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HomeMy WebLinkAbout1957-01-11; City Council; MinutesEXCERPTS OF JVTINUTES OF BOARD OF DIRECTORS OF CARLSBAD IVtUTUAL WATER COIVIPANY RESPECT- ING ACTION OF SAID BOARD AS TO SALE OF THE ASSETS OF CARLSBAD IVTUTUAL WATER COIVLPANY TO CITY OF CARLSBAD. 5i5 >;< ^ >i< >;« >|< >;c >}; >|e >J; EXCERPTS FROM MINUTES OF MEETINGS OF BOARD OF DIRECTORS OF CARLSBAD MUTUAL WATER COMPANY PERTAINING TO THE SALE OF THE CARLSBAD MUTUAL WATER COMPANY TO CITY OF CABLSBAD MINUTES OF A SPECIAL MEETING OF THE BOARD OF DIRECTORS OF THE CARLSBAD MUTUAL WATER COMPANY HELD AT IjOO P.M., January 11, 1957 AT OFFICE OF THE CORPORATION. 601 ELM. CARLSBAD. CALIFORNIA AFFIDAVIT RE NOTICE OF SPECIAL MEETING I, Robert W. Hardin, hereby certify that written notice of a Special Meeting of the Board of Directors of the Carlsbad Mutual Water Company called for 1:00 P. M. Friday, January 11, 1957, by the President of the Corporation, was deposited in the Post Office at the principal place of business of the Corporation, postage prepaid, addressed to eaoh Director at his last known address, or delivered to such Director in person, on Tuesday, January 8, 1957, which is not less than thirty-six hours before the time set for suoh meeting. Special Meeting on the above mentioned date was called by authority of Article XII of the ly-laws of the Corporation which provides for Special Meetings of the Corporation, /s/ R.W. Hardin R. ¥. Hardin, Secretary MINUTES OF THE SPECIAL MEETING of the BOARD OF DIRECTORS of the CARLSBAD MUTUAL WATER COMPANY A special meetingcCDirectors of the Carlsbad Mutual Water Special Meeting « ^ ,. . January 11, 1957 Company was held in the office of the Corporation in the City of Carlsbad, County of San Diego, State of Califomia, on Friday, January II, 1957, as IsOO P. M., said meeting being called under authority of Article 12 of the By-Laws of the Corporation, which provides for Special Meetings of the Corporation. R. R. Robinson C. H. Ingels Directors C, A. Anthony W, W. Rogers Present Arnold Brilhart Also present were Robert W. Hardin, Manager, Shareholders Childers and Walker, reporters from the Carlsbad Journal and Oceanside Blade-Tribune, and Maribee Balcom, stenographer. Meeting was called t) order at IjlO P. K. Offer dated January 1957, from the City of Carlsbad Offer from City of for purchase of the Carlsbad Mutual Water Company was Carlsbad presented as follows: "At the regular meeting of th# City Council held on January 2, 1957, the following motion was passedi "Comn. Helton moved that, subject to the passage of a bond issue, the City Council offer to the shareholders of Carlsbad Mutual Water Company, to piirchase the entire assets of the Carlsbad Mutual Water Company for the sum ®f fiye hundred thousand dollars (|500|000) that the contract of purchase contain guarantees for the continuing water service to North Carlsbad, with substantially the same rates being charged as for the area within tht City of Carlsbadi containing a restriction that the water produced in San Luis Bey wells will not be distributed south of the area outlined in »E3chibit 'D' in the con- tract between the City of Oceanside and the South Coast Land Company| that the City of Carlsbad would covenant to impose a connection charge in an amount to be hereinafter determined by the City Council for the connection of non-stocked lands within the Mutual service system to the facilities of the Mutml Water Company* that this offer be open for acceptance for a period of six (6) months. Seconded by Cmn. Ledgerwood. Four ayes. No nays. Cmn. Robinson abstaining. If there are any tueations regarding this motion or the staps necessary to proceed with the possible purchase of the Company, please let us know." Director Rogers moved, seconded by Director Anthony and carried unanimouslyJ Bl IT ORDERED that the offer of the City of 57-3 Carlsbad for $250,00 per share be presented to the shareholders for their approval or disapproval, in a form to be worked out and then presented at the regiaar meeting of the Board of Directors on January 15. There being no further business to come before th© Board, the meeting was adjourned at 2j05 P« M, /s/ R. W. Hardin /s/ R. R. Robinson Secretary President EXCERPTS UOM MINUTES OF MEETINGS OF BOARD OF DIRKTOBS OF CARLSBAD MUTUAL WATER COMPANY PERTAINING TO THE SALE OF THE CARLSBAD MUTUAL WATER COMPANY TO CITY OF CARLSBAD MINUTES OF THE REGULAR MEETING of the BOARD OF DIRECTORS of the CARLSBAD MUTUAL WATER COMPANY The regular meeting of the Board of Directors of the Regular Meeting June 18, 1957 Carlsbad Mutual Water Company was held in the office of the Company in the City of Carlsbad, County of San Diego, State of Califomia, on Tuesday, June 18, 1957 at IsOO P.M. R. E. Robinson C. H. Ingels Directors C. A. Anthony W, W. Rogers Present 1. S. Phillips Also present were W. Dennis Wood, Secretary-Manager, Herbert Nelson, Claud Helton, Max Ewald, Thcmas H. Tucker, Dick Carboneau, reporter from the Blade-Tribune, and Nell Freeman, stenographer. President Robinson called the meeting td order at li05 P.M. The Board of Directors discussed the issuance of a state- Sale to the City of Carlsbad ment of policy regarding the proposed sale to the City of Carlsbad and unanimously agree oil the policy as follows s Statement of Policy Upon receipt of an affirmative vote from the holders of the majority of the stock of the Company, the Board of Directors of the Carlsbad Mutual Water Company intends to adopt a resolution to sell the assets of the Company to the City of Carlsbad. The Board of Directors affirms and sets forth the terms and conditions as recomstended by the Carlsbad Mutual Water Company Shareholders Committee with additional provisions as follows, provided such terms and conditions are . . -2- . legally possibles 1. Sale price shall be 1500,000.00 cash including current assets and current liabilities. 2. Lands, including North Carlsbad, that are covered by Carlsbad Mutual Water Company stock at the time of sale shall have prior rights to the usage of San Luis Rey Water. 3. Lands lying within the City of Carlsbad and Lands in North Carlsbad that are within the authorized service area of the Carlsbad Mutual Water Company and not wat;er stocked at the time of sale shall be charged an inclusion fee at the rate of 1100.00 per acre prior to being served by Carlsbad Mutual Water Company facilities as exist- ing at time of sale. Funds received from this source for the first five years shall be refunded to shareholders of record at th® time of sale and afterward such funds will go to the City of Carlsbad. It is suggested that refund be made annually. The method of financing this purchase by the City of Carlsbad is not within the province of the Board of Directors of the Carlsbad Mutual Water Company to deteraine. However, the Board agrees that the method of financing should be established upon advice of a recognized bonding counsel. It is the opinion of the Board that the purchase can be financed by a revenue bond without excessive increase in water rates. Director Anthony moved, seconded by Director Rogers and carried unanimously? BE IT ORDERED that the preceding Statement of 57-^5 Policy be sent to the Shareholders with a cover letter informing them of the current affirma- tive votes and that at least 1,000 votes are needed. There being ao further business to come before the Board, upon proper motion, duly seconded, the meeting was adjourned at 2J55 P.M. /s/ W. Dennis Wood /s/ R. R. Robinson Secretary President CONSENT AHD WAIVER OF NOTICE OF SPECIAL MEETING OF THE DIRECTORS OF THE CARLSBAD MUTUAL WATER COMPANY We, the tindersigned, being all of the Directors of the Carlsbad Mutual Water Company, do hereby waive notice of the time and place of the meeting of said Corporation herein provided for., and do hereby consent and agree that a meeting thereof may be held. Said meeting to be held at the office of the Carlsbad Mutual Water Company in the City of Carlsbad, County of San Diego, State of California, on Monday, June 2^, 1957 at 3iOO P.M. /s/ R. R> Robinson a^reslAent /a/ A. Anthony ticePre s ident /s/ H. S. Phillips /s/ C. 1. Ingels /s/ W« ¥. Rogers MINUTES OF THE SPECIAL MEETING of th© BOARD or DIRECTORS of the C.4RLSBAD MUTUAL WAfER COMPANY A special meeting of the Board of Directors of the Sptclal Meeting of Carlsbad Mutual Water Company was held in tie offic® June 2^-, 1957 of the Corporation in the City of Carlsbad, Comty of San Diego, State of California, on Monday, June 2^, 1957, at 3iOO P.M. R. R. Robinson C, H« Ingels Directors C, A, Anthony W, W« Rogers Present H. S. Phillips Also present were W. Dennis Wood, Secretary-Manager, Hay Eberhard, Herbert Nelaon, Bruce Smith, City Attorney, Thomas H. Tucker, and Nell Fraeman, stenographer. President Lobinson called the meeting to order at 3*00 P.M. The purpose of the meeting was to discuss the legality of the various portions of the proposed contract with Attorney Eberhard, After discussion of these points, Mr, Eberhard recommended that because it appeared probable that sufficient votes would soon be Tentative Contract received it would be in order to proceed with th© pre- Sale to the City paration of a tentative contraet for the sale of the assets of the company to the City of Carlsbad* Director Rogers moved, seconded by Director Anthony and carried imanimouslyi BE IT ORDERED that we proceed with drawing 57-^ up a tenatlve ccmtract betweta the City of Carlsbad and the Carlsbad Mutual Water Company for the sale of the assets of the Company to the City. Upon proper motion, duly seconded, the meeting was adjourned at ^i25 P.M. /%/ W. Dtaais Wood /l/„„ „ Secretary President EXCERPTS FROM MINUTES OF MEETINGS OF BOARD OF DIRECTORS OF CARLSBAD MUTUAL WATER COMPANY PERTAINING TO THE SALE OF THE CARLSBAD MUTUAL WATER COMPANY TO CITY OF CARLSBAD CONSENT AND WAIVER OF NOTICE OF SPECIAL MEETING OF THE DIRECTORS OF THE CARLSBAD MUTUAL WATER COMPANY We, the undersigned, being all of the Directors of the Carlabad Mutual Water Company, do hereby waive notice of the time, place and purpose of the meeting of said Corporation herein provided for, and do hereby consent and agree that a meeting thereof may be held at the office of the Carlsbad Mutual Water Company in the City of Carlsbad, County of San Diego and State of California on Friday, August 9, I957 at ktOO P.M. /s/ R. R, Robinson President rP' Afthony Vice-President /s/ C. H. Ingels /a/ . H. S. Phillips /a/ W. w. Rogers MINUTES OF THE SPECIAL MEETING of the BOARD OF DIRECTORS of the CARLSBAD MUTUAL WATER COMPANY A special meeting of the Board of Directors of the Carlsbad Special Meeting Mutual Water Company was held in the office of the Company August 9, 1957 in the City of Carlsbad, County of San Diago, State of California, on Friday, August 9, 1957, at ktOO P.M., said meeting being called under authority of Article 12 of the By-Laws of the Corporation, which provides for special meetings of the Corporation. R. R. Robinson C. H. Ingels Directors C. A. Anthony W. W. Rogers Present H. S. Phillips Also present were W. Dennis Wood, Manager, Thomas H. Tucker, Mr. Perry, reporter from San Diego Union, Dick Carboneau, reporter from the Blade-Tribune, and Nell Freeman, stenographer. President Robinson called the meeting to order at ^lOO P.M. President Robinson stated he had been advised by both President Robinson's attomeys to step aside at this time since a majority of Resignation Votes have come in.in favor of the City of Carlsbad p\2rehasing Carlsbad Mutual Water Company. President Robinson informed the Board that 103 shares of stock had been received from Shareholders Lough, Stevenson, and Briggs on conditional contracts bring the total votes in favor of accepting the offer of the City of Carlsbad to purchase the Carlsbad Mutual Water Company to 1075. Director Anthony said that Director Robinson will be greatly missed but he felt we should accept the resignation since President Robinson feels he should and the lawyers have so advised. Director Anthony moved, seconded by Director Phillips and carried unanimouslyi - -2- WHEREAS R. R. Robinson has tendered his 57-56 resignation as member of the Board of Directors of the Carlsbad Mutual Water CompanyI and WHEREAS R. R. Robinson has served the Company faithfully and welli NOW THEREFORE BE IT RESOLVED that R. R. Robinson's resignation be regretfully accepted! and the Secretary is hereby directed and instructed to write him a letter of thanks. Director Rogers stated he was not going to resign until Shareholders Lough, Briggs, smd Stevenson agree with the original terms, fhey should also sign one of the regular consent to sell cards the other shareholders have signed. Director Rogers nominated Col, E. 0. Hagen to fill the Appointment of New vacancy caused by th© resignation of Director Robinson, Director seconded by Director Phillips, and carried unanimously. After discussion. Director Rogers moved, seconded by Instruction for Lawyers Director Ingels, and carried unanimouslyi to Start on the Contract BE IT ORDERED that Mr. Ray Eberhard, attorney for tha Carlsbad Mutual Water Company be instructed to prepare a contract providing for ' the sale of the Carlsbad Mutual Water Ccaapany 57-57 to the City of Carlsbad and the City of Carlsbad be asked to have their City Attomey for the City of Carlsbad confer with Mr. Eberhard la the preparation of the draft of the contract. There being no further business to come before the Board, upon proper motion, duly seconded, the meeting was adjourned at ^-t50 P.M. /a/ W. Dannis Wood /&/ R. 1. Robinson Secretary President EXCERPTS FROM MINUTES OF MEETINGS OF BOARD OF DIRECTORS OF CARLSBAD MUTUAL WATER COMPANY PERTAINING TO THE SALE OF THE CARLSBAD I4UTUAL WATER COMPAia TO CITY OF CARLSBAD MINUTES OF THE REGULAR MEETING BOARD OF DIRECTORS of the CARLSBAD MUTUAL WATER COMPANY The regular meeting of the Board of Directors of the Regular Meeting Carlsbad Mutual Water Company was held in the office August 20, 1957 of the Company in the City of Carlsbad, State of California on Tuesday, August 20, 1957 at IjOO P.M. C. H. Ingels E. G, Hagen Directors W. W, Rogers C. A. Anthony Present H. S. Phillips Also present were Bill Parry, reporter for the San Diego Union, Buzz Garland, reporter for the Carlsbad Journal, Dick C. Carboneau, reporter for the Blade- Tribune, Bruce Smith, City Attorney, Thomas H, Tucker, and Sell Freeman, stenographer. The President called the meeting to order at ItOO P.M. Upon proper motion, duly seconded, the regular meeting, at 2tl0 P.M., was adjourned to August 27, It00 P.M. /s/ W. Dennis Wood C. A. Anthony Secretary president f EXCERPTS FROM MINUTES OF MEETINGS; OF BOARD OF DIRECTORS OF CARLSBAD MUTUAL WATER COMPANY PERTAINING TO THE SALE OF THE CARLSBAD MUTUAL WATER COMPAl^Y TO CITY OF CAliLSBAD MINUTES OF THE ADJOURNED REGULAR MEETING of the BOARD OF DIRECTORS o^r til© CARLSBAD MUTUAL WATER COMPANY An adjourned regular meeting of the Board of Directors of the Adjourned Meeting Carlsbad Mutual Water Company was held in the office of the August 27, 1957 Corporation in the City of Carlsbad, County of San Diego, State of California, on Tuesday, August 27, 1957 at IsOO P.M. C. A. Anthony W. W, Rogers Directors H. S. Phillips E. G. Hagen Present Director C. H. Ingels Absent Also present were Mr. Bruce Smith, Attorney for City of Carlsbad, Dick Carboneau, reporter from the Blade-Tribune, Joe Heredia, reporter from the Carlsbad Journal, W. Dennis Wood, Secretary-Manager, Thomas H. Tucker, and Nell Freeman, stenograptaa Director Rogers nominated Director Hagen for vice-president Election of Vice- and moved that the nomination be closed. Director Hagen President was declared duly elected as Vice-President of the Board of Directors of the Carlsbad Mutual Water Company by unanimous vote. The Board of Directors read the rough draft of proposed Proposed Contract contract between the City of Carlsbad and the Carlsbad for sale of the Mutual Water Company for the sale of the Company to the Company City of Carlsbad and the report from Mr. Eberhard, After study, some minor changes were made by the Board, Director Rogers moved, seconded by Director Hagen and carried unanimously? »2- BE IT ORDERED that the Board approvea the 57-61 tems of the contract between the City of Carlsbad and tihe Carlsbad Mutual Water Company for the sale of the Company, subject to the concurrence of the Company's Counsel with changes made and approves releasing a copy of this tentative contract to the press. There being no further business to come before the Board, upon proper motion, duly seconded, the meeting was asjourned at 2»l5 to meet again August 30, 1957 liOO P.M. /s/ W. Dennis Wood /s/ C. A. Anthony Secretary " Pi'tsiakt ^ J MINUTES OF THE ADJOUIiKED REGULAR MEETING of the BOARD OF DIRECTORS of" t#ii© CARLSBAD MUTUAL WATER COi-IPANY An adjourned regular meeting of the Board of Directors Adjourned Meeting of the Carlsbad Mutual Water Company was held in the August 30, 1957 office of the Corporation in the City of Carlsbad, County of San Diego, State of California, on Friday, August 30, 1957 at 1?00 P.M. C. A. Anthony H, S. Phillips Dtectors E, G. Hagen W. W. Rogers Present C. H. Ingels Also present were Mr. Herbert Nelsonj Mr. Bruce Smithj Mr. Ray Eberhard| Mr. Dick Carboneau, reporter from the Blade-Tribune5 W. Dennis Wood, Secretary- Manager, and Nell Freeman, stenographer. President Anthony called the meeting to order at 1:00 P.M. Director Rogers moved, seconded by Director Phillips and carried unanimouslyi; WHEREAS for several months negotiations have been under way between the Board of Directors of Carlsbad Mutual Water Company, a corporation, and officials of the City 57-62 of Carlsbad, looking toward the sale by said corporation to said City of the rights and assets of said corporation} and WHEREAS there has been submitted to this Board a draft of a contract providing for the sale by the corporation and purchase of the City of all such rights and assets for the price of $500,000, payable in cash, subject to certain terms and conditions set forth in said draft of contract, a copy of which is hereto attached} and WHEREAS, written consent of certain shareholders to such sale has been filed with the Secretary of this Corporation and it is anticipated that the written consent of share- holders entitled to exercise a majority of the voting power of thia Corporation will be filed with tho Secretary} and -2- WHEREAS it appears to this Board that it is to the best interest of this corporation and its shareholders that said contract be executed on tehalf of the 57-62 corporation, subject to the approval by vote or written consent of shareholders entitled to exercise a majority of the voting power of the corporation} THEREFORE, be it resolved by the Board of Directors of Carlsbad Mutual Water Company, that the President and Secretary of this Board be and they hereby are authorized and ordered to sign and attest such contract for and on behalf of this corporation, such contract to be subject to the written consent of shareholders entitled to exercise a laajority of the voting power of the corporation, and to be in substantially the following form, to witt (contract attached hereto) Director Rogers moved, seconded by Director Hagen and carried unanimously! WHEREAS, the Board of Directors of Carlsbad Mutual 57-63 Water Company has authorized execution of a contract providing for the sale of the rights and assets of the said corporation to the City of Carlsbad, subject to the approval by the vote or written consent of shareholders entitled to exercise a majority of the voting power of the corporation} and WHEREAS, the purchase prioe specified in said agree- ment is the sum of $500,000 cash, amounting to $2^ per share of the authorized per capital stock of the corporation} and WHEREAS, in the event said sale is completed said Corporation will have no further function to perform, or business to transact, and it is anticipated that the corporation thereon will be dissolved} TK^EBY, be it resolved, by the Board of Directors of Carlsbad Mutual Water Company, that upon the completion of the sale of the assets of the corporation to the City of Carlsbad and receipt by said corporation of the purchase price specified in such contraot the amount of such purchase price, to witl the sum of $500,000 shall be distributed to the shareholders of the corporation appearing of record upon the books of the Corporation at the date of such payment at the rate of $250 per share in proportion to their ownership, thereupon pro- ceedings shall be prosecuted for the dissolution of said corporation. -3- Upon leaving this meeting to attend another meeting Director Rogers stated his opinion was that the contract and resolution should be published in the local papers. After discussion, Director Hagen moved, seconded by Director Phillips and carried unanimously by the four directors presenti BE IT ORDERED that the contract and resolution 57-6^ adopting the contract be issued to the news- papers as a public and formal publication. Upon proper motion, duly seconded, the adjourned regular meeting was adjourned at 3s59 P.M. /s/ W. Dennis Wood . /s/ C. A. Anthony Secretary President 1 2 3 4 5 6 7 8 9 10 11 la 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 AGftEEMEMT FOR PURCHASE This Agrtement mad* in duplicate this 30th day of August, 1957, between tht City «| Carlsbad, • municipal corpora^- tion of the State of Californiaj, soaatiaes hereinafter referred to as the "City*' and tha Carlsbad fcfeitual Water Company, a California corporation, somttimt bertinafter referred to as tht 'TKlutuai'* THAT, WHEREAS, tht art* ttrvtd by Mutual hM changed in its character froa a »t«izural to an urban comniunity, rtaultlng in a changt in th« characttr of ust of the wattr provitftd by ^tualf and WHEREAS, tht changt in the chafacttr of the use of tht irattr has diiCM«lifltdl Mutual fron obtaining financing from agrieultural Itnding inati^tiont; and WHEREAS, tht change In tht characttr of the use bf the lands served by Mutual has rttultag in tht stock of Mutual being ^iTid^i into aany fracti©ntl ehartt; and MREAS, tht adninists-fitivt burdens that havt been inpostdg ss a result of tht «®ny fractional tharts of stock, has rtBdtr@a the adminiatration of Jflutual unwieldy and expensive; and WHEREAS, tht City dtsirta to acquirt the rights and pr«ptrtita of said **jtual and hia offertd to purChate such rights and properties upon ttrmt and conditions htrtinaittr set forth, which t@rms and condltio|i» are satisfactory to shartholdtrs of tht *totual who are tntitltd to txercitt a majority of the voting power of the .Mutual; and WHEREAS, it it anticipattd that the vote and written consent of shareholders entitled to exercise a majority of the voting power of the lAitual will be filed with the Secretary of the l\^tual authorising the Mutual to sell its assets to «1- li^iyitfyt^M. ik.,...,.. . 1... ll_.,..lL, ibt C.itf upeu t'Sfas Q&ntnim4 in thit contra$t| KliEREASg «c<^i@iti|H «f such rights and pfi'^/iiisfse of 3 tht J^wtwial will give tht dlty fStmtrship and e®«trol &f th:^ 4 valuabl'^> i.fat@r distribution sytitti strving a isrf® p®Tc®maqB 5 of the City'© populatiofj and thtrtby will b« is b®n@fit t& the City S]M its rtsidtnts; 7 THEREFORE, in. ctmaidtration of th® mutual covenants: S and afr':>^@f^tnts of the parties hart to to bt by tfiid partita i'@ spac V® Xy tpt and p@rfoiiatd and of tht nutusl advantages to 101 the partimB h@rtto and to tht tiiar®boldtrt of l^tyial snd th® i 11 j s.'^^»id©'iit8 m4 pisoptrty owners of City, tht parti®* htrtby ©gre® 12 I m f oll®%f8 i 13 ! 1<, S«iibj@et to all tht t«r«t arid conditions htrtin contained„ 14 j the City igrats to buy, and tht fi&itusl agr@iis t® sell 15 to the« City all of tho aatttt of the Mutual eh®^ in 16 the "Iwentory of Assttt" sarktd "Exhibit A* {I«liibit A 17 to 6®iftsist of an itfe^iatd list of leattSe iwcludis^gs, but 18 n®t liEait@d to (t) all e®t»r rigbtt «*ttte®r aequirtd by 19 6#Pitract, dted, dted rtttrigtiong. pyrchast, prtscriptiNyfi 20 ua®, posmit froB tht Division ©f Water Fl«s®?ayce4 ©£ tht 21 State ©f California (b) raal prop<ertitt (e) isll W8t@3? 22 pro^jct.lon facilities (d) all wattr storag® and resssf^oir 23 faciiititg^-i («) all vtater transaitsion and «?at'ir distri^ 24 kjtisn faciliti®® as «ho«$Bt on nap attaehtd to Exhibit A 25 (f) all chosea in action, accounts rtctlvafelty rafuradg of 26 mf kind, es:p«ctarieies, and cash' on depoait in any baak 27 trust company (g) all ^attr «eters (h) all eicpiipaent^ ' 28 t®ols, supplieg invtntory. Said Exhibit A to b® 29 €#iii«pil©d by the iVfeitual as ©f tht effectivt date of thie" 30 csntrsct and to bear the sndorstaent of the managers of 31 1 th© ft^tual &nd of the City), attached htreto,. and by lj 321 , r#f«r®»c® thsrtto aade s part hersof as if fully stt forth •2- 1 herein, for the sun vi Five Hundred Thousind Dollars ($500,00), i 2 cash, plus tht assumption by the City of all indtbtedntss and 3 obligations of the Mutual as herein provided and upon such 4 other terms and conditions as are hereinafter set forth. 5 2. City assumes and agrees to pay all indebtedness of the Mutual 6 as it exists on the effective date of this agrttment and 7 faithfully to comply with and carry out all obligations of 8 »*itual under any and all contracts to which Mutual is or 9 may be a party on the affective date of this agreement? a 10 statement of such indebtedness and a list of such contracts 11 it hereunto attached, marked "Exhibit D" and by reference 12 thereto madt a part hereof. It is recognixtd that certain 13 of the contractual obligations of the Mutual may be, by 14 the ttrmt of such contract, cancellable; and in such event 15 the City retervts tho right to cancel and discontinue such 16 of tht contracts as the City deems advisable for the best 17 inttrtsts of tht City; the City specifically sets forth its intention to cancel insurance contracts of all types, contracts for retirtment benefits for tmployees of the Mutual, and such other contracts as the City may determine. It is specifically understood and agreed, however, that the legal and contractual rights heretofore held by share- holders of Mutual to specific proportions of the water 24 supply available to, or produced by, the Mutual, dependent upon their ownership of stock, shall not apply to or be binding upon the City, 27 I 3, The City specifically agrees to assume the burdens, and to be bound by the terms of that particular contract entered into between the South Coast Land Company and the City of I Oceanside, under date of August 13^ 1913, and recorded in ^-l- ! the office of the County Recorder cf the County of San Diego, 18 19 20 21 22 23 24 25 26 17 OQ ii " !! 29 l! soil 32 State of California, on September 19, 1913, in Book 627 of -3- 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 D««d8, Ptgt 245 ®t tt^os Sfacorcla of tht County of San Ditg*, insofar as sueh contract rtlatta to tht wattrt naturally trlbutory t® tht San Luia Rty Rivtr, or tht Miaaion Basin, . in tht vallty of said rivtr, 4^ Tht City covtnanta and agrtta to maintain and prottct all wattr rights to which ths Mutual htretofor® may havt been tatitltd, and to distribytt all water productd undtr euch wattr rights, htretofort ai&d now owntd by tht Mutual^ within tbet arta outlintd on "Exhibit B*, (Exhibit B to contain outlint of Mutual atrvict arta as outlintd in Exhibit A attaehtd t© "Octantidt" contract rtftrtnetd in Paragraph 3 of this contract), attaehtd htrtto, and by rtftrtnct thtreto ««dt a part hertof at if fully stt forth htrtin, 5. Tht City covtnants and agrtta that for a ptriod ef t^n years, from and after the tfftctlvt datt of thia contract, tht City will chargt owners of any of tht laadt that art marktd with crots-hatching on "Exhibit C", (Exhibit C to show Mutual atrvict arta tht taat ae outlintd by Exhibit B, with all lands to wliich wattr stock in tht Mutual ia appurttnant at tht tfftctlvt datt htrtof to bt not crots-batchtdi all othtr lands to bt croaa-hatchtd), attaehtd htrtto, and by rtftrtnct thereto nadt a part htrtof as if fully ttt ftrth htrtin, who makt application for the delivery ef wattr to auch lands and «^ich dtlivtry of wattr involvts tht utt of any portion of the Mutual distribution syittm, aa outlined in tht nap attaehtd to "Exhibit A", a fee of $100 an acre, tuch ftt to be denominated an "inclusion fee" and in addition thtreto, to pay for all costs of labor, pipts, pipe lines, ttrvice materials, and other incidental charges that are required to make such connection; that the inclusion ftts so rtceivtd by the City of Carlsbad shall, at the option -4- iTitrifiittittiiitMi 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24! 25 26 27 28 29 30 311 i 32' 7. 8, 9. of the City, either be applied to tht Bond Redemption Fund which hereafter may be created by the City for the redemp- tion of any bonds issued by the City for the purpose of purchasing rights and proptrties of Mutual, or be paid by the City to the persons who may be shareholders of Ikitual at the effective date hereof, in proportion to their respective stock owHership. In the event of a water shortage, the City covenants and agrees, insofar as permitted by law or good water distri- bution practices, to grant priority of allocation of all natural water extracted from the Mission Basin of the San Luis Rey River to those areas which are not cross- hatched, in said "Exhibit C«, The City agrees to maintain at least two varying rate structures, which rata structures shall include an agricultural rate and a domestic rate and such other rate structures as may be hereafter created by the City; and the City shall continue to maintain an appro- priate differential between the agricultural and domestic rates. The City covenants and agrees to continue to furnish water to all areas outside the incorporated limits of the City that are presently being served by the facilities of the Mutual, as the same are delineated-and described by the non- cross-hatched areas on "Exhibit C", at substantially the same rates as are charged in areas within the incorporated limits of the City, provided that in no event shall the City charge a differential .of more than five per cent for water served outside said City limits. The City covenants and agrees to submit to the voters of the City of Carlsbad the following three propositions: (a) Shall the City of Carlsbad incur a bonded -5- 1 2 3 4 5 6 7 8 9 10 11 18 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 indebtedmtte, repayable solely from tht procttdc obtalntd by the City from tht rtvenue fron the sale of water, in an amount of $550,000.00 for the purpose of purchasing the assets of the Carlsbad Mutual Water Company and to discharge all fixed liabilities of the Carlsbad Mutual Water Company? (b) Shall the City of Carlsbad incur a bonded indebtedness^ repayable tolely from the proceeds obtained by tfee City fron the revtnut from tht sale of water, in the anount of $i&0,000.00 for the purpoae of rehabilitating the wattr transnitaion, storage and production facilitits of the City of Carlabad, an© for extending, acquiring and con- structing new wattr production and trantmission facilitits for the City of Carlsbad? (c ) Shall the City of Carlsbad enter into a con- traet with the Carlabad Mutual Wattr Conpany for the purchase by the City of Carltbad of tht assets of the Carlsbad Ritual Water Company, in accordance with the terms and conditions cf a propostd contract as the same were publishtd in the legally published notice cf this election? That the exact wording of the foregoing proposition, shall be subject to approval and revision of bond counsel selected by the City. In the event that both propositions set forth in sub-paragraphs (a) and (c) are approved by the voters of the City, the City shall be obliged to consummate this contract; in the event that either on* or both of the propo- sitions set forth in sub-paragraphs (a) and (c) abo^e are not approved by the voters of the City, then this contract may, at the option of either party, upon written notice to the other party, be declared null and void and of no furtner -6- 1 2 3 4 6 6 7 8 9 10 11 12 13 14^ 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 force and tfftet, 10, Each party htrtto agrtts to execute promptly all documents, instrunents and papers required for the purpose of effect- uating this agreement. 11, The obligation of the Mutual to tell and of the City to buy the rights and proptrties herein agreed to be conveyed shall become effective only when all the following conditions have been coMH^lied with: (a) The voters of the City have approved the issuance of bonds, and the contract, as herein provided t (b) The sale of the rights and properties of the Mjtual, at herein provided, haa received the approval by vote or written content of shareholders entitled to exercitt a majority of the voting power of Mutual; and (c) The power of tht City and of the Mutual, respect- ively, to enter into, and carry out the terms of, this agreement hat been established by decree of a court of competent juritdiction. Whenever in this agreement the term "effective date" is used, it shall be construed to mean the date when all the conditions referred to in this Paragraph 11 have been accomplithed. Such effective date shall be endorsed upon this agreement, and all documents executed pursuant to this agreement shall bear, or refer to, and unless otherwise stated therein, shall be effective as of such effective date. 12, The Mutual herewith covenants and agrees tha- betiwen the date of the signing of this contract and the effective date of this contract it will continue to operate the ^'Sutual in a prudent and economical manner, and that it will not dispose -7- ef any substantial portion of its assets or make any refund glj to itt thartholdert and will not incur any further indebted- i 3 nets, txcepting in the ordinary courtt of butintts, without 4 first ttcuring the consent of tht City. 5 13, Exctpt at to the covenants and conditiont contained in 6 Paragraphs 3, 5 and 8 of thit Agrttntnt, the remaining 7 covenants and conditiona of thit contraet thall remain in 8 I full force and effect for to long at there exists an unpaid g bonded indtbttdntss incurrtd aa a result of the voters' 101 tpprtval of propotitiona containtd in tub-paragraphs (a) 111 and (b) of Paragraph 9 of thit Agrttment. Afttr expiration j ISi of tuch tint all ctvtnantt and conditions thall txpirt and 13i bt no longtr bindisif upon tht City; txcepting, howtvtr, the 141 covenants and conditiont of Paragraphs 3 and 8 shall con- 151 tinut for so long as allowed by law, and tht provisions, 161 covenants and conditions tf Paragraph 5 shall continue for 17 the tint thtrtln pr«vidtd, 18 14, It is agreed bttwttn the partiet that tht Ifcjtual shall retain 19j til funds rtceivtd from distribution of atttts on account 20: of Treasury stock ®wned by tht Mutual, and that the funds 211 so received by the Mutual, or its trustee or successor, i 22| shall be used to pay or dtfray the expenses of the distri- 23 bution of the assets of tht Mutual; that any excess funds 24 remaining after the foregoing deduction shall be paid over 25 to the City, 26 15, The City covenants and agrees to continue the employment of 2? those personnel who are employed by the Jfcitual as of the 28 date of signing of this contract for a period of not less 29 than one year fron and after the effective date of this 30 contract; excepting, however, the City reserves the right to discharge employees for misfeasance, malfeasance or non- 32 feasance. -8- 2 3 4 5 6 7 6 9 10 11 12 13 14 15 16 17 18 19 20 Zl S4 25 26. 27 28! 291 30 31 32 16. It it rteogniatd by tht partiat htrtto, that upon tht contun- natien of tht salt cont®iiplattd by thia contract, tht Iftitutl aay dltaolrt aad dlatabutt itt etttta in kind to tht thtrt- htldtrt ttaaiaftg of i^tcord aa of tht datt of diaaolutitn, in tht tvtnt of tuch dlanolution tht right, and btntfit. inuring to tht btntfit of tht IHttual .hall bt tnforctablt by the individual thartholdtra .tending of rteord on the datt •f di.aolution of tht Mutual or thtlr waptctive fucctttor. or attigat. IN WITNESS WHEREOF, th. llMtu.l h... by r„olutlon of Bo.»l ,f Dir.et,r. «topt«l .« th. 30th d.r ,f Augu.t, i»57, ox4,T»d It. ftr.,ld.nt t, .ffi, hi. rtflMtur. f.r .nd in b.h,lf of th. l»,tu,l .nd furth.r ord,t«l it, 8.er.t.>T to .tt.,t to hi. tif^aturt. Carlabad Mitual Wattr Conpany (SEAL) Atttttt aocrtuipy' m WITNESS WHEfHOF, th. City Council haa by Rt.olution Mt. m adopttd by tht City Council on tht 30th day of Augutt, lf67, cauttd itt Mayor for and in bthalf of tht City of Carltbad to tlgn thi. contract and ordtrtd hit City Cltrk to attt.t to tht City of etrltk«4 (SEAL) Attttt -9* iUii^Mii£iMlliiiHll •tiiiii EXCERPTS FROM MINUTES OF MEETINGS OF BOARD OF DIRECTORS OF CARLSBAD MUTUAL WATER GOMPAKY PERTAINING TO THE SALE OF THE CARLSBAD MUTUAL WATER COMPANY TO CITY OF CARLSBAD MINUTES OF THE REGULAR MEETING of the BOARD OF DIRECTORS of t he CARLSBAD MUTUAL WATER COMPANY The regular meeting of the Board of Directors of the Carlsbad Regxilar Meeting Mutiial Water Company was held in the office of the Corporation October in the City of Carlsbad, Coianty of San Diego, State of Califor- nia, on Tuesday, October 15, 1957 at liOO P.M. 15, 1957 C. A. Anthony 1. G. Hagen Directors C. H. Ingels H. S. Phillips Present W. W. Rogers Also prepent were W. Dennis Wood, Secretary-Manager} Ray C. Eberhard, Company Attorney} Bruce Smith, City Attorney} Joe Heredia, reporter from Carlsbad Journal} Dick Carbineauj from the Blade-Tribune} Jack Kubota, City Engineer} Thomas H. Tucker} and Nell Freeman, stenographer. President Anthony called the meeting to order at Is 10 P.M. After Discussion, Director Rogers moved, seconded by Director Phillips and carried unanimouslyi WliEREAS by Resolution #57-62, duly passed and 57-73 adopted by this Board at its meeting August 30, 1957, this Board approved the draft of a proposed contract between Carlsbad Mutual Water Company, a corporation, and the City of Carlsbad, providing for the sale by the Company and the purchase by the City of the rights and assets of said Corpora- tion, and directed the President and Secretary of this Board to sign and attest such contract for and on behalf of said coiTporation, subject to the vote or written consent of shareholders of said corporation entitled to ex cercise a majority of the voting power of the corporation} and -2- WHEREAS there have now been filed with th© Secretary of said Corporation written consents signed by shareholders entitled to exercise a majority of the voting pover of the corporation giving and granting the directors of said corporation consent to ad^pt a resolution providing for the sale of all the assets of Carlsbad Mutual Water Company to the City of Carlsbad for the sum of $500,000 cash, and upon such other terms and conditions as said Board of Directors may deem to be for the best interests of Carlsbad Mutual Water Company} THEREFORE BE IT RESOLVED, by the Board of Directors of Carlsbad Muttial Water Company, a corporations (1) That said Board does hereby find, determine and declare that the written consent of shareholders of said corporation entitled to exercise a majority of the voting power of said corporation has been filed with the Secretary of said Corporation, authorizing said Board of Directors to adopt a resolution providing for the sale of all assets of said corporation to the City of Carlsbad for the sum of $500,000 and upon such ©ther terms and conditions as said Board of Directors may deem for the best interests of the company} (2) That pursuant to such consent of the shareholders all the assets of Carlsbad Mutual Water Company, as more particularly described in said Resolution # 57-62 and in the contract dated August 30, 1957. executed pursuant to said resolution, shall be sold to the City of Carlsbad for the sum of $500,©00 cash, upon the terms and conditions set forth in said contract, and lhat said contract be and the same hereby is ratified, approved, validated and confirmed} and, (3) That the President and Secretary of tils Board be and they hereby are authorized and directed to execute any and all documents and do any and all things necessary to effectuate and complete said sale, in accordance with the terms of said contract. Attorney Smith cemented it might be wise if the Board directed the Secretary to file and catalogue the consents and preserve the 1030.55 as evidence and not add others to this group as more are received. Attorney Eberhard's recoiamendatlon is that the City file a suit against the company and the company file a cross complaint to insure the legality of the s&X® t -3- After disousaion Director Rogers moved, seconded by Director Hagen and carried uaanimouslyt BE IT ORDERED that the City Council be 57-7^ forwarded a copy of Resolution 57-73 aad a request that in view of uncertainty of financing that it is requested that all steps be taken at the earliest practicable date to make the contract effective. There being no further business to come before the Board, upon proper motion, duly seconded, the meeting was adjourned at 2i35 P.M. /a/ G, A.^Anthony /s/ W. Dennis Wood Presidtnt Secretary mil October 16, 1957 On the 15th day of October 1957 in the Office of the CMWC the undersigned Secretary-Manager of the CMWC did place into the cardboard container to which this statement is attached a number of cards called "Consent to Sell Authorizations" bearing signatures of Registered Shareholders and Regis- tered Pledgees entitled to exercise the voting power of one thousand thirty and fifty-five huxi^ dredths (1030.55) shares of CMWC stock. Also placed in the same cardboard container was an adding machine tape, bearing the signature of the undersigned secretary-Manager, showing the tabu- lation of said 1030.55 shares. W, Dennis Wood /s/ W. Dennis Wood Secretary-Manager CARLSBAD MUTUAL WATER COMPANY WDWimb \ EXCERPTS FROM MINUTES OF MEETINGS OF BOARD OF DIRECTORS OF CARLSBAD MUTUAL WATER COMPANY PERTAINING TO THE SALE OF THE CARLSBAD MUTUAL WATER COMPANY TO CITY OF CARLSBAD MINUTES OF THE REGULAR MEETINO of the BOARD OF DIRECTORS of the CARLSBAD MUTUAL WATER COMPANY The regular meeting of the Board of Directors of the Carlsbad Regular Meeting Mutual Water Company was held in the office of the Corporation March 18, 1958 in the City of Carlsbad, County of San Diego, State of California, on Tuesday, March 18, 1958 at ItOO P.M. C, A, Anthony C, H. Ingels Directors E. G. Hagen H. S. Phillips Present W, W, Rogers Also present were W, Dennis Wood, Secretary-Manager, Bill Parry, reporter from the San Dieg© Union, Thomas H, Tucker, and Nell Freeman, stenographer. President Anthony called the meeting to order at ItOO P.M, After discussion of Section C Paragraph 11 of the Agreement Deletion Paragraph 11 to sell to the City of Carlsbad, th© Manager reported that Section C Sales Contract legal cQ-unsel had advised that court decree as provided for therein would require several months^ litigation and considerable expense and was not necessary to the proper conclusion of the sale, Tlie Manager further advised that the City of Carlsbad had taken action to place the deletion of subject paragraph on the April 8 ballot. Director Rogers moved, seconded by Director Hagen and carried unanimously with an individual voice vote requested by Director Rogersi -2- BE IT ORDERED that Paragraph 11, Section C 58-19 of the Carlsbad Mutual Water Company sales Agreement with City of Carlsbad, "The power of the City and of the Mutual, respectively, to enter into, and carry out the terms of, this agreement has been established by de- cree of a court of competent jurisdiction,", be deleted subject to an affirmative vote in favor of the deletion in the City of Carls- bad April 8, 1958 election. Director Anthony AYE Director Hagen AYE Director Phillips AYE Director Ingels AYE Director Rogers AYE There being no further business to come before the Board, upon proper motion, duly seconded, the meeting was adjourned at It55 P.M, /s/ W. Dennis Wood /s/ C. A. Anthony Secretary ^ ^ President CONSENT AND WAIVER OF NOTICE OF SPECIAL MEETING OF THE DIRECTORS OF THE CARLSBAD MUTUAL WATER COMPANY We, the undersigned, toing all of the Directors of the Carlsbad Mutiial Water Company, do hereby waive notice of the time and place of the meeting of said corporation herein provided for, and do hereby consent and agree that a meeting thereof may be held. Said meeting to be held at the office of the Carlsbad Mutual Water Company In the City of Carlsbad, County of San Diego, State of Califomia, on Friday, April 11, 1958, at 2 s00 P.M. /s/ C. A, Anthony President Vice-President /s/ C. H. Infels /s/ W^ W^ Rogers /s/ H. S. Phillips VP EXCERPTS FROM MINUTES OF MEETINGS OF BOARD OF DIRECTCRS OF CARLSBAD MUTUAL WATER COMPANY PERTAINING TO THE SALE OF THE CARLSBAD MUTUAL WATER COMPANY TO CITY OF CARLSBAD MINUTES OF THE SPECIAL MEETING of the BOARD OF DIRECTORS of the CARLSBAD MUTUAL WATER COMPANY Pursuant to consent and waiver, a special meeting of the Special Meeting Board of Directors of the Carlsbad Mutual Water Company April 11, 1958 was held in the office of the Corporation in the City of Carlsbad, County of Sa^ Diego, State of California, on Friday, April 11, 1958 at 2 P.M. C. A. Anthony H. S. Phillips Directors C, H, Ingels W. W. Rogers Present Director E. G. Hagen Absent Also present were W. Dennis Wood, Secretary-Manager, Attorney Paul S. Swirsky, and Nell Freeman, stenographer. The manager announced that Proposition A on April 8, 1958 April 8 Slection ballot asking that voters amend the contract between the City and the Carlsbad Mutual Water Company was passed by 1,237 y®s votes to 233 no votes. The proposition eliminates the need for a test suit to determine the legality of the sale of the company to the city. Upon proper motion, duly seconded, the special meeting was adjourned at 2i^+5 P.M. /s/ W. Dennis Wood ^ /s/ C. A. Anthony Secretary President mi AMENDMENT TO AGREEMENT FOR PURCHASE WHEREAS, on the 30th day of August, 1957, the CARLSBAD MUTUAL WATER COMPANY and THE CITY OF CARLSBAD executed an agreement wherein the Carlsbad Mutual Water Company agreed to sell its assets to the City of Carlsbad upon the terms and conditions set forth in said agreement, which original agreement is attached hereto} and WHEREAS, on the 17th day of December, 1957, the voters of the City of Carlsbad by a Special Municipal Election approved said agreement} and WHEREAS, Paragraph 11 (c) of said original agreement, as approved by the voters of the City of Carlsbad, provides as follows; "Paragraph 11 (c). The power of the City and of the Mutual, respectively, to enter into, and carry out the terms of, this agreement has been established by decree of a court of competent jurisdiction."} and WHEREAS, on the Sth day of April, 1958, at a General Municipal Election of the City of Carlsbad, the following proposition was approved in the affirmative by the voters of the City of Carlsbad, said proposition being as followst PROPOSITION A - CONTRACT AMENDMENTi "Shall the City Council be authorized to amend the Agreement of Purchase between the City of Carlsbad and the Carlsbad Mutual Water Company (Dated August 30, 1957 and approved by the voters of the City December 17, 1957 and on file in the office of the City Clerk) by striking therefrom the provision requiring litigation, to witj "The power of the City and of the Mutual, respectively, to enter into, and carry out the terms of, this agreement has been established by decree of a court of competent jurisdiction"?". COPY WITNESSETH! This amendment to the original agreement between the City of Carlsbad and the Carlsbad Mutual Water Company, which agreement is heretofore referred to, and which agreement is attached to this amendment. It is mutually agreed by and between the parties hereto that Paragraph 11 (e) of said original agreement shall be deleted from the terms and provisions of said agreement. All remaining terms, conditions, covenants, agreements, stipula- tions and provisions of said original agreement shall remain in full force and effect. If any of the terms and conditions of the original agreement are in conflict or inconsistent with the terms and conditions of this amendment, then in such event the terms and conditions of this amend- ment shall be controlling and decisive to resolve any such conflict or inconsistency, IN WITNESS WHEREOF, the Mutual has, by resolution of its Board of Directors adopted on the //^^ day of Hf^/ioH ^ 1958, ordered its President to affix his signature for and in behalf of the Mutual and Resolution #58-19 further ordered its Secretary to attest to his signature.See letter Attached Carlsbad Mutual Water Company (SEAL) /s/ g« A. Anthony President ATTEST! /8/ W. Dennis Wood Secretary IN WITNESS WHEREOF, the City Coxincil has by Resolution No. 36^ adopted by the City CoTmcil on the 21st day of April, 1958, caused its Mayor for and in behalf of the City of Carlsbad to sign this amendment and ordered the City Clerk to attest to the same. City of Carlsbad By. (SEAL) Mayor ATTEST* /s/ J. H, Price ^ City CJleik CERTIFICATE OF SECRETARY I, W. DENNIS WOOD, Secretary of CARLSBAD MUTUAL WATER COMPANY, a California corporation, do hereby certify that the above and foregoing excerpts are true copies of excerpts from the minutes of the meetings of the Board of Directors of Carlsbad Mutual Water Company held on the dates specified above and entered upon the regular minute book of the said corporation. Said excerpts include all minutes of said Board of Directors respecting action by said Board as to sale of the assets of said Company to the City of Carlsbad and, except to the extent that one or more of the resolutions also so included, all of the resolutions contained in said excerpts are at the date hereof in full force and effect and have not been rescinded, modified, amended or vacated in any way. I do further certify that the said meetings were duly held and that a quorum was at all times present at each meeting. IN WITNESS WHEREOF, I have hereunto set my hand and caused the corporate seal to be hereon set this 1st day of August, 1958. (SEAL) Carlsbad Mutual Water Company