21-1101_SANTA MARGARITA WATER DISTRICT_Assignment, Assumption Agreement (Water Bonds Series 2017)EXECUTION VERSION
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ASSIGNMENT, ASSUMPTION AND AMENDMENT AGREEMENT
by and among
SANTA MARGARITA WATER DISTRICT
as Assignee
and
CITY OF SAN JUAN CAPISTRANO
as Assignor
and
PUBLIC PROPERTY FINANCING CORPORATION OF CALIFORNIA
as Corporation
Dated as of November 1, 2021
relating to
$8,410,000
CITY OF SAN JUAN CAPISTRANO
REFUNDING REVENUE INSTALLMENT AGREEMENT, SERIES 2017
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ASSIGNMENT, ASSUMPTION AND AMENDMENT AGREEMENT
This Assignment, Assumption and Amendment Agreement, dated as of November 1, 2021
(this “Agreement”), is entered into by and among SANTA MARGARITA WATER DISTRICT, a
California Water District duly organized and existing under Division 13 of the Water Code of the
State of California (the “Assignee”), the CITY OF SAN JUAN CAPISTRANO, a municipality duly
organized and existing under and by virtue of the laws of the State of California (the “Assignor”),
and PUBLIC PROPERTY FINANCING CORPORATION OF CALIFORNIA, a nonprofit public
benefit corporation duly organized and existing under the laws of the State of California (the
“Corporation”).
RECITALS
A. Pursuant to Resolution No. DA 20-01 of the Orange County Local Agency
Formation Commission dated August 19, 2021 (the “LAFCO Resolution”), the Assignee has
annexed the municipal water system of the Assignor as described in the LAFCO Resolution (such
water system, which will constitute the water system within the boundaries of a geographic area
within the boundaries of the Assignee which will be designated after the Annexation Effective Date
(as such term is defined below) as Improvement District No. 9, the “Water System”) and will
assume ownership of the Water System effective November 15, 2021 or such later date as provided
in the Annexation Agreement, dated as of January 21, 2020, by and between the Assignee and the
Assignor, as the same may be amended (the “Annexation Effective Date”).
B. The Assignor has entered into an Installment Purchase Agreement, dated as of
December 1, 2017 (the “IPA”), by and between the Assignor and the Corporation, under which the
Assignor agreed to make Series 2017 Installment Payments (as such term is defined in the IPA) to
the Corporation.
C. The Series 2017 Installment Payments are payable from Net Revenues (as such term
is defined in the IPA).
D. Pursuant to the LAFCO Resolution, the Assignee will assume all obligations under
the IPA on the Annexation Effective Date, including the obligation to make the Series 2017
Installment Payments from Net Revenues of the Water System.
E. Capitalized terms that are used herein and not otherwise defined have the meanings
that are assigned to such terms under the IPA.
AGREEMENT
SECTION 1. Assignment.
(a) Effective as of the Annexation Effective Date, the Assignor, for good and valuable
consideration in hand received, does hereby unconditionally assign and transfer to the Assignee
without recourse, for the benefit of the Corporation, all of its rights, title, interest, duties and
obligations in and to the IPA, including the obligation to pay all Series 2017 Installment Payments
to the Corporation. This assignment is absolute and is presently effective.
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(b) In connection with the matters described in subsection (a), the Assignee agrees to
establish a “Revenue Fund” and a “Payment Fund,” in each case meeting the description thereof set
forth in Section 5.2 of the IPA, on or before the Annexation Effective Date.
(c) In connection with the matters described in subsection (a), the Assignor agrees to
transfer the amounts held in the 2017 Rate Stabilization Fund, if any, to the Assignee upon the
Annexation Effective Date, and the Assignee agrees to hold such moneys separate from other funds
of the Assignee for the benefit of the Corporation.
SECTION 2. Acceptance.
(a) The Assignee hereby accepts the foregoing assignment as of the Annexation
Effective Date for the benefit of the Corporation, and agrees thereafter to pay the Series 2017
Installment Payments to the Corporation and assume the other obligations of the Assignor as
provided in the IPA.
(b) From and after the Annexation Effective Date, the Assignee will assume the
responsibilities of the Assignor with respect to compliance with applicable federal requirements for
the tax-exempt status of the Series 2017 Installment Payments, in accordance with the Tax
Compliance Certificate and Agreement dated December 15, 2017 and executed by the Assignor in
connection with the IPA.
SECTION 3. Amendment.
(a) The definition of “City” in Section 1.1 of the IPA is hereby amended as follows:
“City. The term “City” means Santa Margarita Water District, a
California Water District duly organized and existing under Division
13 of the Water Code of the State of California.”
(b) The definition of “Manager” in Section 1.1 of the IPA is hereby amended as follows:
“Manager. The term “Manager” means the General Manager of Santa
Margarita Water District, or any person designated by the General
Manager of Santa Margarita Water District to act on behalf of the
General Manager of Santa Margarita Water District.”
(c) The definition of “Water System” in Section 1.1 of the IPA is hereby amended as
follows:
“Water System. The term “Water System” means the whole and each
and every part of the water system within the boundaries of a
geographic area within the boundaries of Santa Margarita Water
District which will be designated after the date hereof as
Improvement District No. 9 (consisting of the service area annexed to
Santa Margarita Water District pursuant to Resolution No. DA 20-01
dated August 19, 2021 of the Orange County Local Agency
Formation Commission), including all real property and buildings,
including the portion thereof existing on the date hereof, and
including all additions, betterments, extensions and improvements to
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such water system or any part thereof hereafter acquired or
constructed.”
(d) The notice address for the City set forth in Section 10.10 of the IPA is hereby
amended as follows:
“Santa Margarita Water District
26111 Antonio Parkway
Rancho Santa Margarita, California 92688
Attention: General Manager”
SECTION 4. Filings.
The Assignee agrees, at its own expense, to make any filings required by The Depository
Trust Company, the Internal Revenue Service, the California Debt Investment Advisory
Commission and any other federal or state administrative and regulatory bodies in order to evidence
the matters set forth herein.
SECTION 5. Attornment.
The Corporation acknowledges and agrees to the assignment set forth in Section 1 and
agrees to attorn to the Assignee from and after the Annexation Effective Date with respect to all
matters related to the IPA. This Agreement shall confer no rights and impose no obligations upon
the Corporation beyond those expressly provided in the IPA.
SECTION 6. Representations and Warranties.
Each of the Assignee, the Assignor and the Corporation represents and warrants that: (i) the
execution, delivery and performance of this Agreement have been duly authorized by such party by
all necessary action; (ii) this Agreement, assuming due execution by the other parties thereto,
constitutes a valid, binding and enforceable obligation of such party, except as enforcement may be
limited by bankruptcy, insolvency, reorganization, fraudulent conveyance or transfer, moratorium or
other laws relating to or affecting generally the enforcement of creditors’ rights, by equitable
principles, by the exercise of judicial discretion in appropriate cases and by the limitations on
remedies against public agencies in the State of California; (iii) to the best of such party’s
knowledge after due inquiry, this Agreement does not violate any law, regulation or order binding
on such party; (iv) no consent or authorization of any third party is required in connection with the
execution, delivery or performance by such party of this Agreement or, alternatively, all such
consents and authorizations have been given; (v) such party has the power to carry out the
obligations imposed on such party by this Agreement; and (vi) there is no claim, action or
proceeding pending and notice of which has been received by such party, or to the knowledge of
such party, threatened against such party before any court, arbitrator or governmental agency or
regulatory or administrative agency or commission challenging the validity, enforceability or
legality of this Agreement.
In addition, the Assignor and the Corporation represent and warrant that no Event of Default
has occurred and is continuing under the IPA as of the date of execution and delivery of this
Agreement.
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SECTION 7. Partial Invalidity.
If any one or more of the agreements or covenants or portions thereof required hereby to be
performed by or on the part of the Assignee, the Assignor or the Corporation shall be contrary to
law, then such agreement or agreements, such covenant or covenants or such portions thereof shall
be null and void and shall be deemed separable from the remaining agreements and covenants or
portions thereof and shall in no way affect the validity hereof. The Assignee, the Assignor and the
Corporation hereby declare that they would have executed this Agreement, and each and every other
article, section, paragraph, subdivision, sentence, clause and phrase hereof irrespective of the fact
that any one or more articles, sections, paragraphs, subdivisions, sentences, clauses or phrases
hereof or the application thereof to any person or circumstance may be held to be unconstitutional,
unenforceable or invalid.
SECTION 8. California Law.
THIS AGREEMENT SHALL BE CONSTRUED AND GOVERNED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF CALIFORNIA.
SECTION 9. Execution in Counterparts.
This Agreement may be executed in several counterparts, each of which shall be deemed an
original, and all of which shall constitute but one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement by their officers
thereunto duly authorized as of the day and year first written above.
SANTA MARGARITA WATER DISTRICT
By:________________________________________
Its: General Manager
CITY OF SAN JUAN CAPISTRANO
By:________________________________________
Its: City Manager
PUBLIC PROPERTY FINANCING
CORPORATION OF CALIFORNIA
By:________________________________________
Its: Authorized Officer
ACKNOWLEDGED AND AGREED:
CITY NATIONAL BANK
By:__________________________________
Its: Authorized Officer
______________________________________________________________________________________________________________________________________________________________________________________________________________
General Manager