8 b. In the event the operator of the bicycle, nonmotorized scooter, skateboard, in-line skates, roller skates, electric bicycle or electric mobility device is a juvenile, the City shall make reasonable efforts to contact the parent(s) or legal guardian(s) of the operator and advise them of the violation.
c. The City may, in lieu of imposing a fine, allow a violator to complete a bicycle or relevant safety education program, if available, as assigned by the City. Upon successful completion of the program, the fine shall be waived.
cd. Each parent or legal guardian having custody and control of a minor who is issued a citation for violation of this chapter shall be jointly and severally liable with such minor for payment of the fine.
de. The City shall establish a hardship waiver program for individuals who demonstrate financial inability to pay the fines established in this section. Such individuals may be offered community service or other alternatives in lieu of monetary penalties.
10.35.050 – Exemptions
a. This chapter shall not apply to City personnel operating electric bicycles or other vehicles while performing their official duties.
b. This chapter shall not apply to persons with mobility disabilities utilizing wheelchairs or other power-driven mobility devices in accordance with the Americans with Disabilities Act.
c. The City Manager or designee may grant temporary exemptions from the requirements of this chapter for special events or circumstances, provided that adequate alternative safety measures are implemented.
Staff Report
TO: City Council
FROM: Kirk Pelser, Economic Development Director
Joseph Cale, Management Analyst
DATE: November 4, 2025
SUBJECT: Award of Façade Improvement Program Grant Funding – 660 Beaumont Avenue (ED2025-0011)
Description: Consider approving the award of a Façade Improvement Program grant in the amount not to exceed $937.50 to The Casey Family Living Trust, whose property is located at 660 Beaumont Avenue, to assist with eligible façade improvements under the City’s Façade Improvement Program.
Background and Analysis:
The City of Beaumont’s Façade Improvement Program supports the revitalization and enhancement of properties within the Downtown Revitalization target area by incentivizing private investment in exterior building improvements. The program provides matching reimbursement grants of up to 50% of eligible costs, designed to stimulate reinvestment, preserve architectural character, and strengthen the visual appeal of the City’s commercial core.
The applicant, The Casey Family Living Trust, submitted a complete application for improvements at 660 Beaumont Avenue. The proposed scope of work includes exterior repainting.
Staff reviewed the proposal for eligibility, design appropriateness, and compliance with program guidelines. The total project cost is estimated at $1,875, with a grant request not to exceed $937.50 consistent with the program’s matching fund structure.
These improvements align with the City’s Economic Development Strategic Plan and Downtown Revitalization goals, which prioritize property reinvestment, pedestrian- oriented aesthetics, and increased business activity in the Downtown District. Upon completion, the project will result in tangible improvements to the property’s appearance and contribute to the continued revitalization momentum of Downtown Beaumont.
Fiscal Impact:
Funding for the Façade Improvement Program is allocated through the Economic Development Department’s budget under GL Account No. 100-1235-7096-0000.
Sufficient funds are available to support this award. The proposed grant of $937.50 will be reimbursed to the applicant upon successful completion and verification of improvements per program guidelines.
The cost to prepare this staff report is estimated at $350.
Recommended Action:
Approve the award of a Façade Improvement Program grant in the amount not to exceed $937.50 to The Casey Family Living Trust for eligible façade improvements on property located at 660 Beaumont Avenue; and
Authorize the City Manager (or designee) to execute all necessary documents to process this Façade Improvement Program reimbursement.
Attachments:
A. Application and Quotes
Staff Report
TO: City Council
FROM: Kirk Pelser, Economic Development Director
Joseph Cale, Management Analyst
DATE: November 4, 2025
SUBJECT: Award of Façade Improvement Program Grant Funding – 742-790 Beaumont Avenue (ED2025-0012)
Description: Consider approving the award of a Façade Improvement Program grant in the amount not to exceed $34,275 to Thomas L. Daniel, whose property is located at 742-790 Beaumont Avenue, to assist with eligible façade improvements under the City’s Façade Improvement Program.
Background and Analysis:
The City of Beaumont’s Façade Improvement Program supports the revitalization and enhancement of properties within the Downtown Revitalization target area by incentivizing private investment in exterior building improvements. The program provides matching reimbursement grants of up to 50% of eligible costs, designed to stimulate reinvestment, preserve architectural character, and strengthen the visual appeal of the City’s commercial core.
The applicant, Thomas L. Daniel, submitted a complete application for improvements at 742-790 Beaumont Avenue. The proposed scope of work includes preparation of the building’s exterior for new paint and complete repainting.
Staff reviewed the proposal for eligibility, design appropriateness, and compliance with program guidelines. The total project cost is estimated at $68,550, with a grant request not to exceed $34,275 consistent with the program’s matching fund structure.
These improvements align with the City’s Economic Development Strategic Plan and Downtown Revitalization goals, which prioritize property reinvestment, pedestrian- oriented aesthetics, and increased business activity in the Downtown District. Upon completion, the project will result in tangible improvements to the property’s appearance and contribute to the continued revitalization momentum of Downtown Beaumont.
Fiscal Impact:
Funding for the Façade Improvement Program is allocated through the Economic Development Department’s budget under GL Account No. 100-1235-7096-0000.
Sufficient funds are available to support this award. The proposed grant of $34,725 will be reimbursed to the applicant upon successful completion and verification of improvements per program guidelines.
The cost to prepare this staff report is estimated at $350.
Recommended Action:
Approve the award of a Façade Improvement Program grant in the amount not to exceed $34,725 to Thomas L. Daniel for eligible façade improvements at 742-790 Beaumont Avenue; and
Authorize the City Manager (or designee) to execute all necessary documents to process this Façade Improvement Program reimbursement.
Attachments:
A. Application and Quotes
Staff Report
TO: City Council
FROM: Kari Mendoza, Administrative Services Director
DATE: November 4, 2025
SUBJECT: Authorize Changes to the Uniform Compensation Plan
Description: The attached compensation plan has been updated to reflect Council requested changes.
Background and Analysis:
Council and administration are consistently evaluating current positions, upcoming vacancies, recruiting concerns and any market adjustments needed. The attached reflects Council direction to update the salary range for the position of City Manager based on recent survey data of surrounding agencies.
Fiscal Impact:
None at this time. If future negotiations result in a needed budget adjustment, staff will bring it forward in the form of a budget adjustment. City staff estimate the cost to prepare this report was $510.
Recommended Action:
Authorize the attached Uniform Compensation Plan.
Attachments:
A. City Uniform Compensation Plan
Staff Report
TO: City Council
FROM: Robert Vestal, Public Works Director
Darron Usher, Principal Management Analyst
DATE: November 4, 2025
SUBJECT: Public Hearing to Approve the First Reading of an Ordinance for Truck Restrictions and Commercial Vehicle Enforcement
Description: Adding Chapter 10.52 (Truck Prohibitions) to the Beaumont Municipal Code. The proposed ordinance would prohibit trucks over seven (7) tons gross vehicle weight rating (GVWR) from operating on specified City streets, with exceptions for local deliveries, public safety, and essential services.
Background and Analysis:
On December 1, 2020, the City Council adopted the 2040 General Plan, which established a framework for identifying a truck priority network to support industrial and commercial growth while minimizing impacts to residential areas and sensitive receptors. The General Plan recommended that the City formalize truck routes following an analysis of truck access needs.
On May 21, 2024, the City Council received a presentation outlining the framework for the Truck Route Analysis. Subsequently, on August 20, 2024, the City Council received the completed Truck Route Study and adopted the official Truck Route Map. As part of that direction, Council requested that staff evaluate prohibiting heavy truck traffic along certain corridors, including Downtown Beaumont, 6th Street, and residential areas experiencing high truck activity.
On October 7, 2025, staff returned to the City Council to present the proposed Truck Prohibition Ordinance. At that meeting, Council approved staff’s recommendation to move forward to a Public Hearing for the introduction and consideration of the first reading of the ordinance.
The proposed ordinance, prepared in consultation with the City Attorney and consistent with California Vehicle Code Section 35701, establishes the following:
Truck Restrictions
Prohibits trucks over seven (7) tons GVWR on designated streets listed in Exhibit A of the ordinance.
Authorizes local deliveries and access for public utilities, emergency vehicles, solid waste haulers, postal services, and municipal operations. Requires compliant signage at all designated locations before enforcement.
Purpose and Benefits
The ordinance aims to:
Enhance safety and mobility within residential and mixed-use areas. Reduce road degradation caused by heavy trucks.
Align enforcement with the City’s PLUS Land Use Policies and Assembly Bill 98 regarding sensitive receptor protection.
Support local economic development by ensuring truck traffic remains on designated arterial corridors.
Enforcement
The Beaumont Police Department Commercial Enforcement Unit, established in July 2024, will be responsible for enforcement. The unit has issued approximately 6,864 citations since inception, generating approximately $343,200 in fines.
This ordinance complements ongoing enforcement efforts by establishing a clear legal framework for restricting heavy truck activity and enabling officers to issue $500 administrative citations for both unauthorized truck parking and operation on non- designated routes.
Fiscal Impact:
The estimated cost of preparing this staff report and ordinance materials is approximately $350.
Future costs will include signage installation and public notice, which will be paid from the Public Works Operational budget. Citation revenues may increase in the short term and are expected to level off as compliance improves.
Recommended Action:
Hold a public hearing;
Waive the first full reading and approval by title only; “An Ordinance of the City Council of the City of Beaumont, California Adding A New Chapter 10.52 to the Beaumont Municipal Code Containing Truck Restrictions To Designated Streets Within City Limits Consistent With California Vehicle Code Section 35701”; and
Adopt a resolution by title only, “A Resolution Of The City Council of the City of Beaumont, California, Establishing A $500 Administrative Citation Fine for Unauthorized Commercial Truck Parking And Operation On Non-Designated Truck Routes”.
Attachments:
A. Draft Ordinance
B. Resolution
CITY OF BEAUMONT, CALIFORNIA
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF BEAUMONT, CALIFORNIA ADDING A NEW CHAPTER 10.52 TO THE BEAUMONT MUNICIPAL
CODE CONTAINING TRUCK RESTRICTIONS TO DESIGNATED STREETS WITHIN CITY LIMITS CONSISTENT WITH CALIFORNIA VEHICLE CODE SECTION 35701 WHEREAS, California Vehicle Code Section 35701 authorizes the City of Beaumont (“City”) to adopt ordinances prohibiting the use of streets by certain vehicles exceeding a specified weight when alternate routes have been provided.
WHEREAS, the City of Beaumont may prohibit any commercial vehicle exceeding a certain manufacturer’s gross vehicle weight rating, subject to certain exemptions, from using certain roadways consistent with the City’s Policy on Land Use and Sensitive Receptors (PLUS Policy) adopted on March 4, 2025.
WHEREAS, the purpose of this ordinance is to enhance traffic safety, reduce roadway maintenance costs, and preserve the residential and community character of designated streets by prohibiting the use of certain City streets by trucks exceeding 14,000 pou nds or seven (7) tons gross vehicle weight rating (GVWR), consistent with the requirements of the California Vehicle Code (CVC) and the California Department of Transportation (Caltrans).
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF BEAUMONT, RIVERSID E COUNTY, STATE OF CALIFORNIA AS FOLLOWS:
SECTION 1. CEQA. The City Council finds that the actions contemplated by this Ordinance are exempt from the California Environmental Quality Act (“CEQA”) pursuant to 15061(b)(3), CEQA review is not required beca use there is no possibility that this Ordinance may have a significant effect upon the environment.
SECTION 2 . Severability. The City Council hereby declares that if any provision, section, paragraph, sentence, or word of this Ordinance is rendered or de clared to be invalid or unconstitutional by any final court action in a court of competent jurisdiction, or by reason of any preemptive legislation, such invalidity shall not affect the other provisions, sections, paragraphs, sentences, or words of this Or dinance, and to this end the provisions of this Ordinance are severable. The City Council declares that it would have adopted this Ordinance irrespective of the invalidity of any particular portion thereof and intends that the invalid portions should be severed and the balance of the Ordinance enforced.
SECTION 3. Prosecution of Prior Ordinances. Neither the adoption of this Ordinance nor the repeal of any other ordinance of this City shall in any manner affect the prosecution of any violation of any City ordinance or provision of the City of Beaumont Municipal Code, committed prior to the effective date hereof, nor be construed as a waiver of any penalty or the penal provisions applicable to any violation thereof.
SECTION 4. The City Council hereby amends Title 10 of the Beaumont Municipal Code, to add a new Chapter 10.52 to read as specifically set forth in Exhibit “A”.
SECTION 5. Effective Date and Publication . The Mayor shall sign and the City Clerk shall certify to the passage of this Ordinance and cause the same or a summary thereof to be published within 15 days after adoption in accordance with Government Code Section 36933. This Ordinance shall take effect 30 days after adoption in accordance with Government Cod e Section 36937.
INTRODUCED AND READ for the first time and ordered posted at a regular meeting of the City Council of the City of Beaumont, California, held on the _____ day of ___________, 2025, by the following roll call vote:
AYES:
NOES
ABSENT
ABSTAIN
PASSED, APPROVED AND ADOPTED at a regular meeting of the City Council of the City of Beaumont, California, held on the ______ day of ________________, 2025.
AYES:
NOES:
ABSENT:
ABSTAIN:
_______________________
Mike Lara, Mayor
Attest: ______________________
, City Clerk
Approved as to form:
_________________________
John O. Pinkney, City Attorney
EXHIBIT “A”
10.52.010 - Purpose and intent. The purpose of this Chapter is to enhance traffic safety, reduce roadway maintenance costs, and preserve the residential and community character of designated streets by prohibiting the use of certain City streets by trucks exceeding 14,000 pounds or seven (7) tons gross vehicle weight rating (GVWR), consistent with the requirements of the California Vehicle Code (CVC) and the California Department of Transportation (Caltrans).
10.52.020 - Definitions. The following words and phrases when used in this Chapter shall have the definitions respectively ascribed to them in this Section. Whenever any words or phrases used in this Chapter are not defined but are defined in the California Vehicle Code and amendments thereto, such definitions shall apply.
A. For the purposes of this Chapter the word “Truck” means any commercial vehicle with a gross vehicle weight rating (GVWR) in excess of seven tons (14,000 pounds), except those vehicles expressly exempted in this Chapter.
B. The word “GVWR” means Gross Vehicle Weight Rating as defined in the California Vehicle Code.
10.52.030 – Prohibition. The operation of any truck exceeding a GVWR of 7 tons (14,000 pounds) is hereby prohibited on the following streets, in whole or in part, within the City of Beaumont:
1. 6th Street, between Viele Avenue and Pennsylvania Avenue
2. California Avenue, between Luis Estrada Road and the northern City limit
3. 4th Street, between Elm Avenue and California Avenue
4. Pennsylvania Avenue, between Interstate 10 and the northern City limit
5. Oak Valley Parkway, between Beaumont Avenue and the eastern City limit
6. Highland Springs Avenue, between Interstate 10 and northern City limit
7. Beaumont Avenue, between Interstate 10 and Oak Valley Parkway
8. All local roads that primarily serve residential communities
10.52.030 – Exceptions. The provisions of this Chapter shall not apply to trucks performing local deliveries or local pickups to or from destinations located on the restricted streets, provided no reasonable alternative route exists; trucks owned or operated by a public utility, public agency, or municipality engaged in construction, maintenance, or emergency operations; emergency vehicles as defined under California law; transit vehicles, including buses operated by
public transit agencies; or garbage collection, postal service, and other essential municipal service vehicles.
10.52.040. Signage. Appropriate signage indicating the truck restrictions in this Chapter shall be installed by the City at all affected street entrances to provide notice to drivers, in accordance with Caltrans and California Manual on Uniform Traffic Control Devices (CA MUTCD) standards. Enforcement of the prohibition shall commence upon installation of said signage.
10.52.050 - Violation—Penalty.
In the discretion of the Enforcement Officer, any person violating the provisions of this Chapter 10.52 shall be issued an administrative citation pursuant to Beaumont Municipal Code Sections 1.17.200 et seq., or shall be guilty of an infraction pursuant to Beaumont Municipal Code Section 1.16.010. In either case, the amount of the fine shall be in the appropriate amount set forth in Section 1.16.030 of this Code. Each such violation shall be deemed a separate offense as specified in Beaumont Municipal Code Section 1.16.040.
1 RESOLUTION NO. 2025-
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BEAUMONT, CALIFORNIA, ESTABLISHING A $500 ADMINISTRATIVE CITATION FINE FOR
UNAUTHORIZED COMMERCIAL TRUCK PARKING AND OPERATION ON NON-
DESIGNATED TRUCK ROUTES
WHEREAS, the City of Beaumont seeks to ensure public safety, protect local infrastructure, and maintain compliance with designated tru ck routes as established under Beaumont Municipal Code Title 10; and
WHEREAS, on July 2024, the Beaumont Police Department established the Commercial Enforcement Unit to address truck route and parking violations, issuing over 6,800 citations and generating approximately $343,000 in fines; and
WHEREAS, the City Council held a public discussion on October 7, 2025, and directed staff to prepare a public hearing and ordinance establishing new enforcement mechanisms for unauthorized truck activities; and
WHEREAS, to support this ordinance, the City Council desires to formally establish an administrative fine amount for enforcement purposes; and WHEREAS, establishing a $500 fine for unauthorized commercial truck parking and for operating on non -designated truck r outes will deter violations, promote compliance, and ensure consistency with the City’s Administrative Citation Schedule.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF BEAUMONT AS FOLLOWS:
SECTION 1. ADOPTION
The City Council hereby establishes a $500 administrative citation fine for:
Unauthorized commercial truck parking in undesignated locations. Unauthorized operation of commercial trucks on non-designated truck routes.
Both violations shall be added to the City’s Administrative Citation Schedule and enforced pursuant to the procedures outlined in Beaumont Municipal Code Title 1, Chapter 1.17.
SECTION 2. EFFECTIVE DATE
This Resolution shall take effect thirty (30) days after its adoption.
SECTION 3. REPLACEMENT
This fine schedule shall supersede and replace any previously adopted fine amounts relating to unauthorized commercial truck parking or truck route violations.
2 SECTION 4. AUTHORIZATION TO IMPLEMENT
City staff are authorized to take all nece ssary steps to implement the new Parking and Late Payment Penalty Schedule, including notifying the City’s citation processing agency and publishing the penalty amounts on the City’s website.
SECTION 5. CERTIFICATION
The City Clerk shall certify to the passage and adoption of this resolution and shall maintain it in the City’s permanent records.
MOVED, PASSED AND ADOPTED this ___ day of _______2025.
AYES:
NOES:
ABSTAIN:
ABSENT:
By:
Mike Lara, Mayor, City of Beaumont
ATTEST:
Nicole Wheelwright
DEPUTY CITY CLERK
By:
3 EXHIBIT A
REF # PARKING VIOLATION CITATION AMOUNT
PD-12 Unauthorized Commercial Vehicle Parking (over 7 tons) $500.00 PD-13 Unauthorized Use of a Non-Designated Commercial Truck Route $500.00
Staff Report
TO: City Council
FROM: Elizabeth Gibbs, City Manager
DATE: November 4, 2025
SUBJECT: Public Hearing to Approve the Issuance of Local Agency Revenue Bonds, Series 2025B for Improvement Areas 1 and 2 Community Facilities District No. 2023-1 (Fairway Canyon)
Description: The proposed action authorizes the issuance of the Local Agency Revenue Bonds, Series 2025B by the Beaumont Public Improvement Authority (PIA) to finance public improvements for Improvement Area 1 and Improvement Area 2 within Community Facilities District No. 2023-1 (Fairway Canyon). The PIA will issue the 2025B Bonds and use the proceeds to acquire the Local Obligations from each Improvement Area, with debt service on those obligations securing repayment of the Bonds. The financing structure achieves economies of scale and reduces issuance costs while ensuring that all debt service is repaid solely from special taxes levied within the Improvement Areas. Approval of the related resolutions authorizes the execution of the bond documents necessary to complete the transaction.
Background and Analysis:
The City formed Community Facilities District No. 2023-1 (Fairway Canyon) (“District”), including Improvement Area 1 and Improvement Area 2 (the “Improvement Areas”) on June 20, 2023. Subsequent to a noticed public hearing on June 20, 2023, the City Council adopted resolutions establishing the District, designating the Improvement Areas, authorizing the levy of a special tax, approving bonded indebtedness, and calling landowner elections.
On June 20, 2023, elections were held within the Improvement Areas, approving the issuance of bonds in amounts not to exceed $3,500,000 for Improvement Area 1 and $11,000,00 for Improvement Area 2, and authorized the levy of a special tax to repay the bonds.
The District intends to issue a series of bonds on behalf of Improvement Area 1 and a series of bonds on behalf of Improvement Area 2. To achieve efficiencies and economies of scale, the transaction contemplates an issuance through the Beaumont Public Improvement Authority (“PIA”), which will acquire each Improvement Area’s bond
issue (“Local Obligation”). Debt service on the Local Obligations will be used to pay debt service on the Local Agency Revenue Bonds, Series 2025B (“2025B Bonds”) to be issued by the PIA.
The District is in the western portion of the City, west of the 10 Freeway and north of Oak Valley Parkway and includes a total of 419 residential lots comprising Planning Area 4B of the Fairway Canyon master planned community.
Improvement Area No. 1 consists of two non-contiguous tax zones: one in the southwest portion of the District, north of West Oak Valley Parkway, and another located in the northeastern portion of the District, west of Tukwet Canyon Parkway and south of Mickelson Drive. D.R. Horton developed the land within Improvement Area 1 into a residential development of 132 single-family homes in a development known as August II at The Fairways. As of September 5, 2025, the date of value of the Appraisal Report, 131 units had been completed and conveyed to individual homeowners and D.R. Horton owned one completed home. The aggregate value of the property within Improvement Area 1 subject to the Special Tax levy is $79,893,725. Based on the estimated principal amount of the Improvement Area 1 bonds ($2,050,000), the value- to-lien ratio for Improvement Area 1 is approximately 38.97 to 1.
Improvement Area 2 is located in the center of the District, along Sorenstam Drive, and is being developed by Meritage Homes with 287 single family homes, in three developments known as “Magnolia at The Fairways,” “Holly at The Fairways” and “Azalea at The Fairways.” As of September 5, 2025, of the 287 units planned within Improvement Area 2, 271 had been completed and conveyed to individual homeowners and Meritage Homes owned three completed homes and 13 homes in various stages of construction. The aggregate value of the property within Improvement Area 2 is $162,727,411. Based on an estimated principal amount of $7,015,000 for Improvement Area 2, the value-to-lien ratio is approximately 23.20:1.
Discussion:
Based on market conditions as of October 16, 2025, the 2025B Bonds are expected to be issued in a par amount of $9,065,000, with a final maturity of September 1, 2055.
The resolution includes a not to exceed par amount of $10 million to allow for potential changes in market conditions before the bonds are priced and sold. Net proceeds from the 2025B Bonds will be used to acquire the Local Obligations, which will in turn be used to finance certain public improvements benefiting the Improvement Areas. After the issuance of the 2025B Bonds, future parity bonds may be issued for refunding purposes only.
Assuming the City Council approves the resolutions this evening, the 2025B Bonds are expected to price in mid-November 2025 and close roughly two weeks later. Provided in
the table below are estimated financing statistics relating to the 2025B Bonds, and local obligations for each Improvement Area, as well as the projected special tax levy on homes within each Improvement Area. As required under Section 5852.1 of the California Government Code, good faith estimates have been provided to the City by Urban Futures, Inc., the Municipal Advisor in consultation with Stifel, Nicolaus & Company, Incorporated, as underwriter of the 2025B Bonds as Attachment A.
Documents Subject to Approval
City Council will hold a public hearing and be presented with a resolution making findings of significant public benefit in the PIA’s issuance of the 20025B Bonds.
A resolution for the District is presented for consideration by the City Council, acting as the legislative body of the District, to approve its documents with respect to the proposed issuance of bonds by Improvement Area 1 and Improvement Area 2.
The City Council members are members of the Board of Directors of the PIA. Approval by the Board of Directors of the PIA of its resolution presented at this meeting approves its documents with respect to the 2025B Bonds.
The documents for consideration by the City Council and the Board of Directors of the PIA are described below. Approval of the Resolutions approves the preparation, form, and/or authorizes the execution and delivery of the following documents:
Preliminary Official Statement: The POS is the ‘offering document,’ providing a description of the underlying taxing jurisdictions, the 2025B Bonds, and all other information that would be material to a prospective investor’s decision on whether to purchase the 2025B Bonds. While the City’s counsel, consultants, and underwriter have participated in preparing the POS, Council and staff are ultimately responsible for ensuring that the POS is accurate, contains no misleading information and does not omit any information necessary to make the POS not misleading to investors. Authority Indenture of Trust (PIA): The Indenture is a contract entered into between the City and Zions Bancorporation, National Association, as the appointed Select Financing and Levy Statistics
Improvement
Area 1
Improvement
Area 2
2025B
Bonds
Par Amount $2,050,000 $7,015,000 $9,065,000
True Interest Cost 5.05% 5.05% 5.05%
Average Annual Debt Payments $133,069 $454,694 $587,763 Total Debt Payments $3,958,056 $13,524,614 $17,482,669
FY 2025-26 Special Tax Levy Rate Per Parcel $1,106 - $1,414 $1,481 - $2,135 -- Based on market conditions as of October 16, 2025
Trustee for the 2025B Bonds. This document contains terms of the 2025B Bonds including, but not limited to, the payment and redemption provisions, the pledge of revenues to pay the 2025B Bonds, rights and duties of the Trustee, remedies upon a default in the payment of the 2025B Bonds, and other related matters. Bond Indentures (Local Obligations): These documents contain the terms of the bonds in connection with Improvement Area 1 and Improvement Area 2, including payment and redemption provisions, definition and pledge of revenues to pay the underlying obligations, Rights and Duties of the Trustee, remedies upon a default in the payment of the underlying obligations, and final discharge of the underlying obligations and other related matters.
Bond Purchase Agreement: Pursuant to the Bond Purchase Agreement, the City agrees to sell the 2025B Bonds to the underwriter and the underwriter agrees to purchase the 2025B Bonds and the District agrees to sell the Improvement 1 and Improvement Area 2 bonds to the PIA, subject to typical closing conditions. City staff, its municipal advisor, and bond counsel will sign off on the final pricing prior to the execution of the Bond Purchase Agreement.
Continuing Disclosure Agreement: Executed for the benefit of bondholders, this agreement obligates the PIA to file an annual report each Fiscal Year which includes, among other things, the most recent audited financial statements of the City and financial data relating to the underlying tax jurisdictions. The PIA is also required to report certain events to bondholders if and when they occur.
Fiscal Impact:
The Local Obligations and 2025B Bonds are paid from special taxes levied in the Improvement Areas. There is no fiscal impact to the City’s General Fund. The City will, however, be required to provide administration for the District, which will be funded as part of the annual special tax levy.
The property owners are expected to pay special taxes in Fiscal Year 2025-26 of approximately $1,106 to $1,414 in Improvement Area 1, and $1,481 to $2,135 in Improvement Area 2, depending on the size of the home. Such taxes will not increase over time.
The estimated cost to prepare this report is $575.
Recommended Action:
City Council hold a public hearing with respect to the issuance of the 2025B Bonds;
Waive the full reading and adopt by title only “Resolution of the City Council of the City of Beaumon making certain findings with respect to and approving the issuance of Bonds by the Beaumont Public Improvement Authority”
Waive the full reading and adopt by title only, “Resolution of the City Council of the City of Beaumont acting as legislative body of Community Facilities District No. 2023-1 (Fairway Canyon), authorizing the issuance of Special Tax Refunding Bonds and taking other actions in connection therewith” and recess the City Council meeting.
Convene a meeting of the Board of Directors of the Beaumont Public Improvement Authority and waive the full reading and adopt by title only, “Resolution of the Board of Directors of the Beaumont Public Improvement Authority, Riverside County, California, Authorizing the Issuance of its Local Agency Revenue Bonds in an Aggregate Principal Amount Not To Exceed Ten Million Dollars ($10,000,000) And Approving Certain Documents And Taking Certain Other Actions In Connection Therewith” and adjourn the Board Meeting and reconvene the City Council meeting.
Attachments:
A. Good Faith Estimates
B. City Council Resolution Making Findings and approving PIA Bonds C. CFD 2023-1 Resolution Approving the Issuance of Improvement Area 1 Bonds and Improvement Area 2 Bonds
D. PIA Resolution Approving the Issuance of the Local Agency Revenue Bonds, Series 2025B
E. Notice of Public Hearing
F. Authority Indenture of Trust
G. Improvement Area No. 1 Indenture
H. Improvement Area No. 2 Indenture
I. Preliminary Official Statement (includes Continuing Disclosure Agreement) J. Bond Purchase Agreement
K. Presentation
GOOD FAITH ESTIMATES
The good faith estimates set forth herein are provided with respect to the 2025B Bonds in accordance with California Government Code Section 5852.1. Such good faith estimates have been provided to the City by Urban Futures, Inc., the City’s Municipal Advisor (the “Municipal Advisor”) in consultation with Stifel, Nicolaus & Company, Incorporated, the Underwriter for the 2025B Bonds.
Improvement
Area 1
Improvement
Area 2
Authority
Bonds
Par Amount $2,050,000 $7,015,000 $9,065,000
True Interest Cost 5.05% 5.05% 5.05%
Finance Charge $90,680 $310,304 $400,984
Amount of Proceeds Received $1,838,498 $6,292,255 $8,130,753 Total Payment Amount $3,958,056 $13,524,614 $17,482,669
4936-2392-3306v3/022599-0040
RESOLUTION NO. ____
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
BEAUMONT, MAKING CERTAIN FINDINGS WITH
RESPECT TO AND APPROVING THE ISSUANCE OF BONDS
BY THE BEAUMONT PUBLIC IMPROVEMENT
AUTHORITY
WHEREAS, the Beaumont Public Improvement Authority (the “Authority”) is a joint exercise of powers authority duly organized and existing under the provisions of Articles 1 through 4 (commencing with Section 6500) of Chapter 5 of Divis ion 7 of Title 1 of the Government Code of the State of California, and is authorized pursuant to Article 4 of the Act to borrow money for the purpose of financing the acquisition of bonds, notes and other obligations to provide financing and refinancing for capital improvements of member entities of the Authority and other local agencies; and
WHEREAS, the City Council (the “City Council”) of the City of Beaumont, California (the “City”), located in Riverside County, California, has heretofore undertaken proceedings and declared the necessity to issue bonds by the City of Beaumont Community Facilities District No. 2023 -1 (Fairway Canyon) (the “District”) pursuant to the terms and provisions of the Mello -Roos Community Facilities Act of 1982, as amended, bein g Chapter 2.5, Part 1, Division 2, Title 5 of the Government Code of the State of California (the “Mello-Roos Act”); and WHEREAS, the District desires to issue a series of special tax bonds on behalf of Improvement Area No. 1 of the District and a series of special tax bonds on behalf of Improvement Area No. 2 of the District (collectively, the “District Bonds”), in each case to finance certain public facilities authorized under the Mello-Roos Act (the “Facilities”); and WHEREAS, the Authority, for the purpose of acquiring the District Bonds, has determined to issue its Local Agency Revenue Bonds Series 2025 (the “ Authority Bonds”) pursuant to and secured by an Indenture of Trust by and between the Authority and Zions Bancorporation, National Association, as Trustee providing for the issuance of the Authority Bonds, all in the manner provided therein; and
WHEREAS, the Authority Bonds will be issued pursuant to the Marks -Roos Local Bond Pooling Act of 1985, commencing with Section 6584 of the C alifornia Government Code (the “Act”); and
WHEREAS, the City is a member of the Authority and the Facilities will be located within the boundaries of the City; and
WHEREAS, the City has, prior to the consideration of this resolution, held a public hearing on the financing of the Facilities with the proceeds of the issuance of the Authority Bonds in accordance with Section 6586.5 of the Act, which hearing was held at 550 East 6 th Street, Beaumont, California, on November 4, 2025; and
WHEREAS, notice of such hearing was published once in The Press Enterprise, a newspaper of general circulation in the City, at least five days prior to the hearing in accordance with
2 4936-2392-3306v3/022599-0040
Section 6586.5 of the Act;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY, DOES HEREBY RESOLVE, ORDER AND DETERMINE AS FOLLOWS:
SECTION 1. Each of the above recitals is true and correct. Following a duly noticed and conducted public hearing, the City Council has determined and hereby finds that the Authority’s assistance in financing Facilities by the issuance of the Authority Bonds will result in significant public benefits of the types described in Section 6586 (a) through (d), inclusive, of the Act, in that the issuance of the Authority Bonds and related transactions will result in more efficient delivery of local agency services to residential and commercial development.
SECTION 2. The City Council hereby approves the issuance of the Authority Bonds for the purpose of assisting the District in financing the Facilities.
SECTION 3. All actions heretofore taken by officers and agents of the City with respect to the sale and issuance of the Authority Bonds are hereby approved, confirmed and ratified, and t he Mayor and City Clerk of the City, the City Manager, the Finance Director, and the other officers and staff of the City responsible for the fiscal affairs of the City are hereby authorized and directed to take any actions and execute and deliver any and all documents as are necessary to accomplish the issuance, sale and delivery of the Authority Bonds in accordance with the provisions of this Resolution.
SECTION 4. This Resolution shall take effect immediately upon its adoption.
ADOPTED, SIGNED AND APPROVED this 4th day of November, 2025.
Mike Lara, Mayor of the City of Beaumont
(SEAL)
ATTEST:
Nicole Wheelwright, Deputy City Clerk of the City of
Beaumont
3 4936-2392-3306v3/022599-0040
STATE OF CALIFORNIA )
) ss.
COUNTY OF RIVERSIDE )
I, Nicole Wheelwright, Deputy City Clerk of the City of Beaumont, do hereby certify that the foregoing resolution was duly adopted by the City Council of said City, at a regular meeting of said City Council held on the 4th day of November, 2025, and that it was so adopted by the following vote:
AYES:
NOES:
ABSENT:
Nicole Wheelwright, Deputy City Clerk
City of Beaumont
(SEAL)
STATE OF CALIFORNIA )
) ss.
COUNTY OF RIVERSIDE )
I, Nicole Wheelwright, Deputy City Clerk of the City of Beaumont, do hereby certify that the above and foregoing is a full, true and correct copy of RESOLUTION NO. ___, of said City Council, and that the same has not been amended or repealed.
DATED: _________, 2025
Nicole Wheelwright, Deputy City Clerk
City of Beaumont
(SEAL)
4901-7336-1769v4/022599-0040
RESOLUTION NO. ____
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
BEAUMONT, ACTING AS THE LEGISLATIVE BODY OF
THE CITY OF BEAUMONT COMMUNITY FACILITIES
DISTRICT NO. 2023-1 (FAIRWAY CANYON) ,
AUTHORIZING THE ISSUANCE OF SPECIAL TAX BONDS
AND APPROVING CERTAIN DOCUMENTS AND TAKING
CERTAIN OTHER ACTIONS IN CONNECTION
THEREWITH
WHEREAS, the City Council of the City of Beaumont (the “ City”), located in Riverside County, California (hereinafter sometimes referred to as the “legislative body of the District”), has heretofore undertaken proceedings to form the City of Beaumont Community Facilities District No. 2023-1 (Fairway Canyon) (the “District”), and Improvement Area No. 1 (“Improvement Area No. 1”) and Improvement Area No. 2 (“Improvement Area No. 2” and, together with Improvement Area No. 1, the “Improvement Areas”) therein, pursuant to the terms and provisions of the Mello -Roos Community Facilities Act of 1982, as amended, being Chapter 2.5, Part 1, Division 2, Title 5 of the Government Code of the State of California (the “Act”); and WHEREAS, pursuant to Resolution Nos. 2023 -22 and 2023 -23 adopted by the legislative body of the District on the June 20, 2023 , the propositions attached as Attachment A to Resolution No. 2023-22 and incorporated herein by reference were submitted to the qualified electors within the District, and were unanimously approved at elections within the District held on June 20, 2023; and WHEREAS, based upon Resolution Nos. 2023-22 and 2023 -23 and the election held of June 20, 2023, the District is authorized to issue bonds in one or more series, pursuant to the Act, in the maximum aggregate principal amount not to exceed $ 3,500,000 for Improvement Area No. 1, and in the maximum aggregate principal amount not to exceed $11,000,000 for Improvement Area No. 2; and
WHEREAS, the legislative body of the District hereby desires to proceed to issue its first series of bonds for Improvement Area No. 1 for the purpose of financing public facilities in an aggregate principal amount not to exceed $ 2,500,000 designated as the “Ci ty of Beaumont Community Facilities Distr ict No. 2023 -1 (Fairway Canyon) Improvement Area No. 1 Series 2025 Special Tax Bonds” (the “Improvement Area No. 1 Bonds”); and WHEREAS, the legislative body of the District hereby desires to proceed to issue its first series of bonds for Improvement Area No. 2 for the purpose of financing public facilities in an aggregate principal amount not to exceed $ 7,500,000 designated as the “Ci ty of Beaumont Community Facilities District No. 2023 -1 (Fairway Canyon) Improvement Area No. 2 Series 2025 Special Tax Bonds” (the “Improvement Area No. 2 Bonds” and, together with the Improvement Area No. 1 Bonds, the “2025 Bonds”); and
WHEREAS, the legislative body of the District has determined in accordance with Section 53360.4 of the Code that a negotiated sale of the 202 5 Bonds to the Beaumont Public Improvement Authority (the “Authority”) in accordance with the terms of the Bond Purchase
2 4901-7336-1769v4/022599-0040
Agreement to be entered into by and among the Authority, the District and Stifel Nicolaus & Company, Incorporated (the “Bond Purchase A greement”) approved as to form by this legislative body herein will result in a lower overall cost to the District than a public sale; and WHEREAS, in order to effect the issuance of the Improvement Area No. 1 Bonds, the legislative body of the District desires to enter into a Bond Indenture (the “Improvement Area No. 1 Indenture”), by and between the District and Zions Bancorporation, National Association, as trustee thereunder, in substantially the form presented herewith; and WHEREAS, in order to effect the issuance of the Improvement Area No. 2 Bonds, the legislative body of the District desires to enter into a Bond Indenture (the “Improvement Area No. 2 Indenture”), by and between the District and Zions Bancorporation, National Association, as trustee thereunder, in substantially the form presented herewith; and WHEREAS, there has been presented to the legislative body of the District an appraisal report titled “Appraisal of Real Property — Fairway Canyon 4B (Augusta II, Holly, Magnolia & Azalea at The Fairways)” relating to the property within Improvement Area No. 1 and Improvement Area No. 2 (the “Appraisal Report”) prepared by Integra Realty Resources —Sacramento (the “Appraiser”); and
WHEREAS, the legislati ve body of the District has determined that it is prudent in the management of its fiscal affairs to issue the 2025 Bonds and to sell such 2025 Bonds to the Authority; and
WHEREAS, the Authority will issue its bonds (the “Authority Bonds”) to provide funds for its purchase of the 2025 Bonds; and
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY, ACTING AS THE
LEGISLATIVE BODY OF THE DISTRICT , DOES HEREBY RESOLVE, ORDER AND DETERMINE AS FOLLOWS:
SECTION 1. Each of the above recitals is true and correct.
SECTION 2. The legislative body of the District is authorized pursuant to the Act to issue the 2025 Bonds for the benefit of the District for purposes set forth herein.
SECTION 3. The issuance the Improvement Area No. 1 Bonds in the aggregate principal amount not to exceed $2,500,000 is hereby authorized with the exact principal amount of each series to be determined by the official signing the Bond Purchase Agreement in accordance with Section 6 below. The legislative body of the District hereby determines that it is prudent in the management of its fiscal affairs to issue the Improvement Area No. 1 Bonds. The Improvement Area No. 1 Bonds shall mature on the dates and pay interest at the rates set forth in the Bond Pur chase Agreement to be executed on behalf of the District in accordance with Section 6 hereof.
The issuance the Improvement Area No. 2 Bonds in the aggregate principal amount not to exceed $ 7,500,000 is hereby authorized with the exact principal amount of each series to be determined by the official signing the Bond Purchase Agreement in accordance with Section 6 below. The legislative body of the District hereby determines that it is prudent in the management of its fiscal affairs to issue the Improvemen t Area No. 2 Bonds. The Improvement Area No. 2 Bonds
3 4901-7336-1769v4/022599-0040
shall mature on the dates and pay interest at the rates set forth in the Bond Purchase Agreement to be executed on behalf of the District in accordance with Section 6 hereof.
The Improvement Area No. 1 Bonds shall be governed by the terms and conditions of the Improvement Area No. 1 Indenture. The Improvement Area No. 2 Bonds shall be governed by the terms and conditions of the form Improvement Area No. 2 Indenture.
Each of the Improvement Area No. 1 Indenture and the Improvement Area No. 2 Indenture shall be executed by one or more of the Mayor and the City Clerk of the legislative body of the District, the City Manager, the Finance Director, and their written designees (collectively, the “Authorized Officers”) substantially in the form s presented at this meeting, with such additions thereto and changes therein as the officer or officers executing the same deem necessary, including to cure any ambiguity or defect therein, to insert the offe ring price(s), interest rate(s), selling compensation, principal amount per maturity, redemption dates and prices and such other related terms and provisions as limited by Section 6 hereof, to conform any provisions therein to the Indenture for the Authority Bonds. Approval of such changes shall be conclusively evidenced by the execution and delivery of each of the above-listed indentures by one or more Authorized Officers.
Capitalized terms used in this Resolution which are not defined herein have the meanings ascribed to them in the Improvement Area No. 1 Indenture and the Improvement Area No. 2 Indenture, as applicable.
SECTION 4. The 2025 Bonds shall be executed on behalf of the District by the manual or facsimile signature of the Mayor of the legislative body of the District, and the seal of the City of Beaumont, or a facsimile thereof, shall be impressed or imprinted thereon and attested with th e manual or facsimile signature of the City Clerk of the legislative body of the District. Zions Bancorporation, National Association, is hereby appointed to act as Trustee for the 2025 Bonds.
SECTION 5. The covenants set forth in the Improvement Area No. 1 Indenture and the Improvement Area No. 2 Indenture in accordance with Section 4 above are hereby approved, shall be deemed to be covenants of the City Council in its capacity as the legislative body of the District and shall be complied with by the District and its officers.
SECTION 6. The form s of the Bond Purchase Agreement and the Preliminary Official Statement presented herewith are hereby approved; and any one of the Authorized Officers is hereby authorized and directed, for and in the name of the District, to execute the Bond Purchase Agreement substantially in the form approved, with such additions thereto and changes therein as m ay be approved or required by an Authorized Officer, including changes relating to dates and numbers as are necessary to conform the Bond Purchase Agreement to the dates, amounts and interest rates applicable to the 2025 Bonds as of the sale date. Approva l of such additions and changes shall be conclusively evidenced by the execution and delivery of the Bond Purchase Agreement ; provided, however, that the Bond Purchase Agreement be signed only if the true interest cost on the 2025 Bonds does not exceed 5.75% and the Underwriter’s discount (not including original issue discount) does not exceed 1.15% of the principal amount of the 2025 Bonds.
SECTION 7. In accordance with the requirements of Section 53345.8 of the Act, the legislative body of the District hereby determ ines that the value of the real property in Improvement Area No. 1 subject to the special tax to pay debt service on the Improvement Area No. 1 Bonds is at least three times the principal amount of the Improvement Area No. 1 Bonds and the principal amount of all other bonds outstanding that are secured by a special tax levied pursuant to the Act or a
4 4901-7336-1769v4/022599-0040
special assessment levied on property within Improvement Area No. 1. This determination is based on the Appraisal Report, an appraisal of the property within Improvement Area No. 1 made in a manner consistent with the policies adopted by the District pursuant to Section 53312.7 of the Act by the Appraiser, a state certified real estate appraiser, as defined in subdivision (c) of Section 11340 of the Business an d Professions Code, as well as assessed value for the lots within Improvement Area No. 1 not included in the Appraisal Report.
In accordance with the requirements of Section 53345.8 of the Act, the legislative body of the District hereby determines that th e value of the real property in Improvement Area No. 2 subject to the special tax to pay debt service on the Improvement Area No. 2 Bonds is at least three times the principal amount of the Improvement Area No. 2 Bonds and the principal amount of all other bonds outstanding that are secured by a special tax levied pursuant to the Act or a special assessment levied on property within Improvement Area No. 2. This determination is based on the Appraisal Report, an appraisal of the property within Improvement Area No. 2 made in a manner consistent with the policies adopted by the District pursuant to Section 53312.7 of the Act by the Appraiser, a state certified real estate appraiser, as defined in subdivision (c) of Section 11340 of the Business and Professions Code, as well as assessed value for the lots within Improvement Area No. 2 not included in the Appraisal Report.
SECTION 8. The Authorized Officers are each authorized to provide for all services necessary to effect the issuance of the 2025 Bonds. Such services shall include, but not be limited to, obtaining legal services, trustee services and any other services deemed appropriate as set forth in a certificate of an Authorized Officer . The Authorized Officers are authorized to pay for the cost of such services, together with other costs of issuance from 2025 Bond proceeds.
SECTION 9. All actions heretofore taken by officers and agents of the District and the City with respect to the sale and issuance of the 2025 Bonds and the Authority Bonds are hereby approved, confirmed and ratified, and t he Mayor and City Clerk of the legislative body of the District, the City Manager, the Finance Director, and the other officers and staff of the City and the District responsible for the fiscal affairs of the District are hereby authorized and directed to take any actions and execute and deliver any and all documents as are necessary to accomplish the issuance, sale and delivery of the 2025 Bonds and the Authority Bonds in accordance with the provisions of this Resolution and the fulfillment of the purposes of the 2025 Bonds as described in the Improvement Area No. 1 Indenture and the Improvement Area No. 2 Indenture. In the event that the Mayor of the legislative body of the District is unavailable to sign any document authorized for execution herein, any other member of the legislative body of the District or the City Manager or the Finance Director or their written designee , may sign such document. Any document authorized herein to be signed by the City Clerk of the legislative body of the District may be signed by a duly appointed deputy or assistant City Clerk.
SECTION 10. This Resolution shall take effect immediately upon its adoption.
5 4901-7336-1769v4/022599-0040
ADOPTED, SIGNED AND APPROVED this 4th day of November, 2025.
Mike Lara, Mayor of the City of Beaumont, acting in
its capacity as the legislative body of the City of
Beaumont Community Facilities District No. 2023-1
(Fairway Canyon)
(SEAL)
ATTEST:
Nicole Wheelwright, Deputy City Clerk of the City of
Beaumont, acting in its capacity as the legislative
body of the City of Beaumont Community Facilities
District No. 2023-1 (Fairway Canyon)
6 4901-7336-1769v4/022599-0040
STATE OF CALIFORNIA )
) ss.
COUNTY OF RIVERSIDE )
I, Nicole Wheelwright, Deputy City Clerk of the City of Beaumont, do hereby certify that the foregoing resolution was duly adopted by the City Council of said City, acting in its capacity as the legislative body of the City of Beaumont Community Facilities District No. 2023-1 (Fairway Canyon), at a regular meeting of said Board held on the 4th day of November, 2025, and that it was so adopted by the following vote:
AYES:
NOES:
ABSENT:
Nicole Wheelwright, Deputy City Clerk
City of Beaumont
(SEAL)
STATE OF CALIFORNIA )
) ss.
COUNTY OF RIVERSIDE )
I, Nicole Wheelwright, Deputy City Clerk of the City of Beaumont, do hereby certify that the above and foregoing is a full, true and correct copy of RESOLUTION NO. ___, of said City Council, acting in its capacity as the legislative body of the City of Beaumont Community Facilities District No. 2023-1 (Fairway Canyon), and that the same has not been amended or repealed.
DATED: _________, 2025
Nicole Wheelwright, Deputy City Clerk
City of Beaumont
(SEAL)
4916-4982-2313v4/022599-0040
RESOLUTION NO. ____
RESOLUTION OF THE BOARD OF DIRECTORS OF THE
BEAUMONT PUBLIC IMPROVEMENT AUTHORITY,
RIVERSIDE COUNTY, CALIFORNIA, AUTHORIZING THE
ISSUANCE OF ITS LOCAL AGENCY REVENUE BONDS IN
AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED
TEN MILLION DOLLARS ($10,000,000) AND APPROVING
CERTAIN DOCUMENTS AND TAKING CERTAIN OTHER
ACTIONS IN CONNECTION THEREWITH
WHEREAS, the Beaumont Public Improvement Authority (the “Authority”) is a joint exercise of powers authority duly organized and existing under the provisions of Articles 1 through 4 (commencing with Section 6500) of Chapter 5 of Division 7 of Title 1 of the Government Code of the State of California (the “Act”), and is authorized pur suant to Article 4 of the Act (the “Bond Law”) to borrow money for the purpose of financing the acquisition of bonds, notes and other obligations to provide financing and refinancing for capital improvements of member entities of the Authority and other local agencies;
WHEREAS, the City of Beaumont (the “City”) has previously formed City of Beaumont Community Facilities District No. 2023-1 (Fairway Canyon) (the “District”) and designated Improvement Area No. 1 and Improvement Area No. 2 therein pursuant to the Mello -Roos Community Facilities Act of 1982, as amended, being Chapter 2.5 of Part 1 of Division 2 of Title 5 of the Government Code of the State of California (the “Mello-Roos Act”); WHEREAS, the District desires to issue a series of special tax bonds on behalf of Improvement Area No. 1 therein (the “Improvement Area No. 1 Bonds”) and a series of special tax bonds on behalf of Improvement Area No. 2 therein ( the “Improvement Area No. 2 Bonds” and, together with the Improvement Area No. 1 Bonds , the “Local Obligations”), in each case to finance certain public facilities authorized under the Mello-Roos Act (the “Facilities”); WHEREAS, the Authority, for the purpose of acquiring the Local Obligations, has determined to issue its Local Agency Revenue Bonds Series 2025 (the “Authority Bonds”) pursuant to and secured by an Indenture (as defined below) providing for the issuance of the Authority Bonds, all in the manner provided therein; and
WHEREAS, the Authority Bonds will be secured by debt service payments paid with respect to the Local Obligations, the payment on each of which will be secured special tax liens on taxable property within the applicable Improvement Area; and
WHEREAS, there has been filed with the Secretary of the Authority the forms of the following documents to be executed by the Authority with respect to the issuance of the Authority Bonds and the purchase of the Local Obligations, which documents the Board desires to approve for execution as described herein:
(1) The Indenture of Trust (the “Indenture”), by and between the Authority and Zions Bancorporation, National Association, as Trustee;
2 4916-4982-2313v4/022599-0040
(2) The Preliminary Official Statement for the Authority Bonds (the “Preliminary Official Statement”);
(3) The Bond Purchase Agreement, to be dated the date of sale, by and between Stifel, Nicolaus & Company, Incorporated , as Underwriter (the “Underwriter”) , the Authority and The District (the “Bond Purchase Agreement”); and
(4) The Continuing Disclosure Agreement by and between the Authority and Spicer Consulting Group, as dissemination agent; and
WHEREAS, the City is a member of the Authority and the Facilities will be located within the boundaries of the City; and
WHEREAS, the City has, prior to the consideration of this resolution, held a public hearing on the financing of the Facilities with the proceeds of the issuance of the Authority Bonds in accordance with Section 6586.5 of the Act, which hearing was held at 550 East 6th Street, Beaumont, California, on November 4, 2025; and
WHEREAS, notice of such hearing was published once in The Press Enterprise, a newspaper of general circulation in the City, at least five days prior to the hearing in accordance with Section 6586.5 of the Act;
NOW, THEREFORE, THE BOARD OF DIRECTORS OF THE BEAUMONT
PUBLIC IMPROVEMENT AUTHORITY DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS:
SECTION 1. Each of the above recitals is true and correct and is adopted by the Board of Directors. The Board of Directors has determined and hereby finds that the Authority’s assistance in financing Facilities by the issuance of the Authority Bonds will result in significant public benefits of the types described in Section 6586 (a) through (d), inclusive, of the Act, in that the issuance of the Authority Bonds and related transactions will result in more efficient delivery of local agency services to residential and commercial development.
SECTION 2. The Authority Bonds shall be issued in an aggregate principal amount not t o exceed $10,000,000 with the exact principal amount to be determined by the official signing th e Bond Purchase Agreement in accordance with Section 4 below. The Authority Bonds shall mature on the dates and pay interest at the rates set forth in the Bond Purchase Agreement to be executed on behalf of the Authority in accordance with Section 4 below. The Authority Bonds shall be issued under the terms of the Indenture, the form of which is on file with the Secretary of the Board of Directors. The form of the Indenture presented at this meeting is hereby a pproved and each of the Chair of the Board of Directors, the Executive Director and the Treasurer, or their respective written designees (collectively, the “Authorized Officers”), is hereby authorized to execute the Indenture, in the form hereby approved, with such additions thereto and changes therein as the officer or officers executing the same deem necessary to accomplish the issuance of the Authority Bonds as contemplated by this Resolution. Approval of such changes shall be conclusively evidenced by the execution and delivery of the Indenture by one or more of such Authorized Officers.
3 4916-4982-2313v4/022599-0040
SECTION 3. The Authority Bonds shall be executed on behalf of the Authority by the manual or facsimile signature of the Chair of the Board of Directors, and attested with the manual or facsimile signature of the Secretary of the Board of Directors.
SECTION 4. The form of the Bond Purchase Agreement presented at this meeting is hereby approved; and each of the Authorized Officers is hereby authorized to execute the Bond Purchase Agreement in the form so approved, with such additions thereto and changes therein as are necessary to conform the Bond Purchase Agreement to the dates, amounts and interest rates applicable to the Authority Bonds as of the sale date or to cure any defect or ambiguity therein.
Approval of such additions and changes shall be conclusively evidenced by the execution and delivery of the Bond Purchase Agreement by one or more of such Authorized Officers; provided, however, that the Bond Purchase Agreement shall be signed only if th e true interest cost of the Authority Bonds does not exceed 5.75% and only if the Underwriter’s discount (exclusive of original issue discount) does not exceed 1.15% of the principal amount of the Authority Bonds. Each of the Executive Director, the Treas urer and their written designees is authorized to determine the day on which the Authority Bonds are to be priced in order to attempt to produce the lowest borrowing cost for the Authority and may reject any terms presented by the Underwriter to the Author ity if determined not to be in the best interest of the Authority.
SECTION 5. The form of the Continuing Disclosure Agreement presented at this meeting is hereby approved; and each of the Authorized Officers is authorized to execute and deliver the Continuing Disclos ure Agreement in the form hereby approved, with such additions thereto and changes therein as the officers executing the same deem necessary to comply with the requirements of Rule 15c2-12 of the Securities and Exchange Commission, as amended, and to cure any ambiguity or defect therein. Approval of such changes shall be conclusively evidenced by the execution and delivery of the Continuing Disclosure Agreement by one or more of such officers.
SECTION 6. The form of the Preliminary Official Statement presented at thi s meeting is hereby approved; and the Underwrite r is hereby authorized to distribute the Preliminary Official Statement to prospective purchasers of the Authority Bonds in the form hereby approved, together with such additions thereto and changes therein a s are determined necessary by the Treasurer of the Authority, or his or her written designee, to make such Preliminary Official Statement final as of its date for purposes of Rule 15c2-12 of the Securities and Exchange Commission, as amended, including, but not limited to, such additions and changes as are necessary to make the information therein accurate and not misleading. Each of the Authorized Officers is hereby authorized to execute a final Official Statement in the form of the Preliminary Official S tatement, together with such changes as are determined necessary by the Treasurer of the Authority, or his or her written designee, to make such Official Statement complete and accurate as of its date. The Underwriter is further authorized to distribute the final Official Statement for the Authority Bonds and any supplement thereto to the purchasers thereof upon its execution on behalf of the Authority as described above.
SECTION 7. The Authorized Officers are hereby appointed as th e authorized officers of the Authority for all purposes required to effect the issuance of the Authority Bonds and are hereby authorized, empowered, and directed, jointly and severally, to do all such acts and things and to execute all such documents as may be necessary to carry out and comply with the foregoing actions.
SECTION 8. Stradling Yocca Carlson & Rauth LLP (“SYCR”) shall act as bond counsel and disclosure counsel with respect to the issuance of the Authority Bonds and the Local Obligations
4 4916-4982-2313v4/022599-0040
to be issued simu ltaneously with the issuance of the Authority Bonds. Each of the Authorized Officers is authorized to execute and deliver a Bond Counsel Agreement with SYCR.
SECTION 9. Urban Futures, Incorporated (“UFI”) shall act as municipal advisor to the Authority and The Distr ict in connection with the issuance of the Authority Bonds and the Local Obligations.
SECTION 10. Spicer Consulting Group shall act as special tax consultant in connection with the issuance of the Authority Bonds and the Local Obligations.
SECTION 11. Zions Bancorporation, Na tional Association shall act as Trustee and Fiscal Agent in connection with the issuance of the Authority Bonds and the Local Obligations, respectively.
SECTION 12. The Board of Directors acknowledges that the good faith estimates required by Section 5852.1 of the C alifornia Government Code are disclosed in the staff report for this Resolution and are available to the public at the meeting at which this Resolution is approved.
SECTION 13. All actions heretofore taken by the officers and agents of the Authority or the City, acting for and on behalf of the Authority, with respect to the sale and issuance of the Authority Bonds are hereby approved, confirmed and ratified. The Authorized Officers are hereby authorized and directed, to do any and all things and to execute and de liver any and all documents which they may deem necessary or advisable in order to consummate the issuance and sale of the Authority Bonds and otherwise to effectuate the purposes of this Resolution.
SECTION 14. This Resolution shall take effect immediately upon its adoption.
ADOPTED, SIGNED AND APPROVED this 4th day of November, 2025.
Mike Lara, Chair,
Beaumont Public Improvement Authority
ATTEST:
Nicole Wheelwright, Assistant Secretary,
Beaumont Public Improvement Authority
5 4916-4982-2313v4/022599-0040
STATE OF CALIFORNIA )
) ss.
COUNTY OF RIVERSIDE )
I, Nicole Wheelwright , Assistant Secretary of the Board of Directors of Beaumont Public Improvement Authority, do hereby certify that the foregoing resolution was duly adopted by the Board of Directors of said Authority at a regular meeting of said Board held on the 4th day of November, 2025, and that it was so adopted by the following vote:
AYES:
NOES:
ABSENT:
Nicole Wheelwright, Assistant Secretary
Beaumont Public Improvement Authority
STATE OF CALIFORNIA )
) ss.
COUNTY OF RIVERSIDE )
I, Nicole Wheelwright, Assistant Secretary of the Board of Directors of Beaumont Public Improvement Authority, do hereby certify that the above and foregoing is a full, true and correct copy of RESOLUTION NO. ________, of said B oard, and that the same has not been amended or repealed.
DATED: ________, 2025
Nicole Wheelwright, Assistant Secretary
Beaumont Public Improvement Authority
3512 14 Street
Riverside, California 92501
(951) 368-9229
[email protected]
City of Beaumont
550 E. 6th Street
Beaumont, California 92223
Account Number: 5209298
Ad Order Number: 0011761187
Customer's Reference/PO Number:
Publication: The Press-Enterprise
Publication Dates: 10/22/2025
Total Amount: $403.44
Payment Amount: $0.00
Amount Due: $403.44
Notice ID: FwLYGMwOIMSj796HyVGD
Invoice Text: NOTICE OF PUBLIC HEARING NOTICE IS HEREBY GIVEN that the City Council (the “City Council”) of the City of Beaumont (the “City”), will hold a public hearing, in accordance with Section 6586.5(a)(2) of the California Government Code with respect to the financing of certain public improvements by the Beaumont Public Improvement Authority (the “Authority”), on November 4, 2025, at the hour of 6:00 p.m. or as soon thereafter as such matter can be heard, at a regular meeting of the City Council to be held in the City Council Chambers located at 550 East 6 th Street, Beaumont, California. The public improvements to be financed will consist of various public infrastructure improvements specified in the formation proceedings conducted by the City Council pursuant to the Mello‑Roos Community Facilities Act of 1982, as amended (the “Mello-Roos Act”), to form the City of Beaumont Community Facilities District No. 2023-1 (Fairway Canyon) (the “District”) and “Improvement Area No. 1 of City of Beaumont Community Facilities District No. 2023-1 (Fairway Canyon)” and “Improvement Area No. 2 of City of Beaumont Community Facilities District No. 2023- 1 (Fairway Canyon)”. The public improvements to be financed include the construction, purchase, modification, rehabilitation, expansion and/or improvement of roadway, bridge, sewer, domestic and reclaimed water, dry utilities, storm drain, curb and gutter, medians, traffic signals and any other facilities permitted pursuant to the Act, parks, trails, police facilities, fire facilities, library facilities, public community facilities, and appurtenances and appurtenant work, and development impact fees that are used by the City to construct infrastructure including design, engineering and planning costs associated therewith. For the purpose of assisting the District in CFD 2023-1 - Page 1 of 1Page 310 of 1000
The Press-Enterprise
3512 14 Street
Riverside, California 92501
(951) 368-9229
City of Beaumont
550 E. 6th Street
Beaumont, California 92223
Publication: The Press-Enterprise
PROOF OF PUBLICATION OF
Ad Desc: 0011761187
FILE NO. 0011761187
PROOF OF PUBLICATION
I am a citizen of the United States. I
am over the age of eighteen years and
not party to or interested in the above-
entitled matter. I am an authorized
representative of THE PRESS-
ENTERPRISE, a newspaper of
general circulation, printed and
published daily in the County of
Riverside, and which newspaper has
been adjudicated a newspaper of
general circulation by the Superior
Court of the County of Riverside, State
of California, under date of April 25,
1952, Case Number 54446, under
date of March 29, 1957, Case Number
65673, under date of August 25, 1995,
Case Number 267864, and under date
of September 16, 2013, Case Number
RIC 1309013; that the notice, of which
the annexed is a printed copy, has
been published in said newspaper in
accordance with the instructions of the
person(s) requesting publication, and
not in any supplement thereof on the
following dates, to wit:
10/22/2025
I certify (or declare) under the penalty
of perjury that the foregoing is true and
correct.
Date: October 22, 2025.
At: Riverside, California
______________________________
Signature
CFD 2023-1 - Page 1 of 1Page 311 of 1000
Stradling Yocca Carlson & Rauth
Draft of 10/21/25
4924-0349-0409v4/022599-0040
INDENTURE OF TRUST
by and between
BEAUMONT PUBLIC IMPROVEMENT AUTHORITY
and
ZIONS BANCORPORATION, NATIONAL ASSOCIATION,
as Trustee
Dated as of ________ 1, 2025
$___________
BEAUMONT PUBLIC IMPROVEMENT AUTHORITY
LOCAL AGENCY REVENUE BONDS, SERIES 2025B
TABLE OF CONTENTS
Page
i
4924-0349-0409v4/022599-0040
ARTICLE I
DEFINITIONS; AUTHORIZATION AND PURPOSE OF BONDS; EQUAL SECURITY Section 1.1 Definitions .................................................................................................................. 2 Section 1.2 Rules of Construction............................................................................................... 12 Section 1.3 Authorization and Purpose of Bonds ....................................................................... 12 Section 1.4 Equal Security .......................................................................................................... 12
ARTICLE II
ISSUANCE OF BONDS
Section 2.1 Terms of Bonds ........................................................................................................ 13 Section 2.2 Redemption of Bonds............................................................................................... 14 Section 2.3 Form of Bonds ......................................................................................................... 16 Section 2.4 Execution of Bonds .................................................................................................. 16 Section 2.5 Transfer of Bonds..................................................................................................... 17 Section 2.6 Exchange of Bonds .................................................................................................. 17 Section 2.7 Temporary Bonds ..................................................................................................... 17 Section 2.8 Bond Register ........................................................................................................... 17 Section 2.9 Bonds Mutilated, Lost, Destroyed or Stolen ............................................................ 17 Section 2.10 Book-Entry System .................................................................................................. 18
ARTICLE III
DEPOSIT AND APPLICATION OF PROCEEDS
Section 3.1 Issuance of Bonds .................................................................................................... 19 Section 3.2 Application of Proceeds of Sale of 2025B Bonds and Funds Received from the Community Facilities District ............................................................................ 19 Section 3.3 Revenue Fund .......................................................................................................... 20 Section 3.4 Costs of Issuance Fund ............................................................................................ 20 Section 3.5 Purchase Fund .......................................................................................................... 20 Section 3.6 Reserve Fund ........................................................................................................... 21 Section 3.7 Rebate Fund ............................................................................................................. 21 Section 3.8 Surplus Fund ............................................................................................................ 21 Section 3.9 Administrative Expense Fund .................................................................................. 21 Section 3.10 Validity of Bonds ..................................................................................................... 21
ARTICLE IV
REVENUES; FLOW OF FUNDS
Section 4.1 Pledge of Revenues; Assignment of Rights ............................................................. 21 Section 4.2 Receipt, Deposit and Application of Revenues; Revenue Fund .............................. 22 Section 4.3 Reserve Fund ........................................................................................................... 24 Section 4.4 Surplus Fund ............................................................................................................ 25
TABLE OF CONTENTS
(continued)
Page
ii
4924-0349-0409v4/022599-0040
Section 4.5 Investments .............................................................................................................. 26 Section 4.6 Valuation and Disposition of Investments ............................................................... 26
ARTICLE V
COVENANTS OF THE AUTHORITY
Section 5.1 Punctual Payment ..................................................................................................... 27 Section 5.2 Extension of Payment of Bonds ............................................................................... 27 Section 5.3 Against Encumbrances ............................................................................................. 27 Section 5.4 Power to Issue Bonds and Make Pledge and Assignment ....................................... 27 Section 5.5 Accounting Records and Financial Statements ........................................................ 27 Section 5.6 Conditions to Issuance of Additional Obligations ................................................... 28 Section 5.7 Tax Covenants ......................................................................................................... 29 Section 5.8 Rebate Fund ............................................................................................................. 29 Section 5.9 Local Obligations ..................................................................................................... 32 Section 5.10 Sale of Local Obligations ......................................................................................... 32 Section 5.11 Continuing Disclosure Agreement ........................................................................... 33 Section 5.12 Further Assurances ................................................................................................... 33 Section 5.13 Pledged Revenues .................................................................................................... 33
ARTICLE VI
THE TRUSTEE
Section 6.1 Appointment of Trustee ........................................................................................... 33 Section 6.2 Acceptance of Trusts ................................................................................................ 34 Section 6.3 Fees, Charges and Expenses of Trustee ................................................................... 37 Section 6.4 Notice to Bond Owners of Default .......................................................................... 37 Section 6.5 Intervention by Trustee ............................................................................................ 37 Section 6.6 Removal of Trustee .................................................................................................. 37 Section 6.7 Resignation by Trustee............................................................................................. 37 Section 6.8 Appointment of Successor Trustee .......................................................................... 38 Section 6.9 Merger or Consolidation .......................................................................................... 38 Section 6.10 Concerning any Successor Trustee .......................................................................... 38 Section 6.11 Appointment of Co-Trustee ..................................................................................... 38 Section 6.12 Indemnification; Limited Liability of Trustee ......................................................... 39
ARTICLE VII
MODIFICATION AND AMENDMENT OF THE INDENTURE
Section 7.1 Amendment Hereof .................................................................................................. 40 Section 7.2 Effect of Supplemental Indenture ............................................................................ 41 Section 7.3 Endorsement or Replacement of Bonds After Amendment ..................................... 41 Section 7.4 Amendment by Mutual Consent .............................................................................. 41
TABLE OF CONTENTS
(continued)
Page
iii
4924-0349-0409v4/022599-0040
ARTICLE VIII
EVENTS OF DEFAULT AND REMEDIES OF BOND OWNERS
Section 8.1 Events of Default ..................................................................................................... 41 Section 8.2 Remedies; Rights of Bond Owners .......................................................................... 42 Section 8.3 Application of Revenues and Other Funds After Event of Default ......................... 42 Section 8.4 Power of Trustee to Control Proceedings ................................................................ 43 Section 8.5 Appointment of Receivers ....................................................................................... 43 Section 8.6 Non Waiver .............................................................................................................. 43 Section 8.7 Rights and Remedies of Bond Owners .................................................................... 44 Section 8.8 Termination of Proceedings ..................................................................................... 44
ARTICLE IX
MISCELLANEOUS
Section 9.1 Limited Liability of Authority ................................................................................. 44 Section 9.2 Benefits of Indenture Limited to Parties .................................................................. 45 Section 9.3 Discharge of Indenture ............................................................................................. 45 Section 9.4 Successor is Deemed Included in All References to Predecessor ............................ 46 Section 9.5 Content of Certificates ............................................................................................. 46 Section 9.6 Execution of Documents by Bond Owners .............................................................. 46 Section 9.7 Disqualified Bonds ................................................................................................... 47 Section 9.8 Waiver of Personal Liability .................................................................................... 47 Section 9.9 Entire Agreement; Partial Invalidity ........................................................................ 47 Section 9.10 Destruction of Cancelled Bonds .............................................................................. 47 Section 9.11 Funds and Accounts ................................................................................................. 48 Section 9.12 Notices ..................................................................................................................... 48 Section 9.13 Unclaimed Moneys .................................................................................................. 48 Section 9.14 Payment Due on Other than a Business Day ........................................................... 49 Section 9.15 Governing Law ........................................................................................................ 49
Signature Page ................................................................................................................................ S-1
Exhibit A Form of Series 2025B Bonds ................................................................................. A-1
4924-0349-0409v4/022599-0040
INDENTURE OF TRUST
THIS INDENTURE OF TRUST (t his “Indenture”), dated as of ________ 1, 2025, by and between the BEAUMONT PUBLIC IMPROVEMENT AUTHORITY, a joint powers authority organized and existing under the laws of the State of California (the “Authority”) and ZIONS BANCORPORATION, NATIONAL ASSOCIATION, a national banking association organized and existing under the laws of the United States of America (the “Trustee”); WITNESSETH:
WHEREAS, the Authority is a joint exercise of powers authority duly organized and existing under the provisions of Artic les 1 through 4 (commencing with Section 6500) of Chapter 5 of Division 7 of Title 1 of the Government Code of the State of California (the “Act”), and is authorized pursuant to Article 4 of the Act to borrow money for the purpose of financing the acquisit ion of bonds, notes and other obligations to provide financing and refinancing for capital improvements of member entities of the Authority and other local agencies; and WHEREAS, the Authority has determined to issue its Local Agency Revenue Bonds, Series 2025B (the “ 2025B Bond s”) in the aggregate principal amount of $___________ for the primary purpose of acquiring special tax bonds of the Community Facilities District (as defined herein) , the proceeds of which will be utilized to finance the acquisition of or reimbursement for certain public improvements; and
WHEREAS, the 2025B Bonds will be issued pursuant to and secured by this Indenture in the manner provided herein; and
WHEREAS, in order to provide for the authentication and delivery of the Bonds, to establish and declare the terms and conditions upon which the Bonds are to be issued and to secure the payment of the principal thereof and interest thereon, the Authority has authorized the execution and delivery of this Indenture; and
WHEREAS, the Author ity hereby certifies that all acts and proceedings required by law necessary to make the Bonds, when executed by the Authority, authenticated and delivered by the Trustee and duly issued, the valid, binding and legal special obligations of the Authority, a nd to constitute this Indenture a valid and binding agreement for the uses and purposes herein set forth in accordance with its terms, have been done and taken, and the execution and delivery of the Indenture have been in all respects duly authorized;
NOW, THEREFORE, THIS INDENTURE WITNESSETH, that in order to secure the payment of the principal of and the interest and premium (if any) on all Bonds at any time issued and Outstanding under this Indenture, according to their tenor, and to secure the performan ce and observance of all the covenants and conditions therein and herein set forth, and to declare the terms and conditions upon and subject to which the Bonds are to be issued and received, and in consideration of the premises and of the mutual covenants herein contained and of the purchase and acceptance of the Bonds by the Owners thereof, and for other valuable considerations, the receipt and sufficiency of which is hereby acknowledged, the Authority does hereby covenant and agree with the Trustee, for the benefit of the respective Owners from time to time of the Bonds, as follows:
2 4924-0349-0409v4/022599-0040
ARTICLE I
DEFINITIONS; AUTHORIZATION AND PURPOSE OF BONDS; EQUAL SECURITY Section 1.1 Definitions. Unless the context otherwise requires, the terms defined in this Section shall for all purposes of this Indenture and of any Supplemental Indenture and of the Bonds and of any certificate, opinion, request or other documents herein mentioned have the meanings herein specified.
“Act” means Articles 1 through 4 (commencing with Section 6500) of Chapter 5, Division 7, Title 1 of the Government Code of the State, as it may hereafter be amended from time to time. “Additional Bonds” means additional bonds issued pursuant to Section 5.6 and secured on a parity with the 2025B Bonds.
“Annual Debt Service” means, for each Bond Year, the sum of (a) the interest payable on the Outstanding Bonds in such Bond Year, and (b) the principal amount of the Outstanding Bonds scheduled to be paid in such Bond Year, whether at maturity or from sinking fund payments. “Authority Administrative Expenses ” means the fees and expenses of the Trustee, including legal fees and expenses (including fees and expenses of outside counsel and the allocated costs of internal attorneys) and the out of pocket expenses incurred by the Tr ustee, the City and the Authority in carrying out their duties hereunder including payment of amounts payable to the United States pursuant to Section 5.8 hereof.
“Authority” means the Beaumont Public Improvement Authority, a joint exercise of powers agency established pursuant to the laws of the State, whose members as of the date hereof are the City and the Beaumont Parking Authority , until a successor organization shall have become such, and thereafter “Authority” shall mean such successor organization. “Authorized Officer ” means the Chair, Vice Chair, Executive Director or Treasurer of the Authority or any other Person authorized by the Authority to perform an act or sign a document on behalf of the Authority for purposes of this Indenture. “Beneficial Owners” means the actual purchasers of the Bonds whose ownership interests are recorded on the books of the DTC Participants.
“Bond Counsel” means any attorney at law or firm of attorneys selected by the Authority, of nationally recognized standing in matters pertaining to the federal tax exemption of interest on bonds issued by states and political subdivisions, and duly admitted to practice law before the highest court of any state of the United States of America.
“Bond Law” means the Marks -Roos Local Bond Pooling Act of 1985, constituting Article 4 of the Act (commencing with Section 6584), as it may hereafter be amended from time to time. “Bond Register ” means the registration books for the Bonds maintained by the Trustee in accordance with Section 2.8 hereof.
“Bond Year” means each twelve month period extending from September 2 in one calendar year to September 1 of the succeeding calendar year, except in the case of the initial Bond Year
3 4924-0349-0409v4/022599-0040
which shall be the period from the Closing Date of the Bonds to Sep tember 1, 2026, both dates inclusive.
“Bonds” means collectively, the 2025B Bonds and any Additional Bonds authorized by and at any time Outstanding pursuant to the Bond Law and this Indenture. “Business Day” means a day which is not a Saturday or Sunday or a day of the year on which the New York Stock Exchange, the Federal Reserve System, or banks or trust companies in New York, New York, Wilmington, Delaware or Los Angeles, California, or where the Trust Office is located, are not required or authorized by law, regulation or executive order to remain closed. “Certificate of the Authority” means a certificate in writing signed by the Executive Director or Treasurer of the Authority, or by any other officer of the Authority duly authorized in writing by the Board for that purpose.
“CFD Act ” means the Mello -Roos Community Facilities Act of 1982, constituting Chapter 2.5 (commencing with Section 53311), Article 1 of Division 2 of Title 5 of the Government Code of that State of California, as amended from time to time. “City” means the City of Beaumont, County of Riverside, California. “Closing Date ” means for each Series the date on which the Bonds of such Series were executed and delivered to the Original Purchaser thereof. “Code” means the Internal Revenue Co de of 1986, as amended, and the United States Treasury Regulations proposed or in effect with respect thereto. “Community Facilities District” or “CFD” means the City of Beaumont Community Facilities District No. 2023-1 (Fairway Canyon).
“Continuing Disclosure Agreement ” means that certain Continuing Disclosure Agreement dated as of ______ 1 , 2025 between the Authority and Spicer Consulting Group, LLC, as dissemination agent, together with any amendments thereto. “Costs of Issuance ” means the costs an d expenses incurred in connection with the issuance and sale of the Bonds, the Local Obligations, and the acquisition of the Local Obligations by the Authority, including the acceptance and initial annual fees and expenses (including legal fees and expenses) of the Trustee, legal fees and expenses, costs of printing the Bonds and the preliminary and final Official Statements, fees of financial consultants, the underwriter’s discount, and other fees and expenses set forth in a Request of the Authority.
“Costs of Issuance Fund” means the fund by that name established in Section 3.4. “Dated Date” means the date on which the Bonds are issued and authenticated by the Trustee. “Defeasance Securities” means any of the following: (a) non-callable direct obligations of the United States of America (“Treasuries”), (b) evidences of ownership of proportionate interests in future interest and principal payments on Treasuries held by a bank or trust company as custodian, under which the owner of the investment is the real party in interest and has the right to proceed directly and individually against the obligor and the underlying Treasuries are not available to any
4 4924-0349-0409v4/022599-0040
person claiming through the custodian or to whom th e custodian may be obligated, (c ) pre-refunded municipal obligations rated “AAA” and “Aaa” by S&P a nd Moody’s, respectively, and (d) securities eligible for “AAA” defeasance under then existing criteria of S&P. “DTC” means The Depository Trust Company, New York, New York, and its successors and assigns.
“DTC Pa rticipants” means securities brokers and dealers, banks, trust companies, clearing corporations and other organizations maintaining accounts with DTC. “Event of Default” means any of the events described in Section 8.1 hereof. “Fiscal Year” means any twelve month period extending from July 1 in one calendar year to June 30 of the succeeding calendar year, both dates inclusive, or any other twelve month period selected and designated by the Authority as its official fiscal year period. “Improvement Area No. 1” means Improvement Area No. 1 of the Community Facilities District.
“Improvement Area No. 2 ” means Improvement Area No. 2 of the Community Facilities District.
“Improvement Areas” means, collectively, Improvement Area No. 1 and Improvement Area No. 2.
“Indenture” means this Indenture of Trust, as originally executed or as it may from time to time be supplemented, modified or amended by any Supplemental Indenture pursuant to the provisions hereof.
“Independent Accountant” means any accountant or firm of s uch accountants appointed and paid by the Authority, and who, or each of whom –
(a) is in fact independent and not under domination of the Authority or the City; (b) does not have any substantial interest, direct or indirect, in the Authority or the City; and
(c) is not an officer or employee of the Authority, or the City, but who may be regularly retained to make annual or other audits of the books of or reports to the Authority or the City.
“Independent Financial Consultant ” means any financial consultant or firm of such consultants appointed and paid by the Authority, and who, or each of whom – (a) is in fact independent and not under domination of the Authority or the City; (b) does not have any substantial interest, dire ct or indirect, in the Authority or the City; and
5 4924-0349-0409v4/022599-0040
(c) is not an officer or employee of the Authority or the City, but who may be regularly retained to make annual or other audits of the books of or reports to the Authority or the City.
“Information Service s” means such services providing information with respect to called bonds in accordance with then current guidelines of the Securities and Exchange Commission, such as the Trustee may select in its sole discretion.
“Interest Account ” means the account by t hat name established and held by the Trustee pursuant to Sections 3.3 and 4.2(a) hereof.
“Interest Payment Date ” means March 1 and September 1 in each year, beginning March 1, 2026, and continuing thereafter so long as any Bonds remain Outstanding. “Local Obligation Bond Indentures ” means the City of Beaumont Community Facilities District No. 2023-1 (Fairway Canyon) (Improvement Area No. 1) Bond Indenture and the City of Beaumont Community Facilities District No. 2023-1 (Fairway Canyon) (Improvement Area No . 2) Bond Indenture.
Local Obligation Bond Indentures shall also include any additional Local Obligation Bond Indentures executed and delivered in connection with the issuance hereafter of additional Local Obligations.
“Local Obligations” means collectively, the following:
(a) City of Beaumont Community Facilities District No. 2023 -1 (Fairway Canyon) (Improvement Area No. 1) 2025 Special Tax Bonds; (b) City of Beaumont Community Facilities District No. 2023 -1 (Fairway Canyon) (Improvement Area No. 2) 2025 Special Tax Bonds; Local Obligations shall also include any additional Local Obligations issued hereafter pursuant to and in accordance with the provisions of the Local Obligation Bond Indentures. “Local Obligations Delinquency Revenues ” means Revenues receiv ed by the Trustee from the Local Obligations Trustee for a Series of the Local Obligations representing the payment of delinquent debt service on such Local Obligations.
“Local Obligations Trustee” means Zions Bancorporation, National Association , a national banking association duly organized and existing under the laws of the United States of America, with a principal corporate trust office in Los Angeles, California, and its successors and assigns, and any other corporation or association which may at any time be substituted in its place as provided in the Local Obligation Bond Indentures.
“Maximum Annual Debt Service” means, as of the date of any calculation, the largest Annual Debt Service on a Series during the current or any future Bond Year. “Moody’s” means Moody’s Investors Service, Inc., its successors and assigns.
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“Original Purchaser” means, with respect to the 2025B Bonds, Stifel, Nicolaus & Company, Incorporated and with respect to a Series of Additional Bonds, the original purchaser thereof. “Outstanding” when used as of any particular time with reference to Bonds, means (subject to the provisions of Section 9.7 hereof) all Bonds theretofore executed and issued by the Authority and authenticated and delivered by the Trustee under this Indenture except – (a) Bonds theretofore cancelled by the Trustee or surrendered to the Trustee for cancellation pursuant to Section 2.9 hereof;
(b) Bonds paid or deemed to have been paid within the meaning of Section 9.3 hereof or Bonds called for redempti on for which funds have been provided as described in Section 2.2(g) hereof; and
(c) Bonds in lieu of or in substitution for which other Bonds shall have been executed, issued and delivered pursuant to this Indenture or any Supplemental Indenture. “Owner” or “Bond Owner”, when used with respect to any Bond, means the person in whose name the ownership of such Bond shall be registered on the Bond Register. “Permitted Investments ” means any of the following which at the time of investment are legal investments under the laws of the State for the moneys proposed to be invested therein:
1. (a) Direct obligations (other than an obligation subject to variation in principal repayment) of the United States of America (“United States Treasury Obligations”), (b) oblig ations fully and unconditionally guaranteed as to timely payment of principal and interest by the United States of America, (c) obligations fully and unconditionally guaranteed as to timely payment of principal and interest by any agency or instrumentality of the United States of America when such obligations are backed by the full faith and credit of the United States of America, or (d) evidences of ownership of proportionate interests in future interest and principal payments on obligations described abov e held by a bank or trust company as custodian, under which the owner of the investment is the real party in interest and has the right to proceed directly and individually against the obligor and the underlying government obligations are not available to any person claiming through the custodian or to whom the custodian may be obligated.
2. Federal Housing Administration debentures.
3. The listed obligations of government-sponsored agencies which are not backed by the full faith and credit of the United States of America:
(a) Federal Home Loan Mortgage Corporation (FHLMC)
(i) Participation certificates (excluded are stripped mortgage securities which are purchased at prices exceeding their principal amounts) (ii) Senior Debt obligations
(b) Farm Credit Banks (formerly: Federal Land Banks, Federal (i) Intermediate Credit Banks and Banks for Cooperatives)
7 4924-0349-0409v4/022599-0040
(ii) Consolidated system-wide bonds and notes
(c) Federal Home Loan Banks (FHL Banks)
(i) Consolidated debt obligations
(d) Federal National Mortgage Association (FNMA)
(i) Senior debt obligations
(ii) Mortgage-backed securities (excluded are stripped mortgage securities which are purchased at prices exceeding their principal amounts)
4. Unsecured certificates of deposit, time deposits, and bankers’ acc eptances (having maturities of not more than 30 days) of any bank (including the Trustee and any affiliate) the short - term obligations of which are rated “A-1” or better by Standard & Poor’s.
5. Deposits the aggregate amount of which are fully insured by t he Federal Deposit Insurance Corporation (FDIC), in banks (including the Trustee and any affiliate) which have capital and surplus of at least $5 million.
6. Commercial paper (having original maturities of not more than 270 days rated “A - 1+” by Standard & Poor’s and “Prime-1” by Moody’s.
7. Money market funds rated “AAm” or “AAm -G” by Standard & Poor’s, or better (including those of the Trustee or its affiliates).
8. “State Obligations,” which means:
(a) Direct general obligations of any state of the United States of America or any subdivision or agency thereof to which is pledged the full faith and credit of a state the unsecured general obligation debt of which is rated “A3” by Moody’s and “A” by Standard & Poor’s, or better, or any obligation fully and un conditionally guaranteed by any state, subdivision or agency whose unsecured general obligation debt is so rated. (b) Direct general short -term obligations of any state agency or subdivision or agency thereof described in (A) above and rated “A -1+” by Standard & Poor’s and “Prime-l” by Moody’s.
(c) Special Revenue Bonds (as defined in the United States Bankruptcy Code) of any state, state agency or subdivision described in (A) above and rated “AA” or better by Standard & Poor’s and “Aa” or better by Moody’s.
9. Pre-refunded municipal obligations rated “AAA” by Standard & Poor’s and “Aaa” by Moody’s meeting the following requirements:
(a) the municipal obligations are (1) not subject to redemption prior to maturity or (2) the paying agent for the municipal ob ligations has been given irrevocable instructions concerning their call and redemption and the issuer of the municipal obligations has
8 4924-0349-0409v4/022599-0040
covenanted not to redeem such municipal obligations other than as set forth in such instructions;
(b) the municipal obligations are secured by cash or United States Treasury Obligations which may be applied only to payment of the principal of, interest and premium on such municipal obligations;
(c) the principal of and interest on the United States Treasury Obligations (plus any cash in the escrow) has been verified by the report of independent certified public accountants to be sufficient to pay in full all principal of, interest, and premium, if any, due and to become due on the municipal obligations (“Verification”); (d) the cash or United States Treasury Obligations serving as security for the municipal obligations are held by an escrow agent or paying agent in trust for owners of the municipal obligations;
(e) no substitution of a United States Treasury Obligation sh all be permitted except with another United States Treasury Obligation and upon delivery of a new Verification; and
(f) the cash or United States Treasury Obligations are not available to satisfy any other claims, including those by or against the paying agent or escrow agent.
10. Repurchase agreements:
With (1) any domestic bank, or domestic branch of a foreign bank, the long term debt of which is rated at least “A” by Standard & Poor’s and Moody’s; or (2) any broker -dealer with “retail customers” or a rel ated affiliate thereof which broker -dealer has, or the parent company (which guarantees the provider) of which has, long -term debt rated at least “A” by Standard & Poor’s and Moody’s, which broker -dealer falls under the jurisdiction of the Securities Inves tors Protection Corporation; or (3) any other entity rated “A” or better by Standard & Poor’s and Moody’s:
(a) The market value of the collateral is maintained at levels equal to 104% of the amount of cash transferred by the Trustee to the provider of the repurchase agreement plus accrued interest with the collateral being valued weekly and marked -to-market at one current market price plus accrued interest;
(b) The Trustee or a third party acting solely as agent therefor or for the Authority (the “Holder of the Collateral”) has possession of the collateral or the collateral has been transferred to the Holder of the Collateral in accordance with applicable state and federal laws (other than by means of entries on the transferor’s books); (c) The repurchase ag reement shall state and an opinion of counsel shall be rendered at the time such collateral is delivered that the Holder of the Collateral has a perfected first priority security interest in the collateral, any substituted collateral and all proceeds thereof (in the case of bearer securities, this means the Holder of the Collateral is in possession);
(d) The repurchase agreement shall provide that if during its term the provider’s rating by either Moody’s or Standard & Poor’s is withdrawn or suspended or falls below “A “
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by Standard & Poor’s or “A3” by Moody’s, as appropriate, the provider must, at the direction of Trustee, within 10 days of receipt of such direction, repurchase all collateral and terminate the agreement, with no penalty or premium to the Trustee.
Notwithstanding the above, if a repurchase agreement has a term of 270 days or less (with no evergreen provision), collateral levels need not be as specified in (a) above, so long as such collateral levels are 103% or better and the provider is rate d at least “A” by Standard & Poor’s and Moody’s, respectively.
11. Investment agreements with a domestic or foreign bank or corporation (other than a life or property casualty insurance company) the long -term debt of which or, in the case of a guaranteed corporation the long-term debt, or, in the case of a monoline financial guaranty insurance company, claims paying ability, of the guarantor is rated at least “AA” by Standard & Poor’s and “Aa” by Moody’s; provided that, by the terms of the investment agreement:
(a) interest payments are to be made to the Trustee at times and in amounts as necessary to pay debt service on the Bonds;
(b) the invested funds are available for withdrawal without penalty or premium, at any time upon not more than seven days’ prior notice; the Trustee hereby agrees to give or cause to be given notice in accordance with the terms of the investment agreement so as to receive funds thereunder with no penalty or premium paid; (c) the investment agreement shall state that it is the uncon ditional and general obligation of, and is not subordinated to any other obligation of, the provider thereof, or, in the case of a bank, that the obligation of the bank to make payments under the agreement with the obligations of the bank to its other depo sitors and its other unsecured and unsubordinated creditors;
(d) the Trustee receives the opinion of domestic counsel (which opinion shall be addressed to Trustee) that such investment agreement is legal, valid, binding and enforceable upon the provider in accordance with its terms and of foreign counsel (if applicable) in form and substance acceptable, and addressed to, the Trustee; (e) the investment agreement shall provide that if during its term (i) the provider’s rating by either Standard & Poor’s or M oody’s falls below “AA-” or “Aa3”, respectively, the provider shall, at its option, within 10 days of receipt of publication of such downgrade, either (y) collateralize the investment agreement by delivering or transferring in accordance with applicable st ate and federal laws (other than by means of entries on the provider’s books) to the Trustee or a third party acting solely as agent therefor (the “Holder of the Collateral”) collateral free and clear of any third-party liens or claims the market value of which collateral is maintained at levels and upon such conditions as would be acceptable to Standard & Poor’s and Moody’s to maintain an “A” rating in an “A” rated structured financing (with a market value approach); or (z) repay the principal of and accru ed but unpaid interest on the investment; and
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(ii) the provider’s rating by either Standard & Poor’s or Moody’s is withdrawn or suspended or falls below “A-” or “A3”, respectively, the provider must, at the direction of the Trustee, within 10 days of recei pt of such direction, repay the principal of and accrued but unpaid interest on the investment, in either case with no penalty or premium to the Trustee; and
(f) the investment agreement shall state and an opinion of counsel shall be rendered, in the event collateral is required to be pledged by the provider under the terms of the investment agreement at the time such collateral is delivered, that the Holder of the Collateral has a perfected first priority security interest in the collateral, any substitute d collateral and all proceeds thereof (in the case of bearer securities, this means the Holder of the Collateral is in possession);
(g) the investment agreement must provide that if during its term (i) the provider shall default in its payment obligations, the provider’s obligations under the investment agreement shall, at the direction of the Trustee, be accelerated and amounts invested and accrued but unpaid interest thereon shall be repaid to the Trustee, and
(ii) the provider shall become insolvent, not pay its debts as they become due, be declared or petition to be declared bankrupt, etc. (“event of insolvency”), the provider’s obligations shall automatically be accelerated and amounts invested and accrued but unpaid interest thereon shall be repaid to the Trustee.
12. The State of California Local Agency Investment Fund. “Principal Account ” means the account by that name established and held by the Trustee pursuant to Sections 3.3 and 4.2(a) hereof.
“Proportionate Share ” means, as of the date of calcula tion for any issue of the Local Obligations, the ratio derived by dividing the outstanding principal amount of such Local Obligations by the principal amount of the Outstanding Bonds.
“Purchase Fund” means the fund by that name established and held by the Trustee pursuant to Section 3.5 hereof.
“Rebate Fund” means the fund by that name established pursuant to Section 5.8 hereof. “Rebate Regulations ” means the Treasury Regulations issued under Section 148(f) of the Code.
“Record Date” means, with respect to any Interest Payment Date, the fifteenth calendar day of the month preceding the month in which such Interest Payment Date occurs, whether or not such day is a Business Day.
“Request of the Authority ” means a written certificate or request executed by an A uthorized Officer.
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“Request of the City ” means a written certificate or request executed by the Mayor of the City, its City Manager, the Finance Director, or any other officer of the City duly authorized by the City Council of the City to sign documents on its behalf with respect to the matters referred to therein.
“Representation Letter ” means the representation letter dated as of the Closing Date for a Series among the Authority, the Trustee and DTC.
“Reserve Account” means an account of the Reserve Fund established hereunder. “Reserve Fund” means the fund by that name established and held by the Trustee pursuant to Section 3.6 hereof.
“Reserve Requirement ” means an amount equal to the lowest of (i) 10% of the initial principal amount of the Bonds, (ii) Maximum Annual Debt Service on the Outstanding Bonds, or (iii) 125% of Average Annual Debt Service on the Outstanding Bonds. Notwithstanding the foregoing, in no event shall the Reserve Requirement exceed the initial deposit thereto except in connection w ith any increase associated with the issuance of Additional Bonds. As applied to individual accounts of the Reserve Fund, the Reserve Requirement shall initially be allocated as set forth in Section 4.3(a) hereof.
“Responsible Officer” means any officer o f the Trustee assigned to administer the Trustee’s duties under this Indenture.
“Revenue Fund” means the fund by that name established and held by the Trustee pursuant to Sections 3.3 and 4.2 hereof.
“Revenues” means: (a) all amounts received from the Loca l Obligations; (b) any proceeds of the Bonds originally deposited with the Trustee and all moneys deposited and held from time to time by the Trustee in the funds and accounts established hereunder with respect to the Bonds (other than the Administrative E xpense Fund, the Rebate Fund and the Surplus Fund); and (c) investment income with respect to any moneys held by the Trustee in the funds and accounts established hereunder with respect to the Bonds (other than investment income on moneys held in the Administrative Expense Fund, the Rebate Fund and the Surplus Fund). “Securities Depositories ” means The Depository Trust Company, 55 Water Street, 50th Floor, New York, NY 10041-0099 Attn. Call Notification Department, Fax (212) 855-7232; and, in accordance wit h then current guidelines of the securities and Exchange Commission, such other addresses and/or such other securities depositories as the Authority may designate in a Certificate of the Authority delivered to the Trustee.
“Series” means each series of Bonds issued hereunder.
“Series of Local Obligations ” means each of the Local Obligations issued pursuant to the Local Obligation Bond Indentures.
“Six Month Period” shall mean the period of time beginning on the Closing Date and ending six months thereafter, and each six month period thereafter until the latest maturity date of the Bonds (and any obligations that refund the Bonds).
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“Special Taxes” means the taxes authorized to be levied by the CFD on parcels within the Improvement Areas therein, as applicable , which have been pledged to repay the Local Obligations pursuant to the CFD Act.
“Standard & Poor’s” and “S&P” means S&P Global Ratings, a Standard & Poor’s Financial Services LLC business, its successors and assign.
“State” means the State of California.
“Supplemental Indenture” means any indenture, agreement or other instrument hereafter duly executed by the Authority in accordance with the provisions of Article VII of this Indenture. “Surplus Fund” means the fund by that name established pursuant to Section 3.8 hereof. “Tax Certificate” means the certificate by that name to be executed by the Authority on the Closing Date with respect to a Series of Bonds to establish certain facts and expectations and which contains certain covenants relevant to compliance with the Code. “Trust Office” means the office of the Trustee at which at any particular time its corporate trust business with respect to this Indenture shall be administered, which office at the date hereof is located in Los Angeles, Californi a, or such other place as designated by the Trustee except that with respect to presentation of Bonds for payment or for registration of transfer and exchange, such term shall mean the office or agency of the Trustee at which, at any particular time, its c orporate trust agency business shall be conducted.
“Trustee” means Zions Bancorporation, National Association, a national banking association duly organized and existing under the laws of the United States of America, with a corporate trust office in Los A ngeles, California, and its successors and assigns, and any other corporation or association which may at any time be substituted in its place as provided in Article VI hereof. “2025B Bonds” means the Beaumont Public Improvement Authority Local Agency Revenue Bonds, Series 2025B.
Section 1.2 Rules of Construction . All references in this Indenture to “Articles,” “Sections,” and other subdivisions are to the corresponding Articles, Sections or subdivisions of this Indenture; and the words “herein,” “hereof,” “hereunder, ” and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or subdivision hereof.
Section 1.3 Authorization and Purpose of Bonds . The Authority has reviewed all proceedings heretofore taken relative to the author ization of the Bonds and has found, as a result of such review, and hereby finds and determines, that all things, conditions and acts required by law to exist, happen and/or be performed precedent to and in the issuance of the Bonds do exist, have happened and have been performed in due time, form and manner as required by law, and the Authority is now authorized under the Bond Law and each and every other requirement of law, to issue the Bonds in the manner and form provided in this Indenture. Accordingly , the Authority hereby authorizes the issuance of the 2025B Bonds pursuant to the Bond Law and this Indenture for the primary purpose of providing funds to acquire the Local Obligations.
Section 1.4 Equal Security . In consideration of the acceptance of the Bonds by t he Owners thereof, this Indenture shall be deemed to be and shall constitute a contract between the
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Authority and the Owners from time to time of the Bonds; and the covenants and agreements herein set forth to be performed on behalf of the Authority shall be for the equal and proportionate benefit, security and protection of all Owners of the Bonds and for the equal and proportionate benefit, security and protection of all Owners of the Bonds as their respective interests appear without preference, priority or distinction as to security or otherwise of any of the Bonds over other Bonds or any of the Bonds over any other Bonds by reason of the number or date thereof or the time of sale, execution or delivery thereof, or otherwise for any cause whatsoever, exc ept as expressly provided therein or herein.
ARTICLE II
ISSUANCE OF BONDS
Section 2.1 Terms of Bonds. The 2025B Bonds authorized to be issued by the Authority under and subject to the Bond Law and the terms of this Indenture shall be dated as of their Closing Date and be desi gnated the “Beaumont Public Improvement Authority Local Agency Revenue Bonds, Series 2025B ,” which shall be issued in the original aggregate principal amount of ___________ Dollars ($__________).
The 2025B Bonds shall be issued in fully registered form wit hout coupons in denominations of $5,000 or any integral multiple thereof, so long as no Bond shall have more than one maturity date. The 2025B Bonds shall mature on September 1 in each of the years and in the amounts, and shall bear interest (calculated on the basis of a 360-day year of twelve 30-day months) at the rates, as follows:
Maturity Date
(September 1) Principal Amount Interest Rate Per Annum
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Interest on the Bonds shall be payable on each Interest Payment Date to the person whose name appears on the Bond Register as the Owner thereof as of the Record Date immediately preceding each such Interest Payment Date, such interest to be paid by check of the Trustee mailed on such Interest Payment Date by first class mail, postage prepaid, to the Owner at the address of such Owner as it appears on the Bond Register or by wire transfer to an account in the United States of America made on such Interest Payment Date upon writte n instructions of any Owner of $1,000,000 or more in aggregate principal amount of Bonds of a Series provided to the Trustee in writing at least five (5) Business Days before the Record Date for such Interest Payment Date.
Principal of and premium (if any) on any Bond shall be paid upon presentation and surrender thereof, at maturity or the prior redemption thereof, at the Trust Office of the Trustee. The principal of and interest and premium (if any) on the Bonds shall be payable in lawful money of the U nited States of America.
Each Bond shall bear interest from the Interest Payment Date next preceding the date of authentication thereof, unless (a) it is authenticated after a Record Date and on or before the following Interest Payment Date, in which event it shall bear interest from such Interest Payment Date; or (b) it is authenticated on or before the first Record Date, in which event it shall bear interest from the Dated Date; provided, however, that if, as of the date of authentication of any Bond, interest thereon is in default, such Bond shall bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment thereon, or from the Dated Date if no interest has been paid or made available for payment.
Section 2.2 Redemption of Bonds.
(a) Optional Redemption . The 2025B Bond s maturing on or before September 1, 20__ are not subject to optional redemption prior to maturity. The 2025B Bond s maturing on or after September 1, 20__ may be redeemed at the option of the Authori ty, from any source of available funds, prior to maturity on any Interest Payment Date on or after September 1, 20__ as a whole, or in part from maturities of the Local Obligations simultaneously redeemed, if any redemption of Local Obligations is being ma de in conjunction with such optional redemption, and otherwise from such maturities as are selected by the Authority, and by lot within a maturity, at a redemption price equal to the par amount of the 2025B Bonds to be redeemed, together with accrued interest thereon to the date of redemption, without premium.
If the source of funds to optionally redeem the Bonds is to be from a redemption of a Local Obligation, then, prior to consenting to the optional redemption of any Local Obligation which it has purc hased and is held under this Indenture, the Authority shall deliver to the Trustee a certificate of an Independent Accountant or an Independent Financial Consultant verifying that, following such optional redemption of the Local Obligations and redemption of Bonds, the principal and interest generated from the remaining Local Obligations is adequate to make the timely payment of principal and interest due on the Bonds remaining Outstanding following such optional redemption. The Authority shall be required to give the Trustee written notice of its intention to redeem Bonds under this Section (a) at least forty -five (45) days prior to the date fixed for redemption (or such later date as shall be acceptable to the Trustee, in the sole determination of the Trustee, such notice intended for the convenience of the Trustee). The optional redemption provisions (if any) of any Series of Additional Bonds shall be set forth and provided for in a Supplemental Indenture.
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(b) Special Redemption. The 2025B Bonds are subject to special redemption on any Interest Payment Date from proceeds of early redemption of Local Obligations from prepayments of Special Taxes within a Community Facilities District or Improvement Area, as applicable, in whole or in part, from maturities corresponding proportionately to the maturities of the Local Obligations simultaneously redeemed, at the principal amount thereof, plus a premium expressed below as a percentage of the principal amount so redeemed, plus accrued interest to the date of redemption thereof:
Redemption Dates Redemption Prices
Any Interest Payment Date through March 1, 20__ 103%
September 1, 20__ and March 1, 20__ 102
September 1, 20__ and March 1, 20__ 101
September 1. 20__ and any Interest Payment Date thereafter 100
(c) Notice of Redemption . The Trustee on behalf, and at the expense of, the Authority shall send notice of any redemption to the respective Owners of any Bonds designated for redemption at their respective addresses appearing on the Bond Register, and to the Securities Depositories and to the Information Services, at least twenty (20) but not more than sixty (60) days prior to the date fixed for redemption; provided, however, so long as the Bonds are registered in the name of the nominee of DTC, notice shall b e given in such manner as complies with the requirements of DTC. Neither failure to receive any such notice so sent nor any defect therein shall affect the validity of the proceedings for the redemption of such Bonds or the cessation of the accrual of int erest thereon. Such notice shall state the date of the notice, the redemption date, the redemption place and the redemption price and shall designate the CUSIP numbers, Bond numbers and the maturity or maturities (in the event of redemption of all of the Bonds of such maturity or maturities in whole) of the Bonds to be redeemed, and shall require that such Bonds be then surrendered at the Trust Office of the Trustee for redemption at the redemption price, giving notice also that further interest on such Bonds will not accrue after the redemption date.
In addition to the foregoing notice, further notice shall be sent by the Trustee in said form to any Bondowner whose Bond has been called for redemption but who has failed to submit his Bond for payment by the date which is sixty days after the redemption date, but no defect in said further notice nor any failure to give or receive all or any portion of such further notice shall in any manner defeat the effectiveness of a call for redemption.
Unless funds for the optional redemption of any Bonds are irrevocably deposited with the Trustee prior to rendering notice of redemption to the Bondowners, such notice shall state that such redemption is subject to the deposit of funds by the Authority. Any notice of optio nal redemption shall be cancelled and annulled if for any reason funds will not be or are not available on the date fixed for redemption for the payment in full of the Bonds then called for redemption, and such cancellation shall not constitute an Event of Default under this Indenture. The Authority and the Trustee shall have no liability to the Owners or any other party related to or arising from such rescission of redemption. The Trustee shall send notice of such rescission of redemption in the same manner as the original notice of redemption was sent.
Upon the payment by the Trustee from the applicable account in the Revenue Fund of the redemption price of the Bond being redeemed, each check or other transfer of funds issued for
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such purpose shall, to t he extent practicable, bear the CUSIP number identifying, by issue and maturity, the Bonds being redeemed with the proceeds of such check or other transfer. (d) Selection of Bonds of a Maturity for Redemption. Unless otherwise provided hereunder, whenever provision is made in this Indenture or in the applicable Supplemental Indenture for the redemption of less than all of the Bonds of a maturity, the Trustee shall select the Bonds to be redeemed from all Bonds of maturity not previously called for redemption, by lot in any manner which the Trustee in its sole discretion shall deem appropriate and fair. For purposes of such selection, all Bonds shall be deemed to be comprised of separate $5,000 authorized denominations, and such separate authorized denomination s shall be treated as separate Bonds which may be separately redeemed.
(e) Partial Redemption of Bonds . In the event only a portion of any Bond is called for redemption, then upon surrender of such Bond the Authority shall execute and the Trustee shall authenticate and deliver to the Owner thereof, at the expense of the Authority, a new Bond or Bonds of the same maturity date, of authorized denominations in aggregate principal amount equal to the unredeemed portion of the Bond to be redeemed.
(f) Effect of Redemption. From and after the date fixed for redemption, if funds available for the payment of the principal of and interest (and premium, if any) on the Bonds so called for redemption shall have been duly provided, such Bonds so called shall cease to be entitl ed to any benefit under this Indenture other than the right to receive payment of the redemption price, and no interest shall accrue thereon from and after the redemption date specified in such notice. All Bonds redeemed pursuant to this Section 2.2 shall be cancelled and destroyed.
Section 2.3 Form of Bonds . The Bonds, the form of Trustee’s certificate of authentication, and the form of assignment to appear thereon, shall be substantially in the form set forth in Exhibit A attached hereto and by this reference incor porated herein, with necessary or appropriate variations, omissions and insertions, as permitted or required by this Indenture.
Section 2.4 Execution of Bonds. All the Bonds shall, from time to time, be executed on behalf of the Authority by, or bear the manual or fa csimile signature of, one of the members of the Board of Directors of the Authority and be attested by the manual or facsimile signature of the Secretary or by any deputy thereof. If any of the directors or officers who shall have signed or sealed any of the Bonds or whose facsimile signature shall be upon the Bonds shall cease to be such officer of the Authority before the Bond so signed and sealed shall have been actually authenticated by the Trustee or delivered, such Bonds nevertheless may be authentic ated, issued and delivered with the same force and effect as though the person or persons who signed or sealed such Bonds or whose facsimile signature shall be upon the Bonds had not ceased to be such officer of the Authority; and any such Bond may be sign ed and sealed on behalf of the Authority by those persons who, at the actual date of the execution of such Bonds, shall be the proper officers of the Authority, although at the date of such Bond any such person shall not have been such officer of the Authority.
Only such of the Bonds as shall bear thereon a certificate of authentication in substantially the form set forth in Exhibit A, manually executed by the Trustee, shall be valid or obligatory for any purpose or entitled to the benefits of this Indentur e, and such certificate of the Trustee shall be conclusive evidence that the Bonds so authenticated have been duly authenticated and delivered hereunder and are entitled to the benefits of this Indenture.
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Section 2.5 Transfer of Bonds . Subject to Section 2.10, any Bo nd may in accordance with its terms, be transferred, upon the Bond Register, by the person in whose name it is registered, in person or by his duly authorized attorney, upon surrender of such Bond for cancellation, accompanied by delivery of a written inst rument of transfer in a form approved by the Trustee, duly executed. Whenever any Bond shall be surrendered for transfer, the Authority shall execute and the Trustee shall thereupon authenticate and deliver to the transferee a new Bond or Bonds of like Series, tenor, maturity and aggregate principal amount. No Bonds selected for redemption shall be subject to transfer pursuant to this Section nor shall any Bond be subject to transfer during the fifteen days prior to the selection of Bonds for redemption.
The cost of printing any Bonds and any services rendered or any expenses incurred by the Trustee in connection with any transfer or exchange shall be paid by the Authority. However, the Owners of the Bonds shall be required to pay any tax or other governm ental charge required to be paid for any exchange or registration of transfer and the Owners of the Bonds shall be required to pay the reasonable fees and expenses of the Trustee and Authority in connection with the replacement of any mutilated, lost or stolen Bonds.
Section 2.6 Exchange of Bonds . Subject to Section 2.10, Bonds may be exchanged at the Trust Office of the Trustee for Bonds of the same Series, tenor and maturity and of other authorized denominations. No Bonds selected for redemption shall be subject to exchange pursuant to this Section, nor shall any Bond be subject to exchange during the fifteen days prior to the selection of Bonds for redemption. The cost of printing Bonds and any services rendered or expenses incurred by the Trustee in connection with any transfer or exchange shall be paid by the Authority.
Section 2.7 Temporary Bonds. The Bonds may be issued initially in temporary form exchangeable for definitive Bonds when ready for delivery. The temporary Bonds may be printed, lithographed or typewritten, s hall be of such denominations as may be determined by the Authority and may contain such reference to any of the provisions of this Indenture as may be appropriate.
Every temporary Bond shall be executed by the Authority and be registered and authenticate d by the Trustee upon the same conditions and in substantially the same manner as the definitive Bonds. If the Authority issues temporary Bonds, it will execute and furnish definitive Bonds without delay, and thereupon the temporary Bonds may be surrender ed for cancellation, in exchange therefor at the Trust Office of the Trustee, and the Trustee shall authenticate and deliver in exchange for such temporary Bonds an equal aggregate principal amount of definitive Bonds of authorized denominations. Until so exchanged, the temporary Bonds shall be entitled to the same benefits under this Indenture as definitive Bonds authenticated and delivered hereunder.
Section 2.8 Bond Register. The Trustee will keep or cause to be kept at its Trust Office sufficient records for the registration and transfer of the Bonds, which shall be the Bond Register and shall at all times during regular business hours be open to inspection by the Authority upon reasonable notice; and, upon presentation for such purpose, the Trustee shall, under s uch reasonable regulations as it may prescribe, register or transfer or cause to be registered or transferred, on said records, Bonds as hereinbefore provided.
Section 2.9 Bonds Mutilated, Lost, Destroyed or Stolen . If any Bond shall become mutilated, the Authority, at the expense of the Owner of said Bond, shall execute, and the Trustee shall thereupon authenticate and deliver, a new Bond of like tenor and authorized denomination in exchange and substitution for the Bond so mutilated, but only upon surrender to the T rustee of the Bond so mutilated. Every mutilated Bond so surrendered to the Trustee shall be cancelled by it and
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destroyed in accordance with the retention policy of the Trustee then in effect. If any Bond issued hereunder shall be lost, destroyed or sto len, evidence of such loss, destruction or theft may be submitted to the Trustee and, if such evidence be satisfactory to it and indemnity satisfactory to it shall be given, at the expense of the Bond Owner, the Authority shall execute, and the Trustee sha ll thereupon authenticate and deliver, a new Bond of like tenor in lieu of and in substitution for the Bond so lost, destroyed or stolen (or if any such Bond shall have matured or shall have been called for redemption, instead of issuing a substitute Bond the Trustee may pay the same without surrender thereof upon receipt of indemnity satisfactory to the Trustee). The Trustee may require payment of a reasonable fee for each new Bond issued under this Section and of the expenses which may be incurred by the Authority and the Trustee. Any Bond issued under the provisions of this Section in lieu of any Bond alleged to be lost, destroyed or stolen shall constitute an original contractual obligation on the part of the Authority whether or not the Bond alleged t o be lost, destroyed or stolen be at any time enforceable by anyone, and shall be equally and proportionately entitled to the benefits of this Indenture with all other Bonds secured by this Indenture.
Section 2.10 Book-Entry System.
(a) All Bonds shall be initially issued in the form of a separate single certificated fully registered Bond for each maturity date of the Bonds. Upon initial issuance, the ownership of each Bond shall be registered in the Bond Register in the name of Cede & Co., as nominee of DTC.
Except as provided in Section 2.10(d) hereof, all Outstanding Bonds shall be registered in the Bond Register in the name of Cede & Co., as nominee of DTC.
(b) With respect to Bonds registered in the Bond Register in the name of Cede & Co., as nominee of DTC, the Authority and the Trustee shall have no responsibility or obligation with respect to (i) the accuracy of the records of DTC, Cede & Co. or any DTC Participant with respect to any ownership interest in the Bonds, (ii) the delivery to any DTC Participant or any other person, other than an Owner, as shown in the Bond Register, of any notice with respect to the Bonds, including any notice of redemption, or (iii) the payment to any DTC Participant or any other person, other than an Owner, as shown in the Bond Register, o f any amount with respect to principal of, premium, if any, or interest on the Bonds. The Authority and the Trustee may treat and consider the person in whose name each Bond is registered in the Bond Register as the holder and absolute owner of such Bond for the purpose of payment of principal, premium, if any, and interest on such Bond, for the purpose of giving notices of redemption and other matters with respect to such Bond, for the purpose of registering transfers with respect to such Bond, and for al l other purposes whatsoever.
The Trustee shall pay all principal of, premium, if any, and interest on the Bonds only to or upon the order of the respective Owners, as shown in the Bond Register, as provided in Section 2.8 hereof, or their respective attor neys duly authorized in writing, and all such payments shall be valid and effective to fully satisfy and discharge the Authority’s obligations with respect to payment of principal of, premium, if any, and interest on the Bonds to the extent of the sum or sums so paid. No person other than an Owner, as shown in the Bond Register, shall receive a certificated Bond evidencing the obligation of the Authority to make payments of principal, premium, if any, and interest pursuant to this Indenture. Upon delivery by DTC to the Trustee of written notice to the effect that DTC has determined to substitute a new nominee in place of Cede & Co., and subject to the provisions herein with respect to record dates, the word “Cede & Co.” in this Indenture shall refer to such new nominee of DTC.
(c) The delivery of the Representation Letter shall not in any way limit the provisions of Section 2.10(b) hereof or in any other way impose upon the Authority or the Trustee
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any obligation whatsoever with respect to persons having intere sts in the Bonds other than the Owners, as shown on the Bond Register. The Trustee shall take all action necessary for all representations in the Representation Letter with respect to the Trustee to be complied with at all times.
(d) (i) DTC may determine to discontinue providing its services with respect to the Bonds at any time by giving written notice to the Authority and the Trustee and discharging its responsibilities with respect thereto under applicable law. (ii) The Authority, in its sole discretion and wit hout the consent of any other person, may terminate the services of DTC with respect to the Bonds if the Authority determines that:
(A) DTC is unable to discharge its responsibilities with respect to the Bonds, or
(B) a continuation of the requirement that all Out standing Bonds be registered in the Bond Register in the name of Cede & Co., or any other nominee of DTC, is not in the best interest of the beneficial owners of such Bonds. (iii) Upon the termination of the services of DTC with respect to the Bonds pursuant to subsection 2.10(d)(ii)(B) hereof, or upon the discontinuance or termination of the services of DTC with respect to the Bonds pursuant to subsection 2.10(d)(i) or subsection 2.10(d)(ii)(A) hereof after which no substitute securities depository willing to un dertake the functions of DTC hereunder can be found which, in the opinion of the Authority, is willing and able to undertake such functions upon reasonable and customary terms, the Authority is obligated to deliver Bond certificates, as described in this Indenture and the Bonds shall no longer be restricted to being registered in the Bond Register in the name of Cede & Co. as nominee of DTC, but may be registered in whatever name or names DTC shall designate to the Trustee in writing, in accordance with the provisions of this Indenture.
(e) Notwithstanding any other provisions of this Indenture to the contrary, as long as any Bond is registered in the name of Cede & Co., as nominee of DTC, all payments with respect to principal or, premium, if any, and interest on such Bond and all notices with respect to such Bond shall be made and given, respectively, in the manner provided in the Representation Letter.
ARTICLE III
DEPOSIT AND APPLICATION OF PROCEEDS
Section 3.1 Issuance of Bonds . Upon the execution and delivery of this Indenture, the Authority shall execute and deliver the 2025B Bonds in the original aggregate principal amount set forth in Section 2.1 hereof to the Trustee for authentication and delivery to the Original Purchaser thereof upon the Request of the Authority.
Section 3.2 Application of Proceeds of Sale of 2025B Bond s and Funds Received from the Community Facilities District. Upon the receipt by the Trustee of payment for the 2025B
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Bonds in the amount of $__________ (representing the purchase price for the 2025B Bonds ), the Trustee shall deposit such funds as follows:
(a) $_________ of the proceeds of the 2025B Bond s shall be deposited in the Purchase Fund for the acquisition of the Local Obligations in accordance with Section 3.5 hereof. (b) $_________ of the proceeds of the 2025B Bonds, representing the aggregate of each Improvement Area’s share of the Costs of Issuance, shall be retained by the Trustee and deposited in the Costs of Issuance Fund for the payment of Costs of Issuance in acc ordance with Section 3.4 hereof.
(c) $_________ of the proceeds of the 2025B Bonds received by Trustee shall be deposited in the Reserve Fund as set forth in Section 4.3 hereof to satisfy the Reserve Requirement.
The application of proceeds from the sale of a Series of Additional Bonds shall be set forth in the Supplemental Indenture providing for the issuance of such Series of Additional Bonds.
Section 3.3 Revenue Fund. The Trustee shall establish and maintain a separate fund to be known as the “Revenue Fund” and the following separate accounts therein: Interest Ac count and Principal Account. Except as otherwise provided herein, the Trustee shall deposit all Revenues received after the Closing Date to the Revenue Fund and shall apply amounts in the Revenue Fund as described in Section 4.2 below.
Section 3.4 Costs of Issuance F und. The Trustee shall establish and maintain a fund known as the “Costs of Issuance Fund” into which shall be deposited the amounts set forth in Section 3.2(b) above. The moneys in the Costs of Issuance Fund shall be used to pay Costs of Issuance from t ime to time upon receipt by the Trustee of a Request of the Authority. Each such Request of the Authority shall be sufficient evidence to the Trustee of the facts stated therein and the Trustee shall have no duty to confirm the accuracy of such facts. On the date which is one hundred twenty (120) days following the Closing Date, or upon the earlier receipt by the Trustee of a Request of the Authority stating that all Costs of Issuance have been paid, the Trustee shall transfer all remaining amounts in the Costs of Issuance Fund to the Revenue Fund. Upon such transfer, the Costs of Issuance Fund shall be closed and the Trustee shall no longer be obligated to make payments for Costs of Issuance. The Authority may at any time file a Request of the Authority requesting that the Trustee retain a specified amount in the Costs of Issuance Fund and transfer to the Revenue Fund all remaining amounts, and upon receipt of such request by the Trustee, the Trustee shall comply with such request.
Section 3.5 Purchase Fund. The Tr ustee shall establish and maintain a separate fund to be known as the “Purchase Fund” into which shall be deposited a portion of the proceeds of sale of the Bonds pursuant to Section 3.2(a) hereof (or pursuant to the provisions of a Supplemental Indenture). The Trustee shall use the proceeds of the Bonds to purchase Local Obligations on the Closing Date; provided, however, that such Local Obligations may be purchased only if the Trustee has received a certificate of the Original Purchaser of the Bonds or a n Independent Financial Consultant stating that the Revenues to be available to the Trustee, assuming timely payment of the Local Obligations, will be sufficient to permit the timely payment of the principal of and interest on all Outstanding Bonds.
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Section 3.6 Reserve Fund. The Trustee shall establish and maintain a separate fund to be known as the “Reserve Fund” and within such fund, accounts to be known as the “ Improvement Area No. 1 Reserve Account ” and the “Improvement Area No. 2 Reserve Account ,” which accounts shall be administered as provided in Section 4.3 hereof.
Section 3.7 Rebate Fund . The Trustee shall establish and maintain a separate fund, when needed, to be known as the “Rebate Fund” and a separate Rebate Account and Alternative Penalty Account therein for the B onds. The Rebate Fund shall be administered as described in Section 5.8 hereof.
Section 3.8 Surplus Fund . The Trustee shall establish and maintain a separate fund, when needed, to be known as the “Surplus Fund” which shall be administered as described in Section 4.4 hereof.
Section 3.9 Administrative Expense Fund . The Trustee shall establish and maintain a separate fund to be held by the Trustee and known as the “Administrative Expense Fund” into which shall be deposited the amounts specified in Section 4.2(d) and any amounts transferred to the Trustee by the Community Facilities District for the purpose of paying Authority Administrative Expenses which an Authorized Officer directs to be deposited in the Administrative Expense Fund. The moneys in the Administrative Expense Fund shall be used to pay Authority Administrative Expenses or shall be transferred to the Surplus Fund, in either case, upon receipt of a Requisition of the Authority.
Section 3.10 Validity of Bonds . The validity of the authorization and issuance of the Bonds shall not be affected in any way by any proceedings taken by the Authority or the Community Facilities District with respect to the application of the proceeds of the Bonds, and the recital contained in the Bonds that the same are issued pursuant to the Bond Law sha ll be conclusive evidence of their validity and of the regularity of their issuance.
ARTICLE IV
REVENUES; FLOW OF FUNDS
Section 4.1 Pledge of Revenues; Assignment of Rights . Subject to the provisions of Sections 6.3 and 9.3 hereof, the Bonds shall be secured by a first lien o n and pledge (which shall be effected in the manner and to the extent hereinafter provided) of all of the Revenues. The Bonds shall be equally secured by a pledge, charge and lien upon the Revenues without priority for any Bond over any other Bond; and th e payment of the interest on and principal of the Bonds and any premiums upon the redemption of any Bonds shall be and are secured by an exclusive pledge, charge and lien upon the Revenues. So long as any of the Bonds are Outstanding, the Revenues shall n ot be used for any purpose except as is expressly permitted by this Indenture.
The Authority hereby transfers in trust, grants a security interest in and assigns to the Trustee, for the benefit of the Owners from time to time of the Bonds, respectively, all of the Revenues and all of the right, title and interest of the Authority in the Local Obligations, subject to the terms of this Indenture. The Trustee shall be entitled to and shall collect and receive all of the Revenues and any Revenues collected or received by the Authority shall be deemed to be held, and to have been collected or received, by the Authority as the agent of the Trustee and shall forthwith be paid by the Authority to the Trustee. The Trustee also shall be entitled to and, subject to t he provisions of this
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Indenture, the Trustee shall take all steps, actions and proceedings reasonably necessary in its judgment to enforce, either jointly with the Authority or separately, all of the rights of the Authority and all of the obligations of th e City and the Community Facilities District under the Local Obligations.
Upon the deposit with the Trustee of moneys sufficient to pay all principal of, premium, if any, and interest on the Bonds, and upon satisfaction of all claims against the Authority hereunder with respect to the Bonds, including all fees, charges and expenses of the Trustee and the Authority which are properly payable hereunder, or upon the making of adequate provisions for the payment of such amounts as permitted hereby, all moneys remaining in all funds and accounts pertaining to such Bonds, ( except any amounts on deposit in the Rebate Fund and except moneys necessary to pay principal of, premium, if any, and interest on the Bonds, which moneys shall be held by the Trustee pursuant to Section 9.3), shall no longer be considered Revenues and are not pledged to repay the Bonds. Such amounts shall be transferred to the Local Obligations Trustee for each Series of Local Obligations then outstanding proportionately based on their respecti ve Proportionate Share. In the event that the Local Obligations have been paid or defeased, then any such amounts shall be paid by the Trustee to the Authority to be used by the Authority for any lawful purpose.
Section 4.2 Receipt, Deposit and Application of Revenue s; Revenue Fund. Subject to Section 4.2(a)(iv) below, all Revenues described in clause (a) of the definition thereof in Section 1.1 shall be promptly deposited by the Trustee upon receipt thereof in the Revenue Fund. (a) On each Interest Payment Date, the Tru stee shall transfer from the Revenue Fund, and deposit into the following respective accounts for the Bonds, the following amounts in the following order of priority, the requirements of each such account (including the making up of any deficiencies in any such account resulting from lack of Revenues sufficient to make any earlier required deposit) at the time of deposit to be satisfied before any transfer is made to any account subsequent in priority:
(i) Interest Account. On each Interest Payment Date, the Trustee shall deposit in the Interest Account an amount required to cause the aggregate amount on deposit in the Interest Account to equal the amount of interest becoming due and payable on such Interest Payment Date on all Outstanding Bonds on such date. All moneys in the Interest Account shall be used and withdrawn by the Trustee solely for the purpose of paying interest on the Bonds as it shall become due and payable (including accrued interest on any Bonds redeemed prior to maturity). In the event that the amounts on deposit in the Interest Account on any Interest Payment Date, after any transfers from the Reserve Fund pursuant to Section 4.3 hereof, are insufficient for any reason to pay the aggregate amount of interest then coming due and payable on the Outstanding Bonds, the Trustee shall apply such amounts to the payment of interest on each of the Outstanding Bonds on a pro rata basis.
(ii) Principal Account. On each September 1 on which principal of the Bonds shall be payable, the Trustee shall deposit in the Principal Account an amount required to cause the aggregate amount on deposit in the Principal Account to equal the principal amount of, and premium (if any) on, the Bonds coming due and payable on such date, or required to be redeemed on such date pursuant to Section 2.2 hereof; provided, however, that no amount shall be deposited to effect a redemption pursuant to Section 2.2(a) hereof unless the Trustee has first received from the Authority a certificate of an Independent Accountant or an Independent Financial Consultant certifying that such deposit to effect an optional redemption of the Bonds will not impair the ability
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of the Authority to make timely payment of the principal of and interest on the Bonds, assuming for such purposes that the Community Facilities District continues to make timely payments on all Local Obligations not then in default. All moneys in the Principal Account shall be used and withdrawn by the Trustee solely for the purpose of (i) paying the principal of the Bonds at the maturity thereof or (ii) paying the principal of and premium (if any) on any Bonds upon the redemption thereof pursuant to Section 2.2 hereof.
(iii) Reserve Fund. On each Interest Payment Date on which the balance in the Reserve Fund is less than the Reserve Requirement, after making deposits required under (i) and (ii) above, the Trustee shall transfer from the Revenue Fund, an amount sufficient to increase the balance in the Reserve Fund to the Reserve Requirement, by depositing the amount necessary to make the various accounts therein equal to, together, the Reserve Requirement, provided the value of the moneys deposited therein, as invested, shall be valued at market value on such transfer date for purposes of making such determination; and provided, further, that the replenishment of the accounts of the Reserve Fund shall be made in accordance with Section 4.3 hereof. (iv) Local Obligations Delinquency Revenues. The Trustee shall disburse or transfer all Revenues representing Local Obligations Delinquency Revenues in the following order of priority:
First, to make payments required pursuant to Section 8.3 upon the occurrence of an Event of Default as described in Section 8.1(a),
Second, to the Reserve Fund to replenish the amount on deposit therein to the Reserve Requirement as set forth in Section 4.3, and
Third, to make the deposits specified in Section 4.2(a)(i) through (iii) above. (b) If on any Interest Payment Date or date for redemption the amount on deposit in the Revenue Fund is inadequate to make the transfers described in subsection (a) above as a result of a payment default on an issue of Local Obligations, the Trustee shall immediately notify the issuer of such Local Obligations of the amount needed to make the required deposits under subsection (a) above. In the event that following such notice the Trustee receives Local Obligations Delinquency Revenues from the issuer of such Local Obligation to cure such shortfall, the Trustee shall deposit such amounts to the Revenue Fund for application in accordan ce with subsection (a)(iv).
(c) On each Interest Payment Date after making the transfers required under subsections (a) and (b) above, upon receipt of a Request of the Authority to do so, the Trustee shall transfer from the Revenue Fund to the Rebate Fund for deposit in the accounts therein the amounts specified in such Request of the Authority.
(d) On September 1 of each year, after making the deposits required under subsections (a), (b) and (c) above, the Trustee shall transfer all amounts remaining on deposit in the Revenue Fund to the Administrative Expense Fund unless the Trustee has received a Request of the Authority directing it to transfer all or a portion of the said amounts to the Surplus Fund, in which case the Trustee shall make the transfer to the Surplus Fund so specified.
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Section 4.3 Reserve Fund.
(a) There shall be maintained in the Reserve Fund an amount equal to the Reserve Requirement of which $________ shall initially be allocated to the Improvement Area No. 1 Reserve Account , and $ ________ shall initially be al located to the Improvement Area No. 2 Reserve Account, such amounts being the initial Proportionate Share of the Reserve Requirement for each account. In the event that the amount of the Reserve Requirement is changed, the Trustee shall, upon receipt of a Request of the Authority, adjust the Proportionate Share of each Reserve Account to reflect the new Reserve Requirement.
(b) Moneys in the Reserve Fund shall be used solely for the purposes set forth in this Section 4.3. Subject to the limitations set for th in the following paragraph, amounts in the Reserve Fund may be applied to pay the principal of and interest on the Bonds when the moneys in the Interest Account and the Principal Account of the Revenue Fund are insufficient therefor. In addition, moneys in the Reserve Fund may be applied: (i) in connection with an optional redemption of Bonds pursuant to Section 2.2 or a defeasance pursuant to Section 9.3, (ii) when the balance therein equals the principal and interest due on the Bonds to and including maturity, or (iii) when the amount in an account of the Reserve Fund is transferred to the Interest Account and the Principal Account as a credit against the payments due on the Local Obligations secured by such account on the transfer dates specified in subsection (e) below.
(c) Except as otherwise provided herein, all money in the Reserve Fund and the Reserve Accounts therein shall be used and withdrawn by the Trustee solely for the purpose of making transfers as described in this Section 4.3(c). If the amou nts in the Interest Account or the Principal Account of the Revenue Fund are insufficient to pay the principal of or interest on the Bonds when due or mandatory sinking fund payments on the Bonds when due, the Trustee shall withdraw from the applicable Res erve Account or Reserve Accounts an amount equal to the deficiency resulting from the delinquency in the payment of scheduled debt service on the applicable Series of Local Obligations and transfer such amount to the Interest Account, the Principal Account or both, as applicable. If there are insufficient funds on deposit in a Reserve Account to cover a deficiency resulting from the delinquency in the payment of scheduled debt service on the applicable Series of Local Obligations, the Trustee shall withdra w from each of the other Reserve Accounts an amount based upon the Proportionate Share applicable to each such Reserve Account of such remaining deficiency and transfer such amounts to the Interest Account, the Principal Account or both, as applicable.
Upon the transfer by the Trustee to the Reserve Fund of Local Obligations Delinquency Revenues of a Community Facilities District, such Revenues shall be allocated as follows:
(A) First, to the Reserve Account for any Series of Local Obligations, other than the Reserve Account to which such Local Obligations Delinquency Revenues relate, that amount necessary to increase the amount on deposit in such account to the Reserve Requirement on a Proportionate Share basis if the deficiency in the amount on deposit in such account resulted from draws on such account due to delinquencies in the payment of scheduled debt service on that Series of Local Obligations from which the Local Obligations Delinquency Revenues were received. In the event that such Local Obligations De linquency Revenues are insufficient to increase the amount on deposit in each of the applicable Reserve Accounts to their respective Proportionate Share of the Reserve Requirement, a Proportionate Share of such Local Obligations Delinquency Revenues shall be deposited in each such Reserve Account; and
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(B) Second, after increasing the amount on deposit in each applicable Reserve Account to the Reserve Requirement pursuant to the second step above, to the Reserve Account for the Series of Local Obligations from which the Local Obligations Delinquency Revenues were received that amount necessary to replenish the amount on deposit in such Reserve Account to the applicable Reserve Requirement; and
(C) Third, to the Revenue Fund.
(d) On September 1 of each year, any interest earned on the investment of moneys on deposit in the Reserve Fund which would cause the amount therein to exceed the Reserve Requirement shall be applied as set forth in Section 4.5 hereof. (e) When amounts in a Reserve Account are sufficient to repay the rem aining principal and interest due on the related Local Obligations that will be applied to the Bonds, such amounts will be transferred to the Interest Account and the Principal Account as a credit against the payments due on such Local Obligations, with the amount transferred from a Reserve Account being deposited first to the Interest Account as a credit on the interest due on such Local Obligations on such date and the balance being deposited to the Principal Account as a credit on the principal due on such Local Obligations on such date.
Section 4.4 Surplus Fund . Any amounts transferred to the Surplus Fund pursuant to subsection 4.2 hereof shall no longer be considered Revenues and are not pledged to repay the Bonds. So long as Local Obligations are outstanding, on September 1 of each year after setting aside any amount specified in a Request of the Authority as necessary to pay Administrative Expenses, the remaining balance, if any, in the Surplus Fund shall (i) be transferred by the Trustee to the City for credit to the special tax fund for the Local Obligations, and the Community Facilities District shall be credited a percentage of the total amount available on each September 1 that is equal to the percentage which each series of its outstanding Local Obligation represents of all outstanding Local Obligations held by the Trustee as of the date of disbursement or (ii) as set forth in a Request of the City be applied to the redemption of Local Obligations pursuant to the terms of the Local Obligation Bond Indenture with each series of Local Obligations to be credited a percentage of the total amount available on each September 1 that is equal to the percentage which a series of outstanding Local Obligations represents of all outstanding Local Obligations held by the Trustee as of the date of disbursement. In the event that the Local Obligations have been redeemed or defeased in whole or in part, then such credit shall be applied among the Local Obligations based on a Certificate of an Independent Financial Consultant prepared at the direction of the Authorized Representative of the City. In the event the Community Facilities District is no longer obligated to levy Special Taxes to repay Local Obligations, then any amounts in the Surplus Fund may be used by the Authority for any lawful purpose, including, but not limited to, the payment of expenses of the Authority, the City or the Community Facilities District relating to the Bonds, the Local Obligations, the Community Facilities District, or any other purpose as spec ified in a Request of the Authority delivered to the Trustee.
On September 1 of the year preceding the year of the final maturity of the Bonds, the remaining balance in the Surplus Fund shall be credited by the Trustee on a proportionate basis, to the special tax fund established with respect to Local Obligations of the Community Facilities District. Such amounts shall be applied to reduce debt service payments on Local Obligations.
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Section 4.5 Investments. All moneys in any of the funds or accounts established with the Trustee pursuant to this Indenture shall be invested by t he Trustee solely in Permitted Investments, as directed pursuant to the Request of the Authority filed with the Trustee at least two (2) Business Days in advance of the making of such investments. The Trustee shall be entitled to conclusively rely on any such Request of the Authority and shall be fully protected in relying thereon. In the absence of any such Request of the Authority the Trustee shall hold such moneys uninvested. Permitted Investments purchased as an investment of moneys in any fund or ac count established pursuant to this Indenture shall be deemed to be part of such fund or account.
All interest or gain derived from the investment of amounts in any of the funds or accounts established hereunder shall be deposited in the fund or account fro m which such investment was made; provided, however, that all interest or gain derived from the investment of amounts in the accounts of the Reserve Fund shall, to the extent the balance in any account thereof exceeds, on September 1 of each year, its Proportionate Share of the Reserve Requirement as set forth in Section
4.3(a) hereof, be withdrawn by the Trustee on such September 1, commencing March 1, 2026 , and deposited to the appropriate special tax fund of the Community Facilities District to be applied to the payment of debt service on the applicable Local Obligations on the next Interest Payment Date.
For purposes of acquiring any investments hereunder, the Trustee may commingle moneys held by it in any of the funds and accounts held by it hereunder. The Trustee is hereby authorized, in making or disposing of any investment permitted by this Section, to deal with itself (in its individual capacity) or with any one or more of its affiliates, whether it or such affiliate is acting as an agent of the Trustee or for any third person or dealing as principal for its own account. The Trustee and its affiliates may act as advisor, sponsor, principal or agent in the acquisition or disposition of any investment and may impose its customary charges therefor. Th e Trustee and its affiliates may make any and all investments permitted herein through its own investment department. The Trustee shall incur no liability for losses arising from any investments made pursuant to this Section 4.5. The parties hereto ackno wledge that the Trustee is not providing investment supervision, recommendations, or advice.
The Authority acknowledges that to the extent regulations of the Comptroller of the Currency or other applicable regulatory entity grant the Authority the right to receive brokerage confirmations of security transactions effected by the Trustee as they occur, the Authority specifically waives receipt of such confirmations to the extent permitted by law. The Authority further understands that trade confirmations for securities transactions effected by the Trustee will be available upon request and at no additional cost and other trade confirmations may be obtained from the applicable broker.
The Trustee will furnish the Authority periodic cash transaction statements which include detail for all investment transactions made by the Trustee hereunder or brokers selected by the Authority.
Upon the Authority’s election, such statements will be delivered via the Trustee’s online service and upon electing such service, paper statements will be provided only upon request.
Section 4.6 Valuation and Disposition of Investments . For the purpose of determining the amount in any fund or account, the value of Permitted Investments credited to such fund or account shall be valued at the origina l cost thereof (excluding any brokerage commissions and excluding any accrued interest) provided that the investment of any funds held in the Reserve Fund, shall be valued at fair market value and marked to market at least quarterly by the Authority.
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ARTICLE V
COVENANTS OF THE AUTHORITY
Section 5.1 Punctual Payment. The Authority shall punctually pay or cause to be paid the principal and interest and premium (if any) to become due in respect of all the Bonds, in strict conformity with the terms of the Bonds and of this Indenture, according to the true intent and meaning thereof, but only out of Revenues, and other assets pledged for such payment as provided in this Indenture.
Section 5.2 Extension of Payment of Bonds . The Authority shall not directly or indirectly extend or assent to the extension of the maturity of any of the Bonds or the time of payment of any claims for interest by the purchase of such Bonds or by any other arrangement, and in case the maturity of any of the Bonds or the time of payment of any such claims for int erest shall be extended, such Bonds or claims for interest shall not be entitled, in case of any default hereunder, to the benefits of this Indenture, except subject to the prior payment in full of the principal of all of the Bonds then Outstanding and of all claims for interest thereon which shall have been so extended.
Nothing in this Section shall be deemed to limit the right of the Authority to issue Bonds for the purpose of refunding any Outstanding Bonds, and such issuance shall not be deemed to cons titute an extension of maturity of the Bonds.
Section 5.3 Against Encumbrances . The Authority shall not create, or permit the creation of, any pledge, lien, charge or other encumbrance upon the Revenues, and other assets pledged or assigned under this Indenture while any of the Bonds are Outstanding, except the pledge and assignment created by this Indenture. Subject to this limitation, the Authority expressly reserves the right to enter into one or more other indentures for any of its corporate purposes, including o ther programs under the Bond Law, and reserves the right to issue other obligations for such purposes.
Section 5.4 Power to Issue Bonds and Make Pledge and Assignment. The Authority is duly authorized pursuant to law to issue the Bonds and to enter into this Indentur e and to pledge and assign the Revenues, the Local Obligations and other assets purported to be pledged and assigned, respectively, under this Indenture. The Bonds and the provisions of this Indenture are and will be the legal, valid and binding limited, special obligations of the Authority in accordance with their terms, and the Authority and the Trustee shall at all times, subject to the provisions of Article VI hereof and to the extent permitted by law, defend, preserve and protect said pledge and assig nment of the Revenues, the Local Obligations and other assets and all the rights of the Bond Owners under this Indenture against all claims and demands of all persons whomsoever.
Section 5.5 Accounting Records and Financial Statements . The Trustee shall at all times keep, or cause to be kept, proper books of record and account, prepared in accordance with corporate trust industry standards in which complete and accurate entries shall be made of transactions made by it relating to the proceeds of Bonds, the Revenues, t he Local Obligations and all funds and accounts established pursuant to this Indenture. Such books of record and account shall be available for inspection by the Authority and the Community Facilities District upon reasonable prior notice during regular business hours and under reasonable circumstances, in each case as agreed to by the Trustee.
Not later than 45 days following each Interest Payment Date, the Trustee shall prepare and file with the Authority a report in the Trustee’s standard statement form at setting forth: (i) amounts
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withdrawn from and deposited into each fund and account maintained by the Trustee under this Indenture; (ii) the balance on deposit in each fund and account as of the date for which such report is prepared; and (iii) a brief description of all obligations held as investments in each fund and account.
Copies of such reports may be mailed to any Owner upon the Owner’s written request to the Trustee at the expense of such Owner at a cost not to exceed the Trustee’s actual costs of duplication and mailing.
Section 5.6 Conditions to Issuance of Additional Obligations . Except as set forth in this Section 5.6, the Authority covenants that no additional bonds, notes or other indebtedness shall be issued or incurred which are payable out of Revenues in whole or in part.
The Authority may issue Additional Bonds in such principal amount as shall be determined by the Authority, pursuant to a Supplemental Indenture adopted or entered into by the Authority but only for the purpose of refunding the 2025B Bonds or any Additional Bonds. Such Additional Bonds may be issued subject to the following conditions precedent:
(a) The Authority shall be in compliance with all covenants set forth in this Indenture and all Supplemental Indentures;
(b) The proceeds of such A dditional Bonds shall be applied to accomplish a refunding of all or a portion of the Bonds or any Additional Bonds Outstanding. (c) The Supplemental Indenture providing for the issuance of such Additional Bonds shall provide that interest thereon shall be pay able on March 1 and September 1, and principal thereof shall be payable on September 1 in any year in which principal is payable. (d) Prior to the delivery of any Additional Bonds, a written certificate must be provided to the Authority and the Trustee by an I ndependent Financial Consultant which certifies that following the issuance of the Series of Additional Bonds, the principal and interest generated from the Local Obligations is adequate to make the timely payment of principal and interest due on all Outstanding Bonds and the Series of Additional Bonds to be issued hereunder. (e) The Supplemental Indenture providing for the issuance of such Additional Bonds may provide for the establishment of separate funds and accounts. (f) No Event of Default (or any event whi ch, once all notice or grace periods have passed, would constitute an Event of Default ) shall have occurred and be continuing with respect to the Bonds or any of the Local Obligations unless such Event of Default shall be cured upon the issuance of the Additional Bonds.
(g) The Authority shall deliver to the Trustee a written Certificate of the Authority certifying that the conditions precedent to the issuance of such Additional Bonds set forth in subsections (a), (b), (c), (d) and (f) of this Section 5.6 above have been satisfied and that, upon the issuance of such Additional Bonds an amount equal to the Reserve Requirement, as adjusted (if necessary) to reflect the issuance of such Additional Bonds will be on deposit in the Reserve Fund.
Notwithstanding satisfaction of the other conditions to the issuance of Additional Bonds set forth in this Section 5.6, no such issuance may occur if the Reserve Fund is not fully funded at the Reserve Requirement.
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Section 5.7 Tax Covenants. Notwithstanding any other provision of this Ind enture, absent an opinion of Bond Counsel that the exclusion from gross income of interest on the Bonds will not be adversely affected for federal income tax purposes, the Authority covenants to comply with all applicable requirements of the Code necessary to preserve such exclusion from gross income and specifically covenants, without limiting the generality of the foregoing, as follows:
(a) Private Activity. The Authority will not take or omit to take any action or make any use of the proceeds of the Bonds or of any other moneys or property which would cause the Bonds to be “private activity bonds” within the meaning of Section 141 of the Code. (b) Arbitrage. The Authority will make no use of the proceeds of the Bonds or of any other amounts or property, regardless of the source, or take or omit to take any action which would cause the Bonds to be “arbitrage bonds” within the meaning of Section 148 of the Code. (c) Federal Guarantee. The Authority will make no use of the proceeds of the Bonds or take or omit to take any action that would cause the Bonds to be “federally guaranteed” within the meaning of Section 149(b) of the Code.
(d) Information Reporting. The Authority will take or cause to be taken all necessary action to comply with the informational reporting requirement of Section 149(e) of the Code. (e) Miscellaneous. The Authority will take no action inconsistent with its expectations stated in any Tax Certificate executed with respect to the Bonds and will comply with the covenants and requirements stated therein and incorporated by reference herein.
This Section and the covenants set forth herein shall not be applicable to, and nothing contained herein shall be deemed to prevent the Authority from issuing Bonds the interest on which has been determined by the Board to be subject to federal income taxation.
Section 5.8 Rebate Fund
(a) Establishment. The Trustee shall establish a Rebate Fund, when needed, and shall maintain therein separate accounts (solely from amounts deposited by the Authority) designated the “Rebate Account” and the “Alternative Penalty Account.” Absent an opinion of Bond Counsel that the exclusion from gross income for federal income tax purposes of interest on the Bonds will not be adversely affected, the Authority shall cause to be deposited in each such account of the Rebate Fund such amounts as are required to be deposited therein pursuant to this Section and the Tax Certificate.
All money at any time deposited in the Rebate Fund shall be held by the Trustee in trust for payment to the United States Treasury. All amounts on deposit in the Rebate Fund shall be governed by this Section 5.8 and the Tax Certificate unless and to the extent that the Authority delivers to the Trustee an opinion of Bond Counsel that the exclusion from gross income for federal income tax purposes of interest on the Bonds will not be adversely affected if such requirements are not satisfied.
Notwithstanding any other provision of this Indenture, the Trustee shall be deemed conclusively to have complied with this Section 5.8 and the Tax Certificate if it follows the directions set forth in any Request of the Authority or Certificate of the Authority and shall be fully protected in so doing. The Trustee shall have no independent responsibility to, or liability resulting from its failure to, enforce compliance by the Authority with the terms of this Section 5.8 or the Tax Certificate.
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(b) Rebate Account . The following requirements shall be satisfied with respect to the Rebate Account:
(i) Annual Computation . Wi thin 55 days of the end of each Bond Year, the Authority shall calculate or cause to be calculated the amount of rebatable arbitrage, in accordance with Section 148(f)(2) of the Code and Section 1.148 -3 of the Rebate Regulations (taking into account any ap plicable exceptions with respect to the computation of the rebatable arbitrage, described, if applicable, in the Tax Certificate (e.g., the temporary investments exceptions of Section 148(f)(4)(B) and (C) of the Code), and taking into account whether the e lection pursuant to Section 148(f)(4)(C)(vii) of the Code (the “1½% Penalty”) has been made), for this purpose treating the last day of the applicable Bond Year as a computation date, within the meaning of Section 1.148 1(b) of the Rebate Regulations (the “Rebatable Arbitrage”). The Authority shall obtain expert advice as to the amount of the Rebatable Arbitrage to comply with this Section 5.8. (ii) Annual Transfer. Within 55 days of the end of each applicable Bond Year, upon receipt of the Request of the Authority, an amount shall be deposited to the applicable Rebate Account by the Trustee from any Revenues specified by the Authority in the aforesaid Request of the Authority, if and to the extent required so that the balance in the Rebate Account shall e qual the amount of Rebatable Arbitrage so calculated in accordance with (i) of this Subsection (b). In the event that immediately following the transfer required by the previous sentence, the amount then on deposit to the credit of a Rebate Account exceed s the amount required to be on deposit therein, upon receipt of a Request of the Authority, the Trustee shall withdraw the excess from the applicable Rebate Account and then credit the excess to the Revenue Fund. (iii) Payment to the Treasury . The Trustee shall pay, as directed by Request of the Authority, to the United States Treasury, out of amounts in the Rebate Account, (A) Not later than 60 days after the end of (A) the fifth Bond Year, and (B) each applicable fifth Bond Year thereafter, an amount equ al to at least 90% of the Rebatable Arbitrage as set forth in a Certificate of the Authority delivered to the Trustee calculated as of the end of such Bond Year; and
(B) Not later than 60 days after the payment of all the Bonds, an amount equal to 100% of the Rebatable Arbitrage as set forth in a Certificate of the Authority delivered to the Trustee calculated as of the end of such applicable Bonds Year, and any income attributable to the Rebatable Arbitrage, as set forth in a Certificate of the Authority d elivered to the Trustee computed in accordance with Section 148(f) of the Code.
In the event that, prior to the time of any payment required to be made from a Rebate Account, the amount in such Rebate Account is not sufficient to make such payment when suc h payment is due, the Authority shall calculate or cause to be calculated the amount of such deficiency and deposit with the Trustee an amount received from any legally available source equal to such deficiency prior to the time such payment is due. Each payment required to be made pursuant to this Subsection (b) shall be made to the Internal Revenue Service Center, Ogden, Utah 84207 on or before the date on which such payment is due, and shall be accompanied by Internal Revenue Service Form 8038 T (which form shall be completed and provided by the Authority to the Trustee), or shall be made in such other manner as provided under the Code, in each case as specified in a Request of the Authority delivered to the Trustee.
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(c) Alternative Penalty Account.
(i) Six Month Computation. If the 1½% Penalty has been elected, within 85 days of each particular Six Month Period, the Authority shall determine or cause to be determined whether the 1½% Penalty is payable (and the amount of such penalty) as of the close of the applicable Six Month Period. The Authority shall obtain expert advice in making such determinations. (ii) Six Month Transfer . Within 85 days of the close of each Six Month Period, upon receipt of the Request of the Authority, the Trustee shall deposi t in the Alternative Penalty Account from any source of funds (specified by the Authority in the aforesaid Request), if and to the extent required, so that the balance in the Alternative Penalty Account for a Series equals the amount of 1½% Penalty (as spe cified in such Request) due and payable to the United States Treasury determined by the Authority as provided in subsection (c)(i) above. In the event that immediately following the transfer provided in the previous sentence, the amount then on deposit to the credit of the Alternative Penalty Account exceeds the amount required to be on deposit therein to make the payments required by subsection (c)(iii) below, the Trustee, pursuant to a Certificate of the Authority, may withdraw the excess from the Altern ative Penalty Account and credit the excess to the Revenue Fund.
(iii) Payment to the Treasury . The Trustee shall pay, as directed by Request of the Authority, to the United States Treasury, out of amounts in the Alternative Penalty Account, not later tha n 90 days after the close of each Six Month Period the 1½% Penalty (as specified by the Authority in the aforesaid Request), if applicable and payable, computed by the Authority in accordance with Section 148(f)(4) of the Code. In the event that, prior to the time of any payment required to be made from the Alternative Penalty Account, the amount in such account is not sufficient to make such payment when such payment is due, the Authority shall calculate the amount of such deficiency and deposit with the Trustee an amount received from any legally available source of funds equal to such deficiency for transfer into the Alternative Penalty Account prior to the time such payment is due. Each payment required to be made pursuant to this Subsection (c)(iii) s hall be made to the Internal Revenue Service, Ogden, Utah 84207 on or before the date on which such payment is due, and shall be accompanied by Internal Revenue Service Form 8038 T (which form shall be completed and provided by the Authority to the Trustee ) or shall be made in such other manner as provided under the Code.
(d) Disposition of Unexpended Funds . Any funds remaining in the accounts of the Rebate Fund after redemption and payment of the Bonds and the payments of all amounts described in Subsection (b)(iii) or (c)(iii) (whichever is applicable) or provision made therefor satisfactory to the Trustee, including accrued interest and payment of all applicable fees to the Trustee, may, upon written request, be withdrawn by the Trustee and remit ted to the Authority and utilized in any manner by the Authority.
(e) Survival of Defeasance. Notwithstanding anything in this Section to the contrary, the obligation to comply with the requirements of this Section shall survive the defeasance of the Bonds. (f) Trustee. The Trustee shall have no responsibility to monitor or calculate any amounts payable to the U.S. Treasury pursuant to this Section and shall be deemed conclusively to have complied with its obligations hereunder if it follows the written i nstructions of the Authority given pursuant to this Section.
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Section 5.9 Local Obligations . Subject to the provisions of this Indenture (including Article VI), the Authority shall use reasonable efforts to collect all amounts due from the Community Facilities District pursuant to the Local Obligations and shall enforce, and take all steps, actions and proceedings which the Authority and Trustee determine to be reasonably necessary for the enforcement of all of the rights of the Authority thereunder and for the enforce ment of all of the obligations and covenants of the City and the Community Facilities District thereunder. The Authority shall instruct the Community Facilities District to authenticate and deliver to the Trustee the Local Obligations registered in the name of the Trustee.
The Authority, the Trustee and the Community Facilities District may at any time consent to, amend or modify any of the Local Obligations pursuant to the terms thereof, (a) with the prior consent of the Owners of a majority in aggregate principal amount of the Bonds then Outstanding, or (b) without the consent of any of the Owners if such amendment or modification is for any one or more of the following purposes:
(a) to add to the covenants and agreements of the Community Facilities District contained in such Local Obligations, other covenants and agreements thereafter to be observed, or to limit or surrender any rights or power therein reserved to or conferred upon the Community Facilities District; or
(b) to make such provisions for the purpose of curing any ambiguity, or of curing, correcting or supplementing any defective provision contained in such Local Obligations, or in any other respect whatsoever as the Community Facilities District may deem necessary or desirable, provided under any circ umstances that such modifications or amendments shall not materially adversely affect the interests of the Owners of the Bonds in the opinion of Bond Counsel filed with the Trustee; or
(c) to amend any provision thereof to the extent necessary to comply with t he Code, but only if and to the extent such amendment will not, in and of itself, adversely affect the exclusion from gross income of the interest on any Bonds under the Code theretofore issued on a tax-exempt basis, in the opinion of Bond Counsel filed with the Trustee.
Section 5.10 Sale of Local Obligations. Notwithstanding anything in this Indenture to the contrary, the Authority may cause the Trustee to sell, from time to time, all or a portion of a Series of Local Obligations, provided that the Authority shall deliver to the Trustee:
(a) a certificate of an Independent Accountant certifying that, following the sale of such Local Obligations and the Revenues to be paid to the Authority (assuming the timely payment of amounts due thereon with respect to any Local Obligat ions not then in default), together with interest and principal due on any Defeasance Securities pledged to the repayment of the Bonds and the Revenues then on deposit in the funds and accounts established hereunder (valuing any Permitted Investments held hereunder at the then fair market value thereof), will be sufficient to pay the principal of and interest on the Bonds when due;
(b) if any Bonds are then rated by Standard & Poor’s a notification from Standard & Poor’s to the effect that such rating will not be withdrawn or reduced as a result of such sale of Local Obligations;
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(c) an opinion of Bond Counsel that such sale of Local Obligations is authorized under the provisions of this Indenture and will not adversely affect the exclusion of interest on any Bonds theretofore issued on a tax -exempt basis from gross income for purposes of federal income taxation; and
(d) to provide for the issuance of an additional Series of Local Obligations subject to and in accordance with the provisions of the applicable Local Obligation Bond Indenture.
Upon compliance with the foregoing conditions by the Authority, the Trustee shall sell such Local Obligations in accordance with the Request of the Authority and disburse the proceeds of the sale of such Local Obligations to the Authority or upon the receipt of a Request of the Authority shall deposit such proceeds in the Revenue Fund.
Section 5.11 Continuing Disclosure Agreement. The Authority hereby covenants and agrees that it will comply with and carry out all of its obligations under the Cont inuing Disclosure Agreement to be executed and delivered by the Authority in connection with the issuance of the Bonds. Notwithstanding any other provision of this Indenture, failure of the Authority to comply with the Continuing Disclosure Agreement shall not be considered an Event of Default; however, any Owner or Beneficial Owner may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Authority to comply with its obligations under this Section 5.11. For purposes of this Section, “Beneficial Owner” means any person which has or shares the power, directly or indirectly, to make investment decisions concerning ownership of any Bonds (including persons holding Bonds through no minees, depositories and other intermediaries).
Section 5.12 Further Assurances. The Authority will adopt, make, execute and deliver any and all such further resolutions, instruments and assurances as may be reasonably necessary or proper to carry out the intention or to facilitate the performance of this Indenture, and for the better assuring and confirming unto the Owners of the Bonds the rights and benefits provided in this Indenture.
Section 5.13 Pledged Revenues . The Authority represents it has not heretofore made a pledge of, granted a lien on or security interest in, or made an assignment or sale of the Revenues that ranks on a parity with or prior to the pledge granted under this Indenture. The Authority shall not hereafter make any pledge or assignment of, lien on, or sec urity interest in the Revenues payable senior to or on a parity with the pledge of Revenues established under this Indenture.
ARTICLE VI
THE TRUSTEE
Section 6.1 Appointment of Trustee. Zions Bancorporation, National Association, with a corporate trust office presently located in Los Angeles, California, a national banking association organized and existing under and by virtue of the laws of the United States of America, is hereby appointed Trustee by the Authority for the purpose of receiving all moneys required to be deposite d with the Trustee hereunder and to allocate, use and apply the same as provided in this Indenture. The Authority agrees that it will maintain a Trustee which is a trust company, association or bank of good standing located in or incorporated under the la ws of the State, duly authorized to exercise trust powers, with a combined capital and surplus of at least Seventy -Five Million Dollars ($75,000,000),
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and subject to supervision or examination by federal or state authority so long as any Bonds are Outstanding. If such bank, association or trust company publishes a report of condition at least annually pursuant to law or to the requirements of any supervising or examining authority above referred to, then for the purpose of this Section 6.1, the combined capital and surplus shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published.
The Trustee is hereby authorized to pay the principal of and interest and redemption premium (if any) on the Bonds wh en duly presented for payment at maturity, or on redemption prior to maturity, to make regularly scheduled interest payments, and to cancel any Bond upon payment thereof.
Section 6.2 Acceptance of Trusts. The Trustee hereby accepts the trusts imposed upon it by this Indenture, and agrees to perform said trusts, but only upon and subject to the following express terms and conditions:
(a) The Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture. These duties shall b e deemed purely ministerial in nature, and the Trustee shall not be liable except for the performance of such duties, and no implied covenants or obligations shall be read into this Indenture against the Trustee. In case an Event of Default hereunder has occurred (which has not been cured or waived), the Trustee may exercise such of the rights and powers vested in it by this Indenture, and shall use the same degree of care and skill and diligence in their exercise, as a prudent person would exercise or use under the circumstances in the conduct of his own affairs.
(b) The Trustee may execute any of the trusts or powers hereof and perform the duties required of it hereunder by or through attorneys, agents, or receivers, but shall not be responsible for the acts of any agents, attorneys or receivers appointed by it unless such appointment was the result of negligence or willful misconduct. The Trustee may consult with and act upon the advice of counsel (which may be counsel to the Authority) concerning all matter s of trust and its duty hereunder and may conclusively rely upon and shall be wholly protected in reliance upon the advice or opinion of such counsel in respect of any action taken or omitted by it in accordance herewith.
(c) The Trustee shall not be responsib le for any recital herein, or in the Tax Certificate or the Bonds, or for any of the supplements thereto or instruments of further assurance, or for the validity, effectiveness or the sufficiency of the security for the Bonds issued hereunder or intended to be secured hereby and the Trustee shall not be bound to ascertain or inquire as to the observance or performance of any covenants, conditions or agreements on the part of the Authority hereunder or under Tax Certificate. The Trustee shall have no respon sibility, opinion, or liability with respect to any information, statement, or recital in any offering memorandum, official statement, or other disclosure material prepared or distributed with respect to the issuance of the Bonds.
(d) Except as provided in Section 3.2 hereof, the Trustee shall not be accountable for the use of any proceeds of sale of the Bonds delivered hereunder. The Trustee may become the Owner of Bonds secured hereby with the same rights which it would have if not the Trustee; may acquire a nd dispose of other bonds or evidences of indebtedness of the Authority with the same rights it would have if it were not the Trustee; and may act as a depository for and permit any of its officers or directors to act as a member of, or in any other capaci ty with respect to, any committee
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formed to protect the rights of Owners of Bonds, whether or not such committee shall represent the Owners of the majority in aggregate principal amount of the Bonds then Outstanding. (e) The Trustee shall be entitled to reques t and receive written instructions from the Authority and shall have no responsibility or liability for any losses or damages of any nature that may arise from any action taken or not taken by the Trustee in accordance with the written direction thereof. The Trustee shall be protected and shall incur no liability in acting, or refraining from acting, without negligence, in reliance upon any notice, request, direction, consent, certificate, opinion, order, affidavit, letter, telegram, facsimile, bond, deben ture, note, other evidence of indebtedness (including any Bond) or other paper or document believed by it to be genuine and correct and to have been signed, sent or presented by the proper person or persons, not only as to due execution, validity and effec tiveness, but also as to the truth and accuracy of any information contained therein. Any action taken or omitted to be taken by the Trustee without negligence pursuant to this Indenture upon the written request or direction, authority or consent of any p erson who at the time of making such request or direction or giving such authority or consent is the Owner of any Bond, shall be conclusive and binding upon all future Owners of the same Bond and upon Bonds issued in exchange therefor or in place thereof. The Trustee shall not be bound to recognize any person as an Owner of any Bond or to take any action at such person’s request unless the ownership of such Bond by such person shall be reflected on the Bond Register. (f) As to the existence or non -existence of any fact or as to the sufficiency or validity of any instrument, paper or proceeding, the Trustee shall be entitled to rely upon a Certificate of the Authority and/or opinion of counsel as sufficient evidence of the facts therein contained and prior to th e occurrence of an Event of Default hereunder of which the Trustee has been given notice or is deemed to have notice, as provided in Section 6.2(h) hereof, shall also be at liberty to accept a Certificate of the Authority and/or opinion of counsel to the e ffect that any particular dealing, transaction or action is necessary or expedient, and shall be fully protected in relying thereon, but may at its discretion secure such further evidence deemed by it to be necessary or advisable, but shall in no case be bound to secure the same. (g) The permissive right of the Trustee to do things enumerated in this Indenture shall not be construed as a duty and notwithstanding any other provision of this Indenture, the Trustee shall not be answerable for other than its neglig ence or willful misconduct. The immunities and exceptions from liability of the Trustee shall extend to its officers, directors, employees and agents.
(h) The Trustee shall not be required to take notice or be deemed to have notice of any Event of Default hereunder except where a Responsible Officer has actual knowledge of such Event of Default and except for the failure by the Authority to make any of the payments to the Trustee required to be made by the Authority pursuant hereto, including payments on the L ocal Obligations, or failure by the Authority to file with the Trustee any document required by this Indenture to be so filed subsequent to the issuance of the Bonds, unless a Responsible Officer shall be specifically notified in writing of such default by the Authority or by the Owners of at least twenty five percent (25%) in aggregate principal amount of the Outstanding Bonds and all notices or other instruments required by this Indenture to be delivered to the Trustee must, in order to be effective, be delivered to a Responsible Officer at the Trust Office of the Trustee, and in the absence of such notice so delivered the Trustee may conclusively assume there is no Event of Default hereunder except as aforesaid. Delivery of a notice to the officer and ad dress for the Trustee set
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forth in Section 9.12 hereof, as updated by the Trustee from time to time, shall be deemed notice to a Responsible Officer.
(i) At any and all reasonable times the Trustee, and its duly authorized agents, attorneys, experts, accountan ts and representatives, shall have the right fully to inspect all books, papers and records of the Authority pertaining to the Bonds, and to make copies of any of such books, papers and records such as may be desired but which is not privileged by statute or by law. (j) The Trustee shall not be required to give any bond or surety in respect of the execution of the said trusts and powers or otherwise in respect of the performance of its duties hereunder.
(k) Notwithstanding anything elsewhere in this Indenture with respect to the execution of any Bonds, the withdrawal of any cash, the release of any property, or any action whatsoever within the purview of this Indenture, the Trustee shall have the right, but shall not be required, to demand any showings, certificates , opinions, appraisals or other information, or corporate action or evidence thereof, as may be deemed desirable by the Trustee in its sole discretion for the purpose of establishing the right of the Authority to the execution of any Bonds, the withdrawal of any cash, or the taking of any other action by the Trustee. (l) Before taking any action referred to in Sections 6.5, 8.2, or this Article, the Trustee may require that security or indemnity satisfactory to it in its sole and exclusive discretion be furnished for the reimbursement of all expenses to which it may be put and to protect it against all liability, except liability which is adjudicated to have resulted from its negligence or willful misconduct in connection with any such action.
(m) All moneys received by the Trustee shall, until used or applied or invested as herein provided, be held in trust for the purposes for which they were received but need not be segregated from other funds.
(n) Whether or not expressly so provided, every provision of this I ndenture relating to the conduct or affecting the liability of, or affording protection to, the Trustee shall be subject to the provisions of this Article VI.
(o) The Trustee shall not be considered in breach of or in default in its obligations hereunder or progress in respect thereto in the event of delay in the performance of such obligations due to unforeseeable causes beyond its control and without its fault or negligence, including, but not limited to, Acts of God or of the public enemy or terrorists, acts of a government, acts of the other party, fires, floods, epidemics, quarantine restrictions, strikes, freight embargoes, earthquakes, explosion, mob violence, riot, war, inability to procure or general sabotage or rationing of labor, equipment, facilities , sources of energy, material or supplies in the open market, loss or malfunctions of utilities, computer (hardware or software) or communications service, accidents, labor disputes, the unavailability of the Federal Reserve Bank wire or telex or other wir e or communication facility, litigation or arbitration involving a party or others relating to zoning or other governmental action or inaction pertaining to the project, malicious mischief, condemnation, and unusually severe weather or delays of supplies o r subcontractors due to such causes or any similar event and/or occurrences beyond the control of the Trustee.
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(p) The Trustee agrees to accept and act upon facsimile or electronic transmission of written instructions and/or directions pursuant to this Indentu re provided, however, that: (a) such originally executed instructions and/or directions shall be signed by a person as may be designated and authorized to sign for the party signing such instructions and/or directions, and (b) the Trustee shall have recei ved a current incumbency certificate containing the specimen signature of such designated person. Any such instructions, directions and other communications furnished by electronic transmission shall be in the form of attachments in PDF format. (q) The Truste e shall not be liable in connection with the performance of its duties hereunder except for its own negligence or willful misconduct.
Section 6.3 Fees, Charges and Expenses of Trustee . The Trustee shall be entitled to payment and reimbursement by the Authority for re asonable fees for its services rendered hereunder and all advances (including any interest on advances), counsel fees and expenses (including fees and expenses of outside counsel and the allocated costs of internal attorneys) and other expenses reasonably and necessarily made or incurred by the Trustee in connection with such services. Upon the occurrence of an Event of Default hereunder, but only upon an Event of Default with respect to a Series, the Trustee shall have a first lien with right of payment p rior to payment of any Bond upon the amounts held in Funds and accounts for such Series hereunder for the foregoing fees, charges and expenses incurred by it respectively. The Trustee’s right to payment of such fees and expenses shall survive the discharge and payment or defeasance of the Bonds and termination of this Indenture, and the resignation or removal of the Trustee.
Section 6.4 Notice to Bond Owners of Default. If an Event of Default hereunder occurs with respect to any Bonds of which the Trustee has been gi ven, or is deemed to have notice, as provided in Section 6.2(h) hereof, then the Trustee shall promptly give written notice thereof to the Owner of each such Bond unless such Event of Default shall have been cured before the giving of such notice.
Section 6.5 Intervention by Trustee. In any judicial proceeding to which the Authority is a party which, in the opinion of the Trustee and its counsel, has a substantial bearing on the interests of Owners of any of the Bonds, the Trustee may, but shall be under no obligation to do so, intervene on behalf of such Bond Owners, and subject to Section 6.2(l) hereof, shall do so if requested in writing by the Owners of at least twenty five percent (25%) in aggregate principal amount of such Bonds then Outstanding.
Section 6.6 Removal of Trust ee. The Owners of a majority in aggregate principal amount of the Outstanding Bonds may and the Authority may, so long as no Event of Default then exists, upon 30 calendar days’ prior written notice to the Trustee, remove the Trustee initially appointed, and any successor thereto, by an instrument or concurrent instruments in writing delivered to the Trustee. Upon any such removal, the Authority shall appoint a successor or successors thereto; provided that any such successor shall be a bank, association or trust company meeting the requirements set forth in Section 6.1 hereof.
Section 6.7 Resignation by Trustee. The Trustee and any successor Trustee may at any time resign and be discharged from its duties and obligations hereunder by giving prior written notice of its intention to resign to the Authority, the Community Facilities District and the City by registered or certified mail. Upon receiving such notice of resignation, the Authority shall promptly appoint a successor Trustee. Any resignation or removal of th e Trustee and appointment of a successor
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Trustee shall become effective only upon acceptance of appointment by the successor Trustee meeting the requirements below. Upon such acceptance, the Authority shall cause notice thereof to be sent to the Bond Owners at their respective addresses set forth on the Bond Register.
Section 6.8 Appointment of Successor Trustee . In the event of the removal or resignation of the Trustee pursuant to Sections 6.6 or 6.7, respectively, the Authority shall promptly appoint a successor Tr ustee. In the event the Authority shall for any reason whatsoever fail to appoint a successor Trustee within thirty (30) calendar days following the delivery to the Trustee of the instrument described in Section 6.6 or within thirty (30) calendar days fol lowing the receipt of notice by the Authority, the Community Facilities District and the City pursuant to Section 6.7, the Trustee may, at the expense of the Authority, petition any court of competent jurisdiction for the appointment of a successor Truste e meeting the requirements of Section 6.1 hereof. Any such successor Trustee appointed by such court shall become the successor Trustee hereunder notwithstanding any action by the Authority purporting to appoint a successor Trustee following the expiration of such thirty (30) calendar day period.
Section 6.9 Merger or Consolidation . Any company into which the Trustee may be merged or converted or with which it may be consolidated or any company resulting from any merger, conversion or consolidation to which it shall be a party or any company to which the Trustee may sell or transfer all or substantially all of its corporate trust business, provided that such company shall meet the requirements set forth in Section 6.1 hereof, shall be the successor to the Trustee and vested with all of the title to the trust estate and all of the trusts, powers, discretions, immunities, privileges and all other matters as was its predecessor, without the execution or filing of any paper or further act, anything herein to the contrary notwithstanding. The Trustee may assign its rights, duties and obligations hereunder in whole or in part, to an affiliate or subsidiary thereof, provided such Corporation, affiliate or subsidiary shall meet the requirements set forth in Section 6.1 hereof.
Section 6.10 Concerning any Successor Trustee . Every successor Trustee appointed hereunder shall execute, acknowledge and deliver to its predecessor and also to the Authority an instrument in writing accepting such appointment hereunder and to the predecessor Trustee an instrument indemnifying the predecessor Trustee for any costs or claims arising during the time the successor Trustee serves as Trustee hereunder and thereupon such successor, without any further act, deed or conveyance, shall become fully vested with all the estates, properties, rights, powers, trusts, duties and obligations of its predecessors; but such predecessor shall, nevertheless, on the Request of the Authority, or of the Trustee’s successor, execute and deliver an instrument transferring to suc h successor all the estates, properties, rights, powers and trusts of such predecessor hereunder; and every predecessor Trustee shall deliver all securities and moneys held by it as the Trustee hereunder to its successor. Should any instrument in writing from the Authority be required by any successor Trustee for more fully and certainly vesting in such successor the estate, rights, powers and duties hereby vested or intended to be vested in the predecessor Trustee, any and all such instruments in writing shall, on request, be executed, acknowledged and delivered by the Authority.
Section 6.11 Appointment of Co -Trustee. It is the purpose of this Indenture that there shall be no violation of any law of any jurisdiction (including particularly the law of the State) denying or restricting the right of banking corporations or associations to transact business as a trustee in such jurisdiction. It is recognized that in the case of litigation under this Indenture, and in particular in case of the enforcement of the rights of the Trustee on default, or in the case the Trustee deems that by reason of any present or future law of any jurisdiction it may not exercise any of the powers, rights or remedies herein granted to the Trustee or hold title to the properties, in trust, as
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herein granted, or take any other action which may be desirable or necessary in connection therewith, it may be necessary that the Trustee appoint an additional individual or institution as a separate co-trustee. The following provisions of this Section 6.11 are adopted to these ends.
In the event that the Trustee or the Authority appoints an additional individual or institution as a separate or co -trustee, each and every remedy, power, right, claim, demand, cause of action, immunity, estate, title, interest and lien expressed or intended by this Indenture to be exercised by or vested in or conveyed to the Trustee with respect thereto shall be exercisable by and vest in such separate or co -trustee but only to the extent necessary to enable such separate or co-trustee to exercise such powers, rights and remedies, and every covenant and obligation necessary to the exercise thereof by such separate or co-trustee shall run to and be enforceable by either of the Trustee or separate or co-Trustee.
Should any instr ument in writing from the Authority be required by the separate trustee or co-trustee so appointed by the Trustee or the Authority for more fully and certainly vesting in and confirming to it such properties, rights, powers, trusts, duties and obligations, any and all such instruments in writing shall, on request, be executed, acknowledged and delivered by the Authority.
In case any separate trustee or co -trustee, or a successor to either, shall become incapable of acting, resign or be removed, all the est ates, properties, rights, powers, trusts, duties and obligations of such separate trustee or co-trustee, so far as permitted by law, shall vest in and be exercised by the Trustee until the appointment of a new trustee or successor to such separate trustee or co-trustee.
Section 6.12 Indemnification; Limited Liability of Trustee . The Authority further covenants and agrees to indemnify and save the Trustee and its officers, officials, directors, agents and employees, harmless from and against any damages, loss, cost, cla ims, expense (including legal fees and expenses of its attorneys), and liabilities which it may incur arising out of or in the exercise and performance of its powers and duties hereunder, including the costs and expenses of defending against any claim of liability, but excluding any and all losses, expenses and liabilities which are due to the negligence or intentional misconduct of the Trustee, its officers, directors, agents or employees. In no event shall the Trustee be responsible or liable for any con sequential, punitive, indirect, incidental, or special damages or loss of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action. No provision in this Indenture shall require the Trustee to risk or expend its own funds or otherwise incur any financial liability hereunder unless security or indemnity satisfactory to it in its sole and absolute discretion against suc h liability or risk is provided to it. The Trustee shall not be liable for any action taken or omitted to be taken by it in accordance with the direction of a majority (or any lesser amount that may direct the Trustee in accordance with the provisions of the Indenture) of the Owners of the principal amount of Bonds Outstanding relating to the time, method and place of conducting any proceeding or remedy available to the Trustee under this Indenture. The Trustee shall not be liable for any errors of judgme nt made in good faith by a Responsible Officer, unless it shall be proved that the Trustee was negligent or engaged in willful misconduct in ascertaining the pertinent facts. The rights of the Trustee and the obligations of the Authority under this Section 6.12 shall survive termination of this Indenture, discharge of the Bonds and resignation or removal of the Trustee.
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ARTICLE VII
MODIFICATION AND AMENDMENT OF THE INDENTURE
Section 7.1 Amendment Hereof . This Indenture and the rights and obligations of the Authority and of the Owners of the Bonds may be modified or amended at any time by a Supplemental Indenture which shall become binding when the Owners of a majority in aggregate principal amount of the Bonds then Outstanding is filed with the Trustee. No such modification or amendment shall (a) extend the maturity of or reduce the interest rate on any Bond or otherwise alter or impair the obligation of the Authority to pay the principal, interest or redemption premiums, if any, at the time and place and at the rate and in the currency provided therein of any Bond without the express written consent of the Owner of such Bond, (b) reduce the percentage of Bonds required for the written consent to any such amendment or modification, or (c) without written consent of the Trustee, modify any of the rights or obligations of the Trustee.
This Indenture and the rights and obligations of the Authority and of the Owners of the Bonds may also be modified or amended at any time by a Supplemental Indenture which shall become binding upon adoption, without consent of any Bond Owners, to the extent permitted by law but only for any one or more of the following purposes:
(a) to add to the covenants and agreements of the Authority contained in this Indenture, other covenants and agreements thereaft er to be observed, or to limit or surrender any rights or powers herein reserved to or conferred upon the Authority so long as such addition, limitation or surrender of such rights or powers shall not materially adversely affect the Owners of the Bonds; or
(b) to make such provisions for the purpose of curing any ambiguity, or of curing, correcting or supplementing any defective provision contained in this Indenture, or in any other respect whatsoever as the Authority may deem necessary or desirable, provided u nder any circumstances that such modifications or amendments shall not materially adversely affect the interests of the Owners of the Bonds; or
(c) to amend any provision hereof relating to the Code as may be necessary or appropriate to assure compliance with the Code and the exclusion from gross income of interest on the Bonds theretofore issued on a tax -exempt basis, including, but not limited to, amending the procedures set forth in Section 5.8 hereof with respect to the calculation of Rebatable Arbitrage; or (d) to amend or clarify any provision hereof to provide for the issuance of any Additional Bonds on a parity with the Bonds for all purposes of this Indenture, including, but not limited to, for the purpose of exercising all rights and remedies hereunder; or (e) to amend the provisions of Section 4.4 hereof.
The Trustee shall be furnished, at the expense of the Authority, an opinion of Bond Counsel that any such Supplemental Indenture entered into by the Authority and the Trustee complies with the provisions of this Article VII and the Trustee may conclusively rely upon such opinion and shall be fully protected in relying thereon.
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Section 7.2 Effect of Supplemental Indenture . From and after the time any Supplemental Indenture becomes effective pursuant to this Article VII, this Indenture shall be deemed to be modified and amended in accordance therewith, the respective rights, duties and obligations of the parties hereto or thereto and all Owners of Outstanding Bonds, as the case may be, shall thereafter be determined, exerc ised and enforced hereunder subject in all respects to such modification and amendment, and all the terms and conditions of this Indenture for any and all purposes.
Section 7.3 Endorsement or Replacement of Bonds After Amendment . After the effective date of any actio n taken as hereinabove provided, the Authority may determine that any affected Bonds shall bear a notation, by endorsement in form approved by the Authority, as to such action, and in that case upon demand of the Owner of any Bond Outstanding at such effec tive date and presentation of its Bond for that purpose at the Trust Office of the Trustee, a suitable notation as to such action shall be made on such Bond. If the Authority shall so determine, new Bonds so modified as, in the opinion of the Authority, s hall be necessary to conform to such Bond Owners’ action shall be prepared and executed, and in that case upon demand of the Owner of any Bond Outstanding at such effective date such new Bonds shall be exchanged at the Trust Office of the Trustee, without cost to each Bond Owner, for Bonds then Outstanding, upon surrender of such Outstanding Bonds.
Section 7.4 Amendment by Mutual Consent . The provisions of this Article VII shall not prevent any Bond Owner from accepting any amendment as to the particular Bond held by such Owner, provided that due notation thereof is made on such Bond.
ARTICLE VIII
EVENTS OF DEFAULT AND REMEDIES OF BOND OWNERS
Section 8.1 Events of Default . The following events shall be Events of Default hereunder.
(a) Default in the due and punctual payment of the principal of any Bond when and as the same shall become due and payable, whether at maturity as therein expressed, by proceedings for redemption, by declaration or otherwise. (b) Default in the due and punctual payment of any installment of interest on any Bond when and as such interest installment shall become due and payable. (c) Default by the Authority in the observance of any of the other covenants, agreements or conditions on its part in this Indenture or in the Bonds contained, if such default shall have continued for a period of thirty (30) days after written notice thereof, specifying such default and requiring the same to be remedied, shall have been given to the Authority by the Trustee, or to the Authority and the Trustee by the Owners of not less than twenty five pe rcent (25%) in aggregate principal amount of the Bonds at the time Outstanding, provided that such default (other than a default arising from nonpayment of the Trustee’s fees and expenses, which must be cured within such 30 day period) shall not constitute an Event of Default hereunder if the Authority shall commence to cure such default within said thirty (30) day period and thereafter diligently and in good faith shall cure such default within a reasonable period of time; or
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(d) The filing by the Authority of a petition or answer seeking reorganization or arrangement under the federal bankruptcy laws or any other applicable law of the United States of America, or if a court of competent jurisdiction shall approve a petition, filed with or without the consent o f the Authority, seeking reorganization under the federal bankruptcy laws or any other applicable law of the United States of America, or if, under the provisions of any other law for the relief or aid of debtors, any court of competent jurisdiction shall assume custody or control of the Authority or of the whole or any substantial part of its property.
Section 8.2 Remedies; Rights of Bond Owners . Upon the occurrence of an Event of Default, the Trustee may pursue any available remedy at law or in equity to enforce the payment of the principal of, premium, if any, and interest on the Outstanding Bonds, and to enforce any rights of the Trustee under or with respect to this Indenture. Subject to Section 8.3, in the event of an Event of Default arising out of a nonpayment of Trustee’s fees and expenses, the Trustee may sue the Authority to seek recovery of its fees and expenses, provided, however, that such recovery may be made only from the funds of the Authority and not from Revenues.
If an Event of Default shall have oc curred and be continuing and if requested to do so by the Owners of at least twenty -five percent (25%) in aggregate principal amount of Outstanding Bonds, and, in each case, if indemnified as provided in Section 6.2(l), the Trustee shall be obligated to exercise such one or more of the rights and powers conferred by this Article VIII and, as applicable, under the Local Obligations, as the Trustee, being advised by counsel, shall deem most expedient in the interests of the Bond Owners.
No remedy by the terms of this Indenture conferred upon or reserved to the Trustee (or to the Bond Owners) is intended to be exclusive of any other remedy, but each and every such remedy shall be cumulative and shall be in addition to any other remedy given to the Trustee or to the Bond Owners hereunder or now or hereafter existing at law or in equity.
No delay or omission to exercise any right or power accruing upon any Event of Default shall impair any such right or power or shall be construed to be a waiver of any such Event of Default or acquiescence therein; such right or power may be exercised from time to time as often as may be deemed expedient.
In no event shall the principal of the Bonds be accelerated.
Section 8.3 Application of Revenues and Other Funds After Event of Default . Al l amounts received by the Trustee with respect to the Bonds pursuant to any right given or action taken by the Trustee under the provisions of this Indenture relating to the Bonds shall be applied by the Trustee in the following order upon presentation of the several Bonds, and the stamping thereon of the amount of the payment if only partially paid, or upon the surrender thereof if fully paid – First, to the payment of the costs and expenses of the Trustee in declaring such Event of Default and in carrying out the provisions of this Article VIII, including reasonable compensation to its agents, attorneys and counsel (including outside counsel and the allocated costs of internal attorneys), and to the payment of all other outstanding fees and expenses of the Trustee; and Second, to the payment of the whole amount of interest on and principal of the Bonds then due and unpaid, with interest on overdue installments of principal and interest to the extent permitted by law at the net effective rate of interest the n borne by the Outstanding Bonds; provided, however,
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that in the event such amounts shall be insufficient to pay in full the full amount of such interest and principal, then such amounts shall be applied in the following order of priority; (a) first to the pay ment of all installments of interest on the Bonds then due and unpaid,
(b) second, to the payment of all installments of principal of the Bonds then due and unpaid, and
(c) third, to the payment of interest on overdue installments of principal and interest on Bonds.
Section 8.4 Power of Trustee to Control Proceedings . In the event that the Trustee, upon the happening of a default or an Event of Default, shall have taken any action, by judicial proceedings or otherwise, pursuant to its duties hereunder, whether upon its own di scretion or upon the request of the Owners of a majority in aggregate principal amount of the Bonds then Outstanding, it may, in the exercise of its discretion for the best interests of the Owners of the Bonds, with respect to the continuance, discontinuan ce, withdrawal, compromise, settlement or other disposal of such action; provided, however, that the Trustee shall not, unless there no longer continues an Event of Default, discontinue, withdraw, compromise or settle, or otherwise dispose of any litigatio n pending at law or in equity, if at the time there has been filed with it a written request signed by the Owners of a majority in aggregate principal amount of the Outstanding Bonds opposing such discontinuance, withdrawal, compromise, settlement or other such litigation and provided further that the Trustee shall have the right to decline to comply with such written request unless indemnification satisfactory to it has been provided. Any suit, action or proceeding which any Owner of Bonds shall have the right to bring to enforce any right or remedy hereunder may be brought by the Trustee for the equal benefit and protection of all Owners of Bonds similarly situated and the Trustee is hereby appointed (and the successive respective Owners of the Bonds issu ed hereunder, by taking and holding the same, shall be conclusively deemed so to have appointed it) the true and lawful attorney in fact of the respective Owners of the Bonds for the purposes of bringing any such suit, action or proceeding and to do and pe rform any and all acts and things for and on behalf of the respective Owners of the Bonds as a class or classes, as may be necessary or advisable in the opinion of the Trustee as such attorney in fact.
Section 8.5 Appointment of Receivers . Upon the occurrence of an E vent of Default hereunder, and upon the filing of a suit or other commencement of judicial proceedings to enforce the rights of the Trustee and of the Bond Owners under this Indenture, the Trustee shall be entitled, as a matter of right, to the appointment of a receiver or receivers of the Revenues and other amounts pledged hereunder, pending such proceedings, with such powers as the court making such appointment shall confer.
Section 8.6 Non Waiver. Nothing in this Article VIII or in any other provision of this Indenture, or in the Bonds, shall affect or impair the obligation of the Authority, which is absolute and unconditional, to pay the interest on and principal of the Bonds to the respective Owners of the Bonds at the respective dates of maturity, as herein provi ded, out of the Revenues and other moneys herein pledged for such payment.
A waiver of any default or breach of duty or contract by the Trustee or any Bond Owners shall not affect any subsequent default or breach of duty or contract, or impair any rights o r remedies
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on any such subsequent default or breach. No delay or omission of the Trustee or any Owner of any of the Bonds to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver of any such default or an acquiescence therein; and every power and remedy conferred upon the Trustee or Bond Owners by the Bond Law or by this Article VIII may be enforced and exercised from time to time and as often as shall be deemed expedient by the Trustee or the Bond Owners, as the case may be.
Section 8.7 Rights and Remedies of Bond Owners . No Owner of any Bond issued hereunder shall have the right to institute any suit, action or proceeding at law or in equity, for any remedy under or upon this Indenture, unless (a) such Owner shall have previously given to the Trustee written notice of the occurrence of an Event of Default; (b) the Owners of a majority in aggregate principal amount of all the Bonds then Outstanding shall have made written request upon the Trustee to exercise the powers hereinbefore granted or to institute such action, suit or proceeding in its own name; (c) said Owners shall have tendered to the Trustee indemnity reasonably acceptable to the Trustee against the costs, expenses and liabilities to be incurred in compliance with such request; and (d) the Trustee shall have refused or omitted to comply with such request for a period of sixty (60) days after such written request shall have been received by, and said tender of indemnity shall have been made to, the Trustee.
Such notification, request, tender of indemnity and refusal or omission are hereby declared, in every case, to be conditions precedent to the exercise by any Owner of Bonds of any remedy hereunder; it being understood and intended that no one or more Owners of Bonds shall have any right in any manner whatever by his or their action to enforce any right under this Indenture, except in the manner herein provided, and that all proceedings at law or in equity to enforce any provision of this Indenture shall be instituted, had and maintained in the manner herein provided and for the equal benefit of all Owners of the Outstanding Bonds.
The right of any Owner of any Bond to receive payment of the principal of and interest and premium (if any) on such Bond as herein provided or to institute suit for the enforcement of any such payment, shall not be impaired or affected without the written consent of such Owner, notwithstanding the foregoing provisions of this Section or any other provision of this Indenture.
Section 8.8 Termination of Proceedings . In case the Trustee shall have proceeded to enforce any right under this Indenture by the appointment of a receiver or otherwise, and such proceedings shall have been discontinued or abandoned for any reason, or shall have been determined adversely, then and in every such case, the Authority, the Trustee and the Bond Owners shall be restored to their former positions and rights hereunder, respectively, with regard to the property subject to this Indenture, and all rights, remedies and powers of the Trustee shall continue as if no such proceedings had been taken.
ARTICLE IX
MISCELLANEOUS
Section 9.1 Limited Liability of Authority . Notwithstanding anything in this Indenture contained, the Authority shall not be required to advance an y moneys derived from any source of income other than the Revenues or for the payment of the principal of or interest on the Bonds, or any premiums upon the redemption thereof, or for the performance of any covenants herein contained (except to the extent any such covenants are expressly payable hereunder from the
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Revenues). The Authority may, however, advance funds for any such purpose, provided that such funds are derived from a source legally available for such purpose and may be used by the Authority for such purpose without incurring indebtedness.
The Bonds shall be revenue bonds, payable exclusively from the Revenues and other funds as in this Indenture provided. The general fund of the Authority is not liable, and the credit of the Authority is not pledged, for the payment of the interest and premium (if any) on or principal of the Bonds. The Owners of the Bonds shall never have the right to compel the forfeiture of any property of the Authority. The principal of and interest on the Bonds and any p remiums upon the redemption of any thereof, shall not be a legal or equitable pledge, charge, lien or encumbrance upon any property of the Authority or upon any of its income, receipts or revenues except the Revenues and other funds pledged to the payment thereof as in this Indenture provided.
Section 9.2 Benefits of Indenture Limited to Parties . Nothing in this Indenture, expressed or implied, is intended to give to any person other than the Authority, the Trustee and the Owners of the Bonds, any right, remedy or cla im under or by reason of this Indenture. Any covenants, stipulations, promises or agreements in this Indenture contained by and on behalf of the Authority shall be for the sole and exclusive benefit of the Trustee and the Owners of Bonds.
Section 9.3 Discharge of Indenture. The Authority may pay and discharge any or all of the Outstanding Bonds in any one or more of the following ways:
(a) by well and truly paying or causing to be paid the principal of and interest and premium (if any) on such Bonds, as and when the same become due and payable; (b) by irrevocably depositing with the Trustee, in trust, at or before maturity, money which, together with the available amounts then on deposit in the funds and accounts established with the Trustee pursuant to this Indenture and av ailable for such purpose, is fully sufficient to pay such Bonds, including all principal, interest and redemption premiums; or (c) by irrevocably depositing with the Trustee or any other fiduciary, in trust, Defeasance Securities in such amount as an Independe nt Accountant shall determine will, together with the interest to accrue thereon and available moneys then on deposit in the funds and accounts established with the Trustee pursuant to this Indenture and available for such purpose, be fully sufficient to pay and discharge the indebtedness on such Bonds (including all principal, interest and redemption premiums) at or before their respective maturity dates.
Any Outstanding Bond or Bonds shall be deemed to have been paid and discharged under (b) or (c) above if (i) in the case of Bonds to be redeemed prior to the maturity thereof, notice of such redemption shall have been provided pursuant to Section 2.2(d) hereof or provision satisfactory to the Trustee shall have been made for the provision of such notice, ( ii) the Authority shall have delivered an escrow agreement with respect to the deposits under (b) or (c) above; (iii) with respect to a deposit under (c) above, a verification report of an Independent Accountant shall be delivered to the Trustee, and (iv) an opinion of Bond Counsel shall be delivered to the Trustee to the effect that the requirements of this Indenture have been satisfied with respect to such discharge of Bonds. Upon a discharge of one or more Bonds as described above, and notwithstanding t hat any of such Bonds shall not have been surrendered for payment, the pledge of the Revenues, and other funds provided for in this Indenture with respect to such Bonds, as applicable, and all other pecuniary obligations of the Authority under this Indenture with respect to such Bonds, shall cease and terminate, except only
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the obligation of the Authority to comply with the covenants contained in Sections 5.7 and 6.12 hereof, and to pay or cause to be paid to the Owners of such Bonds not so surrendered and paid all sums due thereon from amounts set aside for such purpose. Any funds thereafter held by the Trustee, which are not required for said purposes, shall be paid over to the Authority or upon a Request of the Authority to the City or the Community Facilities District, as applicable.
Defeasance shall be accomplished only with an irrevocable deposit in escrow of cash and/or Defeasance Securities. Further substitutions of securities in the escrow are not permitted. The deposit in the escrow must be suffi cient, without reinvestment, to pay all principal and interest as scheduled on the Bonds to and including the date of redemption.
Section 9.4 Successor is Deemed Included in All References to Predecessor .
Whenever in this Indenture or any Supplemental Indenture eithe r the Authority is named or referred to, such reference shall be deemed to include the successor to the powers, duties and functions, with respect to the management, administration and control of the affairs of the Authority, that are presently vested in t he Authority, and all the covenants, agreements and provisions contained in this Indenture by or on behalf of the Authority shall bind and inure to the benefit of its successors whether so expressed or not.
Section 9.5 Content of Certificates . Every certificate by or on behalf of the Authority with respect to compliance with a condition or covenant provided for in this Indenture shall include (a) a statement that the person or persons making or giving such certificate have read such covenant or condition and the defin itions herein relating thereto; (b) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate are based; (c) a statement that, in the opinion of the signers, they ha ve made or caused to be made such examination or investigation as is necessary to enable them to express an informed opinion as to whether or not such covenant or condition has been complied with; and (d) a statement as to whether, in the opinion of the signers, such condition or covenant has been complied with.
Any such certificate made or given by an officer of the Authority may be based, insofar as it relates to legal matters, upon a certificate or opinion of or representations by counsel, unless such officer knows that the certificate or opinion or representations with respect to the matters upon which his certificate may be based, as aforesaid, are erroneous, or in the exercise of reasonable care should have known that the same were erroneous. Any such certificate or opinion or representation made or given by counsel may be based, insofar as it relates to factual matters, on information with respect to which is in the possession of the Authority, or upon the certificate or opinion of or representations by an officer or officers of the Authority, unless such counsel knows that the certificate or opinion or representations with respect to the matters upon which his certificate, opinion or representation may be based, as aforesaid, are erroneous, or in the exercise of reasonable care should have known that the same were erroneous.
Section 9.6 Execution of Documents by Bond Owners . Any request, consent or other instrument required by this Indenture to be signed and executed by Bond Owners may be in any number of concurrent writings of substantially similar tenor and may be signed or executed by such Bond Owners in person or by agent or agents duly appointed in writing. Proof of the execution of any such request, consent or other instrument or of a writing appointing any such agent, shall be sufficient for any purpose of this Indenture and shall be conclusive in favor of the Trustee and of the Authority if made in the manner provided in this Section 9.6.
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The fact and date of the execution by any person of any such request , consent or other instrument or writing may be proved by the affidavit of a witness of such execution or by the certificate of any notary public or other officer of any jurisdiction, authorized by the laws thereof to take acknowledgements of deeds, certif ying that the person signing such request, consent or other instrument or writing acknowledged to him the execution thereof.
The ownership of Bonds shall be conclusively proved by the Bond Register. Any request, consent or vote of the Owner of any Bond sh all bind every future Owner of the same Bond and the Owner of any Bond issued in exchange therefor or in lieu thereof, in respect of anything done or suffered to be done by the Trustee or the Authority in pursuance of such request, consent or vote. In lieu of obtaining any demand, request, direction, consent or waiver in writing, the Trustee may call and hold a meeting of the Bond Owners upon such notice and in accordance with such rules and obligation as the Trustee considers fair and reasonable for the purpose of obtaining any such action.
Section 9.7 Disqualified Bonds . In determining whether the Owners of the requisite aggregate principal amount of Bonds have concurred in any demand, request, direction, consent or waiver under this Indenture, Bonds which are owned or held by or for the account of the Authority, the City or the Community Facilities District (but excluding Bonds held in any employees’ or retirement fund) shall be disregarded and deemed not to be Outstanding for the purpose of any such determination, provided, however, that for the purpose of determining whether the Trustee shall be protected in relying on any such demand, request, direction, consent or waiver, only Bonds which the Trustee knows to be so owned or held shall be disregarded. Upon request, the Authority shall specify to the Trustee those Bonds disqualified pursuant to this Section 9.7 and the Trustee may conclusively rely upon such certificate.
Section 9.8 Waiver of Personal Liability . No officer, agent or employee of the Authority shall be individu ally or personally liable for the payment of the interest on or principal of the Bonds; but nothing herein contained shall relieve any such officer, agent or employee from the performance of any official duty provided by law.
Section 9.9 Entire Agreement; Partial Inva lidity. This Agreement and the exhibits hereto set forth the entire agreement and understanding of the parties related to this transaction and supersedes all prior agreements and understandings, oral or written. If any one or more of the covenants or agreements, or portions thereof, provided in this Indenture on the part of the Authority (or of the Trustee) to be performed should be contrary to law, then such covenant or covenants, such agreement or agreements, or such portions thereof, shall be null and void and shall be deemed separable from the remaining covenants and agreements or portions thereof and shall in no way affect the validity of this Indenture or of the Bonds; but the Bond Owners shall retain all rights and benefits accorded to them under th e Bond Law or any other applicable provisions of law. The Authority hereby declares that it would have entered into this Indenture and each and every other section, paragraph, subdivision, sentence, clause and phrase hereof and would have authorized the issuance of the Bonds pursuant hereto irrespective of the fact that any or more sections, paragraphs, subdivisions, sentences, clauses or phrases of this Indenture or the application thereof to any person or circumstance may be held to be unconstitutional, unenforceable or invalid.
Section 9.10 Destruction of Cancelled Bonds . Whenever in this Indenture provision is made for the surrender to the Authority or the Trustee of any Bonds which have been paid or cancelled pursuant to the provisions of this Indenture, the Trust ee shall destroy such Bonds in accordance with the retention policy of the Trustee then in effect.
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Section 9.11 Funds and Accounts. Any fund or account required by this Indenture to be established and maintained by the Authority or the Trustee may be established and m aintained in the accounting records of the Authority or the Trustee, as the case may be, either as a fund or an account, and may, for the purpose of such records, any audits thereof and any reports or statements with respect thereto, be treated either as a fund or as an account. All such records with respect to all such funds and accounts held by the Authority shall at all times be maintained in accordance with generally accepted accounting principles and all such records with respect to all such funds and accounts held by the Trustee shall be at all times maintained in accordance with corporate trust industry practices; in each case with due regard for the protection of the security of the Bonds and the rights of every Owner thereof.
Section 9.12 Notices. Any notice, request, complaint, demand, communication or other paper shall be sufficiently given and shall be deemed given when delivered or mailed by registered or certified mail, return receipt requested, postage prepaid, or sent by fax or other electronic transmission, addressed as follows:
If to the Authority: Beaumont Public Improvement Authority c/o City of Beaumont
550 East 6th Street
Beaumont, California 92223
Attention: Executive Director
If to the Community
Facilities District: City of Beaumont Community Facilities District No. 2023- 1(Fairway Canyon)
c/o City of Beaumont
550 East 6th Street
Beaumont, California 92223
Attention: City Manager
If to the Trustee: Zions Bancorporation, National Association 707 Wilshire Boulevard, Suite 5000
Los Angeles, California 90017
Attention: Corporate Trust Services
The Authority, the City and the Trustee may designate any further or different addresses to which subsequent notices, certificates or other communications shall be sent. Any such notice, certificates or oth er communications furnished by electronic transmission shall be in the form of attachments in PDF format.
Section 9.13 Unclaimed Moneys . Anything in this Indenture to the contrary notwithstanding, any moneys held by the Trustee in trust for the payment and discharge o f any of the Bonds which remain unclaimed for two (2) years after the date when such Bonds have become due and payable, either at their stated maturity dates or by call for earlier redemption, if such moneys were held by the Trustee at such date, or for tw o (2) years after the date of deposit of such moneys if deposited with the Trustee after said date when such Bonds become due and payable, shall be repaid by the Trustee to the Authority, as its absolute property and free from trust, and the Trustee shall thereupon be released and discharged with respect thereto and the Bond Owners shall look only to the Authority for the payment of such Bonds; provided, however, that before being required to make
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such payment to the Authority, the Trustee shall, at the exp ense of Authority, cause to be mailed to the Owners of all such Bonds, at their respective addresses appearing on the Bond Register, a notice that said moneys remain unclaimed and that, after a date in said notice, which date shall not be less than thirty (30) days after the date of mailing such notice, the balance of such moneys then unclaimed will be returned to the Authority.
Section 9.14 Payment Due on Other than a Business Day . If the date for making any payment or the last date for performance of any act or the e xercising of any right, as provided in the Indenture, is not a Business Day, such payment, with no interest accruing for the period after such nominal date, may be made or act performed or right exercised on the next succeeding Business Day with the same force and effect as if done on the nominal date provided in this Indenture.
Section 9.15 Governing Law. This Indenture shall be construed and governed in accordance with the laws of the State of California.
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IN WITNESS WHEREOF, the Authority has caused this Indenture to be executed by the Treasurer of the Authority, attested by its Secretary, and the Trustee has caused this Indenture to be executed by one of its authorized officers, all as of the day and year first above written.
BEAUMONT PUBLIC IMPROVEMENT
AUTHORITY
By:
Treasurer
ATTEST:
Secretary
ZIONS BANCORPORATION, NATIONAL
ASSOCIATION, as Trustee
By:
Authorized Officer
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EXHIBIT A
FORM OF SERIES 2025B BOND
R-__ $__________
UNLESS THIS BOND IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE
AUTHORITY OR THE TRUSTEE FOR REGISTRATION OR TRANSFER,
EXCHANGE OR PAYMENT, AND ANY BOND ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE & CO., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO. HAS AN INTEREST
HEREIN.
UNITED STATES OF AMERICA
STATE OF CALIFORNIA
COUNTY OF RIVERSIDE
BEAUMONT PUBLIC IMPROVEMENT AUTHORITY
LOCAL AGENCY REVENUE BOND, SERIES 2025B
INTEREST RATE: MATURITY DATE: DATED DATE: CUSIP NUMBER:
____% September 1, 20__ _________, 2025 _________
REGISTERED OWNER: CEDE & CO.
PRINCIPAL AMOUNT: AND NO/100 DOLLARS
The BEAUMONT PUBLIC IMPROVEMENT AUTHORITY, a joint powers authority organized and existing under the laws of the State of California (the “Authority”), for value received, hereby promises to pay (but only out of the Revenues and other funds hereinafter referred to) to the Registered Owner identified above or registered assigns (the “Registered Owner”), on the Maturity Date identified above (subject to any right of prior redemption hereinafter mentioned), the Pr incipal Amount identified above in lawful money of the United States of America; and to pay interest thereon at the Interest Rate identified above in like money from the Interest Payment Date (as hereinafter defined) next preceding the date of authenticati on of this Bond (unless this Bond is authenticated on or before an Interest Payment Date and after the fifteenth calendar day of the month preceding the month in which such Interest Payment Date occurs, in which event it shall bear interest from such Inter est Payment Date, or unless this Bond is authenticated on or prior to February 15, 2026, in which event it shall bear interest from the Dated Date identified above; provided, however, that if, at the time of authentication of this Bond, interest is in defa ult on this Bond, this Bond shall bear interest from the Interest Payment Date to which interest hereon has previously been paid or made available for payment), payable semiannually on September 1 and March 1 in each year,
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commencing March 1, 2026 (each, a n “Interest Payment Date”) until the Maturity Date stated above or date of redemption of this Bond. The Principal Amount hereof is payable upon presentation and surrender hereof at the Trust Office (as defined in the Indenture) of Zions Bancorporation, Na tional Association (the “Trustee”). Interest hereon is payable by check of the Trustee mailed by first class mail, postage prepaid, on each Interest Payment Date to the Registered Owner hereof at the address of the Registered Owner as it appears on the re gistration books of the Trustee as of the fifteenth calendar day of the month preceding the month in which such Interest Payment Date occurs; provided, however, that payment of interest may be made by wire transfer to an account in the United States of America to any registered owner of Bonds in the aggregate principal amount of $1,000,000 or more upon written instructions of any such registered owner filed with the Trustee in writing at least five (5) Business Days before the Record Date for such Interest Payment Date.
This Bond is one of a duly authorized issue of bonds of the Authority designated the “Beaumont Public Improvement Authority Local Agency Revenue Bonds, Series 2025B ” (the “Bonds”), limited in principal amount to __________ ($_________), secur ed by an Indenture of Trust dated as of ________ 1, 2025 (the “Indenture”), by and between the Authority and the Trustee.
Reference is hereby made to the Indenture and all indentures supplemental thereto for a description of the rights thereunder of the o wners of the Bonds, of the nature and extent of the Revenues, of the rights, duties and immunities of the Trustee and of the rights and obligations of the Authority thereunder; and all of the terms of the Indenture are hereby incorporated herein and consti tute a contract between the Authority and the Registered Owner hereof, and to all of the provisions of which Indenture the Registered Owner hereof, by acceptance hereof, assents and agrees. Capitalized terms not defined herein shall have the meanings set forth in the Indenture.
This Bond is a limited obligation of the Authority, payable solely from the Revenues and funds pledged under the Indenture. This Bond is not a debt of the City of Beaumont (the “City”) or the State of California (the “State”) or any of its political subdivisions (except the Authority and only to the extent set forth in the Indenture), and none of said City, the State or any of its political subdivisions is liable hereon. The Authority has no taxing power.
The Bonds are authorized t o be issued pursuant to the provisions of the Marks -Roos Local Bond Pooling Act of 1985, as amended, constituting Article 4 (commencing with Section 6584) of Chapter 5 of Division 7 of Title 1 of the Government Code of the State of California (the “Act”).
The Bonds are limited obligations of the Authority and, as and to the extent set forth in the Indenture, are payable solely from and secured by a first lien on and pledge of the Revenues and certain other funds held by the Trustee as provided in the Inden ture. The Revenues and such other funds constitute a trust fund for the security and payment of the principal of and interest on the Bonds, except to the extent otherwise provided in the Indenture. The full faith and credit of the Authority is not pledged to the payment of the principal of or interest or redemption premiums (if any) on the Bonds. The Bonds are not secured by a legal or equitable pledge of, or charge, lien or encumbrance upon, any of the property of the Authority or any of its income or r eceipts, except the Revenues and such other funds as provided in the Indenture.
The Bonds have been issued to provide funds to purchase certain obligations of the City of Beaumont Community Facilities District No. 2023 -1 (Fairway Canyon) (the “Community Fa cilities District”) as identified in the Indenture (collectively, the “Local Obligations”). The Community Facilities District, in turn, will take the proceeds that it receives from the sale of the Local Obligations to the Authority to finance the acquisit ion of or reimbursement for certain public improvements, all as more particularly described in the Indenture. The obligations of the
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Community Facilities District to make payments of principal and interest on the Local Obligations are limited obligations secured only as set forth therein.
The Bonds maturing on or before September 1, 20__ are not subject to optional redemption prior to maturity. The Bonds maturing on or after September 1, 20__ may be redeemed at the option of the Authority, from any source of available funds, prior to maturity on any Interest Payment Date on or after September 1, 20__ as a whole, or in part from maturities of the Local Obligations simultaneously redeemed, if any redemption of Local Obligations is being made in conjunction w ith such optional redemption, and otherwise from such maturities as are selected by the Authority, at a redemption price equal to the par amount of the Bonds to be redeemed, together with accrued interest thereon to the date of redemption, without premium.
The Bonds are subject to special redemption on any Interest Payment Date from proceeds of early redemption of the Local Obligations from prepayments of Special Taxes (as such terms are defined in the Indenture), in whole or in part, from maturities corresponding proportionately to the maturities of the Local Obligations simultaneously redeemed, at the principal amount thereof, plus a premium expressed below as a percentage of the principal amount so redeemed, plus accrued interest to the date of redemption thereof:
Redemption Dates Redemption Prices
Any Interest Payment Date through March 1, 20__ 103%
September 1, 20__ and March 1, 20__ 102
September 1, 20__ and March 1, 20__ 101
September 1, 20__ and any Interest Payment Date thereafter 100
Notice of redemption with respect to the Bonds to be redeemed shall be mailed to the registered owners thereof not less than 30 nor more than 60 days prior to the redemption date by first class mail, postage prepaid, to the addresses set forth in the registration books in accordance with the provisions of the Indenture provided, however, so long as the Bonds are registered in the name of the Nominee, notice of redemption shall be given in such manner as complies with the requirements of DTC. Neither a fail ure of the Registered Owner hereof to receive such notice nor any defect therein will affect the validity of the proceedings for redemption. All Bonds or portions thereof so called for redemption will cease to accrue interest on the specified redemption d ate, provided that funds for the redemption are on deposit with the Trustee on the redemption date. Thereafter, the registered owners of such Bonds shall have no rights except to receive payment of the redemption price upon the surrender of the Bonds.
Unless funds for the optional redemption of any Bonds are irrevocably deposited with the Trustee prior to rendering notice of redemption to the Bondowners, such notice shall state that such redemption is subject to the deposit of funds by the Authority. Any notice of optional redemption shall be cancelled and annulled if for any reason funds will not be or are not available on the date fixed for redemption for the payment in full of the Bonds then called for redemption, and such cancellation shall not constit ute an Event of Default under the Indenture. The Authority and the Trustee shall have no liability to the Owners or any other party related to or arising from such rescission of redemption. The Trustee shall send notice of such rescission of redemption i n the same manner as the original notice of redemption was sent.
If this Bond is called for redemption and payment is duly provided therefor as specified in the Indenture, interest shall cease to accrue hereon from and after the date fixed for redemption.
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The Bonds are issuable as fully registered Bonds without coupons in denominations of $5,000 or any integral multiple thereof. Subject to the limitations and upon payment of the charges, if any, provided in the Indenture, fully registered Bonds may be exch anged at the Trust Office of the Trustee for a like aggregate principal amount and maturity of fully registered Bonds of other authorized denominations.
This Bond is transferable by the Registered Owner hereof, in person or by its attorney duly authorized in writing, at the Trust Office of the Trustee, but only in the manner, subject to the limitations and upon payment of the charges provided in the Indenture, and upon surrender and cancellation of this Bond. Upon such transfer a new fully registered Bond or Bonds, of authorized denomination or denominations, for the same aggregate principal amount will be issued to the transferee in exchange herefor. The Trustee shall not be required to register the transfer or exchange of any Bond (i) during the 15 days prior to selection of Bonds for redemption, or (ii) selected for redemption.
The Authority and the Trustee may treat the Registered Owner hereof as the absolute owner hereof for all purposes, and the Authority and the Trustee shall not be affected by any n otice to the contrary. The Indenture and the rights and obligations of the Authority and of the owners of the Bonds and of the Trustee may be modified or amended from time to time and at any time in the manner, to the extent, and upon the terms provided i n the Indenture; provided that no such modification or amendment shall (a) extend the maturity of or reduce the interest rate on any Bond or otherwise alter or impair the obligation of the Authority to pay the principal, interest or redemption premiums at the time and place and at the rate and in the currency provided therein of any Bond without the express written consent of the owner of such Bond, (b) reduce the percentage of Bonds required for the written consent to any such amendment or modification, or (c) without its written consent thereto, modify any of the rights or obligations of the Trustee, all as more fully set forth in the Indenture.
It is hereby certified by the Authority that all things, conditions and acts required to exist, to have happened and to have been performed precedent to and in the issuance of this Bond do exist, have happened and have been performed in due time, form and manner as required by the Constitution and statutes of the State of California and by the Act, and that the amou nt of this Bond, together with all other indebtedness of the Authority, does not exceed any limit prescribed by the Constitution or statutes of the State of California or by the Act.
This Bond shall not be entitled to any benefit under the Indenture, or be come valid or obligatory for any purpose, until the certificate of authentication hereon shall have been signed by the Trustee.
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IN WITNESS WHEREOF, the BEAUMONT PUBLIC IMPROVEMENT AUTHORITY has caused this Bond to be executed in its name and on its behalf by the facsimile signature of its Chair and attested by the facsimile signature of its Secretary, all as of the date set forth above.
BEAUMONT PUBLIC IMPROVEMENT
AUTHORITY
By:
Chair
Attest:
Secretary
[FORM OF CERTIFICATE OF AUTHENTICATION]
This is one of the Bonds described in the within-mentioned Indenture.
Date: _________, 2025 ZIONS BANCORPORATION, NATIONAL
ASSOCIATION, as Trustee
By:
Authorized Signatory
[FORM OF LEGAL OPINION]
The attached is a true copy of the opinion rendered by Stradling Yocca Carlson & Rauth LLP, Newport Beach, California, in connection with the issuance of, and dated as of the date of the original delivery of, the Bonds. A signed copy is on file in my office.
Secretary of the Board of Directors of
Beaumont Public Improvement Authority
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[FORM OF ASSIGNMENT]
For value received the undersigned do(es) hereby sell, assign and transfer unto
whose tax identification number is ,
the within mentioned registered Bond and hereby irrevocably constitute(s) and appoint(s)
attorney to transfer the same on the books of the Trustee with full power of substitution in the premises.
Dated: _______________
Signature guaranteed:
NOTE: Signature guarantee shall be made by
a guarantor institution participating in the
Securities Transfer Agents Medallion Program
or in such other guarantee program acceptable
to the Trustee.
NOTE: The signatures(s) on this Assignment
must correspond with the name(s) as written on
the face of the within Bond in every particular
without alteration or enlargement or any
change whatsoever
Stradling Yocca Carlson & Rauth
Draft of 10/21/25
4920-8282-2761v4/022599-0040
BOND INDENTURE
Between
CITY OF BEAUMONT
COMMUNITY FACILITIES DISTRICT NO. 2023-1 (FAIRWAY CANYON)
and
ZIONS BANCORPORATION, NATIONAL ASSOCIATION,
as Trustee
$__________
CITY OF BEAUMONT
COMMUNITY FACILITIES DISTRICT NO. 2023-1 (FAIRWAY CANYON) (IMPROVEMENT AREA NO. 1)
2025 SPECIAL TAX BONDS
Dated as of __________ 1, 2025
Table of Contents
Page
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ARTICLE I
DEFINITIONS
Section 1.1. Definitions ..................................................................................................................... 2
ARTICLE II
GENERAL AUTHORIZATION AND BOND TERMS
Section 2.1. Amount, Issuance, Purpose and Nature of Bonds and Parity Bonds .......................... 12 Section 2.2. Type and Nature of Bonds and Parity Bonds .............................................................. 12 Section 2.3. Equality of Bonds and Parity Bonds and Pledge of Net Special Taxes ...................... 12 Section 2.4. Description of Bonds; Interest Rates .......................................................................... 13 Section 2.5. Place and Form of Payment ........................................................................................ 14 Section 2.6. Form of Bonds and Parity Bonds ................................................................................ 15 Section 2.7. Execution and Authentication ..................................................................................... 15 Section 2.8. Bond Register .............................................................................................................. 15 Section 2.9. Registration of Exchange or Transfer ......................................................................... 16 Section 2.10. Mutilated, Lost, Destroyed or Stolen Bonds or Parity Bonds ..................................... 16 Section 2.11. Validity of Bonds and Parity Bonds ........................................................................... 17
ARTICLE III
CREATION OF FUNDS AND APPLICATION OF PROCEEDS
Section 3.1. Creation of Funds; Application of Proceeds ............................................................... 17 Section 3.2. Deposits to and Disbursements from Special Tax Fund ............................................. 18 Section 3.3. Administrative Expense Fund ..................................................................................... 19 Section 3.4. Interest Account and Principal Account of the Special Tax Fund .............................. 19 Section 3.5. Reserve Account of the Special Tax Fund .................................................................. 19 Section 3.6. Redemption Account of the Special Tax Fund ........................................................... 20 Section 3.7. Surplus Fund ............................................................................................................... 21 Section 3.8. Acquisition and Construction Fund ............................................................................ 22 Section 3.9. Investments ................................................................................................................. 22
ARTICLE IV
REDEMPTION OF BONDS AND PARITY BONDS
Section 4.1. Redemption of Bonds ................................................................................................. 24 Section 4.2. Selection of Bonds and Parity Bonds for Redemption ............................................... 24 Section 4.3. Notice of Redemption ................................................................................................. 25 Section 4.4. Partial Redemption of Bonds or Parity Bonds ............................................................ 26 Section 4.5. Effect of Notice and Availability of Redemption Money ........................................... 26
ARTICLE V
COVENANTS AND WARRANTY
Section 5.1. Warranty ..................................................................................................................... 27 Section 5.2. Covenants .................................................................................................................... 27
Table of Contents
(continued)
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ARTICLE VI
AMENDMENTS TO INDENTURE
Section 6.1. Supplemental Indentures or Orders Not Requiring Bondowner Consent ................... 31 Section 6.2. Supplemental Indentures or Orders Requiring Bondowner Consent .......................... 32 Section 6.3. Notation of Bonds or Parity Bonds; Delivery of Amended Bonds or Parity Bonds .......................................................................................................................... 33
ARTICLE VII
TRUSTEE
Section 7.1. Trustee ......................................................................................................................... 33 Section 7.2. Removal of Trustee ..................................................................................................... 34 Section 7.3. Resignation of Trustee ................................................................................................ 34 Section 7.4. Liability of Trustee ..................................................................................................... 34 Section 7.5. Merger or Consolidation ............................................................................................. 37
ARTICLE VIII
EVENTS OF DEFAULT; REMEDIES
Section 8.1. Events of Default ........................................................................................................ 37 Section 8.2. Remedies of Owners ................................................................................................... 38 Section 8.3. Application of Revenues and Other Funds After Default ........................................... 38 Section 8.4. Power of Trustee to Control Proceedings ................................................................... 39 Section 8.5. Appointment of Receivers .......................................................................................... 39 Section 8.6. Non-Waiver ................................................................................................................. 40 Section 8.7. Limitations on Rights and Remedies of Owners ........................................................ 40 Section 8.8. Termination of Proceedings ........................................................................................ 40
ARTICLE IX
DEFEASANCE AND PARITY BONDS
Section 9.1. Defeasance .................................................................................................................. 41 Section 9.2. Conditions for the Issuance of Parity Bonds and Other Additional Indebtedness ................................................................................................................ 42
ARTICLE X
MISCELLANEOUS
Section 10.1. Cancellation of Bonds and Parity Bonds .................................................................... 44 Section 10.2. Execution of Documents and Proof of Ownership ..................................................... 44 Section 10.3. Unclaimed Moneys ..................................................................................................... 45 Section 10.4. Provisions Constitute Contract.................................................................................... 45 Section 10.5. Future Contracts .......................................................................................................... 45 Section 10.6. Electronic Signatures .................................................................................................. 46 Section 10.7. Further Assurances ...................................................................................................... 46 Section 10.8. Entire Agreement; Severability ................................................................................... 46 Section 10.9. Notices ........................................................................................................................ 46
Table of Contents
(continued)
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Signature Page ................................................................................................................................... S-1
EXHIBIT A FORM OF 2025 SPECIAL TAX BOND ................................................................. A-1
EXHIBIT B FORM OF REQUISITION FOR DISBURSEMENT OF FACILITIES PROJECT COSTS ...................................................................................................................... B-1
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BOND INDENTURE
THIS BOND INDENTURE dated as of __________ 1, 2025 (the “Indenture”), is made and entered into by the City of Beaumont Community Facilities District No. 2023 -1 (Fairway Canyon) and Zions Bancorporation, National Association, as trustee, and governs the terms of the City of Beaumont Community Facilities District No. 2023-1 (Fairway Canyon) (Improvement Area No. 1) 2025 Special Tax Bonds and any Parity Bonds issued in accordance herewith from time to time.
R E C I T A L S :
WHEREAS, the City Council of the City of Beaumont, located in Riverside County, California (hereinafter sometimes referred to as the “legislative body of the District”), has heretofore undertaken proceedings to form the City of Beaumont Community Facilities District No. 2023-1 (Fairway Canyon) (the “District”), and Improvement Area No. 1 therein (the “Improvement Area”), pursuant to the terms and provisions of the Mello -Roos Community Facilities Act of 1982, as amended, being Chapter 2.5, Part 1, Division 2, Title 5, of the Government Code of the State of California (the “Act”); and
WHEREAS, on ___________, 2025, the legislative body of the District adopted Resolution No. 2025-___ (the “Resolution”) authorizing the issuance and sale of special tax bonds for the Improvement Area pursuant to this Ind enture designated as the “City of Beaumont Community Facilities District No. 2023-1 (Fairway Canyon) (Improvement Area No. 1) 2025 Special Tax Bonds” (the “Bonds”); and
WHEREAS, it is in the public interest and for the benefit of the District, the persons responsible for the payment of special taxes and the owners of the Bonds that the District enter into this Indenture to provide for the issuance of the Bonds, the disbursement of proceeds of the Bonds, the disposition of the special taxes securing the bond s, and the administration and payment of the Bonds; and
WHEREAS, all things necessary to cause the Bonds, when authenticated by the Trustee and issued as provided in the Act, the Resolution and this Indenture, to be legal, valid and binding and limited obl igations in accordance with their terms, and all things necessary to cause the creation, authorization, execution and delivery of this Indenture and the creation, authorization, execution and issuance of the Bonds, subject to the terms hereof, have in all respects been duly authorized; NOW, THEREFORE, in order to establish the terms and conditions upon and subject to which the Bonds are to be issued, and in consideration of the premises and of the mutual covenants contained herein and of the purchase and a cceptance of the Bonds by the Owners thereof, and for other valuable consideration, the receipt of which is hereby acknowledged, the District does hereby covenant and agree, for the benefit of the Owners of the Bonds and any Parity Bonds (as defined herein) which may be issued hereunder from time to time, as follows:
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ARTICLE I
DEFINITIONS
Section 1.1. Definitions. Unless the context otherwise requires, the following terms shall have the following meanings:
“Account” means any account created pursuant to this Indenture. “Act” means the Mello-Roos Community Facilities Act of 1982, as amended, Sections 53311 et seq. of the California Government Code.
“Acquisition and Construction Fund” means the fund by that name established pursuant to Section 3.1 hereof.
“Administrative Expenses” means the administrative costs pursuant to the RMA with respect to the calculation and collection of the Special Taxes, including all attorneys’ fees and other costs related thereto, the fees and expenses of the Trustee, any fees and related costs for c redit enhancement for the Bonds or any Parity Bonds which are not otherwise paid as Costs of Issuance, any costs related to the District’s compliance with state and federal laws requiring continuing disclosure of information concerning the Bonds and the Di strict, and any other costs otherwise incurred by the City on behalf of the District in order to carry out the purposes of the District as set forth in the Resolution of Formation and any obligation of the District hereunder . Administrative Expenses shall also include the administrative costs with respect to the collection of Delinquency Proceeds.
“Administrative Expense Fund” means the fund by that name created and established pursuant to Section 3.1 hereof.
“Administrative Expense Requirement” means $[30,000] in each Bond Year. “Annual Debt Service” means the principal amount of any Outstanding Bonds or Parity Bonds payable in a Bond Year either at maturity or pursuant to a Sinking Fund Payment and any interest payable on any Outstanding Bonds or Parity B onds in such Bond Year, if the Bonds and any Parity Bonds are retired as scheduled.
“Authority” means the Beaumont Public Improvement Authority. “Authority Bonds” means any bonds outstanding under the Authority Indenture, which are secured in part by payme nts made on the Bonds and which may be secured in part by any Parity Bonds.
“Authority Indenture” means that certain Indenture of Trust, dated as of __________ 1, 2025, by and between the Authority and the Authority Trustee, pursuant to which the Authority Bonds are issued.
“Authority Trustee” means Zions Bancorporation, National Association or any successor thereto appointed pursuant to the Authority Indenture.
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“Authorized Investments” means any of the following investments, if and to the extent the same are at the time legal for investment of the District’s funds (the Trustee is entitled to rely upon investment direction from the District as a certification that such investment is an Authorized Investment):
1. (a) Direct obligations (other than an obligati on subject to variation in principal repayment) of the United States of America (“United States Treasury Obligations”), (b) obligations fully and unconditionally guaranteed as to timely payment of principal and interest by the United States of America, (c) obligations fully and unconditionally guaranteed as to timely payment of principal and interest by any agency or instrumentality of the United States of America when such obligations are backed by the full faith and credit of the United States of America, or (d) evidences of ownership of proportionate interests in future interest and principal payments on obligations described above held by a bank or trust company as custodian, under which the owner of the investment is the real party in interest and has t he right to proceed directly and individually against the obligor and the underlying government obligations are not available to any person claiming through the custodian or to whom the custodian may be obligated.
2. Federal Housing Administration debentures.
3. The listed obligations of government -sponsored agencies which are not backed by the full faith and credit of the United States of America:
(a) Federal Home Loan Mortgage Corporation (FHLMC)
(i) Participation certificates (excluded are stripped mortgage securities which are purchased at prices exceeding their principal amounts)
(ii) Senior Debt obligations
(b) Farm Credit Banks (formerly: Federal Land Banks, Federal (i) Intermediate Credit Banks and Banks for Cooperatives) (ii) Consolidated system-wide bonds and notes
(c) Federal Home Loan Banks (FHL Banks)
(i) Consolidated debt obligations
(d) Federal National Mortgage Association (FNMA)
(i) Senior debt obligations
(ii) Mortgage-backed securities (excluded are stripped mortgage securities which a re purchased at prices exceeding their principal amounts)
(e) Financing Corporation (FICO)
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(i) Debt obligations
(f) Resolution Funding Corporation (REFCORP)
(i) Debt obligations
4. Unsecured certificates of deposit, time deposits, demand deposits, and bankers’ acceptances (having maturities of not more than 30 days) of any bank (including the Trustee and any affiliate) the short -term obligations of which are rated “A -1” or better by Standard & Poor’s.
5. Deposits the aggregate amount of which are fully insu red by the Federal Deposit Insurance Corporation (FDIC), in banks (including the Trustee and any affiliate) which have capital and surplus of at least $5 million.
6. Commercial paper (having original maturities of not more than 270 days rated “A-1+” by Standard & Poor’s and “Prime-1” by Moody’s.
7. Money market funds rated “AAm” or “AAm -G” by Standard & Poor’s, or better (including those of the Trustee or its affiliates).
8. “State Obligations,” which means:
(a) Direct general obligations of any state of th e United States of America or any subdivision or agency thereof to which is pledged the full faith and credit of a state the unsecured general obligation debt of which is rated “A3” by Moody’s and “A” by Standard & Poor’s, or better, or any obligation full y and unconditionally guaranteed by any state, subdivision or agency whose unsecured general obligation debt is so rated.
(b) Direct general short -term obligations of any state agency or subdivision or agency thereof described in (A) above and rated “A -1+” by Standard & Poor’s and “Prime-l” by Moody’s.
(c) Special Revenue Bonds (as defined in the United States Bankruptcy Code) of any state, state agency or subdivision described in (A) above and rated “AA” or better by Standard & Poor’s and “Aa” or better by Moody’s.
9. Pre-refunded municipal obligations rated “AAA” by Standard & Poor’s and “Aaa” by Moody’s meeting the following requirements:
(a) the municipal obligations are (1) not subject to redemption prior to maturity or (2) the paying agent for the muni cipal obligations has been given irrevocable instructions concerning their call and redemption and the issuer of the municipal obligations has covenanted not to redeem such municipal obligations other than as set forth in such instructions;
(b) the municip al obligations are secured by cash or United States Treasury Obligations which may be applied only to payment of the principal of, interest and premium on such municipal obligations;
5 4920-8282-2761v4/022599-0040
(c) the principal of and interest on the United States Treasury Obligations (plus any cash in the escrow) has been verified by the report of independent certified public accountants to be sufficient to pay in full all principal of, interest, and premium, if any, due and to become due on the municipal obligations (“Verification”);
(d) the cash or United States Treasury Obligations serving as security for the municipal obligations are held by an escrow agent or paying agent in trust for owners of the municipal obligations;
(e) no substitution of a United States Treasury Obligation shall be permitted except with another United States Treasury Obligation and upon delivery of a new Verification; and
(f) the cash or United States Treasury Obligations are not available to satisfy any other claims, including those by or against the payin g agent or escrow agent.
10. Repurchase agreements:
With (1) any domestic bank, or domestic branch of a foreign bank, the long term debt of which is rated at least “A” by Standard & Poor’s and Moody’s; or (2) any broker -dealer with “retail customers” or a related affiliate thereof which broker -dealer has, or the parent company (which guarantees the provider) of which has, long -term debt rated at least “A” by Standard & Poor’s and Moody’s, which broker -dealer falls under the jurisdiction of the Securities In vestors Protection Corporation; or (3) any other entity rated “A” or better by Standard & Poor’s and Moody’s, provided that:
(a) The market value of the collateral is maintained at levels equal to 104% of the amount of cash transferred by the Trustee or th e District to the provider of the repurchase agreement plus accrued interest with the collateral being valued weekly and marked-to-market at one current market price plus accrued interest; (b) The Trustee or a third party acting solely as agent therefor or for the District (the “Holder of the Collateral”) has possession of the collateral or the collateral has been transferred to the Holder of the Collateral in accordance with applicable state and federal laws (other than by means of entries on the transfero r’s books);
(c) The repurchase agreement shall state and an opinion of counsel shall be rendered at the time such collateral is delivered that the Holder of the Collateral has a perfected first priority security interest in the collateral, any substituted collateral and all proceeds thereof (in the case of bearer securities, this means the Holder of the Collateral is in possession);
(d) The repurchase agreement shall provide that if during its term the provider’s rating by either Moody’s or Standard & Poor’ s is withdrawn or suspended or falls below “A ” by Standard & Poor’s or “A3” by Moody’s, as appropriate, the provider must, at the direction of Trustee or the District, within 10 days of receipt of