Resolution Number SACRA 18-06-11-01SACRA RESOLUTION NO. 18-06-11-01
RESOLUTION OF THE BOARD OF DIRECTORS OF THE SUCCESSOR
AGENCY TO THE SAN JUAN CAPISTRANO COMMUNITY
REDEVELOPMENT AGENCY AUTHORIZING THE ISSUANCE AND
SALE OF TAX ALLOCATION REFUNDING BONDS AND APPROVING
THE FORM OF AN INDENTURE OF TRUST AND AUTHORIZING
CERTAIN OTHER ACTIONS IN CONNECTION THEREWITH
WHEREAS, the San Juan Capistrano Community Redevelopment Agency (the
"Former Agency") was a public body, corporate and politic, duly created, established and
authorized to transact business and exercise its powers under and pursuant to the
provisions of the Community Redevelopment Law (Part 1 of Division 24 of the Health and
Safety Code of the State of California) (the "Law"), and the powers of the Former Agency
included the power to issue bonds for any of its corporate purposes; and
WHEREAS, the Redevelopment Plan (the "Redevelopment Plan") for the San
Juan Capistrano Central Redevelopment Project in the City of San Juan Capistrano,
California (the "Redevelopment Project") has been approved by Ordinance No. 488,
adopted by the City Council of the City of San Juan Capistrano on July 12, 1983, and
amended by Ordinance No. 509, adopted on May 15, 1984, Ordinance No. 547, adopted
on July 16, 1985, Ordinance No. 582 and Ordinance No. 583, adopted on August 19,
1986, Ordinance No. 756, adopted on December 6, 1994, Ordinance No. 883 adopted on
July 15, 2003, Ordinance No. 923 adopted on June 5, 2007 and Ordinance No. 932
adopted on December 18, 2007 together with any amendments thereof heretofore or
hereafter duly enacted pursuant to the Law; and
WHEREAS, the Former Agency previously executed and delivered (i) that certain
San Juan Capistrano Community Redevelopment Agency Non -Negotiable Note dated as
of February 28, 2011, in favor of Kinoshita Enterprises, L.P., a California limited
partnership, in the original principal amount of $3,916,450.71, and (ii) that certain San
Juan Capistrano Community Redevelopment Agency Non -Negotiable Note dated as of
February 28, 2011, in favor of Bobby Kinoshita Investment Enterprises, L.P., a California
limited partnership, in the original principal amount of $4,080,246.64 (collectively, the
"Refunded Obligations"); and
WHEREAS, on June 28, 2011, the California Legislature adopted ABx1 26 (as
amended from time to time, the "Dissolution Act") and ABx1 27 (the "Opt -in Bill"); and
WHEREAS, the California Supreme Court subsequently upheld the provisions of
the Dissolution Act and invalidated the Opt -in Bill resulting in the dissolution of the Former
Agency as of February 1, 2012; and
WHEREAS, on February 1, 2012, the Former Agency was dissolved and its
redevelopment powers, assets and obligations were transferred to the Successor Agency
to the San Juan Capistrano Community Redevelopment Agency (the "Successor
Agency"); and
6/11/2018
WHEREAS, on or about June 27, 2012, AB 1484 was adopted as a trailer bill in
connection with the 2012-13 California Budget; and
WHEREAS, California Health and Safety Code Section 34177.5(a)(2), enacted by
AB 1484, authorizes successor agencies to issue bonds or other indebtedness to finance
debt service spikes, including balloon maturities, provided that (A) the existing
indebtedness is not accelerated, except to the extent necessary to achieve substantially
level debt service, and (B) the principal amount of the bonds or other indebtedness shall
not exceed the amount required to finance the debt service spikes, including establishing
customary debt service reserves and paying related costs of issuance; and
WHEREAS, said Section 34177.5 also authorizes the Successor Agency to issue
bonds pursuant to Article 11 (commencing with Section 53580) of Chapter 3 of Part 1 of
Division 2 of Title 5 of the Government Code (the "Bond Law") for the purposes and within
the parameters set forth in said Section 34177.5; and
WHEREAS, the Successor Agency desires to provide for the advance refunding
and economic defeasance of the Refunded Obligations pursuant to Health and Safety
Code Section 34177.5(a)(2) in order to refinance the balloon maturities due on such
Refunded Obligations on and as of March 1, 2021; and
WHEREAS, for the corporate purposes of the Successor Agency, the Successor
Agency desires to issue at this time tax allocation refunding bonds (the "2018 Bonds") in
an aggregate principal amount sufficient to refund all or a portion of the Refunded
Obligations, and to irrevocably set aside a portion of the proceeds of such 2018 Bonds in
a separate segregated trust fund which will be used to refund the outstanding Refunded
Obligations being refunded, to pay costs in connection with the issuance of the 2018
Bonds and to make certain other deposits as required by the Indenture (as defined below);
and
WHEREAS, the 2018 Bonds shall be secured by a pledge of property tax revenues
authorized by California Health and Safety Code Section 34177.5(a) and (g), pursuant to
the provisions of the Dissolution Act, the Law and the Bond Law, on a basis subordinate
and junior to the Former Agency's outstanding San Juan Capistrano Central
Redevelopment Project Series 2008 Tax Allocation Series A Bonds and San Juan
Capistrano Central Redevelopment Project 2008 Tax Allocation Bonds Subordinate
Taxable Series B Bonds (Housing) (collectively, the "2008 Bonds") and on a parity with
that certain Loan Agreement dated as of November 1, 2016, entered into by and between
the Successor Agency and TPB Investments, Inc., a wholly owned subsidiary of Western
Alliance Bank, an Arizona Corporation, as evidenced by that certain Successor Agency
to the San Juan Capistrano Community Redevelopment Agency 2016 Subordinate Tax
Allocation Refunding Note (the "2016 Loan"); and
WHEREAS, Senate Bill 450 (Chapter 625 of the 2017-2018 Session of the
California Legislature) ("SB 450") requires that the Successor Agency obtain from an
underwriter, municipal advisor or private lender and disclose, in a meeting open to the
public, prior to authorization of the issuance of the 2018 Bonds, good faith estimates of
2 6/11/2018
(a) the true interest cost of the 2018 Bonds, (b) the sum of all fees and charges paid to
third parties with respect to the 2018 Bonds, (c) the amount of proceeds of the 2018
Bonds expected to be received net of the fees and charges paid to third parties and any
reserves or capitalized interest paid or funded with proceeds of the 2018 Bonds, and (d)
the sum total of all debt service payments on the 2018 Bonds calculated to the final
maturity of the 2018 Bonds plus the fees and charges paid to third parties not paid with
the proceeds of the 2018 Bonds; and
WHEREAS, in compliance with SB 450, the Successor Agency has obtained from
the Municipal Advisor the required good faith estimates and such estimates are disclosed
and set forth in Exhibit A attached hereto; and
WHEREAS, the Successor Agency wishes at this time to approve matters relating
to the issuance and sale of the 2018 Bonds; and
BE IT HEREBY RESOLVED by the Governing Board of the Successor Agency to
the San Juan Capistrano Community Redevelopment Agency, as follows:
Section 1. Subject to the provisions of the Indenture referred to in Section 4
hereof, the issuance of the 2018 Bonds, in one or more series, and from time to time, in
an aggregate principal amount of not to exceed $9,500,000, or such lesser amount as is
sufficient to refund all or a portion of the Refunded Obligations for the purpose of financing
the balloon maturities of the Refunded Obligations in accordance with Health & Safety
Code Section 34177.5(a)(2) and the pledge of property tax revenues to the 2018 Bonds
pursuant to the Indenture approved by Section 4 of this Resolution (as authorized by
California Health and Safety Code Section 34177.5(a) and (g)) is hereby approved on the
terms and conditions set forth in, and subject to the limitations specified in, the Indenture.
The 2018 Bonds will be dated, will bear interest at the rates, will mature on the dates, will
be issued in the form, will be subject to redemption, and will be as otherwise provided in
the Indenture, as the same will be completed as provided in this Resolution. The
proceeds of the sale of the 2018 Bonds shall be applied as provided in the Indenture.
The 2018 Bonds may be issued as a single issue, or from time to time, in separate series,
as the Successor Agency shall determine. The approval of the issuance of the 2018
Bonds by the Successor Agency and the Oversight Board shall constitute the approval of
each and every separate series of 2018 Bonds and the sale of the 2018 Bonds at a public
or private sale, without the need for any further approval from the Oversight Board.
Section 2. Opus Bank (the "Purchaser"), has offered to purchase the 2018
Bonds on a direct placement basis pursuant to the terms of a Term Sheet (the "Term
Sheet"), in the form attached hereto as Exhibit B and made a part hereof as though set
forth in full herein. The Chair and Executive Director of the Successor Agency, or any
other Authorized Officer, each acting alone, is hereby authorized to execute the Term
Sheet and to take any and all actions necessary to effectuate a sale of the 2018 Bonds
to the Purchaser in accordance with the Term Sheet, with such changes therein as the
Authorized Officer executing the same may require or approve, such approval to be
conclusively evidenced by Lhe execution and delivery thereof.
3 6/11/2018
Section 3. The Indenture of Trust in substantially the form submitted at this
meeting and made a part hereof as though set forth in full herein (the "Indenture"), is
hereby approved. The Chair or Executive Director of the Successor Agency, or any other
Authorized Officer, each acting alone, is hereby authorized and directed to execute and
deliver the Indenture in the form presented at this meeting with such changes therein as
the Authorized Officer executing the same may require or approve, such approval to be
conclusively evidenced by the execution and delivery thereof, including, without limitation,
adjustments to the lien priority of the 2018 Bonds with respect to the 2008 Bonds and the
2016 Loan; provided, the maximum interest rate on the 2018 Bonds shall not exceed 6%
(exclusive of the default rate). If the Bonds are to be sold in separate series at different
times, each of the Authorized Officers is hereby authorized and directed in the name of
the Successor Agency to execute any supplement to the Indenture to provide for the
issuance of such Series of Bonds consistent with the terms of the Resolution.
Section 4. The Escrow Agreement in substantially the form submitted at this
meeting and made a part hereof as though set forth in full herein (the "Escrow
Agreement") is hereby approved. The Authorized Officers are, and each of them is,
hereby authorized and directed, for and in the name of the Successor Agency, to execute
and deliver one or more Escrow Agreements with respect to the Refunded Obligations in
substantially said form, with such changes therein as the Authorized Officer executing the
same may require or approve, such approval to be conclusively evidenced by the
execution and delivery thereof.
Section 5. Each of the Authorized Officers and other appropriate officers of the
Successor Agency, acting alone, is authorized and directed, jointly and severally, to do
any and all things and to execute and deliver any and all documents and contracts that
they may deem necessary or advisable in order to consummate the sale, execution and
delivery of the 2018 Bonds and otherwise to carry out, give effect to and comply with the
terms and intent of this Resolution, the 2018 Bonds, the Indenture, the Term Sheet, and
the Escrow Agreement, each in order to facilitate the issuance of the 2018 Bonds and
otherwise to carry out, give effect to and comply with the terms and intent of this
Resolution, including, without limitation, the negotiation, preparation and execution of a
private placement memorandum, the placement agent agreement, a rate lock agreement
and any additional agreements as may be required to carry out the purposes hereof, to
amend any of the legal documents entered into in connection with the Refunded
Obligations in order to effectuate the defeasance and refunding of such Refunded
Obligations, to execute irrevocable refunding instructions with respect to the Refunded
Obligations, to amend any of the legal documents entered into in connection with
obligations of the Successor Agency payable on a senior or parity basis to the 2018
Bonds, or that may impact the Successor Agency's authority or ability to pledge tax
increment revenues to the 2018 Bonds, to secure municipal bond insurance on the 2018
Bonds and/or a reserve surety to fund any reserve account or fund established for the
2018 Bonds, if available (which may include entering into a mutual insurance
agreement(s) therefor), to request subordination of any amounts required to be paid to
an affected taxing entity to any or all of the 2018 Bonds, as the Authorized Officer may
require or approve, in consultation with Bond Counsel and the Successor Agency's
4 6/11/2018
municipal advisor, and any such actions heretofore taken by such officers in connection
therewith are hereby ratified, confirmed and approved.
Section 6. The 2018 Bonds may be sold by negotiated sale or by private
placement. The Successor Agency Board hereby approves the appointment of Raymond
James & Associates, Inc. (the "Placement Agent"), as private placement agent to
negotiate on behalf of the Successor Agency the terms of the private placement of the
Bonds with the Purchaser (defined above).
Section 7. As an alternative to the private placement of the 2018 Bonds, the
Executive Director of the Successor Agency or any other Authorized Officer, acting on
behalf of the Successor Agency, is hereby authorized to evaluate and determine whether
the Successor Agency will be benefited by the negotiated sale of the 2018 Bonds and, in
such event, any Authorized Officer is authorized to negotiate and prepare a Bond
Purchase Agreement with the Placement Agent, to provide for the sale of the 2018 Bonds
to the Placement Agent and the Placement Agent's sale of the bonds to investors through
a public offering. The Executive Director and any other Authorized Officer is further
authorized and directed, in the event the 2018 Bonds will be sold by public sale, to cause
a Preliminary Official Statement to be prepared and finalized in accordance with Rule
15c2-12 of the Securities Exchange Act of 1934. The form of the Bond Purchase
Agreement and the Preliminary Official Statement, if prepared, would be presented to the
Successor Agency Board for approval at a future public meeting.
Section 8. U.S. Bank National Association, is hereby appointed as Trustee,
Stradling Yocca Carlson & Rauth, a Professional Corporation, is hereby appointed as
Bond Counsel and Disclosure Counsel, Fieldman Rolapp & Associates is hereby
appointed as Municipal Advisor and HdL Coren & Cone is hereby appointed as Fiscal
Consultant. The Executive Director of the Successor Agency or any Authorized Officer
is hereby authorized and directed to execute contracts with such consultants and advisors
as necessary or proper for carrying out the issuance of the Bonds in accordance with the
Indenture and this Resolution.
Section 9. This Resolution shall take effect immediately upon its adoption.
6/11/2018
IN WITNESS WHEREOF, this Resolution is adopted and approved the 11th day of
June 2018.
Community Redevelopment Agency
D EE
Chair of the Successor Agency to the
San Juan Capistrano Community
Redevelopment Agency
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss.
CITY OF SAN JUAN CAPISTRANO )
I, Maria Morris, Secretary of the Successor Agency to the San Juan Capistrano
Community Redevelopment Agency, hereby certify that the foregoing SACRA Resolution
No. 18-06-11-01 was duly adopted by the Successor Agency at its adjourned regular
meeting held on the 11th day of June, 2018, and that it was so adopted by the following
vote: ' 1
AYES:1 OOARD MEMBERS: Farias, Maryott, Patterson, Ferguson and Chair Reeve
NOE : OARD MEMBERS: None
ABSENT: BOARD`MEMBERS: None
ABSTAIN BOARD MEMBERS: None
V
IS, AGENCY EC ETARY
6 6/11/2018
EXHIBIT A
SB 450 GOOD FAITH ESTIMATES
The good faith -estimates set -forth herein are provided with respect to the
Refunding Bonds in accordance with California Government Code Section 5852.1. Such
good faith estimates have been provided to the Successor Agency by Fieldman, Rolapp
& Associates, Inc., the Successor Agency's Municipal Advisor (the "Municipal Advisor").
Principal Amount. The Municipal Advisor has informed the Successor Agency that,
based on the Successor Agency's financing plan and current market conditions, its good
faith estimate of the aggregate principal amount of the Bonds to be sold is $9,180,000
(the "Estimated Principal Amounts").
True Interest Cost of the Refunding Bonds. The Municipal Advisor has informed
the Successor Agency that, assuming that the respective Estimated Principal Amounts of
the Refunding Bonds is sold, and based on market interest rates prevailing at the time of
preparation of such estimate, its good faith estimate of the true interest cost of the Bonds,
which means the rate necessary to discount the amounts payable on the respective
principal and interest payment dates to the purchase price received for the Bonds, is
4.84%.
Finance Charge of the Refunding Bonds. The Municipal Advisor has informed the
Successor Agency that, assuming that the Estimated Principal Amounts of the Bonds is
sold, and based on market interest rates prevailing at the time of preparation of such
estimate, its good faith estimate of the finance charge for the Bonds, which means the
sum of all fees and charges paid to third parties (or costs associated with the Bonds), is
$165,000.
Amount of Proceeds to be Received. The Municipal Advisor has informed the
Successor Agency that, assuming that the Estimated Principal Amounts of the Refunding
Bonds is sold, and based on market interest rates prevailing at the time of preparation of
such estimate, its good faith estimate of the amount of proceeds expected to be received
by the Successor Agency for sale of the Bonds, less the finance charge of the Bonds, as
estimated above, and any reserves or capitalized interest paid or funded with proceeds
of the Bonds, is $9,015,000.
Total Payment Amount. The Municipal Advisor has informed the Successor
Agency that, assuming that the Estimated Principal Amounts of the Refunding Bonds is
sold, and based on market interest rates prevailing at the time of preparation of such
estimate, its good faith estimate of the total payment amount, which means the sum total
of all payments the Successor Agency will make to pay debt service on the Bonds, plus
the finance charge for the Bonds, as described above, not paid with the respective
proceeds of the Bonds, calculated to the final maturity of the Bonds, is $13,077,228.
The foregoing estimates constitute good faith estimates only and are based on
market conditions prevailing at the time of preparation of such estimates. The actual
A-1
principal amount of the Bonds issued and sold, the true interest cost thereof, the finance
charges thereof, the amount of proceeds received therefrom and total payment amount
with respect thereto may differ from such good faith estimates due to (a) the actual date
of the sale of the Bonds being different than the date assumed for purposes of such
estimates, (b) the actual principal amount of Bonds sold being different from the
respective Estimated Principal Amounts, (c) the actual amortization of the Bonds being
different than the amortization assumed for purposes of such estimates, (d) the actual
market interest rates at the time of sale of the Bonds being different than those estimated
for purposes of such estimates, (e) other market conditions, or (f) alterations in the
Successor Agency's financing plan, or a combination of such factors. The actual date of
sale of the Bonds and the actual principal amount of Bonds sold will be determined by the
Successor Agency based on various factors. The actual interest rates borne by the Bonds
will depend on market interest rates at the time of sale thereof. The actual amortization
of the Bonds will also depend, in part, on market interest rates at the time of sale thereof.
Market interest rates are affected by economic and other factors beyond the control of
the Successor Agency.
A-2
EXHIBIT B
TERM SHEET
[Attached on following pages]
In
,"'lOpusBank
May 30, 2018
Ms. Un Chu Reardon
Mr. Randy Merritt
Raymond James
1201 3rd Ave, Suite 5350
Seattle, WA 98101
1410 Rocky Ridge Drive, Suite 140
Roseville, CA 95661
Tel: 916-945-5133
Subject: Term Sheet for Successor Agency to the San Juan Capistrano Community Redevelopment Agency
Based upon our discussions and preliminary review of the information provided to -date, Opus Bank ("Bank") is pleased to present to the
Successor Agency to the San Juan Capistrano Community Redevelopment Agency ("Borrower") this Letter of Intent for approximately
$9,250,000 in tax allocation debt refinancing (Credit Facility).
This letter is not meant to contain, nor shall it be construed as a commitment to make a loan, nor does this letter necessarily contain all of
the terms and conditions involved in the proposed financing. Rather it is intended only to outline the basic terms of the proposed financing
that the Bank is prepared to consider, subject to the Bank's credit approval, and from which final terms and documents will be structured in
the event that a credit commitment is made and accepted. Naturally, a final commitment must be in writing, will be subject to various
conditions and will require the execution of an indenture and other documentation acceptable to the Bank.
In an effort to be responsive to your needs, we would like to be assured that the general terms we have outlined are acceptable to you before
we continue the loan application process and initiate our due diligence. Therefore we suggest you review the following term sheet and if
acceptable, please indicate your desire to proceed by signing and returning a copy to continue the due diligence process. Acceptance of this
Letter of Intent will constitute your instruction to the Bank to commence its due diligence and continue its loan approval process.
Once we have received your acceptance, we will begin the due diligence and credit approval process. This proposal, if not accepted in
writing and returned to us, will expire on 06/15/2018. The terms and conditions contained in this proposal will supersede any prior proposal.
If you have any questions, please call me at (916) 945-5133.
We appreciate the opportunity to build our relationship with you by proposing this financing and we look forward to a favorable response
from you.
Sincerely,
Dmitry A. Semenov
Senior Managing Director, Public Finance
Letter of Intent Rev. 5/18/15 Page 1 of 4
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Borrower: Successor Agency to the San Juan Capistrano Community Redevelopment
Agency
Proposed Loan Amount: Approximately $9,250,000 (amount to be finalized during due diligence process)
Purpose: Refund outstanding debt and fund costs of issuance
Interest Rate: 4.84% (taxable, computed on the basis of a 360 -day year of twelve 30 -day months)
Interest Rate Lock: The rate will be locked through August 23, 2018. If the transaction fails to close
on or before that date, the Bank reserves the right to adjust the rate 14 days prior
to closing based on changes in the market indices.
Repayment: Annual principal payments on February 1, commencing February 1, 2020. Semi-
annual interest payments on February 1 and August 1, commencing on February
1, 2019.
Maturity: February 1, 2033
Average Life: Not to exceed 8.8 years
Prepayment: No prepayment is allowed in the first 10 years and then Credit Facility can be
prepaid without prepayment penalty at any time.
Debt Service Reserve: No debt service reserve fund will be required
Collateral: The Credit Facility will be secured by and payable from all taxes (i) that were
eligible for allocation to the Borrower with respect to the Central Redevelopment
Project Area and are allocated to the Borrower pursuant to applicable State laws
and (ii) that are deposited or available for deposit by the Auditor -Controller of
Orange County in the Redevelopment Property Tax Trust Fund, all as provided in
Section 34172(d) of the Dissolution Act. The Credit Facility will be subordinate
to the Borrower's 2008 Tax Allocation Bonds, Tax -Exempt Series A Bonds, the
2008 Tax Allocation Bonds, Subordinate Taxable Series B Bonds (Housing),
Borrower's Owner Participation Agreements (Fluidmaster and Sierra Vista), and
on parity with the Borrower's 2016 Subordinate Tax Allocation Note.
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Standard and reasonable representations and warranties of the Borrower for a financing of this type including but not limited to
existence and authority, accuracy of information presented, no litigation, etc.
D Completion of due diligence and documentation customary for this type of transaction.
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City of San Juan Capistrano annual CAFR
Page 2 of 4
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D Standard annual disclosure report consistent with what is currently provided by the Borrower in relation to its outstanding
redevelopment debt, in a format and content similar to the continuing disclosure for the City's Central Redevelopment Project
2008 Tax Allocation Bonds.
➢ Other information as may be determined during due diligence process
F_ ingicial rind Other Ccrvertants: Please, note that the language below conveys intent and is subject to final edits by the Bond Counsel and
Bank Counsel.
➢ The Borrower shall file all required statements required under the Dissolution Act,
A Not later than each date a Recognized Obligation Payment Schedule is due, the Borrower shall submit to the Oversight Board and
the State Department of Finance, a Recognized Obligation Payment Schedule. The Borrower shall take all actions required under
the Dissolution Act to include in the Recognized Obligation Payment Schedule for each Semiannual Period debt service on the
Credit Facility, so as to enable the Orange County Auditor -Controller to distribute from the Redevelopment Property Tax Trust
Fund for deposit in the Redevelopment Obligation Retirement Fund on each January 2 and June 1, as applicable, amounts required
to enable the Borrower to pay timely debt service on the Credit Facility.
A The Borrower shall apply Tax Revenues received in the Bond Year beginning August 2, 2018 to pay debt service on the Credit
Facility on February 1, 2019.
➢ Not later than February 1, 2019 and each February 1 thereafter (or at such earlier time as may be required by the Dissolution Act),
for so long as the Credit Facility is outstanding, the Borrower shall submit an Oversight Board -approved Recognized Obligation
Payment Schedule to the State Department of Finance and to the Orange County Auditor -Controller that shall include for
distribution on the immediately succeeding January 2, interest on the Credit Facility due on the immediately succeeding February
1 plus 50% or more up to 100% of principal (including any mandatory sinking fund redemption amount) due on the Credit Facility
on such February 1, which amounts shall distributed to the Borrower, (c) for distribution on the immediately succeeding June 1,
interest on the Credit Facility due on the immediately succeeding February 1 plus 50% of principal (including any mandatory
sinking fund redemption amount), less amounts received on the prior January 2, due on the Credit Facility on the immediately
succeeding February 1.
➢ In the event the provisions set forth in the Dissolution Act as of the Closing Date of the Credit Facility, that relate to the filing of
Recognized Obligation Payment Schedules are amended or modified in any manner, the Borrower agrees to take all such actions
as are necessary to comply with such amended or modified provisions so as to ensure the timely payment of debt service on the
Credit Facility and, if the timing of distributions of the Redevelopment Property Tax "frust Fund is changed, the receipt of (i) not
less than one of half of debt service due during each Bond Year on the Credit Facility prior to February 1 of such Bond Year, and
(ii) the remainder of debt service due during such Bond Year on Credit Facility prior to the next succeeding August 1.
➢ No breakage fee or other charge will be due from the Borrower in the event the Credit Facility is not closed, regardless of the
reason. The Bank acknowledges that the closing of the Credit Facility is subject to the approval of the Oversight Board, the
Borrower, and the State Department of Finance.
➢ Borrower is responsible for all costs of issuance, including, but not limited to CDIAC fees, bond counsel and bank's counsel. The
bank's counsel fees should not exceed $12,000.
➢ If the Bank is required to process the costs of issuance wires, a processing fee of $1,000 will be charged.
➢ Failure to provide required financial information will be considered an event of default. The Borrower will be given a reasonable
notice and opportunity to cure the default before the default interest rate is assessed. Once an event of default is remedied to mutual
satisfaction of the parties, the default interest rate will be removed and the interest will accrue at the Interest Rate.
➢ The default interest rate will be Interest Rate 1 3.00%.
➢ The bond counsel shall provide the tax opinion,
The Bank will book the Credit Facility as a loan, and, therefore, the additional provisions and conditions set forth in this letter shall be
included in the documentation, which shall include the following: the Credit Facility will be registered to the Bank, DTC will not be holding
the Credit Facility and the Credit Facility will not have a CUSIP; the Credit Facility will not be rated; there will not be a disclosure document;
authorized denominations shall be in the minimum amount of $250,000 and integral multiples of $1 thereof or as a single bond; and no
Page 3 of 4
JV- OpusBank
amendments to the issuing documents without the Bank's prior consent. The Bank shall not be required to surrender the Credit Facility or
assignment thereof for payment of principal, other than for the final payment at maturity thereof.
Inasmuch as the Credit Facility represents a negotiated transaction, the Borrower understands, and hereby confirms, that the Bank is not
acting as a fiduciary of the Borrower, but rather is acting solely in its capacity as a lender, for its own account. The Borrower acknowledges
and agrees that (i) the transaction contemplated herein is an arm's length commercial transaction between the Borrower and the Bank and
its affiliates, (ii) in connection with such transaction, the Bank and its affiliates are acting solely as a principal and not as an advisor including,
without limitation, a "Municipal Advisor" as such term is defined in Section 15B of the Securities and Exchange Act of 1934, as amended,
and the related final rules (the "Municipal Advisor Rules"), (iii) the Bank and its affiliates are relying on the Bank exemption in the
Municipal Advisor Rules, (iv) the Bank and its affiliates have not provided any advice or assumed any advisory or fiduciary responsibility
in favor of the Borrower with respect to the transaction contemplated hereby and the discussions, undertakings and procedures leading
thereto, (v) the Bank and its affiliates have financial and other interests that differ from those of the Borrower, and (vi) the Borrower has
consulted with its own financial, legal, accounting, tax and other advisors, as applicable, to the extent it deemed appropriate.
If your application for business credit is denied, you have the right to a written statement of the specific reasons for the denial. To obtain
the statement, please contact Opus Bank Loan Servicing Department, 131 West Commonwealth Ave., Fullerton, CA 92832 or by telephone
at (855) 678-7562 within 60 days from the date you are notified of our decision. We will send you a written statement of reasons for the
denial within 30 days of receiving your request for the statement.
NOTICE: The federal Equal Credit Opportunity Act prohibits creditors from discriminating against credit applicants on the basis of race,
color, religion, national origin, sex, marital status, age (provided the applicant has the capacity to enter into a binding contract); because all
or part of the applicant's income derives from any public assistance program; or because the applicant has in good faith exercised any right
under the Consumer Credit Protection Act. The federal agency that administers compliance with this law concerning this creditor is: FDIC
Consumer Response Center, 1100 Walnut Street, Box #11, Kansas City, MO 64106.
This proposal is for discussion purposes only. It does not represent a commitment to lend on the part of Opus Bank. If the proposal meets
with your approval, it is then subject to credit approval based upon due diligence, execution and delivery of all documentation required by
the Bank in form and substance satisfactory to Opus Bank and its counsel.
Borrower: Successor Agency to the San Juan Capistrano Community Redevelopment Agency
Date: .k -ice
natu
Print Name: Benjamin Siegel Title: City Manager
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