HomeMy WebLinkAboutRDA AG PKT 2009-09-14 #2a4C;EN®A STAFF REP®RT
DATE: e ~ ~n~ ~~+ i n~ ~nno September 14, 2009
TO: Chairperson and Members of the Redevelopment Agency .
THRU: David Carmany, Executive Director
FROM: Lee Whittenberg, Director of Development Services
SUBJECT: CONSENT TO TRANSFER -SEAL BEACH TRAILER
PARK
SUMMARY OF REQUEST:
Authorize the Executive Director to Execute Exhibit C-1, Issuer Consent to
Transfer of Project, of the "Assignment and Assumption Agreement" and any
other necessary documents to allow Seal Beach Shores, Inc. ("Trailer Park
Residents' Group") to effectuate the transfer of the Seal Beach Trailer Park
("Trailer Park") to Seal Beach Shores, Inc., and the assumption by Seal Beach
Shores, Inc. of all of the obligations of Seal Beach Affordable Housing
Corporation related to such transfer and the Redevelopment Agency of the City
of Seal Beach Mobile Home Park Revenue Bonds (Seal Beach Mobile Home
Park Project), Series 2000A (the "Bonds") as described in the Assignment and
Assumption Agreement.
BACKGROUND:
On January 26, 2009 the Agency considered a Staff Report regarding
consideration of the Agency ". to explore the feasibility of the resident's
501(c)(3) entity assuming the existing City bonds originally issued for the park
purchase by LINC Housing." The Agency, by unanimous vote of the
Agencymembers, directed "...staff to work with the Seal Beach Shores, Inc.
Board in assuming the bonds to acquire the property for the residents." The
Agency's primary objectives concerning the Trailer Park have been since the
issuance of the Bonds in 2000:
1. Maintain affordable housing in the Trailer Park; and
2. Avoid default on the Bonds.
The Agency directed its counsel and staff to seek review and approval of the
transfer of the Trailer Park by ACA Financial Guaranty Corp. (Bond Insurer) and
Best, Best, & Kreiger (Bond Counsel).
Agency counsel and staff have worked with all parties to ensure that the
necessary protections are retained for the Agency and that all contractual
obligations that currently exist will remain in place upon the transfer of the
ownership of the Seal Beach Trailer Park to Seal Beach Shores, Inc.
Agenda Item 2
Page 2
ACA Financial Guaranty Corp. (Bond Insurer) have approved and consented to
this transaction. A copy of the Bond Insurer letter is provided as Attachment B
for the information of the Agency. The Bond Insurer consent letter also includes
the "Assignment and Assumption Agreement" as reviewed and approved by the
City Attorney
The parties have agreed upon the forms of legal opinions amongst Best, Best, &
Kreiger (Bond Counsel) and Borrower's Counsel. Bond Counsel's legal opinion
has been finalized and will be delivered into escrow, to be released prior to
closing and upon receipt of a legal opinion from Borrower's Counsel. Provided
as Attachment C is the as prepared legal opinion letter of Bond Counsel for
information of the Agency. ,
FISCAL IMPACT:
The Trailer Park Residents' Group agreed to reimburse the Agency for all costs
and expenses incurred by Agency staff, attorneys and consultants in connection
with its request. Funds have been deposited for reimbursement of Agency
expenses and the Administrative Services/Finance Department will perform a
final accounting of all Agency costs incurred.
I~ECOIVIIInE1V®ATION:
Adopt Resolution No. 09-04, A Resolution of the Redevelopment Agency of the
City of Seal Beach Authorizing the Executive Director to Execute Exhibit C-1,
Issuer Consent to Transfer of Project, of the "Assignment and Assumption
Agreement", and Any Other Necessary Documents to Effectuate the Transfer of
the Seal Beach Trailer Park to Seal Beach Shores, Inc. and the Assumption by
Seal Beach Shores, Inc. of all of the Obligations of Seal Beach Affordable
Housing Corporation Related to Such Transfer and the Redevelopment Agency
of the City of Seal Beach Mobile Home park Revenue Bonds (Seal Beach Mobile
Home Park Project) Series 2000 A upon Review and Concurrence by Agency
Counsel.
SUBMITTED BY: NOTED AND APPROVED:
B-~
e Whi enberg David Carma ,Executive Director
Director of Development Services Redevelopment Agency
Attachment(s):
A. Resolution No. 09-04
B. Consent Letter, ACA Financial Guaranty Corp., dated June 22, 2009, including:
^ Exhibit A, Assignment and Assumption Agreement;
^ Exhibit A -Legal Description;
^ Exhibit B -Contributed Assets;
^ Exhibit C-1 -Issuer Consent to Transfer of Project
^ Exhibit C-2 -Consent to Transfer of Project of ACA
C. Form of Consent Letter -Best, Best & Kreiger, dated April, 2009
Page 3
~TT~~~~ENT ~
RESOLUTION NO. 09-04
RESOLUTION NUMBER 09-04
A RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE
CITY OF SEAL BEACH AUTHORIZING THE EXECUTIVE
DIRECTOR TO EXECUTE EXHIBIT C-1, ISSUER CONSENT TO
TRANSFER OF PROJECT, OF THE "ASSIGNMENT AND
ASSUMPTION AGREEMENT", AND ANY OTHER NECESSARY
DOCUMENTS TO EFFECTUATE THE TRANSFER OF THE SEAL
BEACH TRAILER PARK TO SEAL BEACH SHORES, INC. AND
THE ASSUMPTION BY SEAL BEACH SHORES, INC. OF ALL OF
THE OBLIGATIONS OF SEAL BEACH AFFORDABLE HOUSING
CORPORATION RELATED TO SUCH TRANSFER AND THE
REDEVELOPMENT AGENCY OF THE CITY OF SEAL BEACH
MOBILE HOME PARK REVENUE BONDS (SEAL BEACH
MOBILE HOME PARK PROJECT), SERIES 2000A UPON
REVIEW AND CONCURRENCE BY AGENCY COUNSEL
WHEREAS, On January 26, 2009 the Agency considered a Staff Report
regarding consideration of the Agency "... to explore the feasibility
of the resident's 501(c)(3) entity assuming the existing City bonds
originally issued for the park purchase by LINC Housing' ; and
WHEREAS, the Redevelopment Agency, by unanimous vote, directed "...staff
to work with the Seal Beach Shores, Inc. Board in assuming the
bonds to acquire the property for the residents"; and
WHEREAS, Agency counsel and staff have worked with all parties to ensure that
the necessary protections are retained for the Agency and that all
contractual obligations that currently exist will remain in place upon
the transfer of the ownership of the Seal Beach Trailer Park to Seal
Beach Shores, Inc.; and
WHEREAS, ACA Financial Guaranty Corp. (Bond Insurer) and Best, Best, &
Kreiger (Bond Counsel) have approved and consented to the
assignment and assumption and transfer of the Seal Beach Trailer
Park.
NOW, THEREFORE, THE REDEVELOPMENT AGENCY OF THE CITY OF
SEAL BEACH DOES HEREBY RESOLVE:
Section 1. The Executive Director is hereby authorized to execute Exhibit C-1,
Issuer Consent to Transfer of Project, of the Assignment and
Assumption Agreement.
Section 2. The Executive Director is hereby authorized to execute any other
necessary documents to effectuate the transfer of the Seal Beach
Trailer Park to Seal Beach Shores, Inc. upon review and
concurrence by Agency Counsel.
(Intentionally Left Blank)
Resolution Number 09-04
PASSED, APPROVED AND ADOPTED by the Redevelopment Agency of the
City of Seal Beach this 14th day of September , 2009 by the following
vote:
AYES: Agency Membe
NOES: Agency Members
ABSENT: Agency Members,
ABSTAIN: Agency Membe
Chairman
ATTEST:
Secretary/City Clerk
STATE OF CALIFORNIA }
COUNTY OF ORANGE } SS
CITY OF SEAL BEACH }
I, Linda Devine, City Clerk of the City of Seal Beach, California, do hereby certify
that the foregoing Resolution is the original copy of Resolution Number 09-04
on file in the office of the City Clerk, passed, approved, and adopted by the
Redevelopment Agency of the City of Seal Beach at a meeting held thereof on
the 14th day of September , 2009.
Secretary/City Clerk
Page 4
ATTACHMENT B
CONSENT LETTER, ACA FINANCIAL
GUARANTY CORP., DATED JUNE 22, 2009,
INCLUDING:
^ EXHIBIT A, ASSIGNMENT AND
ASSUMPTION AGREEMENT;
^ EXHIBIT A -LEGAL DESCRIPTION;
^ EXHIBIT B -CONTRIBUTED ASSETS;
^ EXHIBIT C-1 -ISSUER CONSENT TO
TRANSFER OF PROJECT
^ EXHIBIT C-2 - CONSENT TO
TRANSFER OF PROJECT OF ACA
RECORDING REQUESTED BY AND )
WHEN RECORDED RETURN TO: )
Redevelopment Agency of the )
City of Seal Beach )
211 Eighth Street )
Seal Beach, CA 907040 )
Attn: Director of Development Services )
(Space above for Recorder's Office use only)
This document is recorded for the benefit of the Redevelopment Agency of the City of Seal Beach and the
recording is fee-exempt under Section 27383 of the Government Code.
ASSIGNMENT AND ASSUMPTION AGREEMENT
(SEAL BEACH TRAILER PARK PROJECT)
By and Among
SEAL BEACH AFFORDABLE HOUSING CORPORATION,
SEAL BEACH SHORES, INC.,
and UNION BANK, N.A.
(formerly known as Union Bank of California, N.A.), as trustee
Dated as of August 1, 2009
Relating to
$6,750,000
REDEVELOPMENT AGENCY OF THE CITY OF SEAL BEACH
MOBILE HOME PARK REVENUE BONDS
(SEAL BEACH TRAILER PARK PROJECT)
RVPU B\KSNO W\759849.1
THIS ASSIGNMENT AND ASSUMPTION AGREEMENT (the "Agreement"),
made and entered into as of August 1, 2009, by and among the SEAL BEACH AFFORDABLE
HOUSING CORPORATION, a California nonprofit public benefit corporation ("SBAHC"),
SEAL BEACH SHORES, INC., a California nonprofit public benefit corporation ("SBSI") and
UNION BANK, N.A. (formerly known as Union Bank of California, N.A.), a national banking
association, as trustee ("Trustee").
WITNESSETH:
WHEREAS, in furtherance of the maintenance of housing for citizens of low and
very low income, on December 21, 2000 the Redevelopment Agency of the City of Seal Beach, a
California redevelopment agency (the "Agency"), issued pursuant to an Indenture of Trust, dated
as of December 1, 2000 (the "Indenture"), by and between the Agency and Trustee, $6,750,000
aggregate principal amount "Redevelopment Agency of the City of Seal Beach Mobile Home
Park Revenue Bonds (Seal Beach Trailer Park Project), Series 2000A" (the "2000 Bonds"), the
proceeds of which were loaned to LING Community Development Corporation ("LING-CDC")
for the purpose of acquiring and rehabilitating the Seal Beach Trailer Park (the "Project")
located within the City on the real property described in Exhibit A attached hereto as a low and
very low income project;
WHEREAS, in consideration of the loan made to LILAC-CDC from the proceeds
of the 2000 Bonds, LING-CDC entered into that certain Loan Agreement, dated as of December
1, 2000 (the "2000 Loan Agreement"), by and among the Agency, the Trustee and LING-CDC
relating to the Bonds, under the terms of which LING-CDC executed and delivered to the
Agency for assignment to the Trustee its promissory note, dated December 1, 2000 (the "2000
Note"), in the principal amount of $6,750,000, under which it was to make loan payments to the
Trustee in the amounts and at the time sufficient to pay, as due, the principal of and interest on
the 2000 Bonds;
WHEREAS, in furtherance of the issuance of the 2000 Bonds, the Agency, the
Trustee and LING-CDC entered into the Regulatory Agreement and Declaration of Restrictive
Covenants, dated as of December 1, 2000 (the "2000 Regulatory Agreement"), which provided
that the use and operation of the Project be restricted in certain respects in order to ensure that
the Project would be used and operated in accordance with the Internal Revenue Code; and
WHEREAS, in furtherance of issuance of the 2000 Bonds, the Agency and LINC-
CDC entered into the Administration and Oversight Agreement, dated as of December 1, 2000
(the "2000 Administration Agreement") under which the Agency appointed Rosenow
Spevacek Group, Inc. ("RSG") as an "Oversight Agent" under the 2000 Loan Agreement to
monitor the compliance of LING-CDC thereunder and as "Program Administrator" to monitor
compliance with the 2000 Regulatory Agreement; and
WHEREAS, in compliance with Securities and Exchange Commission Rule
15c2-12, LING-CDC and the Trustee, acting in its capacity as dissemination agent, entered into
the Continuing Disclosure Agreement, dated as of December 1, 2000 (the ``2000 Disclosure
Agreement"), under which LILAC-CDC agreed to provide annual reports to the Trustee for
dissemination in conformity of Rule 15c2-12; and
R VPUBUCSNOVl~759849.1
WHEREAS, in order to secure the payment of the 2000 Note, LILAC-CDC
executed and delivered a Deed of Trust, dated as of December 1, 2000 (the "2000 Deed of
Trust"), under which it conveyed, in trust, its right, title and interest to the Project to Fidelity
National Title Insurance Company, as trustee under the 2000 Deed of Trust, for the benefit of the
Trustee under the 2000 Indenture; and
WHEREAS, in order to further secure its obligations under the 2000 Loan
Agreement, LILAC-CDC executed and there was filed with the Secretary of State a UCC-1
Financing Statement on December _, 2000 (the "2000 Financing Statement"), giving a
security interest in all personal property located in the Project to the Trustee, pursuant to the
California Uniform Commercial Code (the 2000 Loan Agreement, 2000 Regulatory Agreement,
2000 Administration Agreement, 2000 Disclosure Agreement, 2000 Deed of Trust and 2000
Financing Statement are hereinafter referred to collectively as the "2000 Bond Documents");
and
WHEREAS, in connection with the issuance of the Bonds and the financing of the
Project, the Agency and LILAC-CDC entered into the following documents: (1) Amended and
Restated Loan and Grant Agreement dated as of August 31, 2005 (the "Agency Loan
Agreement"), (2) a Regulatory Agreement dated as of December 1, 2000, as amended by the
Amendment of Regulatory Agreement dated as of August 31, 2005 (the "Agency Regulatory
Agreement"), (3) a Deed of Trust dated as of December 1, 2000, as modified by the
Modification of Deed of Trust dated as of August 31, 2005 (the ``Agency Deed of Trust"), and
(4) Residual Receipts Promissory Note in the principal amount of $985,000 and dated December
21, 2000 (the "Agency Note") (the Agency Loan Agreement, Agency Regulatory Agreement,
Agency Deed of Trust and Agency Note are hereinafter referred to collectively as the "Agency
Loan Documents"); and
WHEREAS, pursuant to Section 6.32 of the 2000 Loan Agreement LILAC-CDC
transferred the Project and all of LILAC-CDC's obligations and rights under the 2000 Bond
Documents and the Agency Loan Documents to SBAHC pursuant to that certain Contribution,
Assignment and Assumption Agreement dated as of August 25, 2005;
WHEREAS, SBSI has been formed as a California non-profit public benefit
corporation, and has qualified as a 501(c)(3) tax exempt public charity;
WHEREAS, in furtherance of their respective tax exempt purposes, SBAHC
wishes to contribute the Project and contribute and assign all related personal property,
intangibles, service contracts, and similar obligations as described in Exhibit B attached hereto,
and collectively referred to herein as the "Contributed Assets" to SBSI, and SBSI wishes to
accept the contribution and assignment;
WHEREAS, concurrently with the recordation of this Agreement, SBAHC has
executed and delivered to SBSI a grant deed conveying the Project to SBSI as permitted by
Section 6.2 of the 2000 Loan Agreement and Section 10 of the 2000 Regulatory Agreement and
the parties hereto wish to acknowledge and effectuate the contribution and assignment of the
2000 Bond Documents, the Agency Loan Documents and the Contributed Assets by SBAHC to
SMSI and SBSI's acceptance and assumption thereof.
RVPUB\KSNOW\759849.1 2
NOW, THEREFORE, in consideration of the mutual covenants and undertakings
set forth herein, and for other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereto agree respectively as follows:
Section 1. SBAHC Representations and Warranties. In order to induce the
Agency, the Trustee and ACA Financial Guaranty Corporation ("ACA") to consent to this
Agreement, SBAHC represents and warrants as follows:
a. There is no pending or, to the best knowledge of SBAHC, threatened
action, suit, proceeding, inquiry or investigation, at law or in equity, by or before any court,
public board or body, known by SBAHC, nor, to the best of the knowledge of SBAHC, is there
any basis therefor, looking toward the dissolution or liquidation of SBAHC, or wherein an
unfavorable decision, ruling or finding would, in any way, materially adversely affect the
transactions contemplated by this Agreement or which, in any way, would adversely affect the
execution, validity, delivery or enforceability of this Agreement.
b. SBAHC is anot-for-profit corporation duly organized, validly existing and
in good standing under the laws of the State of California, has the power and authority to own its
property and assets, to carry on its respective business as now being conducted by it and to
execute, deliver and perform this Agreement.
c. SBAHC has been determined by the Internal Revenue Service to be and
continues to be exempt from Federal income taxes under Section 501(a) of the Internal Revenue
Code of 1986, as amended (the "Code"), by virtue of being an organization described in Section
501(c)(3) of the Code, except for unrelated business income subject to taxation under Section
511 of the Code, and is not a "private foundation" as described in Section 590(a) of the Code,
and SBAHC does not know of any circumstances which would disqualify or threaten to
disqualify itself as such an organization.
d. The execution, delivery and performance of this Agreement have been
duly authorized by all requisite corporate action and approval on the part of SBAHC, and the
execution and delivery hereof and compliance with the provisions hereof has not and will not
conflict with or violate any provision of law, any rule, regulation, order, judgment, writ,
injunction or decree of any court or agency of government or the certificate of incorporation or
bylaws of SBAHC or require consent that has not otherwise been secured prior to the date hereof
under, or result in a breach under, any indenture, agreement or other instrument to which
SBAHC is a party or by which it or any of its property is subject to or bound, or be in conflict
with, or constitute (with due notice and/or lapse of time) a breach of or default under any such
indenture, agreement or other such instrument.
e. This Agreement and any and all other agreements and documents required
to be executed and delivered by SBAHC in order to carry out, give effect to and consummate the
transactions contemplated by this Agreement have been duly authorized, executed and delivered
by SBAHC and have not been amended, modified or rescinded, remain in full force and effect
and are the legal, valid and binding obligations of SBAHC enforceable against it in accordance
with their terms, except as such enforcement thereof may be limited by any bankruptcy,
insolvency, reorganization, moratorium or similar statute, rule, regulation or other law affecting
RVPUB~ICSNOW~759849.1 3
the enforcement of creditors' rights and remedies generally, or by the unavailability of, or any
limitation on the availability of, any particular right or remedy (whether in a proceeding in equity
or at law) because of the discretion of a court or of any procedural requirement, public polity or
equitable principle or otherwise, or by general principles of equity, and no authority for its
execution, delivery or performance has been repealed, revoked or rescinded. SBAHC has duly
authorized the taking of and has taken all internal action necessary to give effect to the
transactions contemplated to be performed by the documents cited in this paragraph.
f. SBAHC is not a party to or bound by any contract, agreement or other
instrument, or subject to any charter or other restriction or any judgment, order, writ, injunction,
decree, rule or regulation which, in the opinion of SBAHC, materially adversely affects the
business, operations, affairs, properties, assets or condition, financial or otherwise, of SBAHC.
g. Neither this Agreement nor any other document, certificate or statement
furnished to you by or on behalf of SBAHC contains any untrue statement of a material fact or
omits to state a material fact necessary in order to make the statements contained herein or
therein not misleading. There is no fact known to SBAHC which materially adversely affects the
business, operations, affairs, conditions, properties or assets of SBAHC.
h. All consents, approvals or authorizations, if any, of any governmental
authority, agency, quasi-governmental agency or private corporation required on the part of
SBAHC in connection with the execution and delivery of this Agreement have been duly
obtained, and SBAHC has complied with applicable provisions of law, if any, requiring any
designation, declaration, filing, registration and/or qualification with any governmental authority
in connection with such execution and delivery.
Section 2. SBSI Representations and Warranties. In order to induce the
Agency, the Trustee and the ACA to consent to this Agreement, the Assignor represents and
warrants as follows:
a. There is no pending or, to the best knowledge of SBSI, threatened action,
suit, proceeding, inquiry or investigation, at law or in equity, by or before any court, public board
or body, known by SBSI, nor, to the best of the knowledge of SBSI, is there any basis therefor,
looking toward the dissolution or liquidation of SBSI, or wherein an unfavorable decision, ruling
or finding would, in any way, materially adversely affect the transactions contemplated by this
Agreement or which, in any way, would adversely affect the execution, validity, delivery or
enforceability of this Agreement.
b. SBSI is anot-for-profit corporation duly organized, validly existing and in
good standing under the laws of the State of California, has the power and authority to own its
property and assets, to carry on its respective business as now being conducted by it and to
execute, deliver and perform this Agreement.
c. SBSI has been determined by the Internal Revenue Service to be and
continues to be exempt from Federal income taxes under Section 501(a) of the Code by virtue of
being an organization described in Section 501(c)(3) of the Code (or corresponding provisions of
prior law), except for unrelated business income subject to taxation under Section 511 of the
RVPUB\KSNOW1759849.1 4
Code, and is not a "private foundation" as described in Section 590(a) of the Code, and SBSI
does not know of any circumstances which would disqualify or threaten to disqualify itself as
such an organization.
d. The execution, delivery and performance of this Agreement have been
duly authorized by all requisite action and approval on the part of SBSI, and the execution and
delivery hereof and compliance with the provisions hereof has not and will not conflict with or
violate any provision of law, any rule, regulation, order, judgment, writ, injunction or decree of
any court or agency of government or the certificate of incorporation or bylaws of SBSI or
require consent that has not otherwise been secured prior to the date hereof under, or result in a
breach under, any indenture, agreement or other instrument to which SBSI is a party~or by which
it or any of its property is subject to or bound, or be in conflict with, or constitute (with due
notice and/or lapse of time) a breach of or default under any such indenture, agreement or other
such instrument.
e. This Agreement and any and all other agreements and documents required
to be executed and delivered by SBSI in order to carry out, give effect to and consummate the
transactions contemplated by this Agreement have been duly authorized, executed and delivered
by SBSI and have not been amended, modified or rescinded, remain in full force and effect and
are the legal, valid and binding obligations of SBSI enforceable against it in accordance with
their terms, except as such enforcement thereof may be limited by any bankruptcy, insolvency,
reorganization, moratorium or similar statute, rule, regulation or other law affecting the
enforcement of creditors' rights and remedies generally, or by the unavailability of, or any
limitation on the availability of, any particular right or remedy (whether in a proceeding in equity
or at Iaw) because of the discretion of a court or of any procedural requirement, public polity or
equitable principle or otherwise, or by general principles of equity, and no authority for its
execution, delivery or performance has been repealed, revoked or rescinded. SBSI has duly
authorized the taking of and has taken all internal action necessary to give effect to the
transactions contemplated to be performed by the documents cited in this paragraph.
f. SBSI is not a party to or bound by any contract, agreement or other
instrument, or subject to any charter or other restriction or any judgment, order, writ, injunction,
decree, rule or regulation which, in the opinion of SBSI, materially adversely affects the
business, operations, affairs, properties, assets or condition, financial or otherwise, of SBSI.
g. Neither this Agreement nor any other document, certificate or statement
furnished to you by or on behalf of SBSI contains any untrue statement of a material fact or
omits to state a material fact necessary in order to make the statements contained herein or
therein not misleading. There is no fact known to SBSI which materially adversely affects the
business, operations, affairs, conditions, properties or assets of SBSI.
h. All consents, approvals or authorizations, if any, of any governmental
authority, agency, quasi-governmental agency or private corporation required on the part of SBSI
in connection with the execution and delivery of this Agreement have been duly obtained, and
SBSI has complied with applicable provisions of law, if any, requiring any designation,
declaration, filing, registration and/or qualification with any governmental authority in
connection with such execution and delivery.
RVPUB\KSNOW\759849.1 5
Section 3. Assignment and Assumption. SBAHC hereby assigns, grants,
conveys and transfers to SBSI and SBSI hereby unconditionally and irrevocably accepts and
assumes all of the rights, duties, responsibilities, obligations and liabilities of SBAHC under the
2000 Bond Documents, Agency Loan Documents, and Contributed Assets, and SBSI hereby
agrees and undertakes to perform all of the loans, obligations, covenants and agreements of
SBAHC contained therein to the full extent as if SBSI had originally been a party to each such
document, subject to any and all applicable nonrecourse provisions set forth therein.
Section 4. Sin lg a Purpose Entity. SBSI agrees to maintain its qualification as
a tax exempt organization described in Section 501(c)(3) of the Internal Revenue Code, and shall
operate the Project in a manner that does not constitute an unrelated trade or business of such
organization.
Section 5. Indemnities.
a. SBAHC hereby agrees to indemnify and hold SBSI, Agency, ACA and
Trustee harmless from any and all claims and obligations imposed under, or relating to, the
Project, 2000 Bond Documents, Agency Loan Documents and the Contributed Assets, arising or
occurring prior to the date of this Agreement.
b. SBSI hereby agrees to indemnify and hold SBAHC, LILAC-CDC, Agency,
ACA and Trustee harmless from any and all claims and obligations imposed under, or. relating
to, the Project, 2000 Bond Documents, Agency Loan Documents and the Contributed Assets,
arising or occurring after the date of this Agreement.
Section 6. Payment of Obli ations. Any unpaid liabilities assumed by SBSI
pursuant to this Agreement shall be paid directly by SBSI.
Section 7. No Prior Assignment. SBAHC hereby represents and warrants that
it has not previously assigned, pledged, hypothecated or otherwise transferred any of its rights or
obligations as to the Project, the 2000 Bond Documents, the Agency Loan Documents, or the
Contributed Assets. For accounting and tax basis purposes, SBAHC hereby agrees to provide
SBSI with detailed information concerning the tax and accounting basis in the Contributed
Assets.
Section 8. Agency and ACA as Third Party Beneficiaries. The Agency and
ACA are third party beneficiaries of this Agreement and this Agreement cannot be amended in
any way which adversely affects the Agency's or ACA's interests herein without the written
consent of the Agency and/or ACA, as appropriate.
Section 9. Further Assurances and Acts. It is further agreed by the parties to
this Agreement, that the appropriate officers and employees of each will undertake to perform
such further duties and to execute such further documents as are necessary to implement and
carry into full effect the intent and purpose of the within Agreement including, without
limitation, execution and delivery of any and all assignments, certificates, agreements, notices,
consents, instruments of conveyance, warrants and other documents which they, or any of them,
may deem necessary or advisable in order to consummate the assignment and assumption as
described herein or to otherwise effectuate the purposes of this Agreement.
RVPUB~KSNOW~759849.1 6
Section 10. Consent of Third Parties. This Agreement is expressly contingent
on SBAHC and SBSI receiving an executed Consent to Transfer of Project of the Issuer attached
hereto as Exhibit C-1 and an executed Consent to Transfer of Project of ACA attached hereto as
Exhibit C-2.
Section 11. Counterparts. This Agreement may be executed simultaneously in
one or more counterparts, each of which shall be deemed an original, but all of which together
shall constitute one and the same instrument.
Section 12. Applicable Law. The laws of the State of California shall govern
the interpretation and enforcement of this Agreement.
[Remainder of page intentionally left blank]
RVPUB\KSNOW\7~9849.1 7
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
as of the date first above written.
SEAL BEACH AFFORDABLE HOUSING
CORPORATION, a California nonprofit public
benefit corporation
By:
Executive Director
SEAL BEACH SHORES, INC., a California
nonprofit public benefit corporation
By:
Executive Director
UNION BANK, N.A., as Trustee
By:
Authorized Officer
RVPUB\KSNOW\759849.1 g
ACKNOWLEDGMENT
STATE OF CALIFORNIA )
)ss:
COUNTY OF 1
On
before me,
a
notary public, personally appeared
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument
the person(s) or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that
the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature
(Seal)
RVPUB\KSNOW\759849.1 9
ACKNOWLEDGMENT
STATE OF CALIFORNIA )
)ss:
COUNTY OF )
On ,before me, , a
notary public, personally appeared
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument
the person(s) or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that
the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature
(Seal)
RVPUB\KSNOW\759849.1 1
ACKNOWLEDGMENT
STATE OF CALIFORNIA )
)ss:
COUNTY OF 1
On
before me,
a
notary public, personally appeared
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument
the person(s) or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that
the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature
(Seal)
RVPUB\KSNOW\759849.1 11
EXHIBIT A
LEGAL DESCRIPTION
A PARCEL OF LAND PARTLY IN THE CITY OF SEAL BEACH, COUNTY OF ORANGE,
STATE OF CALIFORNIA AND PARTLY IN THE CITY OF LONG BEACH COUNTY OF
LOS ANGELES, STATE OF CALIFORNIA, AND AS DESCRIBED AS FOLLOWS:
A PORTION OF THAT PARCEL OF LAND GRANTED TO THE CITY OF SEAL BEACH
BY THAT CERTAIN FINAL ORDER OF CONDEMNATION, SUPERIOR COURT OF LOS
A1~iGELES COUNTY, CASE NO. C-78004, PARCEL 4, A CERTIFIED COPY ;OF WHICH
WAS RECORDED MARCH 23, 1977 IN BOOK 12115, PAGE 195 OF OFFICIAL RECORDS
OF ORANGE COUNTY, CALIFORNIA; AND A PORTION OF TIDE LAND LOCATION
NO. 137 "SURVEY N0. 106", AS PATENTED BY THE STATE OF CALIFORNIA ON
FEBRUARY 12, 1901 AND RECORDED APRIL 27, 1901 IN BOOK 9, PAGE 105 OF
PATENTS, RECORDS OF LOS ANGELES COUNTY, AND RECORDED SEPTEMBER 5,
1905 IN BOOK 1, PAGE 231 OF PATENTS, RECORDS ORANGE COUNTY; SAID ABOVE
PORTIONS OF LAND BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS:
BEGINNING AT THE MOST NORTHERLY CORNER OF TRACT NO. 9783, AS SHOWN
ON MAP FILED IN BOOK 437, PAGES 32 TO 36 OF MISCELLANEOUS MAPS,
RECORDS OF ORANGE COUNTY; SAID CORNER BEING A POINT IN THE
SOUTHEASTERLY LINE OF THE LOS ANGELES COUNTY FLOOD CONTROL
DISTRICT LAND DESCRIBED AS PARCEL 8 IN SUPERIOR COURT CASE NO. 231287,
IN AND FOR THE COUNTY OF LOS ANGELES, IN BOOK 2383, PAGE 42, RECORDS OF
ORANGE COUNTY, SAID SOUTHEASTERLY LINE BEING A CURVE CONCAVE
SOUTHEASTERLY AND HAVING A RADIUS OF 2000.00 FEET, A RADIAL LINE FROM
SAID P_QINT BEARS _SOUTH 35° 57' S5" EAST; THENCE NORTHEASTERLY ALONG ~-~ -~ ~ ..:
• ~ SAID CURVE AND 80UT'HEASTERLY LINE, AN ARC DISTANCE OF 356.05 FEET;
THENCE ~ TANGENT TO SAID CURVE AND CONTINUING ALONG SAID
SOUTHEASTERLY LINE, NORTH 54° 02' OS" EAST 239.79 FEET TO THE
NORTHEASTERLY LINE OF THAT 200.00 FOOT WIDE STRIP OF LAND DESCRIBED IN
THE QUITCLAIM DEED TO THE PACIFIC ELECTRIC RAILWAY COMPANY,
RECORDED FEBRUARY 21, 1926 IN BOOK 514, PAGE 44 OF DEEDS, RECORDS OF
ORANGE COUNTY; THENCE SOUTHEASTERLY ALONG SAID NORTHEASTERLY
LINE, SOUTH 42° 15' 32" EAST 492.08 FEET TO THE NORTHWESTERLY LINE OF
FIRST STREET, AS IT NOW EXISTS, SAID LAST MENTIONED NORTHWESTERLY
LINE BEING A LINE PARALLEL WITH AND DISTANT NORTHWESTERLY 110.00
FEET, MEASURED AT RIGHT ANGLES FROM THE BOUNDARY LINE OF THE
RANCHO LOS ALAIVIITOS, PER MAP RECORDED IN BOOK 1, PAGES 460, 461 AND 462
OF PATENTS OF LOS ANGELES COUNTY, CALIFORNIA, AND AS SHOWN ON THE
RECORD OF SURVEY RECORDED IN RECORD OF SURVEY BOOK 90, PAGES 23 TO
30, AND AS MORE PARTICULARLY ESTABLISHED BY SEAL BEACH BOUNDARY
LINE AGREEMENT NO 2 DATED FEBRUARY 5, 1968 AND RECORDED APRIL 8, 1968
N BOOK 8565, PAGE 1 OF OFFICIAL RECORDS OF ORANGE COUNTY; THENCE
SOUTHWESTERLY ALONG SAID LAST MENTIONED PARALLEL LINE, AND THE
NORTHWESTERLY LINE OF FIRST STREET, SOUTH 54° 48' 38" WEST 606.81 FEET TO
RVPUB~KSNOW~759849.1 A-1
THE BEGINNING OF A TANGENT CURVE CONCAVE SOUTHEASTERLY AND
HAVING A RADIUS OF 610.00 FEET; THENCE SOUTHWESTERLY ALONG SAID
CURVE, AN ARC DISTANCE OF 6.79 FEET TO THE MOST EASTERLY BOUNDARY
CORNER OF SAID TRACT NO. 9783; THENCE NORTHWESTERLY ALONG THE
NORTHEASTERLY BOUNDARY LINE OF SAID TRACT NO. 9783, THE FOLLOWING
COURSES:
NORTH 42° 17' 11" WEST 203.39 FEET TO THE BEGINNING OF A TANGENT CURVE
CONCAVE EASTERLY AND HAVING A RADIUS OF 15.00 FEET; THENCE
NORTHERLY ALONG SAID CURVE, AN ARC DISTANCE OF 21.79 FEET TO THE
BEGINNING OF A REVERSE CURVE CONCAVE NORTHWESTERLY AND ~-iAVING A
RADIUS OF 112.50 FEET; THENCE NORTHEASTERLY ALONG SAID CURVE, AN ARC
DISTANCE OF 10.24 FEET TO THE INTERSECTION OF ANON-TANGENT LINE
BEARING NORTH 43° 58' 37" WEST, A LINE FROM SAID POINT OF INTERSECTION
BEARS NORTH 54° 15' 24" WEST; THENCE NORTH 43° 58' 37" WEST 230.28 FEET TO
THE MOST NORTHERLY CORi~TER OF SAID TRACT NO. 9783 AND THE POINT OF
BEGINNING.
THE ABOVE DESCRIBED PARCEL OF LAND IS SHOWN AS "NOT A PART" ON THE
MAP OF TRACT NO. 9783, FILED IN BOOK 437, PAGES 32 TO 36, OF
MISCELLANEOUS MAPS, RECORDS OF ORANGE COUNTY, CALIFORNIA.
EXCEPT FROM THE ABOVE DESCRIBED PROPERTY, THAT PORTION OF THE
SUBSURFACE THEREOF LYING ONE HUNDRED (100) FEET OR MORE BELOW THE
SURFACE OF SAID PROPERTY, BUT WITHOUT AN RIGHT OF ENTRY UPON THE
SURFACE THEREOF, AS SET FORTH IN MEMORANDUM OF LEASE, RECORDED
JANUARY 30, 1980 IN BOOK 13484, PAGE 1969 OF OFFICIAL RECORDS OF ORANGE
COUNTY, CALIFORNIA.
ALSO EXCEPT THEREFROM ALL OIL, OIL RIGHTS, NATURAL GAS RIGHTS,
MINERAL RIGHTS AND OTHER HYDROCARBON SUBSTANCES BY WHATEVER
NAME KNOWN, TOGETHER WITH APPURTENANT RIGHTS THERETO, WITHOUT,
HOWEVER, ANY RIGHT TO ENTER UPON THE SURFACE OF SAID LAND NOR ANY
PORTION OF THE SUBSURFACE LYING ABOVE A DEPTH OF 500 FEET, AS
EXCEPTED OR RESERVED IN INSTRUMENTS OF RECORD.
END OF LEGAL DESCRIPTION
RVPUB\KSNOW\759849.1 A-2
EXHIBIT B
CONTRIBUTED ASSETS
(1) All fixtures, furniture, equipment, furnishing and other personal property
which relate in any way to the construction, use, occupancy, operation, development or marketing of the
Project or the development thereof;
(2) All utility deposits made (and any refunds thereof) and any and all other
funds deposited as security for the fulfillment of any of the obligations of SBAHC in connection with the
Project (or any part thereof);
(3) All deposits and bonds of SBAHC relating to the Park (or any part
thereof), including, without limitation, deposits and bonds provided to any governmental agency as to the
Park;
(4) All original reports, appraisals, drawings, plans, blueprints, studies,
specifications, certificates of occupancy, building permits, including all governmental approvals and
permits and surveys relating to all or any part of the Park, all copies thereof, and all amendments,
modifications, supplements, general conditions and addenda thereto, and copies of all fmancial
documents, instruments, bills, checks, invoices, and all other books and records relating to all or any part
of the Park;
(5) All warranties and guaranties, whether oral or written, of manufacturers,
vendors, contractors and subcontractors relating to the construction, development or work performed or to
be performed in connection with the Park;
(6) All of SBAHC's legal and equitable claims, causes of action, and rights
against the architects, engineers, designers, contractors, subcontractors, suppliers, and materialmen and
any other party who has supplied labor, services, materials or equipment, directly or indirectly, in
connection with the design, planning, marketing, construction, manufacturing or operation of all or any
part of the Park;
(7) The tradenames, tradestyles, service marks, logos, letterheads,
advertising symbols, goodwill, telephone numbers, advertising rights, negatives, prints, brochures, flyers,
pamphlets and all other media items used or to be used in connection with the marketing of the Park (or
any part thereof);
(8) All prepaid insurance policies in connection with the Park or
improvements and all liability insurance policies relating to the Park or improvements thereon to the
extent they apply to events that occurred prior to the transfer of the Pazk or such improvements;
(9) All permits, licenses, contracts, approvals, business licenses, applications
and agreements, of every kind and nature, relating to the Park, including, without limitation, all building
permits and environmental and subdivision approvals; and
(10) All general intangibles and other intangible properly used in connection
with the construction, use, operation, occupancy, development or marketing of the Park and
improvements thereon, including but not limited to the agreements as to the management of the Park, the
agreement as to the management of the SBAHC's assets, legal services and operating contracts.
RVPUB\KSNOW\759849.1 B-1
EXHIBIT C-1
ISSUER CONSENT TO TRANSFER OF PROJECT
The undersigned hereby consents to the transfer of .the Project in
accordance with the terms of the Assignment and Assumption Agreement (Seal Beach Trailer
Park Project) dated August 1, 2009 among Seal Beach Affordable Housing Corporation, Seal
Beach Shores, Inc., and Union Bank, N.A.
transfer of the Project.
This consent shall not be construed as a consent to any subsequent sale or
REDEVELOPMENT AGENCY OF THE CITY OF
SEAL BEACH, a California redevelopment agency
By:_
Name:
Title:
RV PUB\KSNOVl~759849.1 C-1-1
Page 5
AT~AC~~EN~ C
~ORlln O~ CONSENT LETTER -
SEST, SEST ~ I(D~EICER,
®ATE® APRIL, 2009
BEST BEST ~ KRIEGER
ATTORNEYS AT LAW
INDIAN WELLS
(760) 568-2611 3750 University Avenue, Suite 400
Post Office Box 1028
IRVINE Riverside, California 92502-1028
(949) 263-2600 (951) 686-1450
LOS ANGELES (951) 686-3083 Fax
(213) 617-8100 BBKlaw.com
ONTARIO
(909) 989-8584
8{y8e R. Sanow
(951)826-8272
Kyle. S n ow@bbklaw. com
April _, 2009
Redevelopment Agency of the City of Seal Beach
Seal Beach, California
Union Bank of California N.A.
Los Angeles, California
ACA Financial Guaranty Corporation
New York, New York
SACRAMENTO
(916) 325-4000
SAN DIEGO
(619) 525-1300
WALNUT CREEK
(925) 977-3300
Re: $6,750,000 Redevelopment Agency of the City of Seal Beach Mobile
Home Park Revenue Bonds (Seal Beach Mobile Home Park Project)
Series 2000A
Ladies and Gentlemen:
We acted as bond counsel in connection with the issuance by the Redevelopment Agency
of the City of Seal Beach (the "Agency") of its $6,750,000 aggregate principal amount Mobile
Home Park Revenue Bonds (Seal Beach Mobile Home Park Project) Series 2000A (the
"Bonds"). The Agency issued the Bonds pursuant to the provisions of Section 33740 and
following of the California Health and Safety Code and an Indenture of Trust, dated as of
December 1, 2000 (the "Indenture"), between the Agency and Union Bank of California, N.A.
(the "Trustee"). The Bonds were issued for the purpose of making a loan to LILAC Community
Development Corporation, a California nonprofit public benefit corporation (the "Original
Borrower") pursuant to a Loan Agreement, dated as of December 1, 2000 (the "Loan
Agreement"), among the Agency, the Trustee and the Borrower, to finance the acquisition of the
Seal Beach Trailer Park (the "Project"). The Original Borrower, pursuant to Section 6.32 of the
Loan Agreement, transferred all of its interest in the Project to Seal Beach Affordable Housing
Corporation (the "Borrower") under the terms of a Contribution Assignment and Assumption
Agreement dated as of August 25, 2005. Terms not otherwise defined herein shall have the
meanings ascribed to such terms in the Indenture.
We are informed that the Borrower desires to transfer the Project to Seal Beach Shores,
Inc., a California nonprofit public benefit corporation (the "Transferee") under an Assignment of
Assumption Agreement (Seal Beach Trailer Park Project) dates as of April _, 2009 among the
Borrower, SBSI, the Agency and the Trustee (the "Assignment and Assumption Agreement"). .
RV PUB\KSNO W\760498.1
BEST BEST & KRIEGER
ATTORNEYS AT LAW
Redevelopment Agency of the City of Seal Beach
Union Bank of California N.A.
ACA Financial Guaranty Corporation
April _, 2009
Page 2
In connection with the authorization and execution by the Agency of the Assignment and
Assumption Agreement, we have examined and reviewed documents and matters deemed
necessary by us to render the opinions set forth herein, including, without limitation, an opinion
of in its capacity as counsel to SBSI dated April _, 2009. We have not
undertaken to independently verify and we have assumed the accuracy of the factual matters
represented, warranted or certified in such proceedings and the genuineness of all documents and
signatures presented to us. This opinion is being delivered in satisfaction of Section 6.2 of the
Loan Agreement and Section 10 of the Regulatory Agreement.
Based on and subject to the foregoing, and in reliance thereon, we are of the.opinion that,
as of the date hereof, under existing laws, regulations, rulings and judicial decisions, the transfer
of the Project under the Assignment and Assumption Agreement from the Borrower to SBSI will
not, in and of itself, adversely affect the exclusion from gross income of interest on the Bonds for
federal tax purposes or the exemption of interest on the Bonds from present State of California
personal income taxes.
We wish to point out that in order for interest on the Bonds to remain excluded from
gross income for purposes of federal income taxation subsequent to the issuance of the bonds, it
is necessary that provisions of the Internal Revenue Code be complied with on a continuous
basis. We have made no investigation as to whether there has been such compliance in the
present case, and accordingly, we express no opinion whatsoever as to whether interest on the
Bonds is excluded from gross income for purposes of federal income taxation as of the date of
this opinion, nor do we express any opinion as to whether interest on the Bonds is presently
exempt from State of California personal income taxation.
We have not been engaged, nor have we undertaken to advise, any party or to opine as to
any matters not specifically covered herein, including, but not limited to, matters relating to
compliance with any securities law.
This opinion may be relied upon only by the parties to whom it is addressed and may not
be circulated, quoted from or relied upon by any other party without our prior written consent.
Very truly yours,
RVPUB\KSNOW\760498.1
.A