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1 CONTINUING DISCLOSURE CERTIFICATE
This Continuing Disclosure Certificate (the “Disclosure Certificate”) is executed and delivered by the City of Bakersfield (the “City”) in connection with the issuance and delivery of $ __________ City of Bakersfield, California, Wastewater Revenue Refunding Bonds, Series 2025A (the “Series 2025A Bonds”).
The Series 2025A Bonds are being issued pursuant to (i) the charter of the City, (ii) the City of Bakersfield Enterprise Revenue Bond Law, being Chapter 3.55 of the City’s Municipal Code (the “Bond Law”), which incorporates, to the extent made applicable by the Bond Law, the Revenue Bond Law of 1941, being Chapter 6 of Division 2 of Title 5 of the California Government Code, as amended, (iii) certain provisions of the laws of the State of California (including Section 53580 et seq. of the California Government Code, (iv) Resolution No. ________ adopted by the City Council of the City on ___________, 2025 (the “Resolution”), and (v) a Master Trust Indenture, dated as of August 1, 2007 (the “Master Indenture”), by and between the City and U.S. Bank Trust Company, National Association, a national association, as trustee (the “Trustee”), as supplemented by a Sixth Supplemental Trust Indenture, dated as of _____ 1, 2025 (the “Sixth Supplemental Indenture,” and collectively with the Master Indenture, the “Indenture”), by and between the City and the Trustee. The City covenants and agrees as follows:
Section 1. Purpose of the Disclosure Certificate . This Disclosure Certificate is being executed and delivered by the City for the benefit of the Holders and Beneficial Owners of the Series 2025A Bonds and in order to assist the Participating Underwriters in complying with the Rule.
Section 2. Definitions. In addition to the definitions set forth above and in the Indenture, which apply to any capitalized term used in this Disclosure Certificate, unless otherwise defined in this Section, the following capitalized terms shall have the following meanings:
“Annual Report” shall mean any Annual Report provided by the City pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate.
“Beneficial Owner” shall mean any person who has the power, directly o r indirectly, to vote or consent with respect to, or to dispose of ownership of, any Series 2025A Bonds (including persons holding Series 2025A Bonds through nominees, depositories, or other intermediaries). “Dissemination Agent” shall mean the City or any successor Dissemination Agent designated in writing by the City and that has filed with the City a written acceptance of such designation. “Financial Obligation” means a (i) debt obligation, (ii) derivative instrument entered into in connection with, or pledged as security or a source of payment for, an existing or planned debt obligation, or (iii) guarantee of (i) or (ii). The term Financial Obligation shall not include municipal securities as to which a final official statement has been provided to the MSRB consistent with Rule 15c2-12. “Fiscal Year” shall mean the 12-month period beginning on July 1 and ending on the next following June 30, unless and until changed by the City.
“Holder” shall mean either the registered owner of any Series 2025A Bond, or, if the Series 2025A Bonds are registered in the name of DTC or another recognized depository, any Beneficial Owner or applicable participant in its depository system.
“Listed Events” shall mean any of the events listed in Section 5(a) of this Disclosure Certificate. “MSRB” shall mean the Municipal Securities Rulemaking Board. 46738.00002\43793576.1
2 “Official Statement” shall mean the final Official Statement dated ____________, 2025, relating to the Series 2025A Bonds.
“Participating Underwriters” shall mean, BofA Securities, Inc., and any other original underwriters of the Series 2025A Bonds required to comply with the Rule in connection with offering of the Series 2025A Bonds.
“Rule” shall mean 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.
Section 3. Provision of Annual Reports.
(a) The City shall, or shall cause the Dissemination Agent to, not later than nine (9) months after the end of the City’s Fiscal Year (i.e., currently, not later than April 1 of each year), commencing with the report for the 2024-25 Fiscal Year, provide to MSR B an Annual Report that is consistent with the requirements of Section 4 of this Disclosure Certificate. Not later than fifteen (15) calendar days prior to each such Annual Report Date, the City shall provide its Annual Report to the Dissemination Agent, if such Dissemination Agent is a different entity than the City. The Annual Report must be submitted in an electronic format as prescribed by MSRB, accompanied by such identifying information as is prescribed by MSRB, and may include by reference other in formation as provided in Section 4 of this Disclosure Certificate; provided that the audited financial statements of the City may be submitted separately from the balance of the Annual Report, and later than the date required above for the filing of the An nual Report if such audited financial statements are not available by such date. If the City’s Fiscal Year changes, it shall give notice of such change in the same manner as for a Listed Event under Section 5(c). The City shall provide a written certification with each Annual Report furnished to the Dissemination Agent to the effect that such Annual Report constitutes the Annual Report required to be furnished hereunder. The Dissemination Agent may conclusively rely upon such certification of the City an d shall have no duty or obligation to review such Annual Report.
(b) Not later than 15 Business Days prior to the date required in subsection (a), the City shall provide the Annual Report to the Dissemination Agent (if other than the City). If the City is unable to provide to MSRB an Annual Report by the date required in subsection (a), the City shall send to MSRB a notice in substantially the form attached hereto as Exhibit A. Such notice must be submitted in an electronic format as prescribed by MSRB, accompanied by such identifying information as prescribed by MSRB. (c) The Dissemination Agent shall:
(i) provide any Annual Report received by it to the MSRB by the date required in subsection (a);
(ii) if the Dissemination Agent is other than the City, fi le a report with the City certifying that the Annual Report has been provided to MSRB pursuant to this Disclosure Certificate, and stating the date the Annual Report was so provided; and (iii) if the Dissemination Agent is other than the City, take any other actions mutually agreed upon between the Dissemination Agent and the City. 46738.00002\43793576.1
3 Section 4. Content of Annual Reports. The City’s Annual Report shall contain or incorporate by reference the following:
(a) The audited financial statements of the City for the prior Fiscal Year. If the City’s audited financial statements are not available by the time the Annual Report is required to be filed pursuant to Section 3(a), the Annual Report shall contain unaudited financial statements of the City in a format similar to the audited financial statements, and the audited financial statements shall be filed in the same manner as the Annual Report when they become available. Audited financial statements shall be prepared in accordance with generally accepted accounting pr inciples as prescribed for governmental units by the Governmental Accounting Standards Board; provided, however, that the City may from time to time, if required by federal or state legal requirements, modify the basis upon which its financial statements a re prepared. In the event that the City shall modify the basis upon which its financial statements are prepared, the City shall provide a notice of such modification to MSRB, including a reference to the specific federal or state law or regulation specifically describing the legal requirements for the change in accounting basis. (b) The following information for the Fiscal Year to which the Annual Report relates, which information may be provided by its inclusion in the audited financial statements of the City for the prior Fiscal Year described in subsection (a) above:
(i) The principal amount of Series 2025A Bonds outstanding. (ii) Information contained in the following tables in the Official Statement:
(A) “Sewerage SFDE Service Unites and Charges;”
(B) “City of Bakersfield Types of Sewer Users;”
(C) “City of Bakersfield 10 Largest Revenue Contributions;” and
(D) “City of Bakersfield Wastewater Enterprise Historical Revenues, Expenditures, and Debt Service Coverage”.
(c) In addition to any of the information expressly required to be provided under paragraphs (a) and (b) of this Section, the City shall provide such further information, if any, as may be necessary to make the specifically required statements, in the light of the circumstances under which they are made, not misleading.
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 City or related public entities, that are avail able to the public on MSRB’s Internet web site or filed with the Securities and Exchange Commission. The City shall clearly identify each such other document so included by reference.
Section 5. Reporting of Significant Events.
(a) Pursuant to the provisions of this Section 5, the City shall give, or cause to be given, notice of the occurrence of any of the following events with respect to the Series 2025A Bonds:
(i) principal and interest payment delinquencies;
(ii) non-payment related defaults, if material;
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4 (iii) unscheduled draws on any reserve fund for the Series 2025A Bonds reflecting financial difficulties;
(iv) unscheduled draws on any credit enhancements securing the Series 2025A Bonds reflecting financial difficulties;
(v) substitution of any credit or liquidity providers, or their failure to perform; (vi) adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701 -TEB) or other material notices or determinations with respect to the tax status of the Series 2025A Bonds, or other material events affecting the tax status of the Series 2025A Bonds; (vii) modifications to the rights of Owners of the Series 2025A Bonds, if material; (viii) Series 2025A Bond calls, if material, and tender offers for the Series 2025A Bonds; (ix) defeasances;
(x) any release, substitution, or sale of property securing repayment of the Series 2025A Bonds, if material;
(xi) rating changes;
(xii) any bankruptcy, insolvency, receivership, or similar event of the City [this Listed Event is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent, or similar officer for the City 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 the City, or if such jurisdiction has been assumed by leaving the existing governing 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 the City];
(xiii) the consummation of a merger, consolidation, or acquisition involving the City or the sale of all or substantially all of the assets of the City, 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, if material; and (xiv) appointment of a successor or additional trustee or the change of name of a trustee, if material.
(xv) incurrence of a Financial Obligation of the City, if material, or agreement to covenants, events of default, remedies, priority rights, or other similar terms of a Financial Obligation of the City, any of which affect security holders, if material; (xvi) d efault, event of acceleration, termination event, modification of terms, or other similar events under the terms of a Financial Obligation of the City, any of which reflect financial difficulties.
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5 (b) Upon and after the occurrence of a Listed Event listed under subsection (a)(ii), (a)(vii), (a)(viii), (a)(x), (a)(xiii), or (a)(xiv) above, the City shall as soon as possible determine if such event would be material under applicable fede ral securities laws. If the City determines that knowledge of the occurrence of such Listed Event would be material under applicable federal securities laws, the City shall promptly notify the Dissemination Agent, if different from the City, in writing. Such notice shall instruct the Dissemination Agent to report the occurrence pursuant to subsection (d) below. (c) Upon and after the occurrence of any Listed Event (other than a Listed Event listed under subsection (a)(ii), (a)(vii), (a)(viii), (a)(x), (a) (xiii), or (a)(xiv) above), the City shall promptly notify the Dissemination Agent, if different from the City, in writing. Such notice shall instruct the Dissemination Agent to report the occurrence pursuant to subsection (d) below. (d) The City or the D issemination Agent, if the Dissemination Agent has been instructed by the City to report the occurrence of a Listed Event, shall file a notice of such occurrence with MSRB, not in excess of ten (10) business days after the occurrence of such Listed Event. Such notice must be submitted in an electronic format as prescribed by MSRB, accompanied by such identifying information as prescribed by MSRB.
(e) The City hereby agrees that the undertaking set forth in this Disclosure Agreement is the responsibility of the City and that the Dissemination Agent shall not be responsible for determining whether the City’s instructions to the Dissemination Agent under this Section 5 comply with the requirements of the Rule.
Section 6. Termination of Reporting Obligation . The obligations of the City and the Dissemination Agent under this Disclosure Certificate shall terminate upon the legal defeasance, prior redemption, or payment in full of all of the Series 2025A Bonds. If such termination occurs prior to the final maturity of the Series 2025A Bonds, the City shall give notice of such termination in the same manner as for a Listed Event under Section 5(c).
Section 7. Dissemination Agent . The City may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its obligations under this Disclosure Certificate, and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent.
The Dissemination Agent may resign by providing thirty days written notice to the City. The Dissemination Agent shall not be responsible for the content of any report or notice prepared by the City. The Dissemination Agent shall have no duty to prepare any information report nor shall the Dissemination Agent be responsible for filing any report not provided to it by the City in a timely manner and in a form suitable for filing. The City shall initially act as its own Dissemination Agent.
Section 8. Amendment; Waiver . Notwithstanding any other provision of this Disclosure Certificate, the City may amend this Disclosure Certificate, and any provision of this Disclosure Certificate may be waived, provided that the following conditions are satisfied:
(a) if the amendment or waiver relates to the provisions of Section 3(a), 4, or 5(a), it may only be made in connection with a change in circumstances that arises from a change in legal (including a change in law (including rules or regulations) or in interpretations thereof), or a change in the identity, nature, or status of the City or the type of business conducted thereby; (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 2025A Bonds, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and 46738.00002\43793576.1
6 (c) the proposed amendment or waiver either (i) is approved by Holders of the Series 2025A Bonds in the manner provided in the Indenture for amendments to the Indenture with the consent of Holders, or (ii) does not, in the opinion of nationally recognized bond counsel, materially impair the interests of the Holders or Beneficial Owners of the Series 2025A Bonds.
If the annual financial information or operating data to be provided in the Annual Report is amended pursuant to the provisions hereof, the first annual financial information filed pursuant hereto containing the amended operating data or financial information sh all explain, in narrative form, the reasons for the amendment and the impact of the change in the type of operating data or financial information being provided.
In the event of any amendment or waiver of a provision of this Disclosure Agreement, the City 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 City. If an amendment is made to the undertaking specifying the accounting principles to be followed in preparing financial statements, the annual financial information for th e year in which the change is made shall present a comparison between the financial statements or information prepared on the basis of the new accounting principles and those prepared on the basis of the former accounting principles.
The comparison shall include a qualitative discussion of the differences in the accounting principles and the impact of the change in the accounting principles on the presentation of the financial information, in order to provide information to investors to enable them to eval uate the ability of the City to meet its obligations. To the extent reasonably feasible, the comparison shall be quantitative. A notice of the change in the accounting principles shall be sent to MSRB.
Section 9. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the City from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Annual Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Certificate. If the City chooses to include any information in any Annual Report or notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Certificate, the City shall have no obligation under this Disclosure Certificate to update such information or include it in any future Annual Report or notice of occurrence of a Listed Event.
Section 10. Default. In the event of a failure of the City to comply with any provision of this Disclosure Certificate, any Holder or Beneficial Owner of the Series 2025A Bonds may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the City to comply with its obligations under this Disclosure Certificate. A default under this Disclosure Certificate shall not be deemed an Event of Default under the Indenture, and the sole remedy under this D isclosure Certificate in the event of any failure of the City to comply with this Disclosure Certificate shall be an action to compel performance.
Section 11. Duties, Immunities, and Liabilities of Dissemination Agent . The Dissemination Agent shall have o nly such duties as are specifically set forth in this Disclosure Certificate and the City agrees to indemnify and save the Dissemination Agent, and its officers, directors, employees, and agents, harmless against any losses, expenses, and liabilities that it may incur arising out of or in the exercise or performance of its duties hereunder, including the costs and expenses (including attorneys fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent’s negligence or willful misconduct. The obligations of the City under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Series 2025A Bonds. The Dissemination Agent shall not be responsible in any manner for the form at or content of any notice or Annual Report prepared 46738.00002\43793576.1
7 by the City pursuant to this Disclosure Agreement. The City shall pay the reasonable fees and expenses of the Dissemination Agent for its duties hereunder.
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8 Section 12. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the City, the Dissemination Agent, the Participating Underwriters, and Holders and Beneficial Owners from time to time of the Series 2025A Bonds, and shall create no rights in any other person or entity.
Date: ________, 2025
CITY OF BAKERSFIELD
By:
Authorized Officer
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9 EXHIBIT A
NOTICE TO MSRB OF FAILURE TO FILE ANNUAL REPORT
Name of Issuer: City of Bakersfield, California
Name of Bond Issue: City of Bakersfield, California, Wastewater Revenue Refunding Bonds, Series 2025A Date of Issuance: _________, 2025
NOTICE IS HEREBY GIVEN that the City of Bakersfield, California (the “City”), has not provided an Annual Report with respect to the above-named Series 2025A Bonds as required by Section 3 of the Continuing Disclosure Certificate executed by the City on [Closing Date]. The City anticipates that the Annual Report will be filed by _________________.
Dated:
CITY OF BAKERSFIELD
By:
Finance Director