PUBLIC SERVICE DEPARTMENT
ELECTRIC REVENUE BOND INDENTURE
by and between the
CITY OF BUR.BANK, CALIFORNIA
and
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Trustee
Dated as of October 1, 1998
SFLIB 1/1046372/11/90340/00003 ’ ATTACHMENT 3
A3-1
TABLE OF CONTENTS
ARTICLE I
EQUALITY OF SECURITY; DEFINITIONS; CONTENT OF CERTIFICATES AND
OPINIONS
SECTION 1.01. Equality of Security ........................................................................................ ......3SECTION 1.02. Definitions ................................... ~ ........................................................................3SECTION 1.03. Content of Certificates and Opinions .................................................................18 SECTION 2.01.
SECTION 2.02.
SECTION 2.03.
SECTION 2.04.
SECTION 2.05.
SECTION 2.06.
SECTION 2.07.
SECTION 2.08.
SECTION 2.09.
ARTICLE II
THE BONDS
Authorization of Bonds ........................................................................i .............19Terms of the Bonds ............................................................................................19Form of Bonds.¯..-...-..............-.-..-.....-.-.................. ............................................ 19Execution of Bonds .............................................................................................19Transferof Bonds ...............................................................................................20Exchange of Bonds ............................................................................................20Bond Register .....................................................................................................20 Temporary ~.onds ...............................................................................................21Bonds Mutilated, Lost, Destroyed or Stolen ......................................................21
ARTICLE III
ISSUANCE OF BONDS
SECTION 3.01. Issuance of Bonds ..............................................................................................22SECTION 3.02. Proceedings for Issuance of Additional Series of Bonds ...................................22SECTION 3.03. Issuance of Refunding Bonds ............................................................................23SECTION 3.04. Application of Proceeds .....................................................................................23SECTION 3.05. Limitations on the Issuance of Obligations ........................................................23
ARTICLE IV
REDEMPTION OF BONDS
SECTION 4.01. Terms of Redemption .........................................................................................24
ARTICLE V
ELECTRIC NET REVENUES
SECTION 5.01. Pledge of Electric Net Revenues; Electric Revenue Fund .................................25SECTION 5.02. Payments Into Other Funds ......................................: .........................................26 SFLIB 111046372/I 1/90340/00003
ATTACHMENT 3
A3-2
SECTION 5.03. Debt Service Fund .................................................................................... ..........27SECTION 5.04. Parity Reserve Fund ..... ......................................................................................28SECTION 5.05. Investment of Moneys in Funds and Accounts. " 30
ARTICLE VI
COVENANTS ’
SECTION 6.01. Punctual Payment .................................................... ...........................................32SECTION 6.02. Extension of Payment of Bonds ...................................................................... ....32SECTION 6.03. Waiver of Laws .......................................... " ¯ 33SECTION 6.04. Further Assurances .............................................................................................33SECTION 6.05. Against Encumbrances ..........................................: ............................................33SECTION 6.06. Accounting Records and Financial Statements ..................................................33SECTION 6.07. Rebate Fund ........................~ .............................. .................................................34SECTION 6.08. Tax Covenants ....................................................................................................36SECTION 6.09. Rates and Charges. 36SECTION 6.10. Maintenance and Operation of System; Insurance. 37SECTION 6.11. Sale of Electric System ......................................................................................37SECTION 6.12. Continuing Disclosure Agreement. 37
ARTICLE VII
EVENTS OF DEFAULT AND REMEDIES OF BONDHOLDERS
SECTION 7.01.
SECTION 7.02.
SECTION 7.03.
SECTION 7.04.
SECTION 7.05.
SECTION 7.06.
SECTION 7.07.
SECTION 7.08.
SECTION 7.09.
Events of Default ...............................................................................................38Application of Electric Net Revenues and Other Funds After Default; Acceleration.¯"""’"’--"’-’""’-......-............-................................. .......................... 39Trustee to Represent Bondholders .....................................................................40.Bondholders’ Direction of Proceedings .............................................................40Limitation on Bondholders’ Right to Sue ..........................................................40Absolute Obligation of the City .......: .................................................................41Termination of Proceedings ...............................................................................41Remedies Not Exclusive.................................................................................... 41No Waiver of Default ........................................................................................~ 41
ARTICLE VIII
THE TRUSTEE
SECTION 8.01. Appointment; Duties, Immunities and Liabilities of Trustee ............................42SECTION 8.02. Merger or Consolidation ....................................................................................43SECTION 8.03. Liability of Trustee .............................................................................................43SECTION 8.04. Right of Trustee to Rely on Documents .............................................................45SECTION 8.05. Compensation and Indemnification of Trustee ..................................................46 SFLIBI/1046372/i 1190340/00003
ATTACHMENT 3
A3-3
ARTICLE IX
MODIFICATION OR AMENDMENT OF THIS INDENTURE
SECTION 9.01. Amendments Permitted ......................................................................................46SECTION 9.02. Effect of Supplemental Indenture .........................................................~ ...........:.’48SECTION 9.03. Endorsement of Bonds; Preparation of New Bonds ..........................................48SECTION 9.04. Amendment of Particular Bonds; .......................................................................49
ARTICLE X
DEFEASANCE
SECTION 10.01. Discharge of Indenture .....................................................................................49SECTION 10.02. Discharge of Liability on Bonds ..............: .......................................................49SECTION 10.03. Deposit of Money or Securities with Trustee ..................................................50SECTION 10.04. Payment of Bonds After Discharge of Indenture .............................................50 SECTION 11.01.
SECTION 11.02.
SECTION 11.03.
SECTION 11.04.
SECTION 11.05.
SECTION 11.06.
SECTION 11.07.
SECTION 11.08.
SECTION 11.09.
SECTION 11.10.
SECTION 11.11.
SECTION 11.12.
SECTION 11.13.
SECTION 11.14.
SECTION 11.15.
SECTION 11.16.
SECTION 11.17.
ARTICLE XI
MISCELLANEOUS
Liability of City Limited to Electric Net Revenues .........................................51 Successor is Deemed Included in All References to Predecessor ...................51Limitation of Rights to City, Trustee and Bondholders ...................................51 Waiver of Notice ..............................................................................................52Destruction or Delivery of Cancelled Bonds ...................................................52Severability of Invalid Provisions ..............~ .....................................................52Notice to City and Trustee..~ ............................................................................52Evidence of Rights of Bondholders .................................................................52Disqualified Bonds ...........................................................................................53Money Held for Particular Bonds ...................~ ................................................53Funds and Accounts. 53Article and Section Headings and References ................... ..............................53Waiver of Personal Liability ............................................................................54 Governing Law ................................................................................................54Business Day ....................................................................................................54Effective Date of Indenture ..............................................................................54"Execution in Counterparts .................." ..............................................................54 SFLIB 1/1046372/11/90340/00003
iii
ATTACHMENT 3
A3-4
PUBLIC SERVICE DEPARTMENT
ELECTRIC REVENUE BOND INDENTURE
This PUBLIC SERVICE DEPARTMENT ELECTRIC REVENUE BOND
INDENTURE, dated as of October 1, 1998 (the "Indenture"), by and between the CITY OF BURBANK, CALIFORNIA (the "City"), a municipal corporation and chartered city duly organized and existing under the Constitution and laws of the. State of California, and U.S.
BANK TRUST NATIONAL ASSOCIATION, as trustee (the "Trustee"); WITNESSETH:
WHEREAS, the City is a duly constituted chartered city of the State of California duly authorized to exercise the powers granted by its Charter (the "Charter"); and WHEREAS, Article 12 of Chapter 14 of the City Code provides as follows:
Section 14-1201. POWER The Council, exercising the powers reserved ¯ to the City under Sections 3 and 5 (formerly Sections 6 and 8) of Article XI of the Constitution of the State of California and Section 43 of the Charter of the City, may, when the public interest and necessity require, by resolution or resolutions issue revenue bonds for the following purposes: (a) additions to and extensions and improvement of the electric energy system of the City and related facilities, (b) additions to and extensions and improvement of the water system of the City and related facilities, (c) the acquisition, construction, extension or improvemer,: of any other revenue producing system or facility of the City, and (d) to refund obligations issued for any of the foregoing purposes.
Section 14-1202. ¯ PROCEDURE The procedure for the issuance of revenue bonds shall be the procedure set forth in the State Revenue Bond Law of 1941 (commencing with Government Code Section 54300), and by this reference, with the exceptions hereat~er stated, the provisions of said Law are incorporated herein; provided, however, that no election to authorize the issuance of said bonds shall be held, and the restrictions of Government Code 54310 shall not apply, and to those ends Sections 54380 through 54388 and Section 54310 of said Government Code are not incorporated herein and shall not be applicable to the issuance of said revenue bonds; provided, further, that the resolution authorizing the issuance of said revenue bonds may provide that such bonds shall be payable from the revenues of the Enterprise (as specifically defined in such resolution), which may include combined revenues from electric and water services, from interest earnings on unspent bond proceeds and from such other funds as may be legally available for such purpose; provided, further, that before selling the revenue bonds, or any part thereof, the Council may either negotiate the private sale of the revenue bonds with a responsible purchaser or purchasers, who may be purchasing for their own account or for purposes of resale, or give notice inviting sealed bids pursuant to Government Code Section 54388; and provided, further that the interest rate limitation and the limit on discount contained in Section 54402(b) and 54418, respectively, of the Government Code shall likewise not be applicable; and
SFLIBI/1046372/I 1/90340/00003 t ATTACHMENT 3
A3-5
WHEREAS, the City has heretofore issued $26,885,000 aggregate principal amount of its City of Burbank, California Public Service Department Refunding Revenue Bonds, 1987 Series A (the "1987 Bonds") pursuant to an Indenture of Trust, dated as of March 1, |987 (the "Senior Indenture"), by and between the City and Bank of America National Trust and Savings Association (which has been succeeded as trustee by U.S. Bank Trust National Associi~tion), as trustee (the "Senior Trustee"), as amended and supplemented by a First Supplemental Indenture " of Trust, dated as of March 1, 1987, by and between the City and the Senior Trustee, of which $1,915,000 aggregate principal amount is now outstanding and unpaid; and ::
WHEREAS, the City has heretofore issued $27,165,000 aggregate principal am0unt’of its City of Burbank, California Public Service Department Electric and Water Revenue Bonds, 1992 Series A (the "1992 Bonds") pursuant to the Senior Indenture,-as amended and supplemented by a Second Supplemental Indenture of Trust, datedas of November 1, 1992, by and between the City and the Senior Trustee, of which $21,595,000 aggregate principal amount is now outstanding and unpaid; and
WHEREAS, the City has heretofore issued $15,820,000 aggregate principal amount of its City of Burbank, California Public Service Department Refunding Revenue Bonds, 1993 Series A (the "1993 Bonds" and together with the 1987 Bonds and the 1992 Bonds, the "Senior Bonds") pursuant to the Senior Indenture, as amended and supplemented by a Third Supplemental Indenture of Trust, dated as of April 1, 1993, by and between the City and the Senior Trustee, of which $15,070,000 aggregate principal amount is now outstanding and unpaid; and WHEREAS, the City has determined that it is in the interests of the City at this time to agree not to issue any additional bonds under the Senior Indenture in the future and to provide for the separation of the revenues of the City’s electric system and water system to secure bonds of the respective systems; and
WHEREAS, the Senior Indenture provides that nothing therein shall prevent the City from issuing evidences of indebtedness payable out of, or secured by, a pledge, lien or assignment of the trust estate established pursuant to the Senior Indenture (which consists primarily of the net revenues of its electric system and water system) on a basis which is junior and subordinate in all respects to the pledge, lien and assignment made pursuant to the Senior Indenture; and
WHEREAS, the City has determined to enter into this Indenture in order to provide for the authentication and delivery of electric system revenue bonds (the "Bonds") (which electric system revenue bonds shall be junior and subordinate to the Senior Bonds so long as any Senior Bonds remain outstanding), to establish and declare the terms and conditions upon which the Bonds shall be issued and secured and to secure the payment of the principal thereof and premium (if any) and interest thereon;
WHEREAS, the execution and delivery of this Indenture.has in all respects been duly and validly authorized by resolutions duly passed and approved by the City; and WHEREAS, all acts, conditions and things required by law to exist, to have happenedand to have been performed precedent to and in eormeetion with the execution and the entering SFLIBI/1046372/11190340100003
2 ATTACHMENT 3
A3-6
into of this Indenture do exist, have happened and have been performed in due time, form and manner as required by law, and the parties hereto are now duly authorized to execute and enter into this Indenture;
NOW, THEREFORE, THIS INDENTURE WITNESSETH, that in order to secure the. payment of the principal of, premium, if any, and the interest on all Bonds at any time issued, , authenticated and delivered hereunder and to provide the terms and conditions under which all property, rights and interests hereby assigned and pledged are to be dealt with and disposed of,° and to secure the performance and observance of the terms, conditions, stipulations, covenants, agreements, trusts, uses and purposes hereinafter expressed, and in consideration, of the prerhises and of the material covenants herein contained and of the purchase and acceptance of the Bonds by the Owners thereof, and for other valuable consideration, the receipt of which is hereby acknowledged, the City does hereby agree and covenant with the Trustee for the benefit of the respective Owners, from time to time, of the Bonds, as follows:
ARTICLE I
EQUALITY OF SECURITY; DEFINITIONS;
CONTENT OF CERTIFICATES AND OPINIONS
SECTION 1.01. Equality of Security. In consideration of the acceptance of the Bonds by the Owners thereof from time to time, this Indenture shall be deemed .to be and shall constitute a contract between the City, the Trustee and the Owners from time to time of the Bonds and the covenants and agreements herein set forth to be performed by or on behalf of the City or the Trustee shall be for the equal and proportionate benefit, security, and protection of all Owners of the Bonds, without preference, priority or distinction as to security or otherwise of any of the Bonds over any of the others by reasons Of the series, time of issue, sale or negotiation thereof or for any cause whatsoever, except as expressly provided therein or herein. Nothing herein shall prevent additional security being provided to particular Bonds or the creation of a . bond reserve fund therefor under any Supplemental Indenture.
SECTION 1.02. Definitions. The terms defined in this Section shall, for all purposes of this Indenture and of any Supplemental Indenture and of any certificate, opinion or other document herein mentioned, have the meanings herein specified, to be equally applicable to both the singular and plural forms of any of the terms herein defined.
Aecreted Value
"Accreted Value" means, with respect to any Capital Appreciation Indebtedness, the principal amount thereof plus the interest accrued thereon, compounded at the interest rate thereon on each date as specified therein.
Accrued Aggregate Debt Service
"Accrued Aggregate Debt Service" means, as of any date of calculation, an amount equal to the sum of the amounts of accrued Debt Service with respect to all Series of Bonds, calculating the accrued Debt Service with respect to each Series at an amount equal to the sum of SFLIBI/1046372/I 1/90340/00003
I
ATTACHMENT 3
A3-7
(i) interest on the Outstanding Bonds of such Series accrued and unpaid and to accrue to the end of the then current calendar month, and (ii) principal due and unpaid and that portion of the principal for such Series next due which would have accrued if deemed to acc~e to the end of such calendar month if such principal were deemed to accrue daily in equal amounts from the next preceding principal payment date for such Series (or, if there shall be no such preceding ~- principal payment date, from a date one (1) year preceding the due date of such principal installment or from the date of issuance of the Bonds of such Series, whichever period is shorter).
Adjusted Electric Net Revenues
"Adjusted Electric Net Revenues" means the Electric Net Revenues plus, for purposes of determining compliance with Section 6.09 only, other lawfully available funds of the City budgeted by the City for the payment of Electric Operating Expenses or Debt Service on the Bonds and/or any Parity Debt during such Fiscal Year.
Annual Debt Service
"Annual Debt Service" means, for any Fiscal Year, the aggregate amount of principal and interest on all Bonds and Parity Debt becoming due and payable during such Fiscal Year calculated using the principles and assumptions set forth under the definition of Debt Service.
Assumed Debt Service
"Assumed Debt Service" means, for any Fiscal Year, thc aggregate amount of principal and interest which would be payable on all Bonds and Parity Deb’t if each Excluded Principal Payment were amortized for a period specified by the City (but no longer than thirty (30) years from the date of the issuance of the Bonds or Parity Debt to which such Excluded Principal Payment relates) on a substantially level debt service basis, calculated based on a fixed interest rate equal to the rate at which the City could borrow for such period, as certified by a certificate of a financial advisor or investment banker delivered to the Trustee, who may rely conclusively on such certificate, within thirty (30) days of the date of calculation.
Average Annual Debt Service
"Average Annual Debt Service" means, as of any date of calculation, an amount equal to (i) the Annual Debt Service remaining to be paid on all Bonds and Parity Debt on the date of calculation, divided by (ii) the number of Fiscal Years (or partial years) commencing with the Fiscal Year of the date of calculation to and including the Fiscal Year which includes the first date on which none of such Bonds or Parity Debt remains Outstanding. Such interest and principal shall be calculated on the assumption that no Bonds or Parity Debt at the date of calculation shall cease to be Outstanding except by reason of the payment when due of each principal installment (including mandatory sinking account payments).
Bond Obligation
"Bond Obligation" means, as of any given date of calculation, (1) with respect to any Outstanding Bond which is Current Interest Indebtedness, the principal amount thereof, and SFLIBI/1046372/11/90340/00003
ATTACHMENT 3
A3-8
(2) with respect to any Outstanding Bond which is Capital Appreciation Indebtedness, the Aeereted Value thereof.
Bond Resolution
"Bond Resolution" means Resolution No. 25,368 of the City, adopted on September 29~ 1998, as amended and supplemented from time to time.
Bonds; Serial Bonds; Term Bond.q
"Bonds" means the Public Service Department Electric Revenue Bonds authorized by, and at any time Outstanding pursuant to, this Indenture. "Serial Bonds" means Bonds, maturing in specified years, for which no mandatory sinking fund payments are provided.
"Term Bonds" means Bonds payable at or before their specified maturity date or dates from mandatory sinking fund payments established for that purpose and calculated to retire such Bonds on or before their specified maturity date or dates.
Business Day
"Business Day" means any day other than (1) a Saturday, Sunday, or a day on which banking institutions in the State or the State of New York are authorized or obligated by law or executive order to be closed, and (2) for purposes of payments and other actions relating to Bonds secured by a letter of credit, a day upon which commercial banks in the city in which is located the office of the issuing bank at which demands for payment under the letter of credit are to be presented are authorized or obligated by law or executive order to be closed.
Capital Appreciation Indebtedness
"Capital Appreciation Indebtedness" means Bonds and Parity Debt on which interest is compounded and paid less frequently than annually.
Certificate, Statement, Request, Requisition or Order of the City "Certificate," "Statement," "Request," "Requisition" or "Order" of the City mean, respectively, a written certificate, statement, request, requisition or order signed in.the name of the City by its City Manager or any other person authorized by the City Manager to execute such instruments. Any such instrttment and supporting opinions or representations, if any, may, but need not, be combined in a single instrument with any other instrument, opinion or representation, and the two or more so combined shall be read and construed as a single instrument. If and to the extent required by Section 1.03 hereof, certificates and opinions shall include the statements provided for in Section 1.03 hereof.
Charte..___.~r
"Charter" means the City charter of the City, as amended from time to time.
SFLIB 1/1 IM637211 !190340/00003
ATTACHMENT 3
A3-9
"City" means the City of Burbank, Califomia.
City Code
"City Code" means the Municipal Code of the City, as amended from time to time.
Code
"Code" means the Internal Revenue Code of 1986, and the regulations applicable thereto or issued thereunder, as amended from time to time.
Continuing Disclosure Agreement
"Continuing Disclosure Agreement" means any Continuing Disclosure Agreement executed and delivered by the City relating to any Series of Bonds.
Corporate Trust Office
"Corporate Trust Office" or "corporate trust office" means the corporate trust office of the Trustee at 550 South Hope Street, Suite 500, Los Angeles, California 90071, Attention:
Corporate Trust Department; provided, however, that for transfer, registration, exchange, payment and surrender of Bonds, "Corporate Trust Office" means care of the corporate trust office of U.S. Bank Trust National Association in St. Paul, Minnesota, or such other or additional offices as may be designated by the Trustee.
Costs of Issuance
"Costs of Issuance’i means all items of expense directly or indirectly payable by or reimbursable to the City and related to the authorization, execution, sale and delivery of the Bonds, including but not limited to advertising and printing costs, costs of preparation and reproduction of documents, filing and recording fees, travel expenses and costs relating to rating agency meetings and other meetings concerning the Bonds, initial fees and charges of the Trustee, legal fees and charges, fees and disbursements of consultants and professionals, financial advisor fees and expenses, rating agency fees, fees and charges for preparation, execution, transportation and safekeeping of Bonds, surety, insurance and credit enhancement costs, and any other cost, charge or fee in connection with the delivery of Bonds.
Council
"Council" means the City Council of the City.
Coverage Requirement
"Coverage Requirement" means, for any Fiscal Year, an amount of Adjusted Electric Net Revenues equal to at least 1.20 times the amount of the Annual Debt Service for such Fiscal Year.
SFLIBI/1046372111190340100003
I
ATTACHMENT 3
A3-10
Current Interest Indebtedness
"Current Interest Indebtedness" means the Bonds and Parity Debt on v~hich interest is paid at least annually.
Debt Service
"Debt Service" means the amount of principal and interest becoming due and payable on’:all Bonds and Parity Debt provided, however, that for the purposes of computing Debt Service:
(a) Excluded Principal Payments shall be excluded from, such calculation and Assumed Debt Service shall be included in such calculation; (b) if the Bonds or Parity Debt are Variable Rate Indebtedness, the interest rate thereon for periods when the actual interest rate cannot yet be determined shall be assumed to be equal to the rate that is ninety percent (90%) of the average RBI during the twelve (12) calendar month period immediately preceding the date in which the calculation is made (the "assumed RBI-based rate");
(c) principal and interest payments on Bonds and Parity Debt shall be excluded to the extent such payments are to be paid from amounts on deposit with the Trustee or another fiduciary in escrow specifically therefor and to the extent that such interest payments are to be paid from the proceeds of Bonds or Parity Debt held by the Trustee or another fiduciary as capitalized interest;
(d) in determining the principal amount, payment shall (unless a different subsection of this definition applies for purposes of determining principal maturities or amortization) be assumed to be made in accordance with any amortization schedule established for such debt, including any mandatory sinking fund payments or any scheduled redemption or payment of Bonds or Parity Debt on the basis of Accreted Value, and for such purpose, the redemption payment or payment of Accreted Value shall be deemed a principal payment and interest that is compounded and paid as Accreted Value shall be deemed due on the scheduled redemption or payment date of such Capital Appreciation Indebtedness;
(e) if any interest rate swap agreement is in effect with respect to, and is payable on a parity with, the Bonds or Parity Debt to which it relates, no amounts payable under such interest rate swap agreement shall be included in the calculation of Debt Service unless the sum of (i) interest payable on such Bonds or Parity Debt, plus (ii) amounts payable by the City under such interest rate swap agreement,, less (iii) amounts receivable by the City under such interest rate swap agreement are greater than the interest payable on the Bonds or Parity Debt to which it relates, then, in such instance, the amount of such payments to be made that exceed the interest to be paid on .................. the Bonds or Parity Debt shall be included in such calculation. For such purposes, the variable amount under any such interest rate swap agreement shall be assumed to be equal to the assumed RBI-based rate; and
SFLIB 1/1046372/11/90340/00003
l
ATTACHMENT 3
A3-11
(f) if any Bonds or Parity Debt include an option or an obligation to tender all or a portion of such Bonds or Parity Debt to the City, the Trustee or another fiduciary or agent and require that such Bonds or Parity Debt or portion thereof be ]~urchased if properly presented, then for purposes of determining the amounts of principal and interest due, the options or obligations to tender shall be treated as a principal maturity’occurring on the first date on which holders or owners thereof may or are required to tender, except that any such option or obligation to tender shall be ignored and not treated as a principal maturity, if(l) such Bonds or Parity Debt are rated in one of the two highest long-term Rating Categories by Moody’s and by Standard & Poor’s or such Bonds or Parity Debt are rated in the highest short-term note or commercial paper Rating Categories by Moody’s and by Standard & Poor’s and (2) funds for the purchase price are to be provided by a letter of credit or standby bond purchase agreement and the obligation of the City with respect to the provider of such letter of credit or standby bond purchase agreement, other than its obligations on such Bonds or Parity Debt, shall be subordinated to the obligation of the City on the Bonds and Parity Debt.
Defeasance Securities
"Defeasance Securities" means any of the following:
(i) any bonds or other obligations which as to principal and interest constitute direct obligations of, or are unconditionally guaranteed by, the United States of America, including obligations of the Federal National Mortgage Association, the Government National Mortgage Association, Federal Home Loan Banks and Federal Home Loan Mortgage Corporation to the extent unconaitionally guaranteed by the United States of America;
(ii) any certificates, receipts, securities or other obligations evidencing ownership of, or the right to receive, a specified portion of one or more interest payments or principal payments, or any combination thereof, to be made on any bond, note, or other obligation described above in clause (i) including, but not limited to, REFCORP interest strips; or
(iii) any bonds or other obligations of any state of the United States of America or any political subdivision thereof(a) which are not callable prior to maturity or as to which irrevocable instructions have been given to the trustee of such bonds or other obligations by the obligor to give due notice of redemption and to call such bonds for redemption on the date or dates specified in such instructions, (b) which are secured as to principal and interest and redemption premium, if any, by a fund consisting only of cash or bonds or other obligations of the character described above in clause (i) or (ii) which fund may be applied only to the payment of such principal of and interest and redemption premium, if any, on such bonds or other obligations on the interest payment dates and the maturity date or dates thereof or the specified redemption date or dates pursuant to such irrevocable instructions, as appropriate, (e) as to which the principal of and interest on the bonds and obligations of the character described above in clause (i) or (ii) which have been deposited in such fund along with any cash on deposit in such fund are sufficient to pay the principal of and interest and redemption premium, if any, on the bonds or other SFLIBI/1046372/11/90340100003
ATTACHMENT 3
A3-12
obligations described in this clause (iii) on the interest payment dates and the maturity date or dates thereof or on the redemption date or dates specified in the irrevocable instructions referred to in subclause (a) of this clause (iii), as appropriate, and (d) which have been rated not lower than their respective ratings on the Bonds by Moody’s (if Moody’s is then rating the Bonds) and Standard & Poor’s (if Standard & Poor’sis then-- rating the Bonds);
Debt Service Fund
"Debt Service Fund" means the fund by that name established pursuant to Section 5;03 hereof.
Department
"Department" means the Public Service Department of the City of Burbank.
Effective Date
"Effective Date" means the first date on which all Senior Bonds have been paid or discharged in accordance with their terms.
Electric Net Revenues
"Electric Net Revenues" means: (i) prior to the Effective Date, the amount ofEnterprise Subordinated Net Revenues determined by the City in accordance with Generally Accepted Accounting Principles Applicable to Governments to be properly allocable to the Electric System, and (ii) on and after the Effective Date, the amount of Electric Revenues of the Electric System remaining after payment therefrom of the Electric Operating Expenses.
Electric Operating Expenses
"Electric Operating Expenses" means, on and after the Effective Date, the amount required to pay the expenses of management, repair and other costs necessary to operate, maintain and preserve the Electric System in good repair and working order, including but not limited to, the cost of supply and transmission of electric energy under long-term contracts or otherwise and the expenses of conducting the Electric System, but excluding depreciation. "Electric Operating Expenses" shall include all amounts required to be paid by the City under contract with a joint powers agency for purchase of capacity, energy,, transmission capability or any other commodities or services in connection with the foregoing, which contract requires payments by the City to be made hereunder to be treated as Electric Operating Expenses.
Electric Revenue Fund
"Electric Revenue Fund" means the Electric Revenue Fund established pursuant to Section 5.01 hereof.
SFLIBI/1046372/11/90340/00003
I
ATTACHMENT 3
A3-13
Electric Revenues
"ElectricRevenues" means, on and after the Effective Date, all revenues (as defined in Section 54315 of the Government Code, which include all charges received for and all other income and receipts derived by the Department from the operation of the Electric System or :. arising from the Electric System) received by the Department from the services, facilities, energy and distribution of electric energy by the Department, including income from investments, but excepting therefrom (a) all reimbursement charges and deposits to secure service and (b) any -::
charges collected by any person to amortize, or otherwise relating to the payment of, the uneconomic portion of costs associated with assets and obligations ("stranded costs") of the" Electric System or of any joint powers agency in which the City participates which the City has dedicated to the payment of obligations other than the Bonds or any Parity Debt then outstanding, the payments of which obligations wil! be applied to or pledged to or otherwise set aside for the reduction or retirement of outstanding obligations of the City or any joint powers agency in which the City participates relating to such "stranded costs" of the City or of any such joint powers agency to the extent such "stranded costs" are attributable to, or the responsibility of, the City.
Electric System
"Electric System" means the entire system and facilities of the City for the generation, transmission and distribution of electric energy as said system now exists and including all additions, extensions and improvements thereto later constructed or acquired.
Enterprise
"Enterprise" means the Electric System and the Water System.
Enterprise Net Revenues
"Enterprise Net Revenues" means, prior to the Effective Date, the amount of Enterprise Revenues of the Enterprise remaining after payment therefrom of the Enterprise Operating Expenses.
Enterprise Operating Expenses
"Enterprise Operating Expenses" means, prior to the Effective Date, the amount required to pay the reasonable expenses of management, repair and other costs necessary to operate, maintain and preserve the Enterprise in good repair and working order, excluding depreciation but including the City’s obligations under (i) a Power Sales Contract, dated August 6, 1980, as amended, with the Intermountain Power Agency; (ii) an Agreement for Acquisi~!on of C,a,,p.acity,dated as of May 1, 1983, with the Southern California Public Power Authority ( SCPPA ); (iii) a Transmission Service Contract, dated as of May 1, 1983, with SCPPA; (iv) a Power Sales Contract, dated July 1, 1981, with SCPPA; (v) a Transmission Service Contract, dated as of August 4, 1992, with SCPPA relating to the Mead-Adelanto transmission project; (vi) a Transmission Service Contract, dated as of August 4, 1992, with SCPPA relating to the Mead- Phoenixtransmission project; and (vii) other similar contracts and amendments to such contracts entered into or adopted hereafter.
SFLIB 1/1046372/11190340100003
ATTACHMENT 3
A3-14
Enterprise Revenues
"Enterprise Revenues" means, prior to the Effective Date, all revenues (as defined in Section 54315 of the Government Code, which include all charges received for and all other income and receipts derived by theDepartment from the operation of the Electric System and lhe Water System or arising from the Electric System and the Water System) received by the Department from the services, facilities, energy and distribution of electric energy and water b~ the Department, including income from investments, but excepting therefrom all reimbursement:" charges and deposits to secure service.
Enterprise Subordinated Net Revenues
"Enterprise Subordinated Net Revenues" means, prior to the Effective Date, all Enterprise Net Revenues less all amounts required to be paid under the Senior Indenture for principal, interest, reserve fund and any other debt service requirements on the Senior Bonds as the same become due and payable, which Enterprise Subordinated Net Revenues the City shall direct the Senior Trustee pursuant to Section 509 of the Senior Indenture to transfer to the City from the General Reserve Fund established pursuant to the Senior Indenture for deposit in the Electric Revenue Fund pursuant to Section 5.01 hereof.
Event of Default
"Event of Default" means any of the events specified in Section 7.01 hereof.
Excluded Principal Payments
"Excluded Principal Payments" means each payment of principal (or the principal component of lease or installment purchase payments) of Bonds or Parity Debt which the City determines on a date not later than the date of issuance thereof that the City intends to pay with moneys that are not Electric Revenues or Electric Net Revenues, but from the proceeds of future debt obligations of the City and the Trustee may rely conclusively on such determination of the city.
Fiscal Year
"Fiscal Year" means the period beginning on July 1 of each year and ending on the next succeeding June 30, or any other twelve-month period hereafter selected and designated as the official fiscal year period of the City which designation shall be provided to the Trustee in a certificate of the City.
Generally Accepted Accounting Principles Applicable to Governments "Generally Accepted Accounting Principles Applicable to Governments" means generally accepted accounting principles applicable to governments as promulgated by the Governmental Accounting Standards Board or its successor.
SFLIBl/1046372/11/90340/00003
ATTACHMENT 3
A3-15
Indenture
"Indenture" means this Public Service Department Electric Revenue Bbnd Indenture, dated as of October 1, 1998, by and between the City and the Trustee, as originally executed and as it may from time to time be supplemented or amended by any Supplemental Indenture ~.. delivered pursuant to the provisions hereof.
Information Services
The term "Information Services" means Financial Information, Inc.’s "Daily Called Bond Service," 30 Montgomery Street, 10th Floor, Jersey City, New Jersey 07302, Attention: Editor; Kenny Information Services’ "Called Bond Service," 55 Broad Street, 28th Floor, New York, New York 10004; Moody’s "Municipal and Government," 99 Church Street, 8th Floor, New York, New York 10007, Attention: Municipal News Reports; and Standard & Poor’s "Called Bond Record," 25 Broadway, 3rd Floor, New York, New York 10004; or, in accordance with then-current guidelines of the Securities and Exchange Commission, such other addresses and/or such other services providing information with respect to called bonds, or no such services, as the City may designate in a Request of the City delivered to the Trustee.
Investment Securities
"Investment Securities" means the following:
(i) any bonds or other obligations which as to principal and interest constitute direct obligations of, or are unconditionally guaranteed by, the United States of America, including obligations of any of the federal agencies and federally sponsored entities set forth in clause (iii) below to the extent unconditionally guaranteed by the United States of America; (ii) any certificates, receipts, securities or other obligations evidencing ownership of, or the right to receive, a specified portion of one or more interest payments or principal payments, or any combination thereof, to be made on any bond, note, or other obligation described above in clause (i);
(iii) obligations of the Federal National Mortgage Association, the Government National Mortgage Association, Federal Home Loan Banks, and Federal Home Loan Mortgage Corporation;
(iv) obligations of any state, territory or commonwealth of the United States of America or any political subdivision thereof or any agency or department of the foregoing; provided that at the time of their purchase such obligations are rated not lower than their respective ratings on the Bonds by Moody’s (if Moody’s is then rating the Bonds) and Standard & Poor’s (if Standard & Poor’s is then rating the Bonds); (v) any bonds or other obligations of any state of the United States of America or any political subdivision thereof (a) which are not callable prior to maturity or as to which irrevocable instructions have been given to the trustee of such bonds or other obligations by the obligor to give due notice of redemption and to call such bonds for redemption on the.date or dates specified in such instructions, (b) which are secured as to principal and interest and SFLIB 1/1046372/11/90340/00003
ATTACHMENT 3
A3-16
redemption premium, if any, by a fund consisting only of cash or bonds or other obligations of the character described above in clause (i), (ii) or (iii) which fund may be applied only to the payment of such principal of and interest and redemption premium, if any, on such bonds or other obligations on the interest payment dates and the maturity date or dates thereof or the spe.eified redemption date or dates pursuant to such in’evoeable instructions, as approi0riate, (~) as to which the principal of and interest on the bonds and obligations of the character described above in clause (i), (ii) or (iii) which have been deposited in such fund along with any cash on deposit in such fund are sufficient to pay the principal of and interest and redemption premiurff,’ ’ if any, on the bonds or other obligations described in this clause (v) on the interest payment dates and the maturity date or dates thereof or on the redemption date or dates specified in the irrevocable instructions referred to in subelause (a) of this clause (v), as appropriate, and (d) which have been rated not lower than their respective ratings on the Bonds by Moody’s (if Moody’s is then rating the Bonds) and Standard & Poor’s (if Standard & Poor’s is then rating the Bonds);
(vi) bonds, notes, debentures or other evidences of indebtedness issued or guaranteed by any corporation which are, at the time of purchase, rated by Moody’s (ifMoody’s is then rating the Bonds) and Standard & Poor’s (if Standard & Poor’s is then rating the Bonds) in their respective highest short-term Rating Categories, or, if the term of such indebtedness is longer than three (3) years, rated not lower than their respective ratings on the Bonds by Moody’s (if Moody’s is then rating the Bonds) and Standard & Poor’s (if Standard & Poor’s is then rating the Bonds);
(vii) demand or time deposits or certificates of deposit, whether negotiable or not~.negotiable, issued by any bank or trust company organized under the laws of any state of the United States of America or any national banking association (including the Trustee), provided that such certificates of deposit shall be purchased directly from such a bank, trust company or national banking association and shall be either (1) continuously and fully insured by the Federal Deposit Insurance Corporation, or (2) continuously and fully secured by such securities and obligations as are described above in clauses (i) through (iv), inclusive, which shall have a market value (exclusive of accrued interest) at all times at least equal to the principal amount of such certificates of deposit and shall be lodged with the Trustee, as custodian, by the bank, trust company or national banking association issuing such certificates of deposit, and the bank, trust company or national banking association issuing each such certificate of deposit required to be so secured shall furnish the Trustee with an undertaking satisfactory to it that the aggregate market value of all such obligations securing each such certificate of deposit will at all times be. an amount equal to the principal amount of each such certificate of deposit and the Trustee shall be entitled to rely on each such undertaking;
(viii) taxable commercial paper or .tax-exempt commercial paper, rated in their respective highest Rating Categories by Moody’s (ifMoody’s is then rating the Bonds) and Standard & Poor’s (if Standard & Poor’s is then rating the Bonds); (ix) variable rate obligations requi~ed to be redeemed or purchased by the obligor or its agent or designee upon demand of the holder thereof secured as to such redemption or purchase requirement by a liquidity agreement with a corporation and as to the payment of. interest and principal either upon maturity or redemption (other than upon demand by the holder SFLIBI/1046372/11190340/00003
13 ATTACHMENT 3
A3-17
thereof) thereof by an unconditional credit facility of a corporation provided that the variable rate obligations themselves are rated in their respective highest Rating Categories for its short- term rating, if any, and not lower than their respective ratings on the Bonds for its long-term rating, if any, by Moody’s (ifMoody’s is then rating the Bonds) and Standard & Poor’s (if Standard & Poor’s is then rating the Bonds), and that the corporations providing the liquidity ".. agreement and credit facility have, at the date of acquisition of the variable rate obligation by , the Trustee, an outstanding issue of unsecured, uninsured and unguaranteed debt obligations rated not lower than their respective ratings on the Bonds by Moody’s (if Moody’s is then rating":
the Bonds) and Standard & Poor’s (if Standard & Poor’s is then rating the Bonds); (x) any repurchase agreement with any bank or trust company organized under the laws of any state of the United States or any national banking association (including the Trustee) having a minimum permanent capital of one hundred million dollars ($100,000,000) and with short-term debt rated by Moody’s (ifMoody’s is then rating the Bonds) and Standard & Poor’s (if Standard & Poor’s is then rating the Bonds) in their respective four highest short-term rating categories or with government bond dealer reporting to, trading with, and recognized as a primary dealer by the Federal Reserve Bank of New York, which agreement is secured by any one or more of the securities and obligations described in clauses (i), (ii) or (iii) above, which shall have a market value (exclusive of accrued interest and valued at least monthly) at least equal to the principal amount of such investment and shall be lodged with the Trustee or other fiduciary, as custodian for the Trustee, by the bank, trust company, national banking association or bond dealer executing such repurchase agreement, and the entity executing each such repurchase agreement required to be so secured shall furnish the Trustee with an undertaking satisfactory to it that the aggregate market value of all such obligations securing each such repurchase agreement (as valued at least monthly) will be an amount equal to the principal amount of each such repurchase agreement and the Trustee shall be entitled to rely on each such undertaking; .
(xi) any cash sweep or similar account arrangement of or available to the Trustee, the investments of which are limited to investments described in clauses (i), (ii), (iii), (iv) and (x) of this definition of Investment Securities and any money market fund, the entire investments of which are limited to investments described in clauses (i), (ii), (iii), (iv) and (x) of this definition of Investment Securities and which money market fund is rated in their respective highest Rating Categories by Moody’s (ifMoody’s is then rating the Bonds) and Standard & Poor’s (if Standard & Poor’s is then rating the Bonds); provided that as used in this clause (xi) and clause (xii) investments will be deemed to satisfy the requirements of clause (x) if they meet the requirements set forth in clause (x) ending with the words "clauses (i), (ii) or (iii) above" and without regard to the remainder of such clause (x);
(xii). 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 ease of a guaranteed corporation the long-term debt, or, in the ease 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 the terms of the investment agreement shall be approved in writing by each insurer of the Bonds, if any; SFLIBI/1046372/I 1/90340/00003
ATTACHMENT 3
A3-18
(xiii)
(xiv)
shares of beneficial interest in diversified management companies investing exclusively in securities and obligations described in clauses (i) through (xii) of this definition of Investment Securities and which companies ai’e rated in their respective highest Rating Categories by Moody’s (ifMoody’s is then rating the Bonds) and Standard & Poor’s (if Standard & Poor’s is then rating the Bonds) or have an investment advisor registered with the Securities and Exchange Commission with not less than 5 years experience investing in such securities and obligations and with assets under management in excess of $500,000,000; and any investment approved by the Council.
Maximum Annual Debt Service
"Maximum Annual Debt Service" means the greatest amount of principal and interest becoming due and payable on all Bonds and Parity Debt in the Fiscal Year in which the calculation is made or any subsequent Fiscal Year using the principles and assumptions set forth under the definition of Debt Service.
Moody’s
"Moody’s" means Moody’s Investors Service, a corporation duly organized and existing under and by virtue of the laws of the State of Delaware, and its successors and assigns, except that if such corporation shall be dissolved or liquidated or shall no longer perform the functions of a securities rating agency, then the term "Moody’s" shall be deemed to refer to any other nationally recognized securities rating agency selected by the City. ..Opinion of Bond Counsel
"Opinion of Bond Counsel" means a written opinion of a law firm of national standing in the field of public finance selected by the City.
.Outstanding
"Outstanding," when used as of any particular time with reference to Bonds, means (subject to the provisions of Section 11.09) all Bonds theretofore, or thereupon being, authenticated and delivered by the Trustee under this Indenture except (1) Bonds theretofore cancelled by the Trustee or surrendered to the Trustee for cancellation; (2) Bonds with respect to. which all liability of the City shall have been discharged in accordance with Section 10.02, including Bonds (or portions of Bonds) referred to in Section 11.10; and (3) Bonds for the transfer or exchange of or in lieu of or in substitution for which other Bonds shall have been authenticated and delivered by the Trustee pursuant to this Indenture.
Owner or Bondholder or Bondowner
"Owner" or "Bondholder" or "Bondowner," whenever used herein with respect to a Bond, means the person in whose name such Bond is registered.
SFLIBI/1046372/11190340100003
15 ATTACHMENT 3
A3-19
Parity Debt
"Parity Debt" means any indebtedness, installment sale obligation, lease obligation or other obligation of the City for borrowed money or interest rate swap agreement having an equal lien and charge upon the Electric Net Revenues, therefore payable on a parity with theBonds ,. (whether or not any Bonds are Outstanding).
Parity Reserve Fund
"Parity Reserve Fund" means the reserve fund created pursuant to Section 5.04 hereof.
Rating Category_
"Rating Category" means (i) with respect to any long-term rating category, all ratings designated by a particular letter or combination of letters, without regard to any numerical modifier, plus or minus sign or other modifier and (ii) with respect to any short-term or commercial paper rating category, all ratings designated by a particular letter or combination of letters and taking into account any numerical modifier, but not any plus or minus sign or other modifier.
"RBI" means the Bond Buyer Revenue Bond Index or comparable index of long-term municipal obligations chosen by the City, and, if no comparable index can be obtained, eighty percent (80%) of the interest rate on actively traded thirty (30) year United States Treasury obligations.
Rebate Fund
"Rebate Fund" means that fund established under Section 6.07 hereof.
Rebate Requirement
"Rebate Requirement" means the Rebate Requirement defined in the Tax Certificate.
Redemption Price
"Redemption Price" means, with respect to any Bond (or portion thereof) the Bond Obligation of such Bond (or portion thereof) plus the applicable premium, if any, payable upon redemption thereof pursuant to the provisions of such Bond and this Indenture.
Reserve Fund Requirement
"Reserve Fund Requirement" means,.as of any date of determination and excluding any Parity Debt for which no reserve fund is to be maintained or for which a separate reserve fund is to be maintained, the least of(a) ten percent (10%) of the initial offering price to the public of each Series of Bonds and any Parity Debt to be secured by the Parity Reserve Fund as determined under the Code, or (b) the Maximum Annual Debt Service on all Bonds and Parity SFLIBI/1046372/11190340100003
16 ATTACHMENT 3
A3-20
Debt to be secured by the Parity Reserve Fund, or (c) one hundred twenty-five percent (125%) of the Average Annual Debt Service on all Bonds and Parity Debt to be secured by the Parity Reserve Fund, all as computed and determined by the City and specified in wrlting to the Trustee.
Securities Depositories
"Securities Depositories" means the following: The Depository Trust Company, 711 Stewart Avenue, Garden City, New York 11530, Fax-(516) 227-4039 or 4190; Midwest Securities Trust Company, Capital Structures-Call Notification, 440 South LaSalle Street, Chicago, Illinois 60605, Fax-(312) 663-2343; Philadelphia Depository Trust Company, Reorganization Division, 1900 Market Street, Philadelphia, Pennsylvania 19103, Attention:
Bond Department, Dex-(2! 5) 496-5058; or, in accordance with then-current guidelines of the Securities and Exchange Commission, to such other addresses and!or such other securities depositories, or no such depositories, as the City may designate in a Request of the City delivered to the Trustee.
Senior Bonds
"Senior Bonds" means all bonds of the City issued pursuant to the Senior Indenture.
Senior Indenture
"Senior Indenture" means the Indenture of Trust securing the City of Burbank, California Public Service Department Refunding Revenue Bonds, 1987 Series A, the City of Burbank, Califomia Public Service Department Electric and Water Revenue Bonds, 1992 Series A and the City of Burbank, California Public Service Department Refunding Revenue Bonds, 1993 Series A, dated as of March 1, 1987, between the City and Bank of America National Trust and Savings Association (which has been succeeded as trustee by U.S. Bank Trust National Association), as trustee thereunder, as amended and supplemented from time to time.
Series
"Series," whenever used herein with respect to Bonds, means all of the Bonds designated as being of the same series, authenticated and delivered in a simultaneous transaction, regardless of variations in maturity, interest rate, redemption and other provisions, and any Bonds thereafter authenticated and delivered upon transfer or exchange or in lieu of or in substitution for (but not - to refund) such Bonds as herein provided.
Standard & Poor’s
"Standard & Poor’s" means Standard & Poor’s, a corporation duly organized and existing under and by virtue of the laws of the State of New York, and its successors and assigns, except that if such corporation shall be dissolved or liquidated or shall no longer perform the functions ofa securities rating agency, then the term "Standard & Poor’s" shall be deemed to refer to any other nationally recognized securities rating agency selected by the City.
SFLIBI/1046372/! 1/90340/00003
ATTACHMENT 3
A3-21
State
"State" means the State of California.
Supplemental Indenture
"Supplemental Indenture" means any indenture hereafter duly executed and delivered, supplementing, modifying or amending this Indenture, but only if and to the extent that such Supplemental Indenture is specifically authorized hereunder.
Tax Certificate
"Tax Certificate" means the Tax Certificate delivered bythe City at the time of the issuance and delivery of any Series of Bonds, as the same may be amended or supplemented in accordance with its terms.
Treasurer
"Treasurer"means the Treasurer oftheCity.
Trustee
"Trustee" means U.S. Bank Trust National Association, acting as trustee hereunder, or its successor, as Trustee as provided in Section 8.01.
Variable Rate Indebtedness
"Variable Rate Indebtedness" means any indebtedness the interest rate on which is not fixed at the time of incurrence of such indebtedness, and has not at Some subsequent date been fixed, at a single numerical rate for the entire term of the indebtedness.
SECTION 1.03. Content of Certificates and Opinions. Every certificate or opinion provided for in this Indenture with respect to compliance with any provision hereof shall include (1) a statement that the person making or giving such certificate or opinion has read such provision and the definitions herein relating thereto; (2) a brief statement as to the nature and scope of the examination or investigation upon which the certificate or opinion is based; (3) a statement that, in the opinion of such person, he has made or caused to be made such examination or investigation as is necessary to enable him to express an informed opinion with respect to the subject matter referred to in the instrument to which his signature is affixed; and (4) a statement as to whether, in the opinion of such person, such provision has been complied with.
Any such certificate or opinion made or given by an officer of the City may be based, insofar as it relates to legal or accounting matters, upon a certificate or opinion of or representation by counsel, an aecountant~ a financial advisor, an investment banker or an independent consultant, unless such officer knows, or in the exercise of reasonable care should have known, that the certificate, opinion or representation with respect to the matters upon which such certificate or statement may be based, as aforesaid, is erroneous. Any such certificate or SFLIB I ./.I 046372/11/90340/00003
18 ATTACHMENT 3
A3-22
opinion made or given by counsel, an accountant or an independent consultant may be based, insofar as it relates to factual matters (with respect to which information is in the possession of the City) upon a certificate or opinion of or representation by an officer of theCity, unless such counsel, accountant or independent consultant knows, or in the exercise of reasonable care should have known, that the certificate or opinion or representation with respect to the matters upon which such person’s certificate or opinion or representation may be based, as aforesaid, is erroneous. The same officer of the City, or the same counsel or accountant or independent . . consultant, as the case may be, need not certify to all of the matters required to be certified under any provision of this Indenture, but different officers, counsel, accountants or independent consultants may certify to different matters, respectivel.y.
ARTICLE II
THE BONDS
SECTION 2.01. Authorization of Bondg. Bonds may be issued hereunder, in book-entry form or otherwise, from time to time as the issuance thereof is approved by the City. The maximum principal amount of Bonds which may be issued hereunder is not limited; subject, however, to the right of the City, which is hereby reserved, to limit the aggregate principal amount of Bonds which may be issued or Outstanding hereunder. The Bonds are designated generally as "City of Burbank, California Public Service Department Electric Revenue Bonds"; each Series thereof to bear such additional designation as may be necessary or appropriate to distinguish such Series from every other Series of Bonds. The Bonds may be issued in such Series as from time to time shall be established and authorized by the City, subject to the covenants, provisions and conditions herein contained.
SECTION 2.02. Terms of the Bonds. The Bonds of each Series shall bear interest, if any, at such rate or rates or determined in such manner and payable at such intervals as may be determined by the City at the time of issuance thereof pursuant to the Supplemental Indenture under which such Bonds are issued, not to exceed the maximum rate of interest permitted by law and shall mature and become payable on such date or dates and in such year or years as the City may determine by the Supplemental Indenture creating such Series. Principal of, premium, if any, and interest on such Bonds shall be payable in such manner as may be specified in the Supplemental Indenture creating such Series.
The Bonds of any Series may be issued in such denominations as may be authorized by the Supplemental Indenture creating such Series in fully registered form without coupons or in fully registered book-entry form or, for a Series maturing in one year or less, bearer form.
SECTION 2.03. Form of Bonds. The Bonds of any Series shall be in such form or forms as may be specified in the Supplemental Indenture creating such Series.
SECTION 2.04. Execution of Bond.~. The Bonds shall be executed in the name and on behalf of the City with the facsimile or manual signature of any of the Mayor, the Vice Mayor, the City Manager, the Assistant City Manager, the City Treasurer or the Financial Services Director, under seal attested by the facsimile or manual signature of the City Clerk. Such seal SFLIB 1/1046372/11/90340/00003
19 ’
ATTACHMENT 3
A3-23
may be in the form of a facsimile of the City’s seal and may be reproduced, imprinted or impressed on the Bonds. Unless otherwise provided in any Supplemental Indenture, the Bonds shall then be delivered to the Trustee for authentication by it. In case any oftl~e officers who shall have signed or attested any of the Bonds shall cease to be such officer or officers of the City before the Bonds so signed or attested shall have been authenticated or delivered by the -~ Trustee or issued by the City, such Bonds may nevertheless be authenticated, delivered and issued and, upon such authentication, delivery and issue, shall be as binding upon the City as though those who signed and attested the same had continued to be such officers of the City, an~l also any Bond may be signed and attested on behalf of the City by such persons as at the actual date of execution of such Bond shall be the proper officers of the City although at the nomir~al date of such Bond any such person shall not have been such officer of the City.
Except as may be provided in any Supplemental Indenture, only such of the Bonds as shall bear thereon a certificate of authentication substantially in the form recited in the Supplemental Indenture creating such Series, manually executed by the Trustee, shall be valid or obligatory for any purpose or entitled to the benefits of this Indenture, and such certificate of authentication when manually executed by the Trustee shall be conclusive evidence that the Bonds so authenticated have been duly executed, authenticated and delivered hereunder and are entitled to the benefits of this Indenture.
SECTION 2.05. Transfer of Bonds. Any Bond may, in accordance with its terms, be transferred, upon the register required to be kept pursuant to the provisions of Section 2.07 hereof, 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 instrument of transfer, duly executed in a form acceptable to the Trustee.
Whenever any Bond or Bonds shall be surrendered for transfer, the City shall execute and the Trustee shall authenticate and deliver a new Bond or Bonds, of the same Series, tenor, maturity and interest rate and for a like aggregate principal amount; provided that no registration or transfer may occur during the period established by the Trustee for selection of Bonds for redemption, or of any Bond or portion of a Bond so selected for redemption. The Trustee shall require the Bondholder requesting such transfer to pay any tax or other governmental charge required to be paid with respect to such transfer.
SECTION 2.06. Exchange of Bonds. Bonds may be exchanged at the Corporate Trust Office of the Trustee for a like aggregate principal amount of Bonds of other authorized denominations of the same Series, tenor, maturity and interest rate by the person in whose name it is registered, in person or by his duly authorized attorney, upon surrender of such Bond for cancellation; provided that, unless otherwise provided in any Supplemental Indenture, no exchange may occur during the period established by the Trustee for selection of Bonds for redemption, or of any Bond or portion of a Bond so selected for redemption. The Trustee shall require the Bondholder requesting such exchange to pay any tax or other governmental charge required to be paid with respect to such exchange.
SECTION 2.07. ~. The Trustee will keep or cause to be kept, at its Corporate Trust Office sufficient books for the registration and transfer of the Bonds, which shall at all times be open to inspection during normal business hours by the City upon reasonable prior SFLIB I/1046372/11/90340/00003
20 ATTACHMENT 3
A3-24
notice; and, upon presentation for such purpose, the Trustee shall, under such reasonable regulations as it may prescribe, register or transfer or cause to be registered or.transferred, on such hooks, Bonds as hereinbefore provided.
SECTION 2.08. Temporary_ Bonds. The Bonds may be issued in temporary form exchangeable for definitive Bonds. Any temporary Bond may be printed; lithographed or , typewritten, shall be of such denomination as may be determined by the City, shall be in registered form and may contain such referenceio any of the provisions of this Indenture as ma~; be appropriate. A temporary Bond may be in the form of a single Bond payable in installments, each on the date, in the amount and at the rate of interest established for the Bonds maturin~ on such date. Every temporary Bond shall be executed by the City and authenticated by the Trustee upon the same conditions and in substantially the same manner as the definitive Bonds. If the City issues temporary Bonds it will execute and deliver definitive Bonds after being requested to do so, and thereupon the temporary Bonds may be surrendered, for cancellation, in exchange therefor at the Corporate 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 of the same Series, tenor and maturity or maturities. Until so exchanged, the temporary Bonds shall be entitled to the same benefits under this Indenture as definitive Bonds authenticated and delivered hereunder.
SECTION 2.09. Bonds Mutilated, Lost, Destroyed or Stolen. If any Bond shall become mutilated, the City, 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 in exchange and substitution for the Bond so mutilated, but only upon surrender to the Trustee of the Bond so mutilated.
Every mutilated Bond so surrendered to the Trustee shall be cancelled by it and delivered to, or upon the Order of, the City. If any Bond shall be lost, destroyed or stolen, evidence of such loss, destruction or theft may be submitted to the City and the Trustee and, if such evidence be satisfactory to both and indemnity satisfactory to them shall be given, the City, at the expense of the Owner, shall execute, and the Trustee shall 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 the aforementioned indemnity). The City may require payment of a sum not exceeding the actual cost of preparing each new Bond issued under this Section and of the expenses which may be incurred by the City and the Trustee in the premises. 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. additional contractual obligation on the part of the City whether or not the Bond so alleged to be lost, destroyed or stolen be at any time enforceable by anyone, and shall be entitled to the benefits of this Indenture with all other Bonds secured by this Indenture. Neither the City nor the Trustee shall be required to treat both the original Bond and any replacement Bond as being Outstanding for the purpose of determining the principal amount of Bonds which may be issued hereunder or for the purpose of determining any percentage of Bonds Outstanding hereunder, but both the original and replacement Bond shall be treated as one and the same.
SFLIB 111046372/! 1/90340/00003
ATTACHMENT 3
A3-25
ARTICLE III
ISSUANCE OF BONDS
SECTION 3.01. Issuance of Bonds. The City may by Supplemental Indenture establish one or more Series of Bonds payable from Electric Net Revenues and secured by the pledge made under this Indenture equally and ratably with Bonds previously issued, and the City may" issue, and the Trustee may authenticate and deliver to the purchasers thereof, Bonds of any -:
Series so established, in such principal amount as shall be determined by the City, but only, with respect to each Series of Bonds, upon compliance by the City with the provisions of Sectiori 3.02 hereof (except the first Series of Bonds may be issued upon compliance by the City with the requirements of Section 3.02(a) and without further condition) and any additional requirements set forth in said Supplemental Indenture and subject to the following specific conditions, which are hereby made conditions precedent to the issuance of any such additional Series of Bonds:
(a) no Event of Default shall have occurred and then be continuing; (b) the aggregate principal amount of Bonds issued hereunder shall not exceed any limitation imposed by law or otherwise;
(c) there shall be deposited in the Parity Reserve Fund an amount of money so as to increase the amount on deposit therein to the Reserve Fund Requirement; and (d) the City shall have placed on file with the Trustee a Certificate of the City certifying that the sum of: (1) the Electric Net Revenues, plus (2) 90 percent (90%) of the amount by which the City projects Electric Net Revenues for any period of twelve (12) consecutive months during the eighteen (18) months immediately preceding the date on which any additional Bonds or Parity Debt will become Outstanding would have been increased had increases in rates, fees and charges during such period of twelve (12) months been in effect throughout such period of twelve (12) months; plus (3) 75 percent (75%) of the amount by which the City projects Electric Net Revenues will increase during the period of twelve (12) months commencing on the date of issuance of such additional Bonds or Parity Debt due to improvements to the Electric System under construction (financed from any source) or to be financed with the proceeds of such additional Series of Bondsor Parity Debt, shall (4) have been at least equal to 1.20 times the amount of Maximum Annual Debt Service on all Bonds and Parity Debt then outstanding and the additional Bonds or Parity Debt then proposed to be issued.
In the event additional assets or revenues are included within the definition of "Electric Net Revenues" by a Supplemental Indenture, such additional assets or revenues shall be included in the calculations in subsection (d) above, as appropriate, as if such additional assets or revenues had always been included in Electric Net Revenues.
SECTION 3.02. Proceedings for Issuance of Additional Series of Bond.~. Whenever the City shall determine to issue a Series of Bonds pursuant to Section 3.01, the City shall authorize the execution of a Supplemental Indenture specifying the principal amount, and prescribing the form or forms of Bonds of such additional Series and providing the terms, conditions, distinctive SFLIB 111046372/I 1/90340/00003
ATTACHMENT 3
A3-26
designation, denominations, date, maturity date .or dates, interest rate or rates (or the manner of determining the same), redemption provisions and place or places of payment of principal or Redemption Price, if any, of and interest on such Bonds, and any other provisions respecting the Bonds of such Series not inconsistent with the terms of this Indenture.
Before such additional Series of Bonds shall be issued and delivered, the City shall file the following documents with the Trustee (upon which documents the Trustee may conclusivel) rely in determining whether the conditions precedent to the issuance of such Series of Bonds have been satisfied):
(a) an executed copy of the Supplemental Indenture authorizing such Series; (b) a Certificate of the City stating that no Event of Default has occurred and is then continuing;
(□) an Opinion of Bond Counsel to the effect that the execution of the Supplemental Indenture has been duly authorized by the City in accordance with this Indenture; that such Series, when duly executed by the City and authenticated and delivered by the Trustee, will be valid and binding limited obligations of the City, and that upon the delivery of such Series the aggregate principal amount of Bonds then Outstanding will not exceed the amount permitted by law or otherwise; (d) the Certificate of the City required by Section 3.01(d); and (e) a Certificate of the City or of an independent certified public accountant that upon delivery of such Bonds, the aggregate principal amount of Bonds then Outstanding will not exceed the amount permitted hereunder.
SECTION 3.03. Issuance of Refunding Bond.~ Notwithstanding any provisions herein, there shall be no limitation on the ability of the City to issue any Bonds at any time to refund any outstanding Bonds or Parity Debt issued pursuant hereto; provided, however, that the Maximum Annual Debt Service with respect to any such refunding Bonds shall not exceed 1.10 times the Maximum Annual Debt Service with respect to the Bonds or Parity Debt being refunded.
SECTION 3.04. Application of Proceed.~. Proceeds of each Series of Bonds shall be applied as specified in the Supplemental Indenture pursuant to which such Series of Bonds is created.
SECTION 3.05. Limitations on the Issuance of Obligation,. The City will not, so long as any of the Bonds are Outstanding, issue any obligations or securities, howsoever denominated, payable in whole or in part fi’om Electric Net Revenues, except the following:
(a) Bonds of any Series authorized pursuant to Sections 3.01 and 3.02; (b) refunding Bonds authorized pursuant to Section 3.03; SFLIB 1/I 046372/11/90340/00003
ATTACHMENT 3
A3-27
(c) Parity Debt payable on a parity with the Bonds and which will have, when issued, an equal lien and charge upon the Electric Net Revenues, provi.ded that the following conditions to the issuance of such Parity Debt are satisfied:
(1) such Parity Debt has been duly and legally authorized for any ~.- lawful purpose; , (2) no Event of Default shall have occurred and then be continuing, ag---- evidenced in a Certificate of the City filed with the Trustee; (3) unless such Parity Debt is for the refunding purposes specified in Section 3.03, the City shall have obtained and placed on file with the Trustee a Certificate of the City that (on the basis of calculations as of the date of delivery of such Parity Debt) the requirements of Section 3.01 (d) with respect to additional Bonds have been met with respect to such Parity Debt;
(4) the City shall have filed withthe Trustee an Opinion of Bond Counsel to the effect that such Parity Debt has been duly authorized in accordance with law and constitutes a valid and binding obligation of the City payable from Electric Net Revenues on a parity with the Bonds; and
(5) the Trustee shall be designated as paying agent or trustee for such Parity Debt and the City shall deliver to the Trustee a transcript of the proceedings providing for the issuance of such Parity Debt (but the Trustee shall not be responsible for the validity or sufficiency of such proceedings or such Parity Deb0; or
(d) Obligations which are junior and subordinate to the payment of the principal, premium, interest and reserve fund requirements for the Bonds and all Parity Debt and which subordinated obligations are payable as to principal, premium, interest and reserve fund requirements, if any, only out of Electric Net Revenues, after the prior payment of all amounts then required to be paid hereunder from Electric Net Revenues, for principal, premium, interest and reserve fund requirements for the Bonds and all Parity Debt, as the same become due and payable and at the times and in the manner as required in this Indenture.
ARTICLE IV
REDEMPTION OF BONDS
SECTION 4.01. Terms of Redemption. Each Series of Bonds may be made subject to redemption or mandatory or optional tender and purchase prior to their respective stated maturities, as a whole or in part, at such time or times, upon such terms and conditions and upon such notice and with such effect as may be provided in the Supplemental Indenture creating such Series of Bonds.
SFLIBI/1046372/11190340/00003
ATTACHMENT 3
A3-28
Unless otherwise specified in a Supplemental Indenture, each notice of redemption shall be mailed by the Trustee, not less than thirty (30) nor more than sixty (60) days prior to the redemption date, to each Owner, the Securities Depositories and two or more Information Services. Notice of redemption to the Securities Depositories shall be given by certified, registered or overnight mail or by such other method as may be requested by the Securities ~ Depositories. Each notice of redemption shall state the date of such notice, the date of issue of, the Bonds to which such notice relates, the redemption date, the Redemption Price, the place or places of redemption (including the name and appropriate address or addresses of the Trustee),~; the CUSIP number (if any) of the maturity or maturities, and, if less than all of any such maturity, the distinctive certificate numbers of the Bonds of such maturity to be redeemed ahd, in the case of Bonds to be redeemed in part only, the respective portions of the principal amount ’ thereof to be redeemed. Each such notice shall also state that on said date there will become due and payable on each of said Bonds the Redemption Price thereof or of said specified portion of the principal amount thereof in the case of a Bond to be redeemed in part only, together with interest accrued thereon to the date fixed for redemption, and that from and after such redemption date interest thereon shall cease to accrue, and shall require that such Bonds be then surrendered at the address or addresses of the Trustee specified in the redemption notice. Neither the City nor the Trustee shall have any responsibility for any defect in the CUSIP number that appears on any Bond or in any redemption notice with respect thereto, and any such redemption notice may contain a statement to the effect that CUSIP numbers have been assigned by an independent service for convenience of reference and that neither the City nor the Trustee shall be liable for any inaccuracy in such numbers.
Failure by the Trustee to give notice to any one or more of the Information Services or Securities Depositories or failure of any Owner to receive notice or any defect in any such notice shall not affect the sufficiency of the proceedings for redemption.
ARTICLE V
ELECTRIC NET REVENUES
SECTION 5.01. Pledge of Electric Net Revenues; Electric Revenue Fund. (A) The Bonds are revenue obligations of the City and are payable as to both principal and interest, and any premium upon redemption thereof, exclusively from Electric Net Revenues and from the other funds pledged hereunder. All Electric Net Revenues are hereby pledged to secure the payment of the principal of and redemption premium, if any, and interest on the Bonds and any Parity Debt in accordance with their terms, subject only to the provisions of this Indenture permitting the application thereof for the purposes and on the terms and conditions set forth herein. There are hereby pledged to secure the payment of the principal of and redemption premium, if any, and interest on the Bonds in accordance with their terms all amounts (including proceeds of the Bonds) held by the Trustee hereunder (except for amounts held in the Rebate Fund), subject only to the provisions of this Indenture permitting the application thereof for the purposes and on the terms and conditions set forth herein. Said pledge shall constitute a first lien on the Electric Net Revenues and amounts in such funds and shall be valid and binding from and SFLIB 111046372/11/90340/00003
ATTACHMENT 3
A3-29
after delivery by the Trustee of the Bonds or Parity Debt, without any physical delivery thereof or. further act.
The Electric Net Revenues are hereby pledged to the payment of Bonds and Parity Debt without priority or distinction of one over the other and the Electric Net Revenues constitute a. trust fund for the security and payment of the Bonds and Parity Debt; but nevertheless out of Electric Net Revenues, certain amounts may be applied for other purposes as provided herein.
Out of Electric Net Revenues, there shall be applied as hereinafter set forth all sums required for the payment of the principal of (including any premium thereon) and interest of~ the Bonds and all Parity Debt, together with any mandatory sinking fund payments of Bonds and Parity Debt and reserve fund requirements with respect thereto. All remaining Electric Net Revenues, after making the foregoing allocation, shall be available to the City for all lawful City purposes. The pledge of Electric Net Revenues herein made shall be irrevocable until all of the Bonds and all Parity Debt are no longer outstanding.
(B) As long as any Bonds are Outstanding or any Parity Debt remains unpaid, the City shall forthwith deposit in a fund, designated as the "Electric Revenue Fund," which fund the City shall establish and maintain, all Electric Net Revenues when and as received by the City.
Unless otherwise provided herein or in any Supplemental Indenture, investment income on amounts held by the City hereunder (other than amounts held in the Rebate Fund or for which particular instructions are provided in a Supplemental Indenture) shall also be deposited in the Electric Revenue Fund. All moneys at any time held in the Electric Revenue Fund shall be held in trust for the benefit of the Owners of the Bonds and Parity Debt and shall be disbursed, allocated and applied solely for the uses and purposes set forth herein.
SECTION 5.02. Payments Into Other Fund.~.
As soon as practicable in each month after the deposit of Electric Net Revenues into the Electric Revenue Fund, but in any case no later than the last Business Day of such month, the City shall withdraw from the Electric Revenue Fund and pay to the Trustee for deposit in the following funds and accounts, in the following order, the amounts set forth below:
(a) in the Debt Service Fund established pursuant to Section 5.03 hereof, the amount, if any, required so that the balance in said fund, including any subaccounts therein, to the extent.moneys in such subaccounts are available to pay Accrued Aggregate Debt Service as of the last day of the then current month, shall equal the Accrued Aggregate Debt Service as of the last day of the then current month; and (b) in the Parity Reserve Fund established pursuant to Section 5.04 hereof, the amount, if any, required so that the amount credited to such fund shall be at least equal to the Reserve Fund Requirerrient as of the last day of the then current month; provided, that on a parity with such deposits, the City shall set aside or transfer amounts to the appropriate accounts with respect to outstanding Parity Debt as provided in the proceedings for such Parity Debt (which shall be proportionate in the event such amounts are insufficient to provide for all deposits required as of any date to be made with respect to the Bonds and such Parity Debt).
SFLIBI/1046372/I 1/90340/00003
ATTACHMENT 3
A3-30
SECTION 5.03. Debt Service Fund
(A) The Trustee shall establish and maintain and hold in trust so lorig as any Bonds remain Outstanding, a special fund designated as the "Debt Service Fund." The Trustee shall pay out of the Debt Service Fund: (i) on or before each interest payment date for any Outstanding ~.
Bonds, the amount required for the interest payable on such date; (ii) on or before each principal payment date or redemption date, the amount required for the Bond Obligation payable on sucl~ due date (including any mandatory sinking fund payment to be paid on such date); and (iii) on of:
before any redemption date for Outstanding Bonds, the amount required for the payment of interest on such Bonds then to be redeemed. Such amounts shall be applied for such purposes by the Trustee on the due date thereof. The Trustee shall also pay out of the Debt Service Fund the accrued interest included in the purchase price of any Bonds, the Debt Service of which may be paid from the moneys in such fund, purchased for retirement. (B) On or prior to the forty-fifth (45th) day preceding the due date of each mandatory sinking fund payment, any amounts then on deposit in the Debt Service Fund with respect to any mandatory sinking fund payment (exclusive of amounts, if any, set aside in said fund which were deposited therein from the proceeds of Bonds, but inclusive of amounts accumulated therein with respect to interest on the Bonds for which such mandatory sinking fund payment is to be paid) may, and if so directed by the City shall, be applied by the Trustee to the purchase of Bonds of the Series and maturity for which such mandatory sinking fund payment was established in an amount not exceeding that necessary to complete the retirement of the unsatisfied balance of such mandatory sinking fund payment. All purchases of any Bonds pursuant to this subsection (B) shall be made at prices not exceeding the applicable sinking fund Redemption Price of such Bonds plus accrued interest, and such purchases shall be made by the Trustee as directed by the City. If directed by the City, on or prior to the forty-fifth (45th) day next preceding a mandatory sinking fund payment due date, there shall be applied as a credit against such mandatory sinking fund payment, and there shall be deemed to constitute part of the Debt Service Fund until such mandatory sinking fund payment due date, for the purpose of calculating the amount on deposit in such fund, the applicable sinking fund Redemption Price (or principal amount of maturing Bonds) of any Bonds of the Series and maturity for which such mandatory sinking fund payment was established, that were cancelled or delivered to the Trustee for cancellation on or prior to the forty-fifth (45th) day next preceding such mandatory sinking fund payment due date and that was not previously applied as a credit against a mandatory sinking fund payment, including any Bonds purchased pursuant to this subsection 03) and as to which the City has properly claimed a credit against the next mandatory sinking fund payment. As soon as practicable after the forty- fi 4th ¯ltth ( 5 ) day preceding the due date of any such mandatory sinking fund payment, the Trustee shall proceed to call for redemption on such date, Bonds of the Series and maturity for which such mandatory sinking fund payment was established (except in the ease of Bonds maturing on a mandatory sinking fund payment due date). The Trustee shall pay out of the Debt Service Fund, on or before such redemption date (or maturity date), the amount required for the redemption of the Bonds so called for redemption (or for the payment of such Bonds then maturing), and such amounts shall beapplied to such redemption (or payment). (C) The amount, if any, deposited in the Debt Service Fund, including any subaceount, from the proceeds of each Seres of Bonds shall be set aside in such fund and applied to the payment of interest on Bonds as provided in the Supplemental Indenture relating " SFLIB1/1046372/I 1190340100003
ATTACHMENT 3
A3-31
to the issuance of such Series of Bonds and shall be deemed available to pay Accrued Aggregate Debt Service only to the extent so provided.
(D) In the event of the refunding of one or more Bonds, the Trustee may, upon the direction of the City with the advice of Bond Counsel, withdraw from the Debt Service Fund ~. amounts accumulated therein with respect to Debt Service on the Bonds being refunded and deposit such amounts as directed by the City, to be held for the payment of the principal or Redemption Price, if applicable, or interest on the Bonds being refunded’, provided that such :- withdrawal shall not be made unless (a) immediately thereafter the Bonds being refunded shall be deemed to have been paid pursuant to Article X hereof, and (b) the amount remaining in’the Debt Service Fund after such withdrawal shall not be less than the requirement of such fund pursuant to Section 5.02 hereof.
(E) Any provisions of this Indenture to the contrary notwithstanding, so long as there shall be held in the Debt Service Fund an amount sufficient to pay in full all Outstanding Bonds in accordance with their terms (including principal or Redemption Price, if applicable, and interest thereon), no deposits shall be required to be made into the Debt Service Fund.
SECTION 5.04. Parity Reserve Fund.
(A) The Trustee shall establish and maintain and hold in.trust so long as Bonds or Parity Debt to be secured thereby remain outstanding, a special fund designated as the "Parity ¯ Reserve Fund." Amounts on deposit in the Parity Reserve Fund are hereby pledged to the payment of the Bonds and any Parity Debt to be secured by the Parity Reserve Fund and shall be applied only for such purposes as hereinafter permitted.. The Trustee shall deposit in the Parity Reserve Fund, upon the direction of the City, the Reserve Fund Requirement and such other amounts transferred to the Trustee by the City pursuant to Section 5.02 hereof. No deposit need be made in the Parity Reserve Fund so long as there shall be on deposit therein a sum equal to at least the amount required by this clause (A) to be on deposit therein. Whenever the amount on deposit in the Parity Reserve Fund is less than the Reserve Fund Requirement, notice thereof shall be provided to the insurer of the Bonds, if any, and such amount shall be increased to the Reserve Fund Requirement as provided for in this clause (A) not later than twelve months thereafter. Moneys on deposit in the Parity Reserve Fund (including all amounts that may be obtained from letters of credit and surety bonds and insurance policies, as provided below, on deposit in the Parity Reserve Fund) shall be transferred by the Trustee to the Debt Service Fund to pay principal of and interest on the Bonds on any interest payment date in the event amounts on deposit therein are insufficient for such purposes. The Trustee shall also, from such amounts on deposit in the Parity Reserve Fund, transfer or cause to be transferred to any applicable debt service fund for any Parity Debt to be secured by the Parity Reserve Fund, without preference or priority between transfers made pursuant to this sentence and the preceding sentence, and in the event of any insufficiency of such moneys ratably without discrimination or preference, that sum or sums, if any, equal to the amount required to be deposited therein pursuant to the documents under which any such Parity Debt to be secured by the Parity Reserve Fund is issued or incurred.
Amounts on deposit in the Parity Reserve Fund in excess of the Reserve Fund Requirement shall, at the written Request of the City, be withdrawn fi:om the Parity Reserve Fund and transferred to the City.
SFLIBl/1046372/11190340/00003
ATTACHMENT 3
A3-32
03) The City may provide for all or any part of the Reserve Fund Requirement by .delivering to the Trustee an irrevocable letter of credit issued by a financial institution having unsecured debt obligations rated in one of the two highest Rating Categories ~fMoody’s and Standard & Poor’s, securing an amount, together with moneys, Investment Securities or surety bonds or insurance policies (as described in clause (C) below) on deposit in theParity’Reserve Fund, equal to the Reserve Fund Requirement. Such letter of credit shall have an original term of no less than three (3) years or, if less, the final maturity of the Bonds and such letter of credit shall provide by its terms that it may be drawn upon as provided herein. At least one year prior?":
to the stated expiration of such letter of credit, the City shall either (i) deliver a replacement letter of credit, (ii) deliver an extension of the letter of credit for at least an additional year or, if l~ss, the maturity of the Bonds or (iii) deliver to the Trustee a surety bond or an insurance policy satisfying the requirements of clause (C) below. Upon delivery of such replacement letter of credit, extended letter of credit, or surety bond or insurance policy, the Trustee shall deliver the then-effective letter of credit to or upon the order of the City. If the City shall fail to deposit a replacement letter of credit, extended letter of credit, surety bond or insurance policy with the Trustee, the City shall immediately commence to make monthly deposits with the Trustee so that an amount equal to the Reserve Fund Requirement will be on deposit in the Parity Reserve Fund no later than the stated expiration date of the letter of credit. If an amount equal to the Reserve Fund Requirement, as of the date following the expiration of the letter of credit, is not on deposit in the Parity Reserve Fund one week prior to the stated expiration date of the letter of credit . (excluding from such determination the letter of credit), the Trustee shall draw on the letter of credit to fund the amount of any such deficiency in the Parity Reserve Fund. (C) The City may also provide for all or any part of the Parity Reserve Fund by delivering to the Trustee a surety bond or an insurance policy securing an amount, together with moneys, Investment Securities or letters of credit on deposit in the Parity Reserve Fund, equal to the Reserve Fund Requirement. Such surety bond or insurance policy shall be issued by an insurance company whose unsecured debt obligations (or obligations secured by such insurance company’s insurance policies) are rated in one of the two highest Rating Categories of Moody’s and Standard & Poor’s. Such surety bond or insurance policy shall have a term of no less than the final maturity of the Bonds. In the event that such surety bond or insurance policy for any reason lapses or expires, the City shall immediately implement (i) or (iii) of clause 03) above or make the required deposits to the Parity Reserve Fund. Repayment of any draw under any such surety bond or insurance policy, and any expenses and accrued interest related to such draw (collectively the "Policy Costs") shall commence in the first month following each such draw, and shal! be paid at the time specified in clause (A) above in an amount not less than one-twelt~h. (1/12th) of the aggregate of the Policy Costs related to such draw. If and to the extent that cash has also been deposited in the Parity Reserve Fund, all such cash shall be used (including investments purchased with such cash, which shall be liquidated and the proceeds thereof applied as required hereunder) prior to any drawing under surety bond or insurance policy, and repayment of any Policy Costs shall be made prior to any replenishment of any such cash amounts..If~e City shall fail to repay any Policy Costs in accordance herewith, the insurancecompany Issuing such surety bond or insurance polieyshall be entitled to exercise any and all remedies available at law or hereunder other than (i) an acceleration of the interest on or principal of the Bonds as provided herein or (ii) any other remedy that would adversely affect Bondholders. The Trustee shall ascertain the necessity for a claim upon any surety bond or insurance policy provided hereby and provide notice to the insurance company issuing such bond SFLIBI/1046372/11190340100003
ATTACHMENT 3
A3-33
or policy in accordance with the terms and conditions of such bond or insurance policy not less than two (2) Business Days prior to any interest payment date upon which such a claim should be paid.
(D) In the event of any deficiency in the Debt Service Fund for the payment of :. principal and interest payments for the Bonds pursuant to clause (A) above, the Trustee shall, . after first applying all cash and Investment Securities held in the Parity Reserve Fund to pay the Bond Obligation of, any mandatory sinking fund payments with respect to, and interest on, the’":
Bonds when due, on a pro rata basis with respect to the portion of the Parity Reserve Fund held in the form of letters of credit and amounts held in the form of surety bonds and insurance policies (calculated by reference to the maximum amounts of such letters of credit and surety bonds and insurance policies), draw under each letter of credit or surety bond or insurance policy issued with respect to the Parity Reserve Fund, in a timely manner and pursuant to the terms of such letter of credit or surety bond or insurance policy to the extent necessary in order to obtain sufficient funds on or prior to the date such funds are needed to pay the Bond Obligation of, any mandatory sinking fund payments with respect to, and interest on, the Bonds when due. In the event that the Trustee has written notice from the City or any Bondholder that any payment of principal of, or interest on, a Bond has been recovered from a Bondholder pursuant to the United States Bankruptcy Code by a trustee in bankruptcy in accordance with the final, nonappealable order of a court having competent jurisdiction, the Trustee, pursuant to and provided that the terms of the letter of credit or surety bond or insurance policy, if any, credited to the Parity Reserve Fund so provide, shall so notify the issuer thereof and draw on such letter of credit or surety bond or insurance policy to the lesser of the extent required or the maximum amount of .such letter of credit or surety bond or insurance policy in order to pay to such Bondholder the principal of and interest so recovered. All amounts in the Parity Reserve Fund (other than amounts that may be obtained from letters of credit and surety bonds and insurance policies on deposit in the Parity Reserve Fund) may be used and withdrawn by the Trustee,. if so directed by the City, for the payment or redemption of all Bonds then Outstanding, or for the payment of the final principal and interest payments of the Bonds.
SECTION 5.05. ,Investment of Moneys in Funds and Accounts. All moneys in any of the funds and accounts held by the Trustee and established pursuant to this Indenture shall be invested, as directed by the City, solely in Investment Securities; provided, however, that Investment Securities purchased with moneys held by the Trustee in the Parity Reserve Fund shall have an average weighted term to maturity not greater than five years. All Investment Securities shall, as directed by the City in writing or by telephone, promptly confirmed in writing, be acquired subject to the limitations as to maturities hereinafter in this Section set forth and such additional limitations or requirements consistent with the foregoing as may be established by Request of the City. The Trustee may conclusively rely upon any investment direction from the City as a certification to the Trustee that such investment constitutes an Investment Security. If and to the extent the Trustee does not receive investment instructions from the City with respect to the moneys in the funds and accounts held by the Trustee pursuant to this Indenture, such moneys shall be invested in Investment Securities described in clause (xi) of the defmition thereof and the Trustee shall thereupon request investment instructions from the City for such moneys. ’
SFLIB III IM6372111/90340/00003
ATTACHMENT 3
A3-34
Unless otherwise provided herein or in a Supplemental Indenture, all interest, profits and other income received from the investment of moneys in any fund or account, other than the Rebate Fund, shall be transferred to the Electric Revenue Fund when received~ All interest, profits and other income received from the investment of moneys in the Rebate Fund shall be deposited in the Rebate Fund, except as provided in Section 6.07. Notwithstanding anything to the contrary contained herein, an amount of interest receix~ed with respect to any Investment Security equal to the amount of accrued interest, if any, paid as part of the purchase price of such Investment Security shall be credited to the fund or account from which such accrued interest "- was paid.
The Trustee may commingle any of the funds or accounts established pursuant to this Indenture into a separate fund or funds for investment purposes only, provided that all funds or accounts held by the Trustee hereunder shall be accounted for separately as required by this Indenture. The Trustee may act as principal or agent in the making or disposing of any investment and, with the prior written consent of the City, may impose its customary charge therefor. The Trustee may sell or present for redemption, any Investment Securities so purchased whenever it shall be necessary to provide moneys to meet any required payment, transfer, withdrawal or disbursement from the fund or account to which such Investment Security is credited, and the Trustee shall not be liable or responsible for any loss resulting from such investment.
The City may and the Trustee shall, upon the Request of the City, and provided that the Trustee is supplied with an Opinion of Bond Counsel to the effect that such action is permitted under the laws of the State of California, enter into an interest rate swap agreement corresponding to the interest rate or rates payable on a Series of Bonds or any portion thereof and the amounts received by the City or the.Trustee, if any, pursuant to such a swap agreement may be applied to the deposits required hereunder; in which case, the entity with which the City or the Trustee may contract for an interest rate swap is limited to entities the debt securities of which are rated in their respective highest short-term debt Rating Categories by Moody’s and Standard & Poor’s. If the City so designates, amounts payable under the interest rate swap agreement (other than termination payments due thereunder which shall be made expressly subordinate to the payment of the Bonds) shall be secured by Electric Net Revenues on a parity basis with the Bonds and any Parity Debt and, in such event, the City shall pay to the Trustee for deposit in the Debt Service Fund, at the times and in the manner provided by Section 5.02, the amounts to be paid under such interest rate swap agreement, as if such amounts were additional interest due on the Bonds to which such interest rate swap agreement relates, and the Trustee shall pay to the other party to the interest rate swap agreement, to the extent required thereunder, amounts deposited in the Debt Service Fund for the payment of interest on the Bonds with respect to which such agreement was entered.
The Trustee and the City shall each keep proper books of record and accounts containing complete and correct entries of all transactions made by it relating to the receipt, investment, disbursement, allocation and application of the moneys related to the Bonds, including moneys derived from, pledged to, or to be used to make payments on the Bonds. Such records shall specify the account or fund to which each investment (or portion thereof) is to be allocated and shall set forth, in the case of each investment security, (a) its purchase price, (b) identifying information, including par amount, coupon rate; and payment dates, (c) the amount received at SFLIBl/IIM6372J11190340100003
31 ATTACHMENT 3
A3-35
maturity or its sale price, as the case may be, including accrued interest, (d) the amounts and dates of any payments made with respect thereto, and (e) the dates of acquisition and disposition or maturity.
The City acknowledges that to the extent regulations of the Comptroller of the Currency or other applicable regulatory entity grant the City the right to receive brokerage confirmations. of security transactions as they occur, the City will not receive such confirmations to the extent permitted by law. The Trustee will furnish the City periodic cash transaction statements which-:
include detail for all investment transactions made by the Trustee hereunder.
The Trustee may make any investments hereunder through its own bond or investment department or trust investment department, or those of its parent or any affiliate.
The Trustee or any of its affiliates may act as sponsor, advisor or manager in connection with any investments made by the Trustee hereunder.
The Trustee shall also provide to the City in accordance with a Request of the City, with respect to each Investment Security such documentation as is reasonably available to the Trustee and specified by the City to the Trustee in writing and is required by the Code or other applicable law to be obtained by the City as evidence to establish that each investment had been acquired and disposed of on an established market in an arm’s-length transaction at a price equal to its fair market value and with no amounts having been paid to reduce the yield on the investments, or shall be United States Treasury Obligations-State and Local Government Series as set forth, in the Tax Certificate.
ARTICLE VI
COVENANTS
SECTION 6.01. Punctual Payment. The City will punctually pay or cause to be paid the principal or Redemption Price of and interest on all the Bonds, in strict conformity with the terms of the Bonds and of this Indenture, according to the true intent and meaning thereof, and shall punctually pay or cause to be paid all mandatory sinking fund payments, but in each case only out of Electric Net Revenues, as provided in this Indenture.
SECTION 6.02. Extension of Payment of Bondso The City will 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 Bonds or claims for interest of such Bonds or claims for interest and in case the maturity of any of the Bonds or the time of payment of any such claims for interest shall be extended, such Bonds or claims for interest shall not be entitled, in ease 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 not have been so extended.
Nothing in this Section shall be deemed to limit the fight of the City to issue Bonds for the purpose of refunding any Outstanding Bonds, and such issuance shall not be deemed to constitute an extension of maturity of Bonds.
SFLIB 1/11M6372/11/90340/00003
ATTACHMENT 3
A3-36
SECTION 6.03. Waiver of Laws. The City will not at any time insist upon or plead in any manner whatsoever, or claim or take the benefit or advantage of, any stay or extension law now or at any time hereafter in force that may affect the covenants and agreern-ents contained in this Indenture or in the Bonds, and all benefit or advantage of any such law or laws is hereby expressly waived by the City to the extent permitted by law. .-.
SECTION 6.04. Further Assurances. The City will make, execute and deliver any and" all such 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 of the fights and benefits provided in this Indenture.
SECTION 6.05. Against Encumbrances. After the date hereof, the City will not issue any additional Senior Bonds under the Senior Indenture. The City will not create any pledge, lien or charge upon any of the Electric Net Revenues, having priority over the lien of the Bonds; provided, however, that nothing herein shall be construed to limit the ability of the City to issue or incur obligations secured by charges, not constituting Electric Net Revenues, collected by any person to amortize or otherwise relating to the payment of the "stranded costs" of the Electric System or of any joint powers agency in which the City participates which the City has dedicated to the payment of obligations other than the Bonds, the payments of which charges will be applied to or pledged to or otherwise set aside for the reduction or retirement of outstanding obligations of the City or any joint powers agency in which the City participates relating to such "stranded costs" of the City or of any such joint powers agency to the extent such "stranded costs" are attributable to, or the responsibility of, the City.
The C~ty will pay or cause to be paid when due all sums of money that may become due or purporting to be due for any labor, services, materials, supplies or equipment furnished, or alleged to have been furnished, to or for the City in, upon, about or relating to the Electric System and will keep the Electric System free of any and all liens against any portion of the Electric System. In the event any such lien attaches to or is filed against any portion of the Electric System, the City will cause each such lien to be fully discharged and released at the time the performance of any obligation secured by any such lien matures or becomes due, except that if the City desires to contest any such lien it may do so if contesting such lien will not materially impair operation of the Electric System. If any such lien shall be reduced to final judgment and such judgment or any process as may be issued for the enforcement thereof is not promptly stayed, or if so stayed and such stay thereafter expires, the City will forthwith pay or cause to be paid and discharged such judgment.
SECTION 6.06. Accounting Records and Financial Statement.~. (A) The City will at all times keep, or cause to be kept, proper books of record and account, prepared in accordance with Generally Accepted Accounting Principles Applicable to Governments, in which complete and accurate entries shall be made of all calculations relating to Electric Net Revenues. Such books o.freeord and account shall be available for inspection by the Trustee (who shall have no duty to inspect) or the Bondowners at reasonable hours and under reasonable circumstances:
SFLIB1/1046372/11190340/00003
ATTACHMENT 3
A3-37
(B) The City will fumish the Trustee, within one hundredand eighty (180) days after the end of each Fiscal Year, the financial statements of the City’s Electric and Water Enterprise Fund for such Fiscal Year, together with the report and opinion of an independent certified public accountant stating that the financial statements have been prepared in accordance with Generally Accepted Accounting Principles Applicable to Governments and that such accountant’s examination of the financial statements was performed in accordance with generally accepted auditing standards and a Certificate of the Treasurer of the City stating tliat event which constitutes an Event of Default or which with the giving of notice or the passage of:- time or both would constitute an Event of Default has occurred and is continuing as of the end of such Fiscal Year, or specifying the nature of such event and the actions taken and proposed to be taken by the City to cure such default. Thereafter, a copy of such financial statements will be furnished to any Owner of Bonds upon written request to the City. The Trustee shall have no duty to review such financial statements.
(C) The City shall furnish to the Trustee within thirty (30) days after approval thereof, the annual budget of the City for the.City’s Electric and Water Enterprise.
SECTION 6.07. Rebate Fund.
(A) The Trustee shall establish and maintain, so long as any Bonds remain Outstanding, a fund separate from any other fund established and maintained hereunder designated as the "Rebate Fund" (the "Rebate Fund"). All amounts at any time on deposit in the Rebate Fund shall be held by the Trustee to the extent required to satisfy the requirement to make rebate payments to the United States (the "Rebate Requirement") pursuant to Section 148 of the Code and the Treasury Regulations promulgated thereunder (the "Treasury Regulations").
Such amounts shall be free and clear of any lien under this Indenture and shall be governed by this section and Section 6.08 of this Indenture and by the Tax Certificate. (B) Within 45 days of the end of each Bond Year (as such term is defined in the Tax Certificate), (i) the City shall calculate or cause to be calculated with respect to the Bonds the amount that would be considered the "rebate amount" within the meaning of Section 1.148-3 of the Treasury Regulations, using as the "computation date" for this purpose the end of such Bond Year, and (ii) upon the City’s written direction, the Trustee shall deposit to the Rebate Fund from amounts received by the City, if and to the extent required, amounts sufficient to cause the balance in the Rebate Fund to be equal to the "rebate amount" so calculated.
The Trustee shall not be required to deposit any amount to the Rebate Fund in accordance with preceding sentence if the amount on deposit in the Rebate Fund prior to the deposit required to be made under this paragraph 03) equals or exceeds the "rebate amount" calculated in accordance with the preceding sentence. Such excess may be withdrawn from the Rebate Fund to the extent permitted under paragraph (C) of this section.
The City shall not be required to calculate the "rebate amount," and the Trustee shall not be required to deposit any amount to the Rebate Fund in accordance with this paragraph (B), with respect to all or a portion of the proceeds of the Bonds (including amounts treated as proceeds of the Bonds) (i) to the extent such proceeds satisfy the expenditure requirements of Section 148(0(4)03) or Section 148(f)(4)(C) of the Code or Section 1.148-7(d) of the Treasury SFLIBI/1046372/11190340/00003
34 ATTACHMENT 3
A3-38
Regulations, whichever is applicable, and otherwise qualify for the exception to the Rebate Requirement pursuant to whichever of said sections is applicable, (ii) to the extent such proceeds are subject to an election by the City under Section 148(f)(4)(C)(vii) of the Code to pay a 1½% penalty in lieu of arbitrage rebate in the event any of the percentage expenditure requirements of Section 148(f)(4)(C) are not satisfied, or (iii) to the extent such proceeds qualify for th~ ~- exception to arbitrage rebate under Section 148(f)(4)(A)(ii) of the Code for amounts in a "bona. fide debt service fund."
(C) Any funds remaining in the Rebate Fund after payment of all the Bonds hereunder and any amounts described in clause (2) of paragraph (D) of this section, or provision made" therefor, including accrued interest, shall be transferred by the Trustee to the City for deposit to the Electric Revenue Fund.
(D) Subject to the exceptions contained in paragraph (A) of this section to the requirement to calculate the "rebate amount" and make deposits to the Rebate Fund, the Trustee shall, upon the City’s written direction, pay to the United States, from amounts on deposit in the Rebate Fund,
(1) not later than 60 days after the end of(i) the fifth Bond Year, and (ii) each fifth Bond Year thereafter, an amount that, together with all previous rebate payments, is equal to at least 90% of the "rebate amount" calculated as of the end of such Bond Year in accordance with Section 1.148-3 of the Treasury Regulations; and (2) not later than 60 days after the payment of all Bonds, an amount equal to 100% of the "rebate amount" calculated as of the date of such payment (and any income attributable to the "rebate amount" determined to be due and payable) in accordance with Section 1.148-3 of the Treasury Regulations.
(E) Each payment required to be made pursuant to paragraph (D) of this section shall be made to the Internal Revenue Service Center, Philadelphia, Pennsylvania 19255 on or before the date on which such payment is due, and shall be accompanied by Internal Revenue Service Form 8038-T, which shall be completed by or on behalf of the City and provided to the Trustee. (F) In the event that, prior to the time any payment is required to be made from the Rebate Fund, the amount in the Rebate Fund is not sufficient to make such payment when such payment is due, the City shall calculate the amount of such deficiency and direct the Trustee to deposit an amount equal to such deficiency into the Rebate Fund prior to the time such payment " is due.
(G) In the event that immediately following the calculation required by paragraph 03) of this section, but prior to any deposit made under said paragraph, the amount on deposit in the Rebate Fund exceeds the "rebate amount" calculated in accordance with said paragraph, the City shall transfer the excess from the Rebate Fund to the Electric Revenue Fund (I-I) The City shall retain records of all determinations made hereunder until six years after the final payment or discharge of all Bonds.
SFLIBl/1046372/I 1/90340/00003
ATTACHMENT 3
A3-39
(I) Notwithstanding anything in this Indenture to the contrary, the Rebate Requirement shall survive the payment in full or defeasance of the Bonds.
SECTION 6.08. Tax Covenants. The City covenants that it will not take any action, or fail to take any action, if any such action or failure to take action would adversely affect the :- exclusion from gross income of the interest on the Bonds under Section 103 of the Code; provided that, prior to the issuance of any Series of Bonds, the City may exclude the applicatio~ of the covenants contained in this Section 6.08 and Section 6.07 hereof to such Series of Bonds:::
The City will not directly or indirectly use or permit the use of any proceeds of the Bonds or any other funds of the City, or take or omit to take any action that would cause the Bonds to be " arbitrage bonds within the meaning of Section 148(a) of the Code. To that end, the City will comply with all requirements of Section 148 of the Code to the extent applicable to the Bonds.
In the event that at any time the City is of the opinion that for purposes of this Section 6.08 it is necessary to restrict or limit the yield on the investment of any moneys held by the Trustee under this Indenture, the City shall so instruct the Trustee in writing, and the Trustee shall take such action as may be necessary in accordance with such instructions.
Without limiting the generality of the foregoing, the City agrees that there shall be paid from time to time all amounts required to be rebated to the federal government of the United States of America pursuant to Section 148(0 of the Code and any temporary, proposed or final Treasury Regulations as may be applicable to the .Bonds from time to time. The City specifically covenants to pay or cause to be paid to the federal government of the United States of America the Rebate Requirement at the times and in the amounts determined under and as described in the Tax Certificate.
Notwithstanding any provision of this Section 6.08 and Section 6.07 hereof, if the City shall receive an Opinion of Bond Counsel to the effect that any action required under this Section
6.08 and Section 6.07 hereof is no longer required, or to the effect that some further action is required, to maintain the exclusion from gross income of the interest on the Bonds pursuant to Section 103 of the Code, the City and the Trustee may rely conclusively on such opinion in complying with the provisions hereof, and the covenants hereunder shall be deemed to be modified to that extent.
SECTION 6.09. Rates and Charge.~. The City hereby covenants that it shall prescribe, revise and collect such charges for the services, facilities and electricity furnished by the Electric System which, after making allowances for contingencies and error in the estimates, shall provide Electric Net Revenues at least sufficient to pay the following amounts in the order set forth:
(a) The interest on, and principal and Redemption Price of, the outstanding Bonds and any Parity Debt as the same shall become due and payable; (b) All payments required for compliance with this Indenture, including payments required to be made into any bond reserve fund; and (e) All payments required to meet any other obligations of the City which are charges, liens, encumbrances upon or payable from the Electric Net Revenues; SFLIBI/1046372/11190340100003
ATTACHMENT 3
A3-40
and the charges shall be fixed so that in each Fiscal Year (i) the Electric Net Revenues shall be at least equal to 1.00 times the amount required to pay the items specified in clauses (a), (b) and (c) above, and (ii) the Adjusted Electric Net Revenues shall be at least equal to th~ Coverage Requirement.
SECTION 6.10. Maintenance and Operation of System; Insurance,. The City will maintain and preserve the Electric System in good repair and working order at all times, and will operate the Electric System in an efficient and economical manner. Subject in each case to the -~-- condition that insurance is obtainable at rates deemed reasonable by the city and upon terms and conditions deemed reasonable by the City, the City will procure and maintain at all times: (~i) insurance on the Electric System against such risks as and in such amounts as the City deems prudent taking into account insurance coverage for similar utilities, and (b) public liability insurance, including self-insurance, as appropriate, in such amounts as the City deems prudent taking into account insurance coverage for similar utilities.
SECTION 6.11. Sale of Electric System. The Electric System shall not be sold or leased or otherwise disposed of as a whole, or substantially as a whole, unless such sale, lease or other disposition be so arranged as to provide for a continuance of timely payments sufficient in amount to permit payment therefrom of the principal of and interest on, and premiums, if any, due upon the redemption of, all Bonds and Party Debt (including, if applicable, the imposition of any charges collected by any person to amortize or otherwise relating to the payment of "stranded costs" of the Electric System or of any joint powers agency in which the City participates which the City has dedicated to the payment of the Bonds the imposition of which will amortize the payment in full, together with other moneys available for such purpose, of such t3utstanding Bonds through the maturity thereof) payable out of Electric Net Revenues, or to provide for such payments into some other fund charged with such payments. None of the works, plant, properties, facilities or other part of the Electric System or any real or personal property comprising a part of the Electric System will be sold, leased or otherwise disposed of if such sale, lease or disposition would cause the City to be unable to satisfy the requirements of Section 6.09 hereof.
SECTION 6.12. Continuin~ Disclosure Agreement. The City will comply with and carry out all of its obligations under any Continuing Disclosure Agreement executed in connection with a Series of Bonds. Upon the failure of the City to comply with the Continuing Disclosure Agreement relating to any Series of Bonds, the Trustee (at the written request of any Participating Underwriter (as defined in the Continuing Disclosure Agreement) or the Owners of. at least 25% in aggregate Bond Obligation of the related Series of Bonds, shall, but only to the extent indemnified to its satisfaction from any liability or expense, including, without limitation, fees and expenses of its attorneys) or 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 City, to comply with its obligations under this section. For purposes of this section, "Beneficial Owner" shall have the meaning prescribed thereto in the respective Continuing Disclosure Agreement relating to such Series of Bonds.
SFLIBI/1046372/I 1/90340/00003
37 ~’
ATTACHMENT 3
A3-41
ARTICLE VII
EVENTS OF DEFAULT AND REMEDIES OF BONDHOLD]~RS
SECTION 7.01. Events of Default. The following events shall be Events of Default: :- (a) default in the due and punctual payment of the principal or Redemption " Price 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 in the amounts and at the times provided therefor;
(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) failure by the City to observe or perform any covenant, condition, agreement or provision in this Indenture on its part to be observed or performed, other than as referred to in subsection (a) or (b) of this Section, for a period of thirty (30) days after written notice, specifying such failure and requesting that it be remedied, has been given to the City by the Trustee; except that, if such failure can be remedied but not within such thirty (30) day period and if the City has taken all action reasonably possible to remedy such failure within such thirty (30) day period, such failure shall not become an Event of Default for so long as the City shall diligently proceed to remedy the same in accordance with and subject to any directions or limitations of time established by the Trustee;
(d) default by the City under any agreement governing any Parity Debt and the continuance of such default beyond the therein stated grace period, if any, with respect to such default;
(e) the filing by the City of a petition in voluntary bankruptcy for the ’ composition of its affairs or for its corporate reorganization under any state or federal bankruptcy or insolvency law, or an assignment by the City for the benefit of creditors, or the admission by the City in writing to its insolvency or inability to pay debts as they mature, or the consent by the City in writing to the appointment of a trustee or receiver for itself;
(f) the entering by a court of competent jurisdiction of an order, judgment or ¯ decree declaring the City insolvent, or adjudging it banla’upt, or appointing a trustee or receiver of the City, or approving a petition filed against the City seeking reorganization of the City under any applicable law or statute of the United States of America or any state thereof, and such order,, judgment or decree shall not be vacated or Set aside or stayed within sixty (60) days from the date of the entry thereof; or (g) the assumption, under the provisions of any other law for the relief or aid of debtors, by any court of competent jurisdiction of custody or control of the City or of the Electric Net Revenues and such custody or control shall not be terminated within sixty (60) days from the date of assumption of such custody or control.
SFLIB !/1046372/11/90340/00003
38 ATTACHMENT 3
A3-42
SECTION 7.02. Application of Electric Net Revenues and Other Funds After Default:
Acceleration. If an Event of Default shall occur and be continuing, the City shall immediately transfer to the Trustee all Electric Net Revenues held by it and received thereafter and the Trustee shall apply all Electric Net Revenues and any other funds then held or thereafter received by the Trustee under any of the provisions of this Indenture (except as otherwise provided in this Indenture) as follows and in the following order:
(1) To the payment of any expenses necessary in the opinion of the Trustee protect the interests of the Owners of the Bonds and Parity Debt, including the costs and expenses of the Trustee and the Bondholders in declaring such Event of Default, and payment of reasonable fees and expenses of the Trustee (including reasonable fees and disbursements of its counsel and other agents) incurred in and about the performance of its powers and duties under this Indenture;
(2) To the payment of the whole amount of Bond Obligation then due on the Bonds and Parity Debt (upon presentation of the Bonds and Parity Debt to be paid, and stamping thereon of the payment if only partially paid, or surrender thereof if fully paid) subject to the provisions of this Indenture, with interest on such Bond Obligation at the rate or rates of interest borne by the respective Bonds and Parity Debt, to the payment to " the persons entitled thereto of all installments of interest then due and the unpaid principal or Redemption Price of any Bonds and Parity Debt which shall, have become due, whether at maturity or by call for redemption, in the order of their due dates, with interest on the overdue Bond Obligation and Parity Debt at the rate borne by the respective Bonds and Parity Debt, and, if the amount available shall not be sufficient to pay in full all the Bonds and Parity Debt due on any date, together with such interest, then to the payment thereof ratably, according to the amounts of principal or interest or Accreted Value (plus accrued interest) due on such date to the persons entitled thereto, without any discrimination or preference.
In each and every such case during the continuance of such Event of Default, the Owners of not less than a majority in aggregate amount of Bond Obligation of the Bonds at the time Outstanding shall be entitled, upon notice in writing to the City, to declare the principal of all of the Bonds then Outstanding, and the interest accrued thereon, to be due and payable immediately, and upon any such declaration the same shall become and shall be immediately due and payable, anything in this Indenture or in the Bonds contained to the contrary notwithstanding.
This provision, however, is subject to the condition that if, at any time after the principal of the Bonds shall have been so declared due and payable, the City shall pay to or shall deposit with the Trustee a sum sufficient to pay all principal on such Bonds matured prior to such declaration and all matured installments of interest (if any) upon all the Bonds, and the reasonable fees and expenses of the Trustee, and any and all other defaults known to the Trustee (other than in the payment of principal of and interest on the Bonds due and payable solely by reason of such declaration) shall have been made good or cured to the satisfaction of the Trustee, or provision deemed by the Trustee to be adequate shall have been made therefor, then, and in every such ease, the Owners of not less than a majority in aggregate amount of Bond Obligation of the Bonds at the time Outstanding, by written notice to the City and to the Trustee, may, on SFLIBI/1046372/11/90340/00003
39 ATTACHMENT 3
A3-43
behalf of the Owners of all the Bonds, rescind and annul such declaration and its consequences; but no such rescission and annulment shall extend to or shall affect any subsequent default, or shall impair or exhaust any right or power consequent thereon.
SECTION 7.03. Trustee to Represent Bondholders. The Trustee is hereby irrevocably appointed (and the successive respective Owners of the Bonds, by taking and holding the same~ shall be conclusively deemed to have so appointed the Trustee) as trustee and true and lawful attorney-in-fact oft_he Owners of the Bonds for the purpose of exercising and prosecuting on -::
their behalf such rights and remedies as may be available to such Owners under the provisions of the Bonds, this Indenture and applicable provisions of any other law. Upon the occurrence bud continuance of an Event of Default or other occasion giving rise to a right in the Trustee to represent the Bondholders, the Trustee in its discretion may, and upon the written request of the Owners of not less than twenty-five percent (25%) in aggregate amount of Bond Obligation of the Bonds then Outstanding, and upon being indemnified to its satisfaction therefor, shall, proceed to protect or enforce its rights or the rights of such Owners by such appropriate action, suit, mandamus or other proceedings as it shall deem most effectual to protect and enforce any such fight, at law or in equity, either for the specific performance of any covenant or agreement contained herein, or in aid of the execution of any power herein granted, or for the enforcement of any other appropriate legal or equitable right or remedy vested in the Trustee or in such Owners under this Indenture or any other law; and upon instituting such proceeding, the Trustee shall be entitled, as a matter of right, to the appointment of a receiver of the Electric Net Revenues, and other assets pledged under this Indenture, pending such proceedings. All rigtits of action under this Indenture or the Bonds or otherwise may be prosecuted and enforced by the Trustee without the possession of any of the Bonds or the production thereof in any proceeding relating thereto, axid any such suit, action or proceeding instituted by the Trustee shall be brought in the name of the Trustee for the benefit and protection of all the Owners of such Bonds, subject to the provisions of this Indenture (including Section 7.05).
SECTION 7.04. Bondholders’ Direction of Proceedings. Anything in this Indenture to the contrary notwithstanding, the Owners of a majority in aggregate amount of Bond Obligation of the Bonds then Outstanding shall have the right, by an instrument or concurrent instruments in writing executed and delivered to the Trustee and upon furnishing the Trustee with ¯ indemnification satisfactory to it, to direct the method of conducting all remedial proceedings taken by the Trustee hereunder, provided that such direction shall not be otherwise than in accordance with law and the provisions of this Indenture, that the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction, and that the Trustee shall have the right to decline to follow any such direction which in the opinion of the Trustee would be unjustly prejudicial to Bondholders or holders of Parity Debt not parties to such direction.
SECTION 7.05. Limitation on Bondholders’ Right to Sue. No Owner of any Bond shall have the right to institute any suit, action or proceeding at law or in equity, for the protection or enforcement of any right or remedy under this Indenture or any other applicable law with respect to such Bond, unless (1) such Owner shall have given to the Trustee written notice of the occurrence of an Event of Default; (2) the Owners of not less than twenty-five percent (25%) in aggregate amount of Bond Obligation of the Bonds then Outstanding shall have made written request upon the Trustee to exercise the powers hereinbefore granted or to institute such suit, SFLIBl/1046372/11190340100003
40 ATTACHMENT 3
A3-44
action or proceeding in its own name; (3) such Owner or said Owners shall have tendered to the Trustee reasonable indemnity against the costs, expenses and liabilities to be incurred in compliance with such request; (4) 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; and (5) the Trustee shall not have received contrary directions from the Owners of a majority in aggregate amount of Bond .
Obligation of the Bonds then Outstanding.
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 o~’any remedy hereunder or under law; 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 affect, disturb or prejudice the security of this Indenture or the rights of any other Owners of Bonds, or to enforce any right under this Indenture or other applicable law with respect to the Bonds, except in the manner herein provided, and that all proceedings at law or in equity to enforce any such right " shall be instituted, had and maintained in the manner herein provided and for the benefit and protection of all Owners of the Outstanding Bonds, subject to the provisions of this Indenture.
SECTION 7.06. Absolute Obligation of the City. Nothing in this Indenture or in the Bonds contained shall affect or impair the obligation of the City, which is absolute and unconditional, to pay the principal or Redemption Price of and interest on the Bonds to the respective Owners of the Bonds at their respective due dates therefor or upon call for redemption, as herein provided, but only out of the Electric Net Revenues and other assets herein pledged therefor, or affect or impair the right of such Owners, which is also absolute and unconditional, to enforce such payment by virtue of the contract embodied in the Bonds.
SECTION 7.07. Termination of Proceedings. In case any proceedings taken by the Trustee or any one or more Bondholders on account of any Event of Default shall have been discontinued or abandoned for any reason or shall have been determined adversely to the Trustee or the Bondholders, then in every such case the City, the Trustee and the Bondholders, subject to any determination in such proceedings, shall be restored to their former positions and rights hereunder, severally and respectively, and all rights, remedies, powers and duties of the City, the Trustee and the Bondholders shall continue as though no such proceedings had .been taken.
SECTION 7.08. Remedies Not Exclusive. No remedy herein conferred upon or reserved to the Trustee or to the Owners of the Bonds is intended to be exclusive of any other remedy or remedies, and each and every such remedy, to the extent permitted by law, shall be cumulative and in addition to any other remedy given hereunder or now or hereafter existing at law or in equity or otherwise.
SECTION 7.09. No Waiver of Defaulto No delay or omission of the Trustee or of any Owner of the Bonds to exercise any right or power arising upon the occurrence of 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 given by this Indenture to the Trustee or to the Owners of the Bonds may be exercised from time to time and as often as may be deemed expedient.
SFLIBI/1046372/I 1/90340/00003
ATTACHMENT 3
A3-45
ARTICLE VIII
THE TRUSTEE
SECTION 8.01. Appointment; Duties, Immunities and Liabilities of Trustee. (A) U.S. Bank Trust National Association is hereby appointed as Trustee under this" Indenture and hereby accepts the trust imposed upon it as Trustee hereunder and to perform all -::
the functions and duties of the Trustee hereunder, subject to the terms and conditions set forth in this Indenture. The Trustee shall, prior to an Event of Default, and after the curing or waivfr of all Events of Default which may have occurred, perform such duties and only such duties as are specifically set forth in this Indenture and no implied covenants shall be read into this Indenture against the Trustee. The Trustee shall, during the existence of any Event of Default (which has not been cured or waived), exercise such of the rights and powers vested in it by this Indenture and use the same degree of care and skill in their exercise as aprudent person would exercise or use under the circumstances in the conduct of his or her own affairs. (B) The City may remove the Trustee at any time unless an Event of Default shall have occurred and then be continuing, and shall remove the Trustee if at any time requested to do so by an instrument or concurrent instruments in writing signed by the Owners of not less than a majority in aggregate amount of Bond Obligation of the Bonds then Outstanding (or their attorneys duly authorized in writing) or if at any time the Trustee shall cease to be eligible in accordance with subsection (E) of this Section, or shall become incapable of acting, or shall be adjudged a bankrupt or insolvent, or a receiver of the Trustee or its property shall be appointed, or any public officer shall take control or charge of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, in each case by giving written notice of such removal to the Trustee, and thereupon shall appoint a successor Trustee by an instrument in writing.
(C) The Trustee may at any time resign by giving written notice of such resignation to the City and by giving the Bondholders notice of such resignation by mail at the addresses shown on the registration books maintained by the Trustee. Upon receiving such notice of resignation, the City shall promptly appoint a successor Trustee by an instrument in writing. (D) Any removal or resignation of the Trustee and appointment of a successor Trustee shall become effective upon acceptance of.appointment by the successor Trustee. If no successor Trustee shall have been appointed and have accepted appointment within forty-five (45) days of giving notice of removal or notice of resignation as aforesaid, the resigning Trustee or any Bondholder (on behalf of himself and all other Bondholders) may petition any court of competent jurisdiction for the appointment of a successor Trustee, and such court may thereupon, after such notice (if any) as it may deem proper, appoint such successor Trustee. Any successor Trustee appointed under this Indenture, shall signify its acceptance of such appointment by executing and delivering to the City and to its predecessor Trustee a written acceptance thereof, and thereupon such successor Trustee, without any further act, deed or conveyance, shall become vested with all the moneys, estates, properties, rights, powers, trusts, duties and obligations of such predecessor Trustee, with like effect as if originally named Trustee herein; but, nevertheless at the Request of the City or the request of the successor Trustee, such SFLIBllI046372/11190340100003
ATTACHMENT 3
A3-46
predecessor Trustee shall execute and deliver any and all instruments of conveyance or further assurance and do such other things as may reasonably be required for more fully and certainly vesting in and confirming to such successor Trustee all the fight, title and inte~:est of such predecessor Trustee in and to any property held by it under this Indenture and shall pay over, transfer, assign and deliver to the successor Trustee any money or other property subject to the trusts and conditions herein set forth. Upon request of the successor Trustee, the City shall execute and deliver any and all instruments as may be reasonably required for more fully and certainly vesting in and confirming to such successor Trustee all such moneys, estates, properties, rights, powers, trusts, duties and obligations. Upon acceptance of appointment by a successor Trustee as provided in this subsection, the City shall give notice of the succession" of such Trustee to the trusts hereunder by mail to the Bondholders at the addresses shown on the registration books maintained by the Trustee. If the City fails to mail such notice within fifteen (15) days after acceptance of appointment by the successor Trustee, the successor Trustee shall cause such notice to be mailed at the expense of the City. (E) Any Trustee appointed under the provisions of this Section in succession to the Trustee shall be a trust company or bank having the powers of a trust company hav.ing a corporate trust office in the State, having a combined capital and surplus of at least fifty million dollars ($50,000,000) and subject to supervision or examination by federal or state authority. If such bank 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 subsection the combined capital and surplus of such bank or trust company shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. In case at any time the Trustee shall cease to be eligible in accordance with the provisions of this subsection (E)~ the Trustee shall resign immediately in the manner and with the effect specified in this Section.
If, by reason of the judgment of any court, the Trustee or any successor Trustee is rendered unable to perform its duties hereunder, and if no successor Trustee be then appointed, all such duties and all of the fights and powers of the Trustee hereunder shall be assumed by and vest in the Treasurer of the City in trust for the benefit of the Bondowners.
SECTION 8.02. 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 such company shall be eligible under subsection (E) of Section 8.01, shall be the successor to such Trustee without the execution or filing of any paper or any further act, anything herein to the contrary notwithstanding.
SECTION 8.03. Liabili _ty of Trustee.
(A) The recitals of facts herein and in the Bonds contained shall be taken as statements of the City, and the Trustee assumes no responsibility for the correctness of the same (other than the certificate of authentication of the Trustee on each Bond), and makes no representations as to the validity or sufficiency of this Indenture or of the Bonds or of any Investment Security, as to the sufficiency of the Electric Net Revenues, or the priority of the lien SFLIB 1/1046372/11/90340/00003
ATTACHMENT 3
A3-47
of this Indenture thereon, or as to the financial or technical feasibility of the Electric System and shall not incur any responsibility in respect of any such matter, other than in connection with the duties or obligations expressly herein or in the Bonds assigned to or imposed tipon it. The Trustee shall, however, be responsible for its representations contained in its certificate of authentication on the Bonds. The Trustee shall not be liable in connection with the performance of its duties hereunder, except for its own negligence, willful misconduct or breach of the express terms and conditions hereof. The Trustee and its directors, officers, employees or agents may in good faith buy, sell, own, hold and deal in any of the Bonds and may join in any action :- which any Owner of a Bond may be entitled to take, with like effect as if the Trustee was not the Trustee under this Indenture. The Trustee may in good faith hold any other form of indebte~lness of the City, own, accept or negotiate any drafts, bills of exchange, acceptances or obligations of the City and make disbursements for the City and enter into any commercial or business arrangement therewith, without limitation.
(B) The Trustee shall not be liable for any error ofjudgrnent made in good faith by a responsible officer unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts. 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, and shall be entitled to advice of counsel concerning all matters of trust and its duty hereunder, but the Trustee shall be answerable for the negligence or misconduct of any such attorney, agent, or receiver selected by it; provided, however, that the Trustee shall not be answerable for the negligence or misconduct of any attorney or certified public accountant selected by it with due care. (C) The Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Owners of not less than twenty- five percent (25%) in aggregate amount of Bond .Obligation of the Bonds at the time Outstanding relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred upon the Trustee under this Indenture. (D) The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request, order or direction of any of the Bondholders pursuant to the provisions of this Indenture, including, without limitation, the provisions of Article VII hereof, unless such Bondholders shall have offered to the Trustee security or indemnity satisfactory to it against the costs, expenses and liabilities which may be incurred therein or thereby.
(E) No provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance or exercise of any of its duties hereunder.
(F) The Trustee shall not be deemed to have knowledge of and shall not be required to take any action with respect to, any Event of Default (other than an Event of Default described in subsections (a) or (b) of Section 7.01) or event which would, with the giving of notice, the passage of time or both, constitute an Event of Default, unless the Trustee shall have actual knowledge of such event or shall have been notified of such event by the City or the Owners of twenty-five percent (25%) in aggregate amount of Bond Obligation of the Bonds at the time Outstanding. Without limiting the generality of the foregoing, the Trustee shall not be required S FLIB 1/1046372/11/90340/00003
ATTACHMENT 3
A3-48
to ascertain, monitor or inquire as to the performance or observance by the City of the terms, conditions, covenants or agreements set forth in Article VI hereof (including, without limitation, the covenants of the City set forth in Sections 6.07 or 6.08 hereof), other than the covenants of the City to make payments with respect to the Bonds when due as set forth in Section 6.01 and to file with the Trustee when due, such reports and certifications as the City is required to file w~-th the Trustee hereunder.
(G) No permissive power, right or remedy conferred upon the Trustee hereunder shalI-- be construed to impose a duty to exercise such power, right or remedy. (H) The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, coupon or other paper or document but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the City, personally or by agent or attorney.
(I) The Trustee shall not be responsible for:
(1) the application or handling by the City of any Electric Net Revenues or other moneys transferred to or pursuant to any Requisition or Request of the City in accordance with the terms and conditions hereof;
(2) the application and handling by the City of any other fund er account designated to be held by the City hereunder;
(3) any error or omission by the City in making any computation or giving any instruction pursuant to Sections 6.07 and 6.08 hereof and may rely conclusively on any computations or instructions furnished to it by the City in connection with the requirements of Section 6.08 and the Tax Certificate; or (4)
City.
the construction, operation or maintenance of the Electric System by the (J) Whether or not therein expressly so provided, every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Article VIII.
(K) The Trustee shall have no responsibility with respect to any information, statement or recital in any official statement, offering memorandum or any other disclosure material prepared or distributed with respect to the Bonds.
SECTION 8.04. Right of Trustee to Rely on Documents. The Trustee shall be protected in acting upon any notice, resolution, request, consent, order, certificate, report, opinion, note or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties. The Trustee may consult with counsel, including, without limitation, counsel of or to the City, with regard to legal questions, and the opinion of such counsel shall be SFLIB 1/1046372/11190340100003
ATTACHMENT 3
A3-49
full and complete authorization and protection in respect of any action taken or suffered by it hereunder in good faith and in accordance herewith unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts.
Whenever in the administration of the trusts imposed upon it by this Indenture the Trustee shall deem it necessary or desirable that a matter be provedor established prior to taking or suffering any action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by a -:-" Certificate of the City, and such Certificate shall be full warrant to the Trustee for any action taken or suffered in good faith under the provisions of this Indenture in reliance upon such " Certificate, but in its discretion the Trustee may, in lieu thereof, accept other evidence of such matter or may require such additional evidence as to it may seem reasonable. The Trustee may also rely conclusively on any report or certification of any certified public accountant, investment banker, financial consultant, or other expert selected by the City or selected by the Trustee with due care in connection with matters required to be proven or ascertained in connection with its administration of the trusts created hereby.
SECTION 8.05. Compensationand Indemnification of Trustee. The City shall cause to be paid to the Trustee from timeto time reasonable compensation for all service rendered under this Indenture, and also all reasonable expenses, charges, counsel fees and other disbursements, including those of its attorneys, agents, and employees, incurred in and about the performance of their powers and duties under this Indenture, subject to the provisions of Section 11.10 hereof.
The City further agrees to indemnify and save the Trustee, its officers, directors and employees harmless from and against any costs, claims, expenses or liabilities, including fees and expenses of its attorneys, which it may incur in the exercise and performance of its powers and duties hereunder, and which are not due to its negligence, misconduct or default.
ARTICLE IX
MODIFICATION OR AMENDMENT OF THIS INDENTUP,_E
SECTION 9.01. Amendments Permitted.
(A) (1) This Indenture and the rights and obligations of the City, the Owners of the Bonds and the Trustee may be modified or amended from time to time and at any time by a Supplemental Indenture, which the City and the Trustee may enter into with the written consent " of the Owners of a majority in aggregate amount of Bond Obligation of the Bonds (or, if such Supplemental Indenture is only applicable to a Series of Bonds, such Series of Bonds) then Outstanding shall have been filed with the Trustee; provided that if such modification or amendment will, by its terms, not take effect so long as any Bonds of any particular maturity remain Outstanding, the consent of the Owners of such Bonds shall not be required and such Bonds shall not be deemed to be Outstanding for the purpose of any calculation of Bonds Outstanding under this Section.
(2) In lieu of satisfying the requirements of Section 9.01(A)(1) hereof, this Indenture and the rights and obligations of the City and of the Owners of the Bonds and of the SFLIB 1/1046372111190340100003
46 ATTACHMENT 3
A3-50
Trustee may also be modified or amended at any time by a Supplemental Indenture entered into by the City and the Trustee which shall become binding when the written consents of each provider of a letter of credit or a policy of bond insurance for the Bonds shall have been filed with the Trustee, provided that at such time the payment of all the principal of and interest on all Outstanding Bonds shall be insured by a policy or policies of municipal bond insurance or :. payable under a letter of credit the provider of which shall be a financial institution or association having unsecured debt obligations rated, or insuring or securing other debt obligations rated on the basis of such insurance or letters of credit, in one of the two highest Rating Categories of ":
Moody’s or Standard & Poor’s. A copy of each such Supplemental Indenture shall be sent by the City to Moody’s and Standard & Poor’s.
(3) No such modification or amendment shall (a) extend the fixed maturity of any Bond, or reduce the amount of principal thereof, or extend the time of payment or reduce the amount of any mandatory sinking fund payment provided for the payment of any Bond, or reduce the rate of interest thereon, or extend the time of payment of interest thereon, or reduce any premium payable upon the redemption thereof exclusively, without the consent of the Owner of each Bond so affected, or (b) reduce the aforesaid percentage of Bond Obligation the consent of the Owners of which is required to effect any such modification or amendment, or permit the creation of any lien on the Electric Net Revenues and other assets pledged under this Indenture prior to or on a parity with the lien created by this Indenture, or deprive the Owners of the Bonds of the lien created by this Indenture on such Electric Net Revenues and other assets (in each case, except as expressly provided in this Indenture), without the consent of the Owners of all of the Bonds then Outstanding. It shall not be necessary for the consent of the Bondholders to approve the particular form of any Supplemental Indenture, but it shall be sufficient if such consent shall approve the substance thereof. Promptly after the execution and delivery by the Trustee and the City of any Supplemental Indenture pursuant to this subsection (A), the Trustee shall mail a notice, setting forth in general terms the substance of such Supplemental Indenture to the Owners of the Bonds at the addresses shown on the registration books of the Trustee. Any failure to give such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such Supplemental Indenture.
(B) This Indenture and the fights and obligations of the City, of the Trustee and of the Owners of the Bonds may also be modified or amended from time to time and at any time by a Supplemental Indenture, which the City may adopt without the consent of any Bondholders but only to the extent permitted by law and only for any one or more of the following purposes:
(1) to add to the covenants and agreements of the City in this Indenture contained other covenants and agreements thereafter to be observed, to pledge or assign additional security for the Bonds (or any portion thereof), or to surrender any right or power herein reserved to or conferred upon the City;
(2) to make such provisions for the purpose of curing any ambiguity, inconsistency or omission, or of curing or correcting any defective provision, contained in this Indenture, or in regard to matters or questions arising under this Indenture, as the City may deem necessary or desirable, . and which shall not materially and adversely affect the interests.of the Owners of the Bonds;
SFLIBI/1046372JI 1/90340/00003
47 ATTACHMENT 3
A3-51
(3) to modify, amend or supplement this Indenture in such manner as to permit the qualification hereof under the Trust Indenture Act of 1939, as amended, or any similar federal statute hereafter in effect, and to add such other terms, ~onditions and provisions as may be permitted by said Act or similar federal statute, and which shall not materially and adversely affect the interests of the Owners of the Bonds; ." ~. (4). to make modifications or adjustments necessary, appropriate or desirabl~ to provide for the issuance of Variable Rate Indebtedness, Capital Appreciation ". ~" Indebtedness or Parity Debt with such interest rate, payment, maturity and other terms as the City may deem desirable; subject to the provisions of Section 3.01, 3.03 and 3.05; (5) to provide for the issuance of Bonds in book-entry form or bearer form, provided that no such provision shall materially and adversely affect the interests of the Owners of the Bonds;
(6) if the City agrees in a Supplemental Indenture to maintain the exclusion of interest on a Series of Bonds from gross income for purposes of federal income taxation, to make such provisions as are necessary or appropriate to ensure such exclusion; (7) to provide for the issuance of an additional Series of Bonds pursuant to provisions of Section 3.02 or Section 3.03; and
(8) for any other purpose that does not materially and adversely affect the interests of the Owners of the Bonds.
SECTION 9.02. Effect of Supplemental Indenture. From and after the.time any Supplemental Indenture becomes effective pursuant to this Article, this Indenture shall be deemed to be modified and amended in accordance therewith, and the respective rights, duties and obligations under this Indenture of the City, the Trustee and all Owners of Bonds Outstanding shall thereafter be determined, exercised and enforced hereunder subject in all respects to such modification and amendment, and all the terms and conditions of any such Supplemental Indenture shall be deemed to be part of the terms and conditions of this Indenture for any and all purposes.
SECTION 9.03. Endorsement of Bonds; Preparation of New Bond~. Bonds delivered after any Supplemental Indenture becomes effective pursuant to this Article may, and if the Trustee so determines shall, bear a notation by endorsement.or otherwise in form approved by the City and the Trustee as to any modification or amendment provided for in such Supplemental Indenture, and, in that ease, upon demand of the Owner of any Bond Outstanding at the time of such execution and presentation of his Bond for such purpose at the Corporate Trust Office or at such additional offices as the Trustee may select and designate for that purpose, a suitable notation shall be made on such Bond. If the Supplemental Indenture shall so provide, new Bonds so modified as to conform, in the opinion of the City and the Trustee, to any modification or amendment contained in such Supplemental Indenture, shall be prepared and executed by the City and authenticated by the Trustee, and upon demand of the Owners of any Bonds then Outstanding shall be exchanged at the Principal Corporate Trust Office, without cost to any SFLIB 1/1046372/11/90340/00003
ATTACHMENT 3
A3-52
Bondholder, for Bonds then Outstanding, upon surrender for cancellation of such Bonds, in equal aggregate principal amounts of the same Series, tenor and maturity.
SECTION 9.04. Amendment of Particular Bonds. The provisions of this Article shall not prevent any Bondholder from accepting any amendment as to the particular Bonds held by him, provided that due notation thereof is made on such Bonds.
ARTICLE X
DEFEASANCE
SECTION 10.01. Discharge of Indenture. Bonds of any Series or a portion thereof may be paid by the City in any of the following ways:
(a) by paying or causing to be paid the Bond Obligation of and interest on such Outstanding Bonds, as and when the same become due and payable; (b) by depositing with the Trustee, an escrow agent or other fiduciary, in trust, at or before maturity, money or securities in the necessary amount (as provided in Section
10.03) to pay or redeem such Outstanding Bonds; or
(c)
Bonds.
by delivering to the Trustee, for cancellation by it, such Outstanding If the City shall pay all Series for which any Bonds are Outstanding and also pay or cause to be paid all other sums payable¯ hereunder by the City, then and in that case, at the election of the City (evidenced by a Certificate of the City filed with the Trustee signifying the intention of the City to discharge all such indebtedness and this Indenture), and notwithstanding that any Bonds shall not have been surrendered for payment, this Indenture and the pledge of Electric Net Revenues and other assets made under this Indenture and all covenants, agreements and other obligations of the City under this Indenture shall cease, terminate, become void and be completely discharged and satisfied. In such event, upon Request of the City, the Trustee shall cause an accounting for such period or periods as may be requested by the City to be prepared and filed with the City and shall execute and deliver to the City all such instruments as may be necessary or desirable to evidence such discharge and satisfaction, and the Trustee shall pay over, transfer, assign or deliver to the City all moneys or securities or other property held by it pursuant to this Indenture which, as evidenced by a verification report, upon which the Trustee may conclusively rely, from a firm of certified public accountants, are not required for the ¯ payment or redemption of Bonds not theretofore surrendered for such payment or redemption.
SECTION 10.02. Discharge ofLiabili _ty on Bor~d.~. ¯Upon the deposit with the Trustee, escrow agent or other fiduciary, in trust, at or before maturity, of money or securities in the necessary amount (as provided in Section 10.03) to pay or redeem any Outstanding Bond (whether upon or prior to its maturity or the redemption date of such Bond), provided that, if such Bond is to be redeemed prior to maturity, notice of such redemption shall have been given as in Article IV provided or provision satisfactory to the Trustee shall have been made for the giving of such notice, then all liability of the City in respect of such Bond shall cease, terminate SFLIBl/1046372/I 1/90340/00003
49 ATTACHMENT 3
A3-53
and be completely discharged, provided that the Owner thereof shall thereafter be entitled to the payment of the principal of and premium, if any, and interest on the Bonds, and the City shall remain liable for such payment, but only out of such money or securities deposited with the Trustee as aforesaid for their payment, subject, however, to the provisions of Section 10.04 and the continuing duties of the Trustee hereunder.
The City may at any time surrender to the Trustee for cancellation by it any Bonds previously issued and delivered, which the City may have acquired in any manner whatsoever,’:- and such Bonds, upon such surrender and cancellation, shall be deemed to be paid and retired.
SECTION 10.03. Deposit of Money or Securities with Trustee.. Whenever in this Indenture it is provided or permitted that there be deposited with or held in trust by the Trustee money or securities in the necessary amount to pay or redeem any Bonds, the money or securities so to be deposited or held may include money or securities held by the Trustee in the funds and accounts established pursuant to this Indenture and shall be:
(a) lawful money of the United States of America in an amount equal to the principal amount of such Bonds and all unpaid interest thereon to maturity, except that, in the case of Bonds which are to be redeemed prior to maturity and in respect of which notice of such redemption shall have been given as in Article IV provided or provision satisfactory to the Trustee shall have been made for the giving of such notice, the amount to be deposited or held shall be the principal amount or Redemption Price of such Bonds and all unpaid interest thereon to the redemption date; or (b) Defeasance Securities, the principal of and interest on which when due will, in the opinion of an independent certified public accountant delivered to the Trustee (upon which opinion the Trustee may conclusively rely), provide money sufficient to pay the principal or Redemption Price of and all unpaid interest to maturity, or to the redemption date, as the case may be, on the Bonds to be paid or redeemed, as such principal or Redemption Price and interest become due, provided that, in the case of Bonds which are to be redeemed prior to the maturity thereof, notice of such redemption shall have been given as in Article IV provided or provision satisfactory to the Trustee shall have been made for the giving of such notice;
provided, in each case, that the Trustee shall have been irrevocably instructed (by the terms of this Indenture or by Request of the City) to apply such money to the payment of such principal or Redemption Price and interest with respect to such Bonds.
SECTION 10.04. payment of Bonds After Discharge of Indenture. Any moneys held by the Trustee in trust for the payment of the principal or Redemption Price of, or interest on, any Bonds and remaining unclaimed for two years after the principal of all of the Bonds has become due and payable (whether at maturity or upon call for redemption .as provided in this Indenture), if such moneys were so held at such date, or two (2) years after the date of deposit of such moneys if deposited after said date when all of the Bonds became due and payable, shall be repaid to the City free from the trust created by this Indenture, and all liability of the Trustee with respect to such moneys shall thereupon cease; provided, however, that before the repayment of such moneys to the City as aforesaid, the Trustee may (at the cost of the City) first mail to the SFLIBl/1046372/I I/90340100003
50 ATTACHMENT 3
A3-54
Owners of any Bonds remaining unpaid at the addresses shown on the registration books maintained by the Trustee a notice, in such form as may be deemed appropriate by the Trustee, with respect to the Bonds so payable and not presented and with respect to the-provisions relating to the repayment to the City of the moneys held for the payment thereof. All moneys held by or on behalf of the Trustee for the payment of principal or Accreted Value of or interest 6r premium on Bonds, whether at redemption or maturity, shall be held in trust for the account of the Owners thereof and the Trustee shall not be required to pay Owners any interest on, or be liable to the Owners or any other person (other than the City) for any interest earned on, moneys so held. " Any interest earned thereon shall belong to the City and shall be deposited monthly by the Trustee into the Electric Revenue Fund.
ARTICLE XI
MISCELLANEOUS
SECTION 11.01. Liability of City Limited to Electric Net Revenues. Notwithstanding anything in this Indenture or in the Bonds contained, the City shall not be required to advance any moneys derived from any source other than the Electric Net Revenues and other assets pledged hereunder for any of the purposes in this Indenture mentioned, whether for the payment of the principal or Redemption Price of or interest on the Bonds or for any other purpose of this Indenture.
The Bonds are special, limited obligations of the City. The Bonds shall not be deemed to constit-ate a debt or liability of the City, the State of California or of any political subdivision thereof within the meaning of any constitutional or statutory provision, or a pledge of the faith and credit of the City, the State of California or of any political subdivision thereof, but shall be payable, except to the extent of certain amounts held hereunder pledged therefor, solely from Electric Net Revenues. Neither the faith and credit nor the taxing power of the City, the State of California or of any political subdivision thereof is pledged to the payment of the principal of, premium, if any, or the interest on the Bonds. The issuance of the Bonds shall not directly or indirectly or contingently obligate the City, the State of Califomia or any political subdivision thereof to levy or to pledge any form of taxation whatsoever therefor or to make any appropriation for their payment.
SECTION 11.02. Successor is Deemed Included in All References to Predecessor.
Whenever in this Indenture either the City or the Trustee is named or referred to, such reference shall be deemed to include the successors or assigns thereof, and all the covenants and agreements in this Indenture contained by or on behalf of the City 0r the Trustee shall bind and inure to the benefit of the respective successors and assigns thereof whether so expressed or not.
SECTION 11.03. Limitation of Rights to City, Trustee and Bondholders~ Nothing in this Indenture or in the Bonds expressed or implied is intended or shall be construed to give to any person other than the City, the Trustee and the Owners of the Bonds and any Parity Debt, any legal or equitable right, remedy or claim under or in respect of this Indenture or any covenant, condition or provision therein or herein contained; and all such covenants, conditions and SFLIBl/1046372/I 1/90340/00003
51 ATTACHMENT 3
A3-55
provisions are and shall be held to be for the sole and exclusive benefit of the City, the Trustee and the Owners of the Bonds and any Parity Debt.
SECTION 11.04. Waiver of Notice. Whenever in this Indenture the giving of notice by mail or otherwise is required, the giving of such notice may be waived in writing by the person entitled to receive such notice and in any such case the giving or receipt of such notice shall no.t be a condition precedent to the validity of any action taken in reliance upon such waiver. " SECTION 11.05. Destruction or Delive _ry of Cancelled Bonds. Whenever in this Indenture provision is made for the cancellation by the Trustee and the delivery to the City of any Bonds, the Trustee may, in its sole discretion, in lieu of such cancellation and delivery, destroy such Bonds, and deliver a certificate of such destruction to the City.
SECTION 11.06. SeverabiliW of Invalid Provision.~. If any one or more of the provisions contained in this Indenture or in the Bonds shall for any reason be held to be invalid, illegal or unenforceable in any respect, then such provision or provisions shall be deemed severable from the remaining provisions contained in this Indenture and such invalidity, illegality or unenforceability shall not affect any other provision of this Indenture, and this Indenture shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein. The City hereby declares that it would have executed and delivered this Indenture and each and every other Section, paragraph, sentence, clause or phrase hereof and authorized the issuance of the Bonds pursuant thereto irrespective of the fact that any one or ¯ more Sections, paragraphs, sentences, clauses or phrases of this Indenture may be held illegal, invalid or unenforceable.
SECTION 11.07. Notice to City and Trustee. Any notice to or demand upon the Trustee may be served or presented, and such demand may be made, at the Corporate Trust Office of the Trustee. Any notice to or demand upon the City, shall be deemed to have been sufficiently given or served for all purposes by being deposited, first-class mail postage prepaid, in a post office letter box, addressed, as the case may be, to the City at 275 East Olive Avenue, Burbank, California 91502, Attention: Financial Services Director (or such other address as may have been filed in writing by the City with the Trustee).
SECTION 11.08. Evidence of Rights of Bondholders. Any request, consent or other instrument required or permitted by this Indenture to be signed and executed by Bondholders may be in any number of concurrent instruments of substantially similar tenor and shall be signed or executed by such Bondholders in person, or by an 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, or of the holding by-any person of Bonds transferable by delivery, shall be sufficient for any purpose of this Indenture and shall be conclusive in favor of the " Trustee and of the City if made in the manner provided in this Section.
The fact and dat~ of the execution by any person of any such request, consent or other instrtmaent or writing may be proved by the certificate of any notary public or other officer of any jurisdiction, authorized by the laws thereof to take aeknowledgrnents of deeds, certifying that the person signing such request, consentor other instrument acknowledged to him the SFLIB 1/1046372/11/90340/00003
ATTACHMENT 3
A3-56
execution thereof, or by an affidavit of a witness of such execution duly sworn to before such notary public or other officer.
The ownership of Bonds shall be proved by the bond registration books held by the Trustee. The Trustee may establish a record date as of which to measure consent of the Bondowners in order to determine whether the requisite consents are received.
Any request, consent, or other instrument or writing of the Owner of any Bond shall bind every future Owner of the same Bond and the Owner of every Bond issued in exchange therefor or in lieu thereof, in respect of anything done or suffered to be done by the Trustee or the C~ty in accordance therewith or reliance thereon.
SECTION 11.09. Disqualified Bonds. In determining whether the Owners of the requisite aggregate amount of Bond Obligation 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 City, or by any other obligor on the Bonds, or by any person directly or indirectly controlling or controlled by, or under direct or indirect common control with, the City or any. other obligor on the Bonds, shall be disregarded and deemed not to be Outstanding for the purpose of any such determination. Bonds so owned which have been pledged in good faith may be regarded as Outstanding for the purposes of this Section if the pledgee shall establish to the satisfaction of the Trustee the pledgee’s right to vote such Bonds and that the pledgee is not a person directly or indirectly controlling or controlled by, or under direct or indirect common control with, the City or any other obligor on the Bonds. In case of a dispute as to such right, any decision by the Trustee taken upon the advice of counsel shall be full protection to the Trustee.
SECTION 11.10. Money Held for Particular Bonds. The money held by the Trustee for the payment of the interest, principal or Redemption Price due on any date with respect to particular Bonds (or portions of Bonds in the case of registered Bonds redeemed in part only) shall, on and after such date and pending such payment, be set aside on its books and held in trust by it for the Owners of the Bonds entitled thereto, subject, however, to the provisions of Section 10.04.
SECTION 11.11. Funds and Accounts. Any fund required by this Indenture to be established and maintained by the Trustee may be established and maintained in the accounting records of the Trustee, either as a fund or an account, and may, for the purposes of such records, any audits thereof and any reports or statements with respect thereto, be treated either as a fund or as an account; but all such records with respect to all such funds shall at all times be maintained in accordance with customary standards of the industry, to the extent practicable, and with due regard for the protection of the security of the Bonds and the rights of every holder thereof.
SECTION 11.12. Article and Section Headings and References. The headings or titles of the several Articles and Sections hereof, and any table of contents appended to copies hereof, shall be solely for convenience of reference and shall not affect the meaning, construction or effect of this Indenture.
SFLIBI/1046372/! 1/90340/00003
ATTACHMENT 3
A3-57
All references herein to "Articles," "Sections" and other subdivisions are to the corresponding Articles, Sections or subdivisions of this Indenture; the words "herein," "hereof," "hereby," "hereunder" and other words of similar import refer to this Indentur~ as a whole and not to any particular Article, Section or subdivision hereof; and words of the masculine gender shall mean and include words of the feminine and neuter genders. ~.
SECTION 11.13. Waiver of Personal Liability. No Council member, officer, agent or employee of the City or the Trustee shall be individually or personally liable for the payment of":
the principal or Redemption Price of or interest on the Bonds or be subject to any personal liability or accountability by reason of the issuance thereof; but nothing herein contained sh~ll relieve any such Council member, officer, agent Or employee of the City or the Trustee from the performance of any official duty provided.by law or by this Indenture.
SECTION 11.14..Governing Law. This Indenture shall be construed and governed in accordance with the laws of the State of California.
SECTION 11.15. Business Day. Except as specifically set forth in a Supplemental Indenture, any payments or transfers which would otherwise become due on any day which is not a Business Day shall become due or shall be made on the next succeeding Business Day with the same effect as if made on such preceding non’Business Day.
SECTION 11.16. Effective Date of Indenture. This Indenture shall take effect upon its execution and delivery.
SECTION 11. i 7. Execution in Counterpart.~o This Indenture may be executed in several counterparts, each of which shall be deemed an original, and all of which shall constitute but one and the same instrument.
SFLIB 111046372111190340100003
54 ’
ATTACHMENT 3
A3-58
IN WITNESS WHEREOF, the parties hereto have executed this Indenture by their officers thereunto duly authorized as of the dayand year first written above.
City Manager
(Seal)
ATTEST:
City
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Trustee
Authorized Officer
SFLIBl/1046372/I 1/90340/00003
ATTACHMENT 3
A3-59