201102409.2
1 CONTINUING DISCLOSURE AGREEMENT
This Continuing Disclosure Agreement (the “Disclosure Agreement”), dated as of [August] 1, 2024, is executed and delivered by the City of Glendale, California (the “City”) and The Bank of New York Mellon Trust Company, N.A., as successor trustee (the “Trustee”), in connection with the issuance of $[PAR AMOUNT] aggregate principal amount of City of Glendale Electric Revenue Bonds, 2024 Second Series (the “2024 Second Series Bonds”). The 2024 Second Series Bonds are being issued pursuant to Article XXVI of the Charter, Ordinance No. [____] (the “Ordinance”), adopted on [____], 2024 by the City Council (the “City Council”) of the City and an Indenture of Trust, dated as of February 1, 2000, by and between the City and the Trustee (as supplemented and amended, the “Indenture”). The City and the Trustee covenant and agree as follows:
SECTION 1. Purpose of this Disclosure Agreement. This Disclosure Agreement is being executed and delivered by the City and the Trustee for the benefit of the Holders and Beneficial Owners of the 2024 Second Series Bonds and in order to assist the Participating Underwriter in complying with Securities and Exchange Commission Rule 15c2-12.
SECTION 2. Definitions. In a
ddition to the definitions set forth in the Indenture, which apply to any capitalized term used in this Disclosure Agreement unless otherwise defined in this Section 2, the following capitalized terms shall have the following meanings:
“Annual Report” shall mean any Annual Report provided by the City pursuant to, and as de
scribed in, Sections 3 and 4 of this Disclosure Agreement. “Beneficial Owner” shall mean any person which (a) has the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of any 2024 Second Series Bonds (including persons holding 2024 Second Series Bonds through nominees, depositories or other intermediaries), or (b) is treated as the owner of any 2024 Second Series Bonds for federal income tax purposes.
“Dissemination Agent” shall mean the Trustee, acting in its capacity as Dissemination Agent hereunder, or any successor Dissemination Agent designated in writing by the City and which has filed with the Trustee a written acceptance of such designation. “Financial Obligation” shall mean a (a) debt obligation; (b) derivative instrument entered into in connection with, or pledged as security or a source of payment for, an existing or planned debt obligation; or (c) guarantee of a debt obligation or any such derivative instrument; provided that “financial obligation” shall not include municipal securities as to which a final official statement (as defined in the Rule) has been provided to the MSRB consistent with the Rule. “Fiscal Year” shall mean the period beginning on July 1 of each year and ending on the next succeeding June 30, or any twelve-month or fifty-two week period hereafter selected by the City, with notice of such selection or change in fiscal year to be provided as set forth herein. “Listed Events” shall mean any of the events listed in Section 5(a) of this Disclosure Agreement.
EXHIBIT E
201102409.2
2 “MSRB” shall mean the Municipal Securities Rulemaking Board established pursuant to Section 15B(b)(1) of the Securities Exchange Act of 1934, as amended, or any other entity designated or authorized by the Securities and Exchange Commission to receive reports pursuant to the Rule. Until otherwise designed by the MSRB or the Securities and Exchange Commission, filings with the MSRB are to be made through the Electronic Municipal Marketplace Access (“EMMA”) website of the MSRB, currently located at http://emma.msrb.org. “Owner” shall mean either the registered owners of the 2024 Second Series Bonds, or, if the 2024 Second Series Bonds are registered in the name of The Dep ository Trust Company or another recognized depository, any applicable participant in such depository system. “Participating Underwriter” shall mean any of the original underwriter or underwriters of the 2024 Second Series Bonds required to comply with the Rule in connection with offering of the 2024 Second Series Bonds.
“Rule” shall mean Rule 15c2 -12 adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same has been or may be amended from time to time.
“State” shall mean the State of California.
SECTION 3. Provision of Annual Reports.
(a) The City shall, or shall cause the Dissemination Agent to, not later than seven months after the end of the City’s Fiscal Year, commencing with the report for the Fi scal Year ended June 30, 2024, provide to the MSRB an Annual Report which is consistent with the requirements of Section 4 of this Disclosure Agreement. The Annual Report may be submitted as a single document or as separate documents comprising a package, and may include by reference other information as provided in Section 4 of this Disclosure Agreement; provided that the audited financial statements of the City may be submitted separately from the balance of the Annual Report and later than the date required above for the filing of the Annual Report if they are not available by that date. If the Fiscal Year changes for the City, the City shall give notice of such change in the manner provided under Section 5 hereof.
(b) Not later than ten (10) Business Days prior to the date specified in subsection (a) for providing the Annual Report to the MSRB, the City shall provide its Annual Report to the Dissemination Agent. If by ten (10) Business Days prior to such date specified in subsection (a), the Dissemination Agent has not received a copy of the Annual Report from the City, the Dissemination Agent shall promptly notify the City of such failure to receive the report. The City shall provide a written statement with each Annual Report furnished to the Dissemination Agent to the effect that such Annual Report constitutes the Annual Report required to be furnished by it hereunder. The Dissemination Agent may conclusively rely upon such statement of the City and shall have no duty or obligation to review such Annual Report. (c) If the Dissemination Agent is unable to verify that an Annual Report of the City has been provided to the MSRB by the date required in subsection (a), the Dissemination Agent shall, in a timely manner, send a notice to the MSRB in substant ially the form attached hereto as Exhibit A.
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3 (d) The Dissemination Agent shall:
(i) determine prior to the date for providing the Annual Report for such year the electronic filing address of, and the then -current procedure for, submitting Annual Reports to the MSRB; and
(ii) provided it has received the Annual Report pursuant to Section 3(a), file a report with the City (and if the Dissemination Agent is not the Trustee, the Trustee) certifying that the Annual Report has been provided pursuant to this Discl osure Agreement, stating the date it was provided. The Dissemination Agent shall have no responsibility for the content of any Annual Report.
SECTION 4. Content of Annual Reports.
(a) The City’s Annual Report shall contain or include by reference the following:
(i) The audited financial statements of the City’s Electric Works Revenue Fund for the most recently completed Fiscal Year, prepared in accordance with generally accepted accounting principles for governmental enterprises as prescribed from time to time by any regulatory body with jurisdiction over the City and by the Governmental Accounting Standards Board. If the City’s audited financial statements are not available by the time the Annual Report is required to be filed pursuant to Section 3(a), the Annual Report shall contain unaudited financial statements in a format similar to the financial statements contained in the final Official Statement, and the audited financial statements shall be filed in the same manner as the Annual Report when they become available. (ii) Updated information comparable to the information in the following charts:
(a) the chart entitled “Electric System Facilities” as it appears on page [__] in the Official Statement, dated _____, 2024, relating to the 2024 Second Series Bonds (the “Official Statement”);
(b) the chart entitled “Total Power Generated and Purchased and Peak Demand” as it appears on page [__] in the Official Statement; (c) the chart entitled “Power Supply Resources” as it appears on page [__] in the Official Statement;
(d) the chart entitled “Five Year History of Rates” as it appears on page [__] in the Official Statement;
(e) the chart entitled “Percentage Increase in Electric Rates” as it appears on page [__] in the Official Statement;
(f) the chart entitled “Customers, Sales, Revenues and Demand” as it appears on page [__] in the Official Statement;
(g) the chart entitled “Capital Requirements” as it appears on page [__] in the Official Statement;
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4 (h) the chart entitled “Outstanding IPA and SCPPA Obli gations” as it appears on page [__] in the Official Statement;
(i) the chart entitled “Historical Operating Results and Debt Service Coverage” as it appears on page [__] in the Official Statement; and (j) the chart entitled “Electric System Statement Of Net Position ” as it appears on page [__] in the Official Statement.
(iii) Updated information comparable to the information in the section entitled “THE ELECTRIC SYSTEM — Transfers to the General Fund” as such information appears on page [__] in the Official Statement.
(b) Any or all of the items listed above may be included by specific reference to other documents, including official statements of debt issues of the City or public entities related thereto, which have been submitted to the MSRB or the Securities and Exchange Commission. If the document included by reference is a final official statement, it must be available from the MSRB.
The City shall clearly identify each such other document so included by reference. (c) The contents, presentation and format of the Annual Reports may be modified from time to time as determined in the judgment of the City to conform to changes in accounting or disclosure principles or practices and legal requirements followed by or applicable to the City or to reflect changes in the legal form of the City; provided, that any such modifications shall comply with the requirements of the Rule.
SECTION 5. Reporting of Significant Events.
(a) Pursuant to the provisions of this section, upon the occurrence of any of the following events (in each case to the extent applicable) with respect to the 2024 Second Series Bonds, the City shall give, or cause to be given by so notifying the Dissemination Agent in writing and instructing the Dissemination Agent to give, notice of the occurrence of such event, in each case, pursuant to Section 5(c) hereof:
(i) principal or interest payment delinquencies;
(ii) non- payment related defaults, if material;
(iii) modifications to the rights of the Owners of the 2024 Second Series Bonds, if material;
(iv) optional, contingent or unscheduled calls, if material, and tender offers;
(v) defeasances;
(vi) rating changes;
(vii) adverse tax opinions or the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material notices or determinations with respect to the tax 201102409.2
5 status of the 2024 Second Series Bonds or other material events affecting the tax status of the 2024 Second Series Bonds;
(viii) unscheduled draws on the debt service reserves reflecting financial difficulties;
(ix) unscheduled draws on the credit enhancements reflecting financial difficulties;
(x) substitution of the credit or liquidity providers or their failure to perform;
(xi) release, substitution or sale of property securing repayment of the 2024 Second Series Bonds, if material;
(xii) bankruptcy, insolvency, receivership or similar proceedings of the City, which shall occur as described below;
(xiii) appointment of a successor or additional trustee or the change of name of a trustee, if material;
(xiv) the co nsummation of a merger, consolidation, or acquisition involving the City or the sale of all or substantially all of the assets of the Electric System of the City other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material; (xv) incurrence of a Financial Obligation of the City ’s Electric System, or agreement to covenants, events of defa ult, remedies, priority rights, or other similar terms of a Financial Obligation of the City’s Electric System, any of which affect holders of the 2020 Bonds, if material; or
(xvi) default, event of acceleration, termination event, modification of terms, or other similar events under the terms of a Financial Obligation of the City’s Electric System, any of which reflect financial difficulties..
For these purposes, any event described in item (xii) of this Section 5(a) is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent, or similar officer for the City in a proceeding under the United States Bankruptcy Code or in any other proceeding under state or federal law in which a court or governmental authority has ass umed jurisdiction over substantially all of the assets or business of the City, or if such jurisdiction has been assumed by leaving the existing governing body and officials or officers in possession but subject to the supervision and orders of a court or governmental authority, or the entry of an order confirming a plan of reorganization, arrangement, or liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or business of the City.
(b) Upon receipt of notice from the City and instruction by the City to report the occurrence of any Listed Event, the Dissemination Agent shall provide notice thereof to the MSRB in accordance with Section 5(c) hereof. In the event the Dissemination Agent shall obtain actual knowledge of the occurrence of any of the Listed Events, the Dissemination Agent shall, 201102409.2
6 immediately after obtaining such knowledge, contact the City, inform the City of the event, and request that the City promptly notify the Dissemination Ag ent in writing whether or not to report the event pursuant to Section 5(c). For purposes of this Disclosure Agreement, “actual knowledge” of the occurrence of such Listed Event shall mean actual knowledge by the Dissemination Agent, if other than the Trustee, and if the Dissemination Agent is the Trustee, then by the officer at the corporate trust office of the Trustee with regular responsibility for the administration of matters related to the Indenture. The Dissemination Agent shall have no responsibility to determine the materiality, if applicable, of any of the Listed Events. (c) The City, or the Dissemination Agent, if the Dissemination Agent has been instructed by the City to report the occurrence of a Listed Event, shall file a notice of such occurrence with the MSRB in a timely manner not more than ten (10) business days after the occurrence of the event.
SECTION 6. Termination of Reporting Obligation. The obligations of the City and the Trustee under this Disclosure Agreement shall terminate upon the legal defeasance, prior redemption or payment in full of all of the 2024 Second Series Bonds.
SECTION 7. Dissemination Agent. T
he City may, from time to time, appoint or engage
a Dissemination Agent to assist it in carrying out its obligations under this Disclosure Agreement, and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent. The initial Dissemination Agent shall be the Trustee. The Dissemination Agent may resign by providing thirty (30) days’ written notice to the City.
SECTION 8. Amendment; Waiver .
Notwithstanding any other provision of this
Disclosure Agreement, the City and the Trustee may amend this Disclosure Agreement (and the Trustee shall agree to any amendment so requested by the City which does not impose any greater duties or any greater risk of liability on the Trustee), and any provision of this Disclosure Agreement may be waived, provided that the following conditions are satisfied:
(a) If the amendment or waiv er relates to the provisions of Sections 3(a) or 4, it may only be made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature or status of an obligated person with respect to the 2024 Second Series Bonds, or the type of business conducted; (b) The undertaking, as amended or taking into account such waiver, would, in the opinion of nationally recognized bond counsel, have complied with the requirements of the Rule at the time of the original issuance of the 2024 Second Series Bonds, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and (c) The amendment or waiver either (i) is approved by the Holders of the 2024 Second Series Bonds in the same manner as provided in the Indenture with respect to amendments to the Indenture which require the consent of Holders, or (ii) does not, in the opinion of nationally recognized bond counsel, materially impair the interests of the Holders or Beneficial Owners of the 2024 Second Series Bonds.
If any amendment or waiver of a provision of this Disclosure Agreement, the City shall describe such amendment in its next Annual Report, and shall include, as applicable, a narrative explanation 201102409.2
7 of the reason for the amendment or waiver and its impact on the type (or in the case of a change of accounting principles, on the presentation) of financial information or operating data being presented by the City. In addition, if the amendment relates to the accounting principles to be followed in preparing financial statements, (i) notice of such change shall be given in the manner provided in Section 5 and (ii) the Annual Report for the year in which the change is made should present a comparison (in narrative form and also, if feasible, in quantitative form) between the financial statements as prepared on the basis of the new accounting principles and those prepared on the basis of the former accounting principles.
SECTION 9. Additional Info rmation. Nothing in this Disclosure Agreement shall be deemed to prevent the City from disseminating any other information, using the means of dissemination set forth in this Disclosure Agreement or any other means of communication, or including any other information in any Annual Report, in addition to that which is required by this Disclosure Agreement. If the City chooses to include any information in any Annual Report in addition to that which is specifically required by this Disclosure Agreement, the City shall have no obligation under this Disclosure Agreement or otherwise to update such information or include it in any future Annual Report.
SECTION 10. F
ilings with the MSRB . All information, operating data, financial statements, annual reports, notices and other documents provided to the MSRB in accordance with this Disclosure Agreement shall be provided in an electronic format prescribed by the MSRB and shall be accompanied by identifying information as prescribed by the MSRB.
SECTION 11. Default.
In the event of a failure of the City or the Trustee to comply with any provision of this Disclosure Agreement, the Trustee may (and, at the request of any Participating Underwriter or the Holders of at least 25% aggregate principal amount of outstanding 2024 Second Series Bonds, shall) upon being indemnified to its satisfaction, or any Holder or Beneficial Owner of the 2024 Second Series Bonds may, take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the City or the Trustee, as the case may be, to comply with its obligations under this Disclosure Agreement. The sole remedy under this Disclosure Agreement in the event of any failure of the City or the Trustee to comply with this Disclosure Agreement shall be an action to compel performance.
SECTION 12. Duties, Immunities and Liabilities of Trustee and Dissemination Agent.
Article VII of the Indenture is hereby made applicable to this Disclosure Agreement as if this Disclosure A greement were (solely for this purpose) contained in the Indenture. The Dissemination Agent shall be entitled to the protections, limitations from liability and indemnities afforded to the Trustee thereunder. The Dissemination Agent (if other than the Trustee or the Trustee in its capacity as Dissemination Agent) shall have only such duties as are specifically set forth in this Disclosure Agreement, and the City agrees, to the extent permitted by law, to indemnify and save the Dissemination Agent, its officers, directors, employees and agents, harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including reasonable attorneys’ fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent’s negligence or willful misconduct. The obligations of the City under this Section 12 shall survive resignation or removal of the Dissemination Agent and payment of 201102409.2
8 the 2024 Second Series Bonds. If the Trustee performs the duties assigned to it hereunder, the Trustee shall not be responsible to any person for any failure by the City or the Dissemination Agent (if other than the Trustee) to perform duties or obligations imposed hereby. The Dissemination Agent shall be paid compensation by the City for its services provided hereunder in accordance with its schedule of fees as agreed to between the Dissemination Agent and the City.
Any company succeeding to all or substantially all of the Dissemination Agent’s corporate trust business shall be the successor to the Dissemination Agent hereunder without the execution or filing of any document or any further act.
SECTION 13. Beneficiaries. This Disclosure Agreement shall inure solely to the benefit of the City, the Trustee, the Dissemination Agent, the Participating Underwriter and Holders and Beneficial Owners from time to time of the 2024 Second Series Bonds, and shall create no rights in any other person or entity. No person shall have any right to commence any action against the Trustee or the Dissemination Agent seeking any remedy other than to compel specific performance of this Disclosure Agreement. Neither the Trustee nor the Dissemination Agent shall be liable under any circumstances for monetary damages to any person for any breach of this Disclosure Agreement.
SECTION 14. N
otices. All written notices to be given hereunder shall be given in person or by mail to the party entitled thereto at its address set forth below, or at such other address as such party may provide to the other parties in writing from time to time, namely:
To the City:
City of Glendale
141 N. Glendale Avenue
Room 346
Glendale, California 91206-4998
Attention: Director of Finance
Telephone: (818) 548-2085
Facsimile: (818) 956-3286
To the Trustee: The Bank of New York Mellon Trust Company, N.A. 400 Hope Street
Suite 400
Los Angeles, California 90071
Attention: California Unit
Telephone: (213) 630-6247
Facsimile: (213) 630-6215
The Trustee and the City may, by notice given hereunder, designate any further or different addresses to which subsequent notices, certificates or other communications shall be sent. Unless specifically otherwise required by the context of this Disclosure Agreement, any notices required to be given hereunder to the Trustee or the City may be given by any form of electronic transmission capable of producing a written record. Each such party shall file with the Trustee information appropriate to receiving such form of electronic transmission. [Remainder of Page Intentionally Left Blank]
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9 SECTION 15. Counterparts . This Disclosure Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument.
CITY OF GLENDALE, CALIFORNIA
By
Director of Finance and Information Technology
THE BANK OF NEW YORK MELLON TRUST
COMPANY, N.A., as Trustee
By
Authorized Officer
201102409.2
A-1
EXHIBIT A
NOTICE OF FAILURE TO FILE ANNUAL REPORT
Name of Issuer: CITY OF GLENDALE, CALIFORNIA
Name of Issue: ELECTRIC REVENUE BONDS, 2024 SECOND SERIES Date of Issuance: ________, 2024
NOTICE IS HEREBY GIVEN that the City of Glendale, California (the “City”) has not provided an Annual Report with respect to the above -named 2024 Second Series Bonds as required by the Continuing Disclosure Agreement, dated as of [August] 1, 2024, between the City and The Bank of New York Mellon Trust Company, N.A., as Trustee. The City anticipates that the Annual Report will be filed by [date].
Dated:
The Bank of New York Mellon Trust Company, N.A.,
as Dissemination Agent, on behalf of the City of Glendale, California
By
Title:
cc: City of Glendale, California