or the Ordinance, and no event has
occurred and is continuing which, with the passage of time or the
giving of notice, or both, would constitute a default or an event
or default under any such instrument and which would materially
adversely affect the City' s ability to perform its obligations
under this Agreement, the Note, the Resolution or the Ordinance;
(viii) the Reimbursement District has been duly and
properly formed and the City has full legal power and authority to
collect the Fees as contemplated by the Ordinance and the
Resolution; and
Section 5 . 2 . Subsequent Advances. In the case of any
subsequent advances the representations and warranties contained
in this Agreement shall be true and correct on and as of the date
of each such Advance as though made as of such date.
Section 6. 0 Indemnification. To the extent permitted by
law the City agrees to indemnify and save Pardee harmless from and
against all claims, suits and actions brought against, or to which
any such person .or entity is made a party, and from and against
all losses and damages suffered by them as a result thereof, where
and to the extent such claim, suit or action arises out of the
establishment and formation of the Reimbursement District, the
collection of Reimbursement Fees or the execution and delivery
of this Agreement or the Note. In the event the City is required
to indemnify as herein provided the City shall be subrogated to
the rights of Pardee to recover such losses or damages from any
other person or entity.
Section 7 . 0 Miscellaneous.
Section 7 . 1 Successors. All of the covenants,
stipulations, promises, and agreement contained in this Agreement
by or on behalf of, or for the benefit of, any of the parties
hereto, shall bind or inure to the benefit of the successors of
the respective parties.
Section 7 . 2 Amendment. This Agreement shall be amended
only by a written instrument executed by the parties hereto or
their successors.
Section 7 . 3 Severability. If any provision of this
Agreement or the Note shall be held to be invalid, illegal or
unenforceable, the validity, legality and enforceability of the
remaining portions hereof shall not in any way be affected or
impaired thereby.
Section 7 . 4 Entire Agreement. This Agreement and the
Note supersedes and cancels any and all other agreements, either
oral or written, between the parties with respect to the subject
matter herein. Each party to this Agreement acknowledges that no
representation by any party which is not embodied herein or in any
other agreement, statement, or promise not contained in this
Agreement or the Note shall be valid and binding. The parties
hereto agree to act in a manner which will not frustrate the
purposes of this Agreement or the Note.
Section 7 . 5 Governing Law. This Agreement shall be
governed by and construed in accordance with the laws of the
State.
Section 7 . 6 Execution. This Agreement may be executed
in several counterparts each of which shall be an original and all
of which shall constitute bur one and the same agreement.
Section 7 . 7 Notices. All correspondence, notices or
certificates required by this Agreement shall be sufficiently
given and served if delivered by hand directly to the offices
named below or sent by United States first-class mail postage
prepaid and addressed as follows:
(a) if to Pardee,
Pardee Construction Company
10880 Wilshire Boulevard
Suite 1400
Los Angeles, California 90024
Attention: President
(b) if to the City
City of Lake Elsinore
130 South Main Street
Lake Elsinore, California 92330
Attention: Director of Finance.
Section 7 . 8 Costs and expenses of Pardee. All actual
costs and expenses incurred by Pardee to the date of the execution
of this Agreement in connection with the formation of the
Reimbursement District and the execution of this Agreement and
thereafter, all actual costs and expenses of Pardee relating to
the collection of the Reimbursement Fees, the Reimbursement
District and/or this Agreement, including but not limited to the
fees and expenses of its counsel and other experts, shall be
reimbursed and shall be construed as part of the Construction
Costs.
Section 7. 9 Increased costs. In the event the costs of
II the Project exceed $13 , 686, 900, City shall take all necessary
actions to increase the amount of the Reimbursement Fee
established in the Ordinance and in the Resolution, so as to
provide sufficient funds to pay for such increased costs from the
remaining undeveloped property situated within the Reimbursement
District.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement on the day and year first above written.
CITY OF LAKE ELSINORE
JIM RIAKLER, MAYOR
A TEST: APPROVED AS TO FORM & LEGALITY:
a
VICKI k1`_&AD, CITY CLERK JOHN R. HARP R, CI Y ATTORNEY
PARDEE-GROSSMAN/COTTONWOOD CANYON,
a General Partnership
by: Pardee Construction Company
a California Corporation,
General Partner
BY
EXHIBIT A
Reserved
EXHIBIT R
CITY OF LAKE ELSINORE
REIMBURSEMENT AGREEMENT NOTE
$9 , 000 , 000 . 00 Lake Elsinore, California
February 1 , 1990
On February 1, 2009 or such earlier date as
Reimbursement Fees are available, for value received, the
CITY OF LAKE ELSINORE, a public corporation organized and
existing under the laws of the State of California ("City") ,
hereby promises to pay to the order of PARDEE CONSTRUCTION
COMPANY, a California corporation ("Pardee") , at Los
Angeles, California, the sum of up to Nine Million and
00/100 ' s -------------------- Dollars ($9 , 000 , 000 . 09 .
Interest shall be payable on the unpaid balance hereof from
time to time outstanding hereunder on the dates and at the
rate per annum specified pursuant to Section 3 . 3 of, or as
otherwise provided in, the Reimbursement Agreement.
Prepayments may be made at any time on this Note,
without premium or penalty, in part or in full, together
with accrued interest to the date of such prepayment on the
amount prepaid, upon 3 business days' notice to Pardee.
All amounts payable on this Note pursuant to the
Reimbursement Agreement shall be payable in lawful money of
2CIZOOZ5.MX5.649,963-006 B -1
02/09/90
the Unitea States of America in immediately available funds,
as provided in the Reimbursement Agreement, at Pardee
Construction, 10880 Wilshire Boulevard, Suite 1400, Los
Angeles, California 90024 .
This Note is the Note referred to in, and is
subject to, that certain Reimbursement Agreement dated as of
February 1, 1990, between City and Pardee (as the same may
be amended, modified or supplemented from time to time, the
"Reimbursement Agreement") . Capitalized terms used and not
defined in this Note shall have the meanings defined in the
Reimbursement Agreement.
City promises to pay costs of collection and
reasonable attorneys' fees incurred by Pardee in connection
with the enforcement of this Note. Except as provided in
the Reimbursement Agreement, City hereby waives diligence,
demand, presentment, protest or notice of any kind
whatsoever. Notwithstanding anything herein to the
contrary, the City shall not be obligated to make any
payments with respect to this Note except to the extent of
the Reimbursement Fees.
This Note is governed by, and shall be construed
in accordance with, the laws of the State of California.
2C1200I5.MXS.649,963-006 B-2
02/09/90
IN WITNESS WHEREOF, this Note has been executed as
of the day and year first above written.
CITY OF LAKE ELSINORE
B 1 `-
Y
By
(SEAL)
2MOOIS.MS.649,963-006 B-3
02/09/90
Note (cont' d)
ADVANCES AND PAYMENTS OF PRINCIPAL
Amount Amount of Unpaid
of Principal Principal Notation
Date Advance Repaid Balance Made By
B-4
CERTIFICATE
It is hereby certified that the Representations and Warranties
contained in the Reimbursement Agreement between Pardee Construction
Company and the City of Lake Elsinore dated March 27 , 1990, in
connection with the improvement of Railroad Canyon Road are correct
and accurate and are those Representations and Warranties agreed upon
between the parties.
l ;
Dated Sept. 28, 1990 k I,(
GARY ASHBURN, Mayor
City` f Lake Elsinore
LAW OFFICES
BROWN,HARPER,BURNS&HENTSCHKE
NEWPORT BEACH(714)551-1915
F.MACKENDE BROWN' 453 5.GLASSELL STREET
FAX 476-1015
ALAN R.BURNS ORANGE,CALIFORNIA 92666
JOHN ROBERT HARPER' (714)771.7728 SAN DIEGO(619)456-1915
DANIEL S.HENTSCHKE FAX 744.3350 FAX 259-OM
ROBERT A.OWEN
OF COUNSEL
MMCHAEL B MONTGCMERV'
'A PROFESSIONAL CORPORATION
September 25, 1990
Vicki Kasad, City Clerk
City of Lake Elsinore
130 South Main Street
Lake Elsinore, CA 92330
Re: Pardee Construction Company Reimbursement Agreement
Dear Vicki:
Enclosed please find the Certificate and Opinion referenced in the
Reimbursement Agreement between Pardee Construction Company and the
City of Lake Elsinore, pursuant to the correspondence from Mike McGee.
If you have any questions or comments, please don't hesitate to let me
know.
Yours truly,
BROWN, HARPER, BURNS
& HENTSCHKE
A6L"
JOHN R. HARP R
City Attorney
City of Lake Elsinore
JRH/lp
fake E15,
v CITY HALL
130 SOUTH MAIN STREET
LAKE ELSIN0RE, CALIF0RNIA92330
Telephone (714) 674.3125
FAX TRANSMITTAL CITY FAX #: 714/674-2392
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PHONE: 714/674-3124 - extension 204
ASK FOR:
DATE: �
TIME:
P.O, Box 1556
Pardee Construction Temecula,California 92390
Tel(714)676-7377 Weyerhaeuser
Company FAX(7141 6991404
Michael V. McGee
July 17 , 1990 Vice President
Ms. Vicki Kasad
City Clerk
CITY OF LAKE ELSINORE
130 S. Main Street
Lake Elsinore, CA 92330
Dear Vicki:
Enclosed are the three executed originals of the
Reimbursement Agreement between Pardee Construction Company
and the City of Lake Elsinore in connection with the
improvement of Railroad Canyon Road. Please note that the
Ordinance number and Resolution numbers (as approved) need
to be typed into the three blank spaces provided on page
two.
The body of the Reimbursement Agreement makes reference to
certain exhibits and conditions of effectiveness which must
be executed and provided as an integral part of the
document. Since these were not returned to me with the
original Reimbursement Agreement executed by the City,
please provide the following as soon as possible together
with one of the executed originals:
1. Exhibit A (included herein for your reference; no
action necessary) .
2 . Exhibit B: Note, and Schedule of Payments and
Advances (please have executed) .
3 . Certified copies of the Resolutions and the Ordinance
referenced on page two of the Agreement.
4 . A certificate, signed by an authorized representative
of the City, affirming the accuracy of the
representations and warranties contained in the
Agreement.
5. Certified copies of the Authorizing Resolution of the
Council authorizing the execution, delivery and
performance of the Agrement and the Note.
6. Certificate of the Clerk of the Council certifying
the names and offices of the officers of the Council
authorized at the time to sign the Agreement and the
Note, together with the true signatures of such
officers.
Vicki Kasad (cont. )
July 17 , 1990
Page Two
7 . An opinion of legal counsel to the City as to the
items set forth in the A reement, paragraphs 5. 0 (g)
(i) -(viii) . Coe AANac-edo� yr use
Thank you for your continuing assistance in this matter.
Please do not hesitate to contact me if I can answer any
questions.
Sincerely,
PARDEE CONSTRUCTION COMPANY
� ./(/-;��00' --
Michael V. McGee
MVM/dh
cc: Masood Sohaili, O'Melveny & Myers (w/o encl. )
occurred and is continuing which, with the passage of time or the
giving of notice, or both, would constitute a default or an event
of default under any such instrument and which would materially
adversely affect the City' s ability to collect the Reimbursement
Fees.
(j ) The City shall perform such further acts and to
execute and deliver such further documents as may be reasonably
,necessary to carry out the provisions of this Agreement, the
Ordinance, the Note and the Resolution.
(k) In order to maintain the exclusion from gross income
for Federal Income Tax purposes of the interest on the Note, the
City Covenants to comply with each applicable requirement of
Section 103 and Sections 141 through 150 of the Internal Revenue
Code at 1986, as amended.
Section 5. 0 Conditions to Effectiveness.
The obligations of Pardee under this Agreement have been
undertaken in reliance on, and shall be subject to, the due
performance by the City of its covenants and agreements to be
observed and performed hereunder and to the accuracy of the
representations and warranties of the City herein on the date
hereof. Pardee ' s obligations to make Advances under this
Agreement shall be subject to, at the option of Pardee, the
satisfaction of the following conditions precedent:
Section 5 . 1 First Advance. In the case of the first
Advance made on or before the date hereof, Pardee shall have
received the following, each duly executed and in form and
substance satisfactory to Pardee:
(a) This Agreement.
(b) The Note.
(c) Certified copies of the Resolution and the
Ordinance.
(d) A certificate, signed by an authorized
representative of the City, affirming the accuracy of the
representations and warranties contained in this Agreement.
(e) Certified copies of the resolution (the "Authorizing
Resolution ") of the Council authorizing the execution, delivery
and performance of this Agreement and the Note.
(f) Certificate of the Clerk of the Council certifying
the names and offices of the officers of the Council authorized to
sign this Agreement and the Note, together with the true
signatures of such officers.
(g) An opinion of counsel to the City in form and
substance satisfactory to Pardee and its counsel addressed to
Pardee, to the effect that:
(i) the City is duly organized and validly existing
under the Constitution and the laws of the State;
(ii) the Resolution, the Ordinance and the
Authorizing Resolution have each been duly adopted at a meeting of
the Council which was called and held pursuant to law and with
all public notice required by law and at which a quorum was
present and acting throughout, and that the Resolution, the
Ordinance and the Authorizing Resolution are each in full force
and effect and have not been modified, rescinded or amended.
(iii) there is no action, suit, proceeding or
investigation at law or in equity before or by any court or
governmental agency or body, pending or, to the best knowledge of
such counsel threatened against the City in any way contesting or
affecting the validity of the Reimbursement District, the
Reimbursement Fee, this Agreement or the Note or contesting the
powers of the Council to enter into or perform its obligations
under this Agreement, the Note, the Resolution or the Ordinance;
(iv) to the best knowledge of such counsel after
reasonable investigation, the execution and delivery of this
Agreement and the Note, compliance with the provisions of this
Agreement, the Resolution, the Ordinance and the Note under the
circumstances contemplated hereby and thereby do not and will not
in any material respect conflict with or constitute on the part of
the City a breach of or default under any agreement or other
instrument to which the City is a party or by which it is bound or
any existing law, regulation, court order or consent decree to
which the City is subject;
(v) this Agreement and the Note have been duly
authorized, executed and delivered by the City and, assuming due
authorization, execution and delivery by Pardee of the
Reimbursement Agreement, each constitute legal , valid and binding
obligations of the City enforceable in accordance with its terms,
except as the enforcement hereof may be limited by bankruptcy,
insolvency or other laws affecting the enforcement of creditors ,
rights generally and by the application of equitable principles if
equitable remedies are sought;
(vi) no authorization, approval , consent or other order
of the State or any local agency of the State, other than such
authorizations, approvals and consents which have been obtained,
is required for the valid authorization, execution and delivery by
the City of the Note and this Agreement;
(vii) the City is not in breach of or default under any
applicable law or administrative regulation of the State or the
United States or any applicable judgment or decree or any loan
agreement, indenture, bond, note, resolution, contract or other
instrument to which the City is a party or is otherwise subject,
which breach or default would materially adversely affect the
City' s ability to perform its obligations under this Agreement,
the Note, the Resolution or the Ordinance, and no event has
occurred and is continuing which, with the passage of time or the
giving of notice, or both, would constitute a default or an event
or default under any such instrument and which would materially
adversely affect the City' s ability to perform its obligations
under this Agreement, the Note, the Resolution or the Ordinance;
(viii) the Reimbursement District has been duly and
properly formed and the City has full legal power and authority to
collect the Fees as contemplated by the Ordinance and the
Resolution; and
Section 5. 2 . Subsequent Advances. In the case of any
subsequent advances the representations and warranties contained
in this Agreement shall be true and correct on and as of the date
of each such Advance as though made as of such date.
Section 6. 0 Indemnification. To the extent permitted by
law the City agrees to indemnify and save Pardee harmless from and
against all claims, suits and actions brought against, or to which
any such person or entity is made a party, and from and against
all losses and damages suffered by them as a result thereof, where
and to the extent such claim, suit or action arises out of the
establishment and formation of the Reimbursement District, the
collection of Reimbursement Fees or the execution and delivery
of this Agreement or the Note. In the event the City is required
to indemnify as herein provided the City shall be subrogated to
the rights of Pardee to recover such losses or damages from any
other person or entity.
Section 7 . 0 Miscellaneous.
Section 7 . 1 Successors. All of the covenants,
stipulations, promises, and agreement contained in this Agreement
by or on behalf of, or for the benefit of, any of the parties
hereto, shall bind or inure to the benefit of the successors of
the respective parties.
Section 7 . 2 Amendment. This Agreement shall be amended
only by a written instrument executed by the parties hereto or
their successors.
Section 7 . 3 Seyerability. If any provision of this
Agreement or the Note shall be held to be invalid, illegal or
unenforceable, the validity, legality and enforceability of the
remaining portions hereof shall not in any way be affected or
impaired thereby.
Section 7 . 4 Entire Agreement. This Agreement and the
Note supersedes and cancels any and all other agreements, either
of fade &;("O to
�} CITY HALL
130SOUTH MAIN STREET
LAKE ELSINORE, CALIFORNIA 92330
Telephone (714) 674-3125
September 27 , 1990
Mr. Michael Mc Gee, Vice President
Pardee Construction Company
P.O. Box 1556
Temecula, CA. 92390
Dear Mike;
Here, at last, are the documents to back-up the Reimbursement
Agreement. It took a while to gather them all .
If there are any questions, please don 't hesitate to call .
Sincerely,
VICKI KASAD
CITY CLERK
Enclosures
LAW OFFICES
BROWN,HARPER,BURNS &HENTSCHKE
453 S.GIASSELL STREET NEWPORT BEACH(714)551-1915
F.MACKEI,IDE BROWN'
FAx 47o-191s
AL/W R.BURNS
ORANGE,CALIFORNIA 92666
JOHN ROBERT HARPER' (714)771-7728
$AN DIEGO(6 tq 456 19I5
DANIEL S HENTSCHKE
FAX 7443350 FAX 259-0292
ROBERT A.OWEN
OF COUtIML
MICHAEL B.MONTGOMERr
'A PROFESSIONAL CORPORATION
September 25, 1990
Pardee Construction Company
P.O. Box 1556
Temecula, California 92390
Attn: Michael V. McGee, Vice President
Re: Opinion of Counsel
The firm of Brown, Harper, Burns & Hentschke and John R. Harper,
Esquire, have acted as City Attorney for the City of Lake Elsinore
with respect to all matters and including the Reimbursement Agreement
between Pardee Construction Company and the City of Lake Elsinore,
dated March 27, in connection with the improvement of Railroad Canyon
Road. In our capacity as City Attorney, we hereby render the
following opinion:
1. The City is duly organized and validly existing under the
Constitution and the laws of the State;
2 . The Resolution, the Ordinance and the Authorizing
Resolution have each been duly adopted at a meeting of the Council
which was called and held pursuant to law and with all public notice
required by law and at which a quorum was present and acting
throughout, and that the Resolution, the Ordinance and the Authorizing
Resolution are each in full force and effect and have not been
modified, rescinded or amended.
3 . There is no action, suit, proceeding or investigation at
law or in equity before or by any court or governmental agency or
bond, pending or, to the best knowledge of such counsel threatened
against the City in any way contesting or affecting the validity of
the Reimbursement District, the Reimbursement Fee, this Agreement or
the Note or contesting the powers of the Council to enter into or
perform its obligations under this Agreement, the Note, the Resolution
or the Ordinance;
LAW OFFICES
BROWN,HARPER,BURNS&HENTSCHKE
Pardee Construction Company
September 25, 1990
Page Two
4 . To the best knowledge of our knowledge after reasonable
investigation, the execution and delivery of this Agreement and the
Note, compliance with the provisions of this Agreement, the
Resolution, the Ordinance and the Note under the circumstances
contemplated hereby and thereby do not and will not in any material
respect conflict with or constitute on the part of the City a breach
of or default under any agreement or other instrument to which the
City is a party or by which it is bound or any existing law,
regulation, court order or consent decree to which the City is subject;
5. This Agreement and the Note have been duly authorized,
executed and delivered by the City and, assuming due authorization,
execution and delivery by Pardee of the Reimbursement Agreement, each
constitute legal, valid and binding obligations of the City
enforceable in accordance with its terms, except as the enforcement
hereof may be limited by bankruptcy, insolvency or other laws
affecting the enforcement of creditors' rights generally and by the
application of equitable principles if equitable remedies are sought;
6. No authorization, approval, consent or other order of the
State or any local agency of the State, other than such
authorizations, approvals and consents which have been obtained, is
required for the valid authorization, execution and deliver by the
City of the Note and this Agreement.
7 . The City is not in breach of or default under any
applicable law or administrative regulations of the State or the
United States or any applicable judgment or decree or any loan
agreement, indenture, bond, note, resolution, contract or other
instrument to which the City is a party or is otherwise subject, which
breach or default would materially adversely affect the City's ability
to perform its obligations under this Agreement, the Note, the
Resolution or the Ordinance, and no event has occurred and is
continuing which, with the passage of time or the giving of notice, or
both, would constitute a default or an event of default under any such
instrument and which would materially adversely affect the City's
ability to perform its obligations under this Agreement, the Note, the
Resolution or the Ordinance.
LAW OFFICES
BROWN,HARPER,BURNS&HENTSCHKE
Pardee Construction Company
September 25, 1990
Page Three
8 . The Reimbursement District has been duly and properly
formed and the City has full legal power and authority to collect the
Fees as contemplated by the Ordinance and the Resolution.
Dated ,Z BROWN, HARPER, BURNS
& HENTSCHKE
By:
JOHN R. 14ARPE
P.O.Box 1666 A
Pardee Construction Temecula,California 92390
Tel(714►676-7377 Weyerhaeuser
Company FAX 17141 699-1404
Michael V. McGee
July 17, 1990 Vice President
Ms. Vicki Kasad
City Clerk
CITY OF LAKE ELSINORE
130 S. Main Street
Lake Elsinore, CA 92330
Dear Vicki:
Enclosed are the three executed originals of the
Reimbursement Agreement between Pardee Construction Company
and the City of Lake Elsinore in connection with the
improvement of Railroad Canyon Road. Please note that the
ordinance number and Resolution numbers (as approved) need
to be typed into the three blank spaces provided on page
two.
The body of the Reimbursement Agreement makes reference to
certain exhibits and conditions of effectiveness which must
be executed and provided as an integral part of the
document. Since these were not returned to me with the
original Reimbursement Agreement executed by the City,
please provide the following as soon as possible together
with one of the executed originals:
1. Exhibit A (included herein for your reference; no
action necessary) .
2 . Exhibit B: Note, and Schedule of Payments and
Advances (please have executed) .
3 . Certified copies of the Resolutions and the Ordinance
referenced on page two of the Agreement.
4 . A certificate, signed by an authorized representative
of the City, affirming the accuracy of the
representations and warranties contained in the
Agreement.
5. Certified copies of the Authorizing Resolution of the
Council authorizing the execution, delivery and
performance of the Agrement and the Note.
6. Certificate of the Clerk of the Council certifying
the names and offices of the officers of the Council
authorized at the time to sign the Agreement and the
Note, together with the true signatures of such
officers.
Vicki Kasad (cont. )
July 17 , 1990
Page Two
7 . An opinion of legal counsel to the City as to the
items set forth in the Agreement, paragraphs 5. 0 (g)
(i) - (viii) .
Thank you for your continuing assistance in this matter.
Please do not hesitate to contact me if I can answer any
questions.
Sincerely,
PARDEE CONSTRUCTION COMPANY
Michael V. McGee
MVM/dh
cc: Masood Sohaili, O'Melveny & Myers (w/o encl . )
Form 8038-G Information Return for Tax-Exempt Governmental Obligations
► Under Section 149(e) OMB No 1545 0720
(Rev October 1989) ►See separate Instructions Expires 5-31-92
Department of the Treasury (Use Form 8038-GC If the Issue price Is under S 100,000)
Internal Revenue Service
Reporting Authority Check box if Amended Return ►
2 Issuer's employer Identification number
1 Issuer's name
City of Lake : ls-inore 95-6000707
4 Report number
3 Number and street
130 SOut=i1 Main Street G19 -
5 City or town,state,and ZIP code 6 Date of issue
-01-1990
Lake Elsinore, CA 92330
8 CUSIP Number
7 Name of Issue
$9,000,000 City of Lake Elsinore Reiinburser ri n/a
ET Mi Type of Issue(check box(es)that applies and enter the Issue Price)
9 Check box If obligations are tax or other revenue anticipation bonds► ❑ Issue price
10 Check box if obligations are in the form of a lease or installment sale► ❑
11 ❑ Education . . . . . . . . . . . • • • .
12 ❑ Health and hospital . . . . . . . . . . • • • • . .
13 ❑ Transportation . . . . . . . . . . . . . . . .
14 ❑ Public safety . . . . . . . . .
15 ❑ Environment(including sewage bonds) . . . . . . . . . . . . . . . . . .
16 ❑ Housing . . . . . . . . . . . . . . . . . . . . . . . . .
17 ❑ Utilities . . . . . . . . . . . . . . . . . . .
18 ❑ Other. Describe(see Instructions)► -
Description of Obligations
(a) (b) (c) Stated (d) N) (n redemption Weighed Net interest
Maturity date Interest rate Issue price price at maturity average matunt Yield cost
19 Final maturity 2-0.1-2009 VR % ) 000 000 9 000 000
20 Entire issue . 9,000,000 9 000 000 19 years VP % VR %
Uses of Original Proceeds of Bond Issues (including underwriters'discount)
21 Proceeds used for accrued Interest 21 0-
22 Issue price of entire issue(enter line 20c) . . . . . . . 22 9,000,000
23 Proceeds used for bond issuance costs(including underwriters'discount). 23 1 -()
24 Proceeds used for credit enhancement . . . L . . . . . . . . 24 -0-
25 Proceeds allocated to reasonably required reserve or replacement fund 25 -0
26 Proceeds used to refund prior issues. . . . . . . . . . . . 26 -0-
27 Total(add lines 23,24,25.and 26) . . . . . . . . . . . . . . . . . . . . . 27 00000 9 000 000
28 Nonrefunding proceeds of the issue subtract line 27 from line 22 and enter amount here 28 -0-
Description of Refunded Bonds(complete this part only for refunding bonds)
21? Enter the remaining weighted average maturity of the bonds to be refunded . . . . . . . . ► n j'A years
30 Enter the last date on which the refunded bonds will be called . . . . . . . . . . . . ►
31 Enter the dates the refunded bonds were issued Iiii-
LIMILITr
Miscellaneous
32 Enter the amount of the state volume cap allocated to the issue . . . . . . . . . . . . ► n/a
33 Enter the amount of the bonds designated by the issuer under section 265(b)(3XBxixlll) (small
issuer exception) . . . . . . . . . . . . . . . . . . . . . . . . . . . ►
34 Pooled financings:
a Enter the amount of the proceeds of this issue that are to be used to make loans to other governmental units lo-
b Check box if this issue is a loan made from the proceeds of another tax-exempt issue ► ❑ and enter the name of the
issuer ► and the date of the issue III,-
Under penalties of perjury.I declare that I have examined this return and accompanying schedules and statements,and to the hest of my knowledge and belief.
they are true,correct,and complete.
Please
Sign 4-12-91
Teresa Chervenv City TrPaturer
Here S gnat a officer Date Type or print name and title
For Paperwork Reduction Act Notice, ee page 1 the Instructions. Form 8038•G (Rev 10-89)
U.S. Oo•.ri M hfnHna ofr5c.1 IM-262-151/00019
REIMBURSEMENT AGREEMENT
THIS REIMBURSEMENT AGREEMENT approved this 27th day of
March, 1990, by and between the City of Lake Elsinore (the
"City") , a City organized and existing under laws of the State of
California (the "State") , and Pardee - Grossman/Cottonwood Canyon,
a general partnership organized and existing under the laws of the
State ("Pardee") ;
W I T N E S S T H•
WHEREAS, the Project (as hereinafter defined) shall be
constructed pursuant to City' s Circulation Element of the General
Plan and to the transportation provisions thereof by Pardee; and
WHEREAS, the present estimated Construction Costs of the
Project are $13 , 686, 900; and
WHEREAS, the construction costs of the Project will be
initially defrayed with funds to be advanced by Pardee which
advances plus interest are to be reimbursed from the fees
collected by City in accordance with this agreement; and
WHEREAS, the parties recognize and acknowledge that
construction of the Project is dependent upon Pardee advancing the
necessary funds.
NOW, THEREFORE, in consideration of the terms and
conditions herein set forth, the City and Pardee DO HEREBY AGREE
AS FOLLOWS :
Section 1. 0 Definitions.
"Additional Interest" shall mean, with respect to each
fiscal year of the City, all interest actually accrued on Advances
made by Pardee for Construction Costs pursuant to this Agreement
during such Fiscal Year.
"Administrative Costs" shall mean 10% of the amount of
Construction Costs, payable to Pardee as the administrator of the
Project on the first business day of each month, and based on the
aggregate amount of the Construction Costs for the prior month.
"Advances" shall mean, collectively as of any date, (i)
all advances of funds made by Pardee pursuant to Section 3 . 1
hereof prior to such date; and (ii) all Additional Interest for
fiscal years of the City which have been completed prior to such
date.
"Agreement" shall mean this Reimbursement Agreement,
entered into by the City and Pardee, as contemplated and
authorized by Sections 66484 and 33514 . 9 of the Government Code.
"Construction Costs" shall mean the costs for the
construction and completion of the Project including, but not
Contract/Agreement # 654
limited to, the costs of assessment engineering; preliminary
traffic studies; design; engineering; the services, reports and
studies of environmental and other consultants; legal expenses;
right of way appraisal ; procurement and condemnation proceedings;
preliminary engineering and topographic survey; right of way
acquisition; legal and financial consulting fees in developing the
road program; engineering design; soils engineering; construction
survey; engineering and soils support services during construction
phase; permits; miscellaneous City, County and Caltrans fees;
reimbursable costs such as blueprinting and copying; and
Administrative Costs.
"Council" means the City Council of the City.
"Ordinance" means Ordinance No. S�O of the City adopted
pursuant to Sections 66484 and 66489 of the Government Code which:
(a) permits City to require the payment of a fee for purposes of
defraying the actual or estimated cost of constructing bridges
over waterways, railways, freeways, and canyons, or constructing
major thorough fares; and (b) prescribes the procedure and
conditions to be complied with by City in order to enable City to
require the payment of such fees.
"Prime Rate" shall mean that variable rate of interest
equal to the prime rate as printed on the first business day of
each month in the Wall Street Journal, or in the event such rate
is not printed, the rate announced by a bank of the State agreed
upon by the City and Pardee, as the prime lending rate for such
bank.
"Project" means the design and construction, including
i the preparation of the plans and specifications and the necessary
j documents or reports as may be required for the widening,
straightening, and reprofiling (regrading) of Railroad Canyon Road
from Interstate 15 to a location near the north line of the
Cottonwood Hills Specific Plan, being a point where 4-lane paved
1 improvements exist; said length of road being approximately
12, 500 feet. The Project includes, but is not limited to, traffic
detouring and signing, (including the potential construction of a
temporary road) grading and rock blasting, installation of curbs
and raised medians, grading of the roadbed to the ultimate
sections width (varies from 110 feet to 124 feet) , asphaltic
concrete paving, curbs, raised medians, storm drains, brow
ditches, slope planting, median landscaping, lighting, traffic
signal, signing, and striping
rn0.nc2
"Resolution" means _-No. of the City
which permits the City to collect Reimbursement Fees for the
Project and to reimburse Pardee for certain costs related to the
Project.
"Reimbursement District" means the area set forth in the
Dian No. '�Z-7 0.
"Reimbursement Fee" means collectively (i) that fee which
will be paid by developments within the Reimbursement District
pursuant to the Ordinance and the Resolution for the development
of any or all undeveloped property lying within the Reimbursement
District, as such fee may be amended and/or increased from time to
time, and (ii) the amounts, if any, available from a Mello Roos
Community Facilities District or other financing district formed
over all or a portion of Pardee ' s property.
Section 2 . 0 Construction of the Protect. City and
Pardee agree that Pardee shall construct the Project and that
Pardee shall be paid the Administrative Fee from the Reimbursement
Fees for the services to be rendered in connection with the
construction of the Project. Pardee shall competitively bid the
construction contract for the Project and shall provide that the
contractor pay prevailing wages in connections with the
construction of the Project.
Section 3 . 0 Advancement of Funds and Reimbursement.
3 . 1 Advancement of Funds. Pardee undertakes and agrees,
from time to time, to advance the funds required to defray the
Construction Costs, when, as and if such funds are required up to
an aggregate principal amount not to exceed $9 , 000, 000; provided,
however, that funds will not be advanced to the extent any
Reimbursement Fees (including but not limited to Reimbursement
Fees payable by Pardee) are available to pay Construction Costs,
and such sums, to the extent available shall be used to pay
Construction Costs first. To the extent all Construction Costs
have been paid such Reimbursement Fees shall be applied as
Provided in Section 3 . 5 hereof.
3 . 2 Maintenance of the Reimbursement District.
Collection of Fees and Formation of Mello Roos District.
(a) City undertakes and agrees to diligently comply with
such provisions of law as may be necessary to permit City to
charge and collect the Reimbursement Fees. City shall not, unless
and until all amounts due and owing under this agreement and the
Notes have been fully paid:
(i) amend or rescind the Ordinance of the Resolution
in any manner so as to reduce the amount of land within the
Reimbursement District or reduce the amount of the Reimbursement
District or reduce the amount of the Reimbursement Fees payable by
any owner of land within the Reimbursement District;
(ii) fail to collect the Reimbursement Fees when due;
(iii) fail to defend in good faith any legal
challenge to the establishment of the Reimbursement District
and/or the collection of the Reimbursement Fees.
In addition, City shall no later than the fifth business
day of each month provide Pardee with all Reimbursement Fees
collected during the prior calendar month and provide an accounting
of all Reimbursement Fees collected. Pardee shall apply all
Reimbursement Fees received as provided in Sections 3 . 1 and 3 . 5
hereof.
(b) City shall use its best efforts to form a Mello Roos
Community Facilities District or other financing district over all
or a portion of Pardee' s property to pay for the construction of
the Project and/or to reimburse Pardee for the Advances. In that
regard, the City shall undertake all steps necessary (including
but not limited to those steps required by Section 33514 . 9 of the
Government Code) to assure that Pardee will be reimbursed for the
Advances to the extent a Mello Roos Community Facilities District
or other financing district is formed.
3 . 3 Execution and Delivery of the Note. The obligations
of City to repay the aggregate unpaid amount of the Advances and
interest thereon shall be evidenced by a promissory note in
substantially the form of Exhibit B attached hereto, dated the
date hereof, duly executed and delivered by City to Pardee (the
"Note") . The aggregate amount of the Advances shall be adjusted
at the end of each Fiscal Year of the City to include all
Additional Interest on all Advances for the prior Fiscal Year, and
the principal amount of the Note shall also be adjusted to include
all such Additional Interest as part of the principal of the Note.
Pardee shall endorse on the schedule attached to the Note
appropriate notations as provided therein to evidence the making
of and payments by City upon each Advance; provided, however, that
the failure to make or error in making such notation shall not
limit or otherwise affect the obligations of City hereunder or
under the Note. Pardee ' s obligations of City hereunder or under
the Note. Pardee' s notations shall be conclusive, absent manifest
error. The principal of the Note shall be prepayable in whole or
in part at any time by the City, upon three business days notice
to Pardee. Notwithstanding anything herein to the contrary, the
City shall have no obligation to make any payments on the Note or
pursuant to this Agreement, except from Reimbursement Fees
collected by the City. The Advances from time to time outstanding
under the Note shall bear interest at the Prime Rate plus 2% per
annum. Interest on the Note shall be computed on the basis of a
year of 365 days (or 366 days in leap year) and paid for actual
days elapsed and shall be calculated on the last day of each
fiscal year of the City.
3 . 4 Pardee Credits. Pardee shall be entitled on any
business day to claim, at its sole option, a credit against the
amount of any Reimbursement Fee which would otherwise be payable
by Pardee with respect to the development of its property lying
within the Reimbursement District, an amount up to the aggregate
amount of Advances outstanding on such business day; provided,
however, that the aggregate amount of the Advances shall be
reduced on the date any such Reimbursement Fee would be payable by
Pardee by the amount of each credit received in lieu of the
payment of any such Reimbursement Fee.
3 . 5 Reduction in Advances. The aggregate amount of
Advances shall be reduced on the fifth business day of each
calendar month by the amount of the Reimbursement fees received by
Pardee from the City for the prior calendar month, pursuant to
Section 3 .2 hereof.
Section 4 . 0 Representations, Warranties and Covenants of
the City. The City represents and warrants to, and covenants with
Pardee that:
(a) The City is a city organized and operating pursuant
to the Constitution and laws of the State and has all necessary
power and authority to enter into and perform its duties under
this Reimbursement Agreement and the Note and, when executed and
delivered by the respective parties hereto, this Reimbursement
Agreement and the Note will each constitute the legal, valid and
binding obligations of the City enforceable in accordance with its
terms, except as enforceable in accordance with its terms, except
as enforcement hereof and thereof may be limited by bankruptcy,
insolvency or other laws affecting the enforcement of creditors '
rights generally and by the application of equitable principles if
equitable remedies are sought.
(b) The execution and delivery by the City of this
Reimbursement Agreement and the Note and compliance by the City
with the provisions hereof and thereof, will not conflict with, or
constitute a violation of or default under, the Constitution of
the State or any existing law, charter, ordinance, regulation,
decree, order or resolution applicable to the City, and will not
conflict with or result in a violation or breach of, or constitute
a default under, any contract, agreement, indenture, mortgage,
lease or other instrument to which the City is subject or by which
it is bound.
(c) There is no action, suit or proceeding of any court
or governmental agency or body pending or to the best knowledge of
the City, threatened against the City, in any way contesting or
affecting the validity of this Reimbursement Agreement, the
Reimbursement District, the Reimbursement Fees or the Note or
contesting the powers of the City to enter into or perform its
obligations under this Reimbursement Agreement or the Note or in
which a final adverse decision could materially adversely affect
the operations of the City or the consummation of the transactions
contemplated by this Reimbursement Agreement, the Resolution, the
Ordinance or the Note.
(d) The City is not in breach of or default under any
applicable law of administrative regulation of the State or the
United States or any applicable judgment or decree or any loan
agreement, indenture, bond, note, resolution, agreement or other
instrument to which the City is a party or is otherwise subject,
which breach or default would materially adversely affect its
ability to enter into or perform its obligations under this
Reimbursement Agreement, the Resolution, the Ordinance or the
Note, and no event has occurred and is continuing which, with the
passage of time or the giving of notice, or both, would constitute
a default or an event of default under any such instrument and
which would materially adversely affect the City's ability to
enter into or perform its obligations under this Reimbursement
Agreement, the Resolution, the Ordinance or the Note.
(e) Except as specifically provided in the Conditions of
Approval of the Specific Plan for Cottonwood Hills and in the
resolution of approval for the Cottonwood Hills Phase I Vesting
Tentative Map, the City will not condition the approval of any
entitlements with respect to property of Pardee within the
boundaries of the Reimbursement District, including but not
limited to the issuance of final subdivision maps, building
permits, inspections, or certificates of occupancy, upon the
construction of the Project and will not seek other forms of
mitigation with respect to the Project, including, but not limited
to, the payment of money, the dedication of land, or the
application of an assessment, tax or requirements of any nature
against any property within the Reimbursement District (other than
the Reimbursement Fees) , whether or not permitted by present or
future State law, rulings, regulations, and court decisions if the
proceeds of such assessment, tax or requirement will be used to
finance or fund, directly of indirectly, the Project.
(f) The City has all necessary power and authority to
establish the Reimbursement District and levy and collect the
Reimbursement Fees and, the Resolution and the Ordinance
establishing the Reimbursement District were duly adopted and
have not been amended, modified or rescinded.
(g) The establishment of the Reimbursement District and
the Reimbursement Fees does not conflict with, or constitute a
violation of or default under, the Constitution of the State or
any existing law, charter, ordinance, regulation, decree, order or
resolution applicable to the City, and will not conflict with or
result in a violation or breach of, or constitute a default under,
any contract, agreement, indenture, mortgage, lease or other
instrument to which the City is subject or by which it is bound.
(h) To the best knowledge of the City there is no
action, suit or proceeding of any court or governmental agency or
body pending or threatened against the City in any way contesting
or affecting the validity of the Reimbursement District or
contesting the powers of the City to levy and collect the
Reimbursement Fees or in which a final adverse decision could
materially adversely affect the operations of the Reimbursement
District.
(i) The City is not in breach of or default under any
applicable law of administrative regulation of the State or the
United States or any applicable judgment or decree or any loan
agreement, indenture, bond, note, resolution, agreement or other
instrument to which the City is a party or is otherwise subject,
which breach or default would materially adversely affect the
City's ability to collect the Reimbursement fees, and no event has
occurred and is continuing which, with the passage of time or the
giving of notice, or both, would constitute a default or an event
of default under any such instrument and which would materially
adversely affect the City' s ability to collect the Reimbursement
Fees.
(j ) The City shall perform such further acts and to
execute and deliver such further documents as may be reasonably
necessary to carry out the provisions of this Agreement, the
Ordinance, the Note and the Resolution.
(k) In order to maintain the exclusion from gross income
for Federal Income Tax purposes of the interest on the Note, the
City Covenants to comply with each applicable requirement of
Section 103 and Sections 141 through 150 of the Internal Revenue
Code at 1986, as amended.
Section 5 . 0 Conditions to Effectiveness.
The obligations of Pardee under this Agreement have been
undertaken in reliance on, and shall be subject to, the due
performance by the City of its covenants and agreements to be
observed and performed hereunder and to the accuracy of the
representations and warranties of the City herein on the date
hereof. Pardee ' s obligations to make Advances under this
Agreement shall be subject to, at the option of Pardee, the
satisfaction of the following conditions precedent:
Section 5 . 1 First Advance. In the case of the first
Advance made on or before the date hereof, Pardee shall have
received the following, each duly executed and in form and
substance satisfactory to Pardee:
(a) This Agreement.
(b) The Note.
(c) Certified copies of the Resolution and the
Ordinance.
(d) A certificate, signed by an authorized
representative of the City, affirming the accuracy of the
representations and warranties contained in this Agreement.
(e) Certified copies of the resolution (the "Authorizing
Resolution ") of the Council authorizing the execution, delivery
and performance of this Agreement and the Note.
(f) Certificate of the Clerk of the Council certifying
the names and offices of the officers of the Council authorized to
sign this Agreement and the Note, together with the true
signatures of such officers.
(g) An opinion of counsel to the City in form and
substance satisfactory to Pardee and its counsel addressed to
Pardee, to the effect that:
(i) the City is duly organized and validly existing
under the Constitution and the laws of the State;
(ii) the Resolution, the Ordinance and the
Authorizing Resolution have each been duly adopted at a meeting of
the Council which was called and held pursuant to law and with
all public notice required by law and at which a quorum was
present and acting throughout, and that the Resolution, the
Ordinance and the Authorizing Resolution are each in full force
and effect and have not been modified, rescinded or amended.
(iii) there is no action, suit, proceeding or
investigation at law or in equity before or by any court or
governmental agency or body, pending or, to the best knowledge of
such counsel threatened against the City in any way contesting or
affecting the validity of the Reimbursement District, the
Reimbursement Fee, this Agreement or the Note or contesting the
powers of the Council to enter into or perform its obligations
under this Agreement, the Note, the Resolution or the Ordinance;
(iv) to the best knowledge of such counsel after
reasonable investigation, the execution and delivery of this
Agreement and the Note, compliance with the provisions of this
Agreement, the Resolution, the Ordinance and the Note under the
circumstances contemplated hereby and thereby do not and will not
in any material respect conflict with or constitute on the part of
the City a breach of or default under any agreement or other
instrument to which the City is a party or by which it is bound or
any existing law, regulation, court order or consent decree to
which the City is subject;
(v) this Agreement and the Note have been duly
authorized, executed and delivered by the City and, assuming due
authorization, execution and delivery by Pardee of the
Reimbursement Agreement, each constitute legal , valid and binding
obligations of the City enforceable in accordance with its terms,
except as the enforcement hereof may be limited by bankruptcy,
insolvency or other laws affecting the enforcement of creditors ,
rights generally and by the application of equitable principles if
equitable remedies are sought;
(vi) no authorization, approval, consent or other order
of the State or any local agency of the State, other than such
authorizations, approvals and consents which have been obtained,
is required for the valid authorization, execution and delivery by
the City of the Note and this Agreement;
(vii) the City is not in breach of or default under any
applicable law or administrative regulation of the State or the
United States or any applicable judgment or decree or any loan
agreement, indenture, bond, note, resolution, contract or other
instrument to which the City is a party or is otherwise subject,
which breach or default would materially adversely affect the
City's ability to perform its obligations under this Agreement,
the Note, the Resolution or the Ordinance, and no event has
occurred and is continuing which, with the passage of time or the
giving of notice, or both, would constitute a default or an event
or default under any such instrument and which would materially
adversely affect the City' s ability to perform its obligations
under this Agreement, the Note, the Resolution or the Ordinance;
(viii) the Reimbursement District has been duly and
properly formed and the City has full legal power and authority to
collect the Fees as contemplated by the Ordinance and the
Resolution; and
Section 5. 2 . Subsequent Advances. In the case of any
subsequent advances the representations and warranties contained
in this Agreement shall be true and correct on and as of the date
of each such Advance as though made as of such date.
Section 6. 0 Indemnification. To the extent permitted by
law the City agrees to indemnify and save Pardee harmless from and
against all claims, suits and actions brought against, or to which
any such person or entity is made a party, and from and against
all losses and damages suffered by them as a result thereof, where
and to the extent such claim, suit or action arises out of the
establishment and formation of the Reimbursement District, the
collection of Reimbursement Fees or the execution and delivery
of this Agreement or the Note. In the event the City is required
to indemnify as herein provided the City shall be subrogated to
the rights of Pardee to recover such losses or damages from any
other person or entity.
Section 7 . 0 Miscellaneous.
Section 7 . 1 Successors. All of the covenants,
stipulations, promises, and agreement contained in this Agreement
by or on behalf of, or for the benefit of, any of the parties
hereto, shall bind or inure to the benefit of the successors of
the respective parties.
Section 7 . 2 Amendment. This Agreement shall be amended
only by a written instrument executed by the parties hereto or
their successors.
Section 7 . 3 Severability. If any provision of this
Agreement or the Note shall be held to be invalid, illegal or
unenforceable, the validity, legality and enforceability of the
remaining portions hereof shall not in any way be affected or
impaired thereby.
Section 7 . 4 Entire Agreement. This Agreement and the
Note supersedes and cancels any and all other agreements, either
oral or written, between the parties with respect to the subject
matter herein. Each party to this Agreement acknowledges that no
representation by any party which is not embodied herein or in any
other agreement, statement, or promise not contained in this
Agreement or the Note shall be valid and binding. The parties
hereto agree to act in a manner which will not frustrate the
purposes of this Agreement or the Note.
Section 7 . 5 Governing Law. This Agreement shall be
governed by and construed in accordance with the laws of the
State.
Section 7 . 6 Execution. This Agreement may be executed
in several counterparts each of which shall be an original and all
of which shall constitute bur one and the same agreement.
Section 7 . 7 Notices. All correspondence, notices or
certificates required by this Agreement shall be sufficiently
given and served if delivered by hand directly to the offices
named below or sent by United States first-class mail postage
prepaid and addressed as follows:
(a) if to Pardee,
Pardee Construction Company
10880 Wilshire Boulevard
Suite 1400
Los Angeles, California 90024
Attention: President
(b) if to the City
City of Lake Elsinore
130 South Main Street
Lake Elsinore, California 92330
Attention: Director of Finance.
Section 7 .8 Costs and expenses of Pardee. All actual
costs and expenses incurred by Pardee to the date of the execution
of this Agreement in connection with the formation of the
Reimbursement District and the execution of this Agreement and
thereafter, all actual costs and expenses of Pardee relating to
the collection of the Reimbursement Fees, the Reimbursement
District and/or this Agreement, including but not limited to the
fees and expenses of its counsel and other experts, shall be
reimbursed and shall be construed as part of the Construction
Costs.
Section 7. 9 Increased costs. In the event the costs of
the Project exceed $13 , 686, 900, City shall take all necessary
actions to increase the amount of the Reimbursement Fee
established in the Ordinance and in the Resolution, so as to
provide sufficient funds to pay for such increased costs from the
remaining undeveloped property situated within the Reimbursement
District.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement on the day and year first above written.
CITY OF LAKE ELSINORE
JIM WINKLER, MAYOR
A'TrEST: APPROVED AS TO FORM & LEGALITY:
1
1
VICKI KASAD, CITY CLERK JOHN R. HARPER, C Y ATTORNEY
PARDEE-GROSSMAN/COTTONWOOD CANYON,
a General Partnership
by: Pardee Construction Company
a California Corporation,
General Partner
BY
EXHIBIT A
Reserved
EXHIBIT B
CITY OF LAKE ELSINORE
REIMBURSEMENT AGREEMENT NOTE
$9 , 000 , 000 . 00 Lake Elsinore, California
February 1 , 1990
On February 1, 2009 or such earlier date as
Reimbursement Fees are available, for value received, the
CITY OF LAKE ELSINORE, a public corporation organized and
existing under the laws of the State of California ("City") ,
hereby promises to pay to the order of PARDEE CONSTRUCTION
COMPANY, a California corporation ("Pardee") , at Los
Angeles, California, the sum of up to Nine Million and
00/100 ' s -------------------- Dollars ($9 , 000 , 000 . 09 .
Interest shall be payable on the unpaid balance hereof from
time to time outstanding hereunder on the dates and at the
rate per annum specified pursuant to Section 3 . 3 of, or as
otherwise provided in, the Reimbursement Agreement.
Prepayments may be made at any time on this Note,
without premium or penalty, in part or in full, together
with accrued interest to the date of such prepayment on the
amount prepaid, upon 3 business days' notice to Pardee.
All amounts payable on this Note pursuant to the
Reimbursement Agreement shall be payable in lawful money of
2CIZOOI5.MXS.649,963-006 B -1
02/09/90
the United States of America in immediately available funds,
as provided in the Reimbursement Agreement, at Pardee
Construction, 1o880 Wilshire Boulevard, Suite 1400, Los
Angeles, California 90024.
This Note is the Note referred to in, and is
subject to, that certain Reimbursement Agreement dated as of
February 1, 1990, between City and Pardee (as the same may
be amended, modified or supplemented from time to time, the
"Reimbursement Agreement") . Capitalized terms used and not
defined in this Note shall have the meanings defined in the
Reimbursement Agreement.
City promises to pay costs of collection and
reasonable attorneys' fees incurred by Pardee in connection
with the enforcement of this Note. Except as provided in
the Reimbursement Agreement, City hereby waives diligence,
demand, presentment, protest or notice of any kind
whatsoever. Notwithstanding anything herein to the
contrary, the City shall not be obligated to make any
payments with respect to this Note except to the extent of
the Reimbursement Fees.
This Note is governed by, and shall be construed
in accordance with, the laws of the State of California.
2CIZOOZ5.MX5.649,963-006 B-2
02/09/90
IN WITNESS WHEREOF, this Note has been executed as
of the day and year first above written.
CITY OF LAKE ELSINORE
By
By
(SEAL)
2CIZOOI5.MXS.649,963-006 g-3
02/09/90
Note (cont' d)
ADVANCES AND PAYMENTS OF PRINCIPAL.
Amount Amount of Unpaid
of Principal Principal Notation
Date Advance Repaid Balance Made By
B-4
F /. I
MINUTES
REGULAR CITY COUNCIL MEETING
CITY OF LAKE ELSINORE
545 CHANEY STREET
LAKE ELSINORE, CALIFORNIA
TUESDAY, MARCH 27 , 1990
Councilman Washburn requested the addition of a reimbursement
agreement with Pardee Development for work on Railroad Canyon Road.
MOVED BY WASHBURN, SECONDED BY BUCK AND CARRIED BY UNANIMOUS VOTE TO
ADD THIS ITEM TO THE AGENDA.
53 . City Manager Molendyk explained the requested agreement in
support of the Railroad Canyon Road Improvements. City Attorney
Harper advised that a few changes will be neces,ary and
suggested approval subject to City Attorney review.
MOVED BY WASHBURN, SECONDED BY BUCK AND CARRIED BY UNANIMOUS VOTE TO
APPROVE THE REIMBURSEMENT AGREEMENT SUBJECT TO CITY ATTORNEY REVIEW.
Mayor Winkler thanked Councilmembers Buck and Washburn for their
efforts on this project.