2007 RES R-140-07 - Laserfiche WebLink

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CITY OF COLTON PROMISSORY NOTE $2,000,000.00 , 2007 Colton, California FOR VALUE RECEIVED, the undersigned, THE CITY OF COLTON, a California municipal corporation, promises to pay from the City of Colton Wastewater Fund ("Wastewater Fund") ("Maker") to the City of Colton Water Fund ("Water Fund") ("Holder") the principal sum of Two Million Dollars ($2,000,000), together with interest as provided herein. Such principal sum is subject to reduction as provided below. This Promissory Note is made with reference to the Colton City Council's approval on October 16, 2007 of a loan of funds in the amount of two million dollars ($2,000,000) from the Wastewater Fund to the Water Fund. These separate enterprise funds are maintained by the City of Colton for its water and wastewater operations. The City Council determined on October 16, 2007 that there are funds available in the Wastewater Fund for loan and investment and subsequently approved the above described loan from the Wastewater Fund to the Water Fund. 1. Maker will pay to Holder the principal amount of this Promissory Note, and accrued interest, as follows: 1.1 Maker shall pay to Holder two million dollars ($2,000,000) with interest thereon from the date of June 30, 2007 at the current LAIF rate per annum, principal and interest payable semi-annually on January 1St and June 30th and due in full by December 31, 2008. 1.2 The Water Utility shall utilize the funds in accordance with all legal requirement. This Promissory Note is payable from all legally available revenues of the Water Fund. 1.3 In the even sufficient revenues are not available to make semi-annual payments, interest shall accrue and be capitalized. The term of the Promissory Note shall be eighteen (18) months, unless extended by mutual consent of both parties. 2. All payments due hereunder are payable in lawful money of the United States of America in same day funds. This Promissory Note may be prepaid in full at any time without penalty. 3. The entire principal amount of this Promissory Note shall become immediately due and payable if the City Council determines that the money lent from the Wastewater Fund is needed to pay for obligations of that fund as such obligations may arise by operation of fact or law. 4. Payment of the principal amount of this Promissory Note and any accrued interest shall be subordinate to existing debt and any future bonded indebtedness of Maker. 5. The unenforceability or invalidity of any provision or provisions of this Promissory Note as to any persons or circumstances shall not render that provision or those provisions unenforceable or invalid as to any other person or circumstances, and all provisions hereof, in all other respects, shall remain valid and enforceable. A-1