CONTINUING DISCLOSURE AGREEMENT
THIS CONTINUING DISCLOSURE AGREEMENT (this “Disclosure Agreement”), dated as of [__________], 2023, is by and among ANAHEIM PUBLIC FINANCING AUTHORITY (the “Authority”), CITY OF ANAHEIM, a municipal corporation and chartered city organized and existing under and by virtue of its charter and the laws of the State of California (the “City”), ANAHEIM ARENA MANAGEMENT, LLC, a limited liability company organized and existing under the laws of the State of California (the “Manager,” and together with the Authority and the City, the “Disclosure Parties”), and U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION, a national banking association organized and existing under the laws of the United States of America (“U.S. Bank”), in its capacity as Trustee (the “Trustee”) and in its capacity as Dissemination Agent (the “Dissemination Agent”).
W I T N E S S E T H :
WHEREAS, pursuant to the Master Indenture, as supplemented by the ______ Supplemental Indenture, each dated as of [_______ 1], 2023 (as supplemented by the ______ Supplemental Indenture, the “Indenture”), by and among the Authority, the City and the Trustee, the Authority has issued $[_________] aggregate principal amount of its Anaheim Public Financing Authority Taxable Lease Revenue Bonds (Anaheim Arena Improvement Project), 2023 Series [●] (the “Series 2023[●] Bonds”); WHEREAS, the Series 2023[●] Bonds are payable from the base rental payments to be made by the City pursuant to the Lease Agreement, dated as of [_______], 2023, by and between the City, as lessee, and the Authority, as lessor; and
WHEREAS, this Disclosure Agreement is being executed and delivered by the Authority, the City, the Manager, the Trustee and the Dissemination Agent for the benefit of the Owners and Beneficial Owners of the Series 2023[●] Bonds and in order to assist the underwriter of the Series 2023[●] Bonds in complying with Securities and Exchange Commission Rule 15c2-12(b)(5); NOW, THEREFORE, for and in consideration of the mutual promises and covenants herein contained, the receipt whereof is hereby acknowledged, the parties hereto agree as follows:
Section 1. Definitions. Unless the context otherwise requires, the terms defined in this Section shall for all purposes of this Disclosure Agreement have the meanings herein specified. Capitalized undefined terms used herein shall have the meanings ascribed thereto in the Indenture. “Annual Report” means any Annual Report provided by the Manager pursuant to, and as described in, Sections 2 and 3 hereof.
“Annual Report Date” means the date in each year that is the last day of the sixth month after the end of the City’s Fiscal Year, which date, as of the date of this Disclosure Agreement, is December 31. “Authority” means the Anaheim Public Financing Authority, a joint exercise of powers authority organized and existing under and by virtue of the laws of the State, and any successor thereto. “City” means the City of Anaheim, a municipal corporation and chartered city organized and existing under and by virtue of its charter and the laws of the State, and its successors. “Dissemination Agent” means U.S. Bank, acting in its capacity as Dissemination Agent hereunder, or any successor Dissemination Agent designated in writing by the City and which has filed with the Trustee and the then existing Dissemination Agent a written acceptance of such designation. 2 “Financial Obligation” means (a) a debt obligation of the Disclosure Party, (b) a derivative instrument entered into in connection with, or pledged as security or a source of payment for, an existing or planned debt obligation of the Disclosure Party, or (c) a guarantee of (i) a debt obligation of the Disclosure Party, or (ii) a derivative instrument described in clause (b), above; provided, however, that the term “Financial Obligation” shall not include “municipal securities” (as such term is defined in the Securities Exchange Act of 1934, as amended) as to which a “final official statement” (as such term is defined in the Rule) has been provided to the MSRB consistent with the Rule. “Indenture” means the Master Indenture, as supplemented by the ______ Supplemental Indenture, each dated as of [_______ 1], 2023, by and among the Authority, the City and U.S. Bank Trust Company, National Association, as trustee, as originally executed and as it may be further amended, supplemented or otherwise modified from time to time in accordance with its terms. “Listed Events” means any of the events listed in subsection (a) or subsection (b) of Section 4 hereof.
“Manager” means Anaheim Arena Management, LLC, a limited liability company organized and existing under the laws of the State, and its successors. “MSRB” means the Municipal Securities Rulemaking Board or any other entity designated or authorized by the Securities and Exchange Commission to receive reports pursuant to the Rule. Until otherwise designated by the MSRB or the Securities and Exchange Commission, filings with the MSRB are to be made through the Electronic Municipal Market Access (EMMA) website of the MSRB, currently located at http://emma.msrb.org.
“Official Statement” means the Official Statement, dated [_______], 2023, relating to the Series 2023[●] Bonds.
“Participating Underwriter” means the original underwriter of the Series 2023[●] Bonds required to comply with the Rule in connection with the offering of the Series 2023[●] Bonds. “Rule” means Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time. “Series 2023[●] Bonds” means the Anaheim Public Financing Authority Taxable Lease Revenue Bonds (Anaheim Arena Improvement Project), 2023 Series [●]. “Trustee” means U.S. Bank, acting in its capacity as Trustee under the Indenture, or any successor thereto as Trustee thereunder substituted in its place as provided therein.
Section 2. Provision of Annual Reports. (a) The Manager shall, or shall cause the Dissemination Agent to, provide to the MSRB an Annual Report that is consistent with the requirements of Section 3 hereof, not later than the Annual Report Date, commencing with the report for Fiscal Year 20______-_____. The Annual Report may include by reference other information as provided in Section 3 hereof; provided, however, that the audited financial statements of the Manager, may be submitted separately from the balance of the Annual Report, and later than the date required above for the filing of the Annual Report if they are not available by that date. If the Manager’s Fiscal Year changes, it shall, or it shall instruct the Dissemination Agent to, give notice of such change in a filing with the MSRB. (b) Not later than fifteen (15) business days prior to the date specified in subsection (a) of this Section for the providing of the Annual Report to the MSRB, the Manager shall provide the Annual Report 3 to the Dissemination Agent. If by such date, the Dissemination Agent has not received a copy of the Annual Report, the Dissemination Agent shall contact the Manager to determine if the Manager is in compliance with the first sentence of this subsection (b).
(c) If the Dissemination Agent has not received a copy of the Annual Report from the Manager by the date specified in subsection (a) of this Section, the Dissemination Agent shall, in a timely manner, send a notice to the MSRB in substantially the form attached as Exhibit A. (d) The Dissemination Agent shall:
(i) provide each Annual Report received by it to the MSRB, as provided herein; and (ii) file a report with the Manager and the Trustee certifying that such Annual Report has been provided pursuant to this Disclosure Agreement and stating the date it was provided to the MSRB.
Section 3. Content of Annual Reports. The Manager’s Annual Report shall contain or incorporate by reference the following:
(a) Audited financial statements of the Manager for the preceding Fiscal Year, prepared in accordance with the generally accepted auditing standards for municipalities in the State of California. If the Manager’s audited financial statements are not available by the time the Annual Report is required to be provided to the MSRB pursuant to Section 2(a) hereof, the Annual Report shall contain unaudited financial statements, in a format similar to the financial statements contained in the Official Statement, and the audited financial statements shall be provided to the MSRB in the same manner as the Annual Report when such audited financial statements become available. (b) To the extent not included in the audited financial statements of the Manager, the Annual Report shall include the principal amount of Bonds Outstanding as of the December 1 next preceding the Annual Report Date.
(c) To the extent not included in the audited financial statements of the Manager, the Annual Report shall include the following items, providing financial and operating data (as of the end of the preceding Fiscal Year) substantially similar to that provided in the corresponding tables and charts in the Official Statement:
(i) [_____________];
(ii) [_____________];
(iii) Information in the Official Statement under the captions “[_______] – [_______]” and “[_______]”.
Any or all of the items listed above may be included by specific reference to other documents, including official statements of debt issues of the Manager or related public entities that have been made available to the public on the MSRB website. The Manager shall clearly identify each such other document so included by reference.
Section 4. Reporting of Significant Events. (a) Pursuant to the provisions of this Section, each Disclosure Party, as applicable, shall give, or cause to be given, notice of the occurrence of any of the 4 following events with respect to the Series 2023[●] Bonds in a timely manner not later than ten (10) business days after the occurrence of the event:
(i) principal and interest payment delinquencies;
(ii) unscheduled draws on debt service reserves reflecting financial difficulties; (iii) unscheduled draws on credit enhancements reflecting financial difficulties; (iv) substitution of credit or liquidity providers, or their failure to perform; (v) adverse tax opinions or issuance by the Internal Revenue Service of proposed or final determination of taxability or of a Notice of Proposed Issue (IRS Form 5701 TEB); (vi) tender offers;
(vii) defeasances;
(viii) rating changes;
(ix) bankruptcy, insolvency, receivership or similar event of such Disclosure Party; and (x) default, event of acceleration, termination event, modification of terms or other similar events under the terms of a Financial Obligation of such Disclosure Party, any of which reflect financial difficulties.
For purposes of the event identified in paragraph (ix) of this subsection, the event is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent or similar officer for such Disclosure Party in a proceeding under the U.S. Bankruptcy Code or in any other proceeding under state or federal law in which a court or governmental authority has assumed jurisdiction over substantially all of the assets or business of such Disclosure Party, or if such jurisdiction has been assumed by leaving the existing governmental body and officials or officers in possession but subject to the supervision and orders of a court or governmental authority, or the entry of an order confirming a plan of reorganization, arrangement or liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or business of such Disclosure Party. (b) Pursuant to the provisions of this Section, each Disclosure Party, as applicable, shall give, or cause to be given, notice of the occurrence of any of the following events with respect to the Series 2023[●] Bonds, if material, in a timely manner not later than ten (10) business days after the occurrence of the event:
(i) unless described in paragraph (v) of subsection (a) of this Section, other notices or determinations by the Internal Revenue Service with respect to the tax status of the Series 2023[●] Bonds or other material events affecting the tax status of the Series 2023[●] Bonds; (ii) modifications to rights of holders of the Series 2023[●] Bonds; (iii) bond calls;
(iv) release, substitution, or sale of property securing repayment of the Series 2023[●] Bonds;
5 (v) non-payment related defaults;
(vi) the consummation of a merger, consolidation, or acquisition involving such Disclosure Party or the sale of all or substantially all of the assets of such Disclosure Party other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms;
(vii) appointment of a successor or additional Trustee or the change of name of a Trustee; and
(viii) incurrence of a Financial Obligation, or agreement to covenants, events of default, remedies, priority rights or other similar terms of a Financial Obligation, any of which affect holders of the Series 2023[●] Bonds.
(c) The Trustee shall, within one business day of obtaining actual knowledge of the occurrence of any of the Listed Events, contact the applicable Disclosure Party and inform such Disclosure Party of the event.
(d) Whenever a Disclosure Party obtains knowledge of the occurrence of a Listed Event described in subsection (b) of this Section, such Disclosure Party shall determine if such event would be material under applicable Federal securities laws.
(e) Whenever a Disclosure Party obtains knowledge of the occurrence of a Listed Event described in subsection (a) of this Section, or determines that knowledge of a Listed Event described in subsection (b) of this Section would be material under applicable Federal securities law, such Disclosure Party shall, or shall cause the Dissemination Agent to, file a notice of the occurrence of such Listed Event with the MSRB, within ten (10) business days of such occurrence. (f) Notwithstanding the foregoing, notice of Listed Events described in paragraph (iii) of subsection (b) of this Section need not be given any earlier than the notice (if any) of the underlying event is given to holders of affected Bonds pursuant to the Indenture.
Section 5. Format for Filings with MSRB. Any report or filing with the MSRB pursuant to this Disclosure Agreement must be submitted in electronic format, accompanied by such identifying information as is prescribed by the MSRB.
Section 6. Termination of Reporting Obligation. The Disclosure Parties’ obligations under this Disclosure Agreement shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Series 2023[●] Bonds. If such termination occurs prior to the final maturity of the Series 2023[●] Bonds, the Disclosure Parties shall give, or cause to be given, notice of such termination in a filing with the MSRB.
Section 7. Dissemination Agent. The Disclosure Parties may, from time to time, appoint or engage a Dissemination Agent to assist them in carrying out their respective obligations under this Disclosure Agreement, and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent. The Dissemination Agent may resign by providing thirty (30) days’ written notice to the applicable Disclosure Party and the Trustee.
Section 8. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Agreement, the Disclosure Parties, the Trustee and the Dissemination Agent may amend this Disclosure 6 Agreement (and the Trustee and the Dissemination Agent shall agree to any amendment so requested by the Disclosure Parties, so long as such amendment does not adversely affect the rights or materially increase the obligations of the Trustee or the Dissemination Agent), and any provision of this Disclosure Agreement may be waived, provided that the following conditions are satisfied:
(a) if the amendment or waiver relates to the provisions of subsection (a) of Section 2 hereof, Section 3 hereof or subsection (a) or (b) of Section 4 hereof, it may only be made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature or status of an obligated person with respect to the Series 2023[●] Bonds, or the type of business conducted;
(b) the undertakings herein, as proposed to be amended or waived, would, in the opinion of nationally recognized bond counsel, have complied with the requirements of the Rule at the time of the primary offering of the Series 2023[●] Bonds, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and (c) the proposed amendment or waiver (i) is approved by Owners of the Series 2023[●] Bonds in the manner provided in the Indenture for amendments to the Indenture with the consent of Owners, or (ii) does not, in the opinion of nationally recognized bond counsel, materially impair the interests of Owners or Beneficial Owners of the Series 2023[●] Bonds.
In the event of any amendment or waiver of a provision of this Disclosure Agreement, the Disclosure Parties shall describe such amendment or waiver in the next Annual Report, and shall include, as applicable, a narrative explanation of the reason for the amendment or waiver and its impact on the type (or in the case of a change of accounting principles, on the presentation) of financial information or operating data being presented by the Disclosure Parties. In addition, if the amendment relates to the accounting principles to be followed in preparing financial statements (i) notice of such change shall be given in a filing with the MSRB, and (ii) the Annual Report for the year in which the change is made shall present a comparison (in narrative form and also, if feasible, in quantitative form) between the financial statements as prepared on the basis of the new accounting principles and those prepared on the basis of the former accounting principles.
Section 9. Additional Information. Nothing in this Disclosure Agreement shall be deemed to prevent any Disclosure Party from disseminating any other information, using the means of dissemination set forth in this Disclosure Agreement or any other means of communication, or including any other information in any Annual Report or notice required to be filed pursuant to this Disclosure Agreement, in addition to that which is required by this Disclosure Agreement. If any Disclosure Party chooses to include any information in any Annual Report or notice in addition to that which is specifically required by this Disclosure Agreement, such Disclosure Party shall have no obligation under this Disclosure Agreement to update such information or include it in any future Annual Report or notice of occurrence of a Listed Event or any other event required to be reported.
Section 10. Default. In the event of a failure of any Disclosure Party, the Trustee or the Dissemination Agent to comply with any provision of this Disclosure Agreement, the Trustee may (and, at the written direction of the Participating Underwriter or the Owners of at least 25% of the aggregate principal amount of Outstanding Bonds, shall, upon receipt of indemnification reasonably satisfactory to the Trustee), or any Owner or Beneficial Owner of the Series 2023[●] Bonds may, take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause such Disclosure Party, the Trustee or the Dissemination Agent, as the case may be, to comply with its obligations under this Disclosure Agreement. A default under this Disclosure Agreement shall not be deemed an Event of Default under the Indenture, and the sole remedy under this Disclosure Agreement in 7 the event of any failure of any Disclosure Party, the Trustee or the Dissemination Agent to comply with this Disclosure Agreement shall be an action to compel performance.
Section 11. Duties, Immunities and Liabilities of Trustee and Dissemination Agent. [Article VIII] of the Indenture is hereby made applicable to this Disclosure Agreement as if this Disclosure Agreement were (solely for this purpose) contained in the Indenture. The Dissemination Agent shall be entitled to the protections and limitations from liability afforded to the Trustee thereunder. Neither the Trustee nor the Dissemination Agent shall be responsible for the form or content of any Annual Report or notice of Listed Event. The Dissemination Agent shall receive reasonable compensation for its services provided under this Disclosure Agreement. The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Agreement. To the extent permitted by law, the Disclosure Parties severally agree to indemnify and save the Dissemination Agent, its officers, directors, employees and agents, harmless against any loss, expense and liabilities which it may incur in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including attorneys’ fees) of defending against any claim of liability, and which are not due to its negligence or its willful misconduct. The obligations of the Disclosure Parties under this Section shall survive resignation or removal of the Dissemination Agent and the termination of this Disclosure Agreement.
The Dissemination Agent has no power to enforce performance on the part of any Disclosure Party.
The Dissemination Agent shall not be responsible for the content of any notice or report prepared by any Disclosure Party pursuant to this Disclosure Agreement.
Section 12. Beneficiaries. This Disclosure Agreement shall inure solely to the benefit of the Disclosure Parties, the Trustee, the Dissemination Agent, the Participating Underwriter and the Owners and Beneficial Owners from time to time of the Series 2023[●] Bonds, and shall create no rights in any other person or entity.
Section 13. Governing Laws. This Disclosure Agreement shall be governed by and construed in accordance with the laws of the State of California.
Section 14. Electronic Signature. Each of the parties hereto agrees that the transaction consisting of this Disclosure Agreement may be conducted by electronic means. Each party agrees, and acknowledges that it is such party’s intent, that if such party signs this Disclosure Agreement using an electronic signature, it is signing, adopting, and accepting this Disclosure Agreement and that signing this Disclosure Agreement using an electronic signature is the legal equivalent of having placed its handwritten signature on this Disclosure Agreement on paper. Each party acknowledges that it is being provided with an electronic or paper copy of this Disclosure Agreement in a usable format.
Section 15. Counterparts. This Disclosure Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Disclosure Agreement as of the date first above written.
8 ANAHEIM PUBLIC FINANCING
AUTHORITY
By:
Authorized Officer
CITY OF ANAHEIM
By:
Authorized Officer
ANAHEIM ARENA MANAGEMENT, LLC
By:
Authorized Officer
U.S. BANK TRUST COMPANY, NATIONAL
ASSOCIATION, AS TRUSTEE
By:
Authorized Signatory
U.S. BANK TRUST COMPANY, NATIONAL
ASSOCIATION, AS DISSEMINATION
AGENT
By:
Authorized Signatory
A-1
EXHIBIT A
FORM OF NOTICE OF FAILURE TO FILE ANNUAL REPORT
Name of Issuer: Anaheim Public Financing Authority
Name of Issue: Anaheim Public Financing Authority Taxable Lease Revenue Bonds (Anaheim Arena Improvement Project), 2023 Series [●] (“Series 2023[●] Bonds”)
Date of Issuance: [________], 2023
NOTICE IS HEREBY GIVEN that Anaheim Arena Management, LLC, a California limited liability company (the “Manager”) has not provided an Annual Report with respect to the above-named Series 2023[●] Bonds as required by the Continuing Disclosure Agreement, dated as of [________], 2023, by and among Anaheim Public Financing Authority, the City of Anaheim, the Manager and U.S. Bank Trust Company, National Association, in its capacity as Trustee and in its capacity as Dissemination Agent. [The Manager anticipates that such Annual Report will be filed by ____________.] Dated: _______________ U.S. Bank Trust Company, National Association, as Dissemination Agent,
on behalf of Anaheim Arena Management, LLC
cc: Anaheim Arena Management, LLC