NRF/104800735.4 39
rights or duties hereunder. Nothing herein shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Certificate holder any plan of reorganization, arrangement, adjustment, or composition affecting the Certificates or the rights of any Certificate holder thereof, or to authorize the Trustee to vote in respect of the claim of any Certificate holder in any such proceeding without the approval of the Certificate Holders so affected.
SECTION 13.7. Non-waiver Nothing in this Article or in any other provision of this Trust Agreement or in the Certificates shall affect or impair the obligations of the Lessee, which obligations are absolute and unconditional, to pay or prepay the Lease Payments as provided in the Lease. No delay or omission of the Trustee or of any Certificate holder of any of the Certificates to exercise any right or power arising upon the happening of any Event of Default shall impair any such right or power or shall be construed to be a waiver of any such Event of Default or an acquiescence therein, and every power and remedy given by this Article to the Trustee or to the Certificate Holders may be exercised from time to time and as often as shall be deemed expedient by the Trustee or the Certificate Holders.
SECTION 13.8. Remedies Not Exclusive No remedy herein conferred upon or reserved to the Trustee or to the Certificate Holders is intended to be exclusive of any other remedy, and every such remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing, at law or in equity or by statute or otherwise.
SECTION 13.9. Power of Trustee to Control Proceedings If the Trustee, upon the occurrence of an Event of Default, shall have taken any action, by judicial proceedings or otherwise, pursuant to its duties hereunder, whether upon its own discretion or upon the request of the Certificate Holders of not less than a majority in principal amount of the Certificates then Outstanding, it shall have full power, in the exercise of its discretion for the best interest of the Certificate Holders with respect to the continuance, discontinuance, withdrawal, compromise, settlement or other disposal of such action; provided, however, that the Trustee shall not, unless there no longer continues an Event of Default, discontinue, withdraw, compromise or settle or otherwise dispose of any litigation pending at law or in equity, if at the time there has been filed with it a written request signed by the Certificate Holders of at least a majority in principal amount of the Outstanding Certificates hereunder opposing such discontinuance, withdrawal, compromise, settlement or other disposal of such litigation.
SECTION 13.10. Limitation on Certificate Holders’ Right to Sue No Certificate holder of any Certificate executed and delivered hereunder shall have the right to institute any suit, action or proceeding at law or in equity, for any remedy under or upon this Trust Agreement, unless (a) such Certificate holder shall have previously given to the Trustee written notice of the occurrence of an Event of Default under the Lease; (b) the Certificate Holders of not less than a majority in aggregate principal amount of all the Certificates then Outstanding shall have made written request upon the Trustee to exercise the powers herein before granted or to institute such action, suit or proceeding in its own name; (c) said Certificate Holders shall have tendered to the Trustee reasonable indemnity against the costs, expenses and liabilities to be incurred in compliance with such request; and (d) the Trustee shall have refused or omitted to comply with such request for a period of 60 days after such written request shall have been received by, and said tender of indemnity shall have been made to, the Trustee.
NRF/104800735.4 40
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 Certificate holder of Certificates of any remedy hereunder; it being understood and intended that no one or more Certificate Holders shall have any right in any manner whatever by his or their action to enforce any right under this Trust Agreement, except in the manner herein provided and for the equal benefit of all Certificate Holders of the Outstanding Certificates.
The right of any Certificate holder of any Certificate to receive payment of said Certificate holder’s proportionate interest in the Lease Payments as the same become due, or to institute suit for the enforcement of such payment, shall not be impaired or affected without the consent of such Certificate holder, notwithstanding the foregoing provisions of this Section 13.10 or any other provision of this Trust Agreement.
SECTION 13.11. Agreement to Pay Attorneys’ Fees and Expenses If the Lessee or the Lessor should default under any of the provisions hereof and the non-defaulting party or parties should employ attorneys or incur other expenses for the collection of moneys or the enforcement or observance of any obligation or agreement on the part of the defaulting party contained herein, the defaulting party agrees that it will on demand therefor pay to the non-defaulting party the reasonable fees of such attorneys and such other expenses so incurred by the non-defaulting party or parties; provided, however, that the Trustee shall not be required to expend its own funds for any payment described in this Section.
SECTION 13.12. No Liability by the Lessor Except as Expressly Provided Herein The Lessor shall not have any obligation or liability to the Certificate Holders with respect to the payment when due of the Lease Payments by the Lessee, or with respect to the performance by the Lessee of the other agreements and covenants required to be performed by it contained in the Lease or herein, or with respect to the performance by the Trustee of any right or obligation required to be performed by it contained herein.
ARTICLE XIV
MISCELLANEOUS
SECTION 14.1. Defeasance Defeasance shall be deemed to occur if any or all Outstanding Certificates are paid and discharged in any one or more of the following ways:
(a) By well and truly paying or causing to be paid the Principal Components and Interest Components and prepayment premiums, if any, on all or a portion of the Certificates Outstanding, as and when the same become due and payable; (b) If prior to maturity and having given notice of prepayment by irrevocably depositing with the Trustee, in trust, at or before maturity, an amount of cash which, together with available amounts then on deposit in the Lease Payment Fund, is sufficient to pay all or a portion of the Certificates Outstanding, including all Principal Components, Interest Components, and prepayment premium, if any;
NRF/104800735.4 41
(c) By irrevocably depositing with the Trustee, in trust, noncallable, nonprepayable Defeasance Obligations in such amount as will, in the opinion of an independent certified public accountant, together with interest to accrue thereon and moneys then on deposit and available in the Lease Payment Fund together with the interest to accrue thereon, be fully sufficient to pay and discharge all Certificates (including all Principal Components and Interest Components represented thereby and prepayment premium, if any) at or before their maturity date and the fees and expenses of the Trustee have been paid in full; or (d) By irrevocably depositing with the Trustee security for the payment of all or a portion of Lease Payments as more particularly described in Article X, Section 10.1 of the Lease, said security to be held by the Trustee as agent for the Lessee to be applied by the Trustee to pay the Lease Payments as the same become due and payable and make a Prepayment in full on the Lease Payment Date pursuant to Article X, Section 10.1 of the Lease.
To accomplish defeasance, the Lessee shall cause to be delivered (i) a report of an independent firm of nationally recognized certified public accountants or such other accountant verifying the sufficiency of the escrow established to pay the Certificates in full on the maturity or prepayment date (a “Verification”), (ii) an escrow deposit agreement, (iii) an opinion of nationally recognized special counsel addressed to the Trustee to the effect that the Certificates are no longer “Outstanding” under this Trust Agreement and (iv) a certificate of discharge of the Trustee which may rely on the Verification with respect to the Certificates; each Verification and defeasance opinion shall be acceptable in form and substance, and addressed to the Lessee and the Trustee. The Certificate shall be deemed “Outstanding” under the Trust Agreement unless and until they are in fact paid and retired or the above criteria are met.
Notwithstanding that any Certificates shall not have been surrendered for payment, all obligations of the Lessor, the Trustee and the Lessee with respect to all or a portion of Outstanding Certificates shall cease and terminate, except only the obligations of the Lessee under Article IX, Section 9.6 hereof, the obligation of the Trustee pursuant to Article II, Section
2.8 hereof and its obligations to pay or cause to be paid, from Lease Payments paid by or on behalf of the Lessee from funds deposited pursuant to paragraphs (b) through (d) of this Section, to the Certificate Holders of the Certificates not so surrendered and paid all sums due with respect thereto, and in the event of deposits pursuant to such paragraphs, the Certificates shall continue to evidence and represent direct and proportionate interests of the Certificate Holders thereof in Lease Payments.
Any funds held by the Trustee, at the time of one of the events described in paragraphs (b) through (d) of this Section, which are not required for the payment to be made to Certificate Holders, as verified by a certified public accountant, shall be paid over to the Lessee pursuant to the Lessee’s written request therefor; provided that the fees and expenses of the Trustee have been fully paid.
NRF/104800735.4 42
SECTION 14.2. Records
(a) The Trustee shall keep complete and accurate records of all moneys received and disbursed by it under this Trust Agreement, which shall be available for inspection by the Lessee, the Lessor and any Owner, or the agent of any of them, at any time during regular business hours with reasonable prior notice.
(b) For so long as the Original Purchaser is the registered Owner of the Certificates, the Lessee shall submit to the Original Purchaser, upon written request (a) current audited financial statements in reasonable detail, with supporting schedules (the “Audit”) as soon as practicable after the Lessee’s acceptance thereof and in any case within 360 days after the end of each fiscal year, which may be in electronic .PDF format. If the Audit is filed on the MSRB’s “EMMA” website, to satisfy this requirement, the Lessee may email a link to the posted Audit to the Original Purchaser within such 360-day period. The electronic audit or EMMA link may be sent to the following email address (or such other address as the Original Purchaser supplies to the Lessee in writing): [email protected], and (b) at the request of the Original Purchaser, the Lessee’s annual budget as submitted or approved. (c) The Lessee further agrees that upon 10 days prior written notice, it will permit the Original Purchaser or its agents and representatives to inspect the Lessee’s books and records and make extracts therefrom at its own expense during regular business hours and in a manner which will not disrupt the normal business routine of the Lessee. The Lessee shall furnish to the Original Purchaser such other financial information as it may reasonably request, so long as publicly available. If the Audit is not available within 360 days of fiscal year end, the Lessee will furnish unaudited financial statements to the Original Purchaser in the manner described in this paragraph within such period, and will then supply the Audit within 10 business days following the availability thereof.
SECTION 14.3. Notices All written notices to be given under this Trust Agreement shall be given by mail or personal delivery to the party entitled thereto at its address set forth below, or at such address as the party may provide to the other party in writing from time to time. Notice to the Trustee shall be effective upon receipt, and notice to the other parties shall be deemed effective upon receipt and shall be deemed to have been received upon the earlier of actual receipt or five Business Days after deposit in the United States mail, in certified form, postage prepaid or, in the case of personal delivery, upon delivery to the address set forth below:
If to the Lessee: City of Maywood
4319 E. Slauson Avenue
Maywood, CA 90270
Attention: City Manager
If to the Trustee: U.S. Bank [Trust Company,] National Association 633 West Fifth Street, 24th Floor
Los Angeles, California 90071
Attention: Global Corporate Trust
NRF/104800735.4 43
If to the Lessor: Municipal Finance Corporation
2111 Palomar Airport Road, #320
Carlsbad, CA 92011
Attention: _________
SECTION 14.4. Governing Law This Trust Agreement shall be construed and governed in accordance with the laws of the State applicable to contracts made and performed therein.
SECTION 14.5. Binding Effect; Successors This Trust Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns.
Whenever in this Trust Agreement either the Lessor, the Lessee or the Trustee are named or referred to, such reference shall be deemed to include the successors or assigns thereof and all the covenants and agreements in this Trust Agreement contained by or on behalf of the Lessor, the Lessee or the Trustee shall bind and inure to the benefit of the respective successors and assigns thereof whether so expressed or not.
SECTION 14.6. Execution in Counterparts This Trust 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 agreement.
SECTION 14.7. Electronic Signatures Each of the parties hereto agrees that the transaction consisting of this Trust Agreement may be conducted by electronic means. Each party agrees and acknowledges that it is such party’s intent that if such party signs this Trust Agreement using an electronic signature it is signing, adopting, and accepting this Trust Agreement and that signing this Trust Agreement using an electronic signature is the legal equivalent of having placed its handwritten signature on this Trust Agreement on paper. Each party acknowledges that it is being provided with an electronic or paper copy of this Trust Agreement in usable format.
SECTION 14.8. Destruction of Canceled Certificates Whenever in this Trust Agreement provision is made for the surrender or cancellation by the Trustee and the delivery to the Lessor of any Certificates, the Lessee’s Authorized Signatory may request the Trustee to furnish to the Lessee a certificate of destruction of such Certificates, upon their destruction.
SECTION 14.9. Headings 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 Trust Agreement. All references herein to “Articles,” “Sections” and other subdivisions are to the corresponding Articles, Sections or other subdivisions of this Trust Agreement; and the words “herein,” “hereof,” “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular Article, Section or other subdivision hereof.
SECTION 14.10. Waiver of Notice Whenever in this Trust Agreement 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 case the giving or receipt of such notice
NRF/104800735.4 44
shall not be a condition precedent to the validity of any action taken in reliance upon such waiver.
SECTION 14.11. Interested Parties Nothing in this Trust Agreement expressed or implied is intended or shall be construed to confer upon, or to give or grant to, any person or entity, other than the Lessee, the Trustee and the Certificate Holders, any right, remedy or claim under or by reason of this Trust Agreement or any covenant, condition or stipulation hereof, and all covenants, stipulation, promises and agreements in this Trust Agreement contained by and on behalf of the Lessee shall be for the sole and exclusive benefit of the Lessee, the Trustee and the registered owners of the Certificates.
SECTION 14.12. Severability of Invalid Provisions In case any one or more of the provisions contained in this Trust Agreement or in the Certificates shall for any reason be held to be invalid, illegal or unenforceable in any respect, then such invalidity, illegality or unenforceability shall not affect any other provision of this Trust Agreement, and this Trust Agreement shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein. The parties hereto hereby declare that they would have entered into this Trust Agreement and each and every other section, paragraph, sentence, clause or phrase hereof and authorized the delivery of the Certificates pursuant to this Trust Agreement, irrespective of the fact that any one or more sections, paragraphs, sentences, clauses or phrases of this Trust Agreement may be held illegal, invalid or unenforceable. [Remainder of page intentionally left blank.]
S-1
IN WITNESS WHEREOF, the parties have executed this Trust Agreement as of the date and year first above written.
U.S. BANK [TRUST COMPANY,]
NATIONAL ASSOCIATION,
as Trustee
By:
Authorized Signatory
MUNICIPAL FINANCE CORPORATION, as
Lessor
By:
Treasurer
CITY OF MAYWOOD, as Lessee
By:
City Manager
104800735.4 A-1
EXHIBIT A
FORM OF CERTIFICATE
CITY OF MAYWOOD CERTIFICATES OF PARTICIPATION,
2022 SERIES A
Evidencing the Proportionate Undivided Interest of the Owner Hereof in Lease Payments to Be Made by
CITY OF MAYWOOD
Pursuant to Lease Agreement with
MUNICIPAL FINANCE CORPORATION
Interest Rate Maturity Date Dated Date CUSIP No.
%
REGISTERED OWNER: STERLING NATIONAL BANK
PRINCIPAL AMOUNT: $
THIS IS TO CERTIFY THAT the registered owner named above, or registered assigns of this Certificate of Participation (the “Certificate”) is the owner of a proportionate and undivided interest in the right to receive and collect certain Lease Payments, Additional Payments and Prepayments (as defined in the Trust Agreement) to be made by the CITY OF MAYWOOD, a general law city duly organized and existing under and by virtue of the Constitution and laws of the State of California, as Lessee (the “Lessee”) pursuant to the Lease Agreement, dated as of March 1, 2022 (the “Lease”), by and between the MUNICIPAL FINANCE CORPORATION, a nonprofit public benefit corporation duly organized and existing under the laws of the State of California, as lessor (the “Lessor”), and the Lessee, which Lease Payments and certain other rights and interests under the Lease have been assigned to U.S.
BANK [TRUST COMPANY,] NATIONAL ASSOCIATION, as trustee (the “Trustee”) under the Trust Agreement, dated as of March 1, 2022 (the “Trust Agreement”), by and among the Lessee, the Lessor and the Trustee. The Certificates are being executed and delivered in order to obtain funds to finance the acquisition, construction and/or installation of certain improvements for the benefit of the Lessee, and to pay the costs of execution and delivery of the Certificates.
Capitalized terms used and not defined herein shall have the meanings ascribed to such terms in the Trust Agreement or the Lease, as applicable.
The Registered Owner of this Certificate is entitled to receive, subject to the terms of the Lease, on the maturity date specified above (the “Principal Payment Date”), the principal amount specified above, representing a portion of the Lease Payments designated as principal (the “Principal Component”), and to receive on ______ 1, 2022, and semiannually thereafter on
104800735.4 A-2
______ 1 and _______ 1 of each year (each, an “Interest Payment Date”) until payment in full of said Principal Component, the Registered Owner’s portion of the Lease Payments designated as interest (the “Interest Component”) coming due during the six months immediately preceding each of the Payment Dates (collectively, each Principal Payment Date and Interest Payment Date is hereinafter referred to as a “Payment Date”); provided, that such Interest Component shall be payable from the Interest Payment Date next preceding the date of execution of this Certificate (unless (i) it is executed as of an Interest Payment Date, in which event the Interest Component shall be payable from the date of execution thereof; (ii) it is executed after a Record Date and before the following Interest Payment Date, in which event the Interest Component shall be payable from such following Interest Payment Date; or (iii) it is executed on or before a Record Date, in which event the Interest Component shall be payable from the date of delivery of the Certificates).
The “Record Date” is the close of business on the fifteenth day of the month preceding a Payment Date, whether or not such day is a business day. There shall be no execution or registration of transfer of Certificates during the period established by the Trustee for selection of Certificates for prepayment or any Certificate selected for prepayment. The Interest Component is the result of the multiplication of the Principal Component by the rate per annum identified above. Interest with respect to the Certificates shall be calculated on the basis of a 360-day year, comprised of twelve months of 30 days each. Such amounts are payable by wire transfer or check in lawful money of the United States of America. The amount representing Principal Component payable at maturity or upon prepayment in whole is payable to the Registered Owner by wire transfer or check of the Trustee upon presentation and surrender of this Certificate at the Principal Corporate Trust Office. The amounts representing Interest Component are payable by check mailed on the applicable Interest Payment Date by first class mail by the Trustee to the Registered Owner hereof at his address as it appears on the registration books of the Trustee or by wire transfer to a bank account in the United States in the case of Registered Owners owning $1,000,000 or more in aggregate principal amount of Certificates who have furnished instructions in writing to the Trustee at least 15 days prior to the Record Date for the related Payment Date.
The total amount of each payment made to the Registered Owner of this Certificate is comprised of interests in the Principal Component and Interest Component of Lease Payments made by the Lessee.
This Certificate has been executed and delivered by the Trustee pursuant to the Trust Agreement. The Lessee is authorized to enter into the Lease and the Trust Agreement under the Constitution and the laws of the State of California. Reference is hereby made to the Lease and the Trust Agreement (copies of which are on file at the Principal Corporate Trust Office) for a description of the terms on which the Certificates are executed and delivered, the rights thereunder of the Registered Owners of the Certificates, the rights, duties and immunities of the Trustee and the rights and obligations of the Lessee under the Lease, to all of the provisions of which the Lease and Trust Agreement the Registered Owner of this Certificate, by acceptance hereof, assents and agrees.
The Lessee is obligated to pay Lease Payments from any source of legally available funds, and the Lessee has covenanted in the Lease to make the necessary annual appropriations
104800735.4 A-3
therefor. The obligation of the Lessee to pay the Lease Payments does not constitute an obligation of the Lessee for which the Lessee is obligated to levy or pledge any form of taxation or for which such Lessee has levied or pledged any form of taxation. The obligation of the Lessee to pay the Lease Payments does not constitute a debt of the Lessee, the State of California or any of its political subdivisions, and does not constitute indebtedness within the meaning of any constitutional or statutory debt limitation or restriction. Under certain circumstances, the Lessee is not obligated to make Lease Payments due to the loss or destruction of all or a portion of the Leased Property.
The Certificates are subject to prepayment as set forth in the Trust Agreement. If this Certificate is called for prepayment and payment is duly provided therefor as specified in the Trust Agreement, the Interest Component shall cease to accrue with respect hereto from and after the date fixed for prepayment. The provisions of the Trust Agreement may be amended by the parties thereto to the extent and in the manner permitted by the terms of the Trust Agreement.
This Certificate is subject to mandatory sinking fund prepayment prior to maturity at a prepayment price equal to the Principal Component of the Certificates to be prepaid, plus accrued interest with respect thereto to the prepayment date, on _________ 1 of each year, commencing _________ 1, 2022, in the Principal Components and on the prepayment dates as follows:
Mandatory Sinking Fund
Prepayment Date
(_________ 1)
Mandatory
Sinking Fund Payment
†
† Maturity.
This Certificate is transferable by the Registered Owner hereof, in person or by his duly authorized attorney, at the Principal Corporate Trust Office of the Trustee, but only in the manner, subject to the limitations and upon payment of the charges provided in the Trust Agreement and upon surrender and cancellation of this Certificate. Upon such transfer, a new Certificate or Certificates, of Authorized Denomination or denominations, for the same aggregate Principal Component, maturity and interest rate, will be delivered to the transferee.
This Certificate also may be exchanged for a like aggregate Principal Component of Certificates of other Authorized Denominations as prescribed in the Trust Agreement. The Lessee, the Lessor and the Trustee may treat the Registered Owner hereof as the absolute Owner hereof for all purposes whether or not this Certificate shall be overdue, and the Lessee, the Lessor and the Trustee shall not be affected by any notice to the contrary.
104800735.4 A-4
THIS IS TO FURTHER CERTIFY that all acts, conditions and things required by the Trust Agreement to exist, to have happened and to have been performed by or in relation to the Trustee precedent to and in connection with the execution and delivery of this Certificate do exist, have happened and have been performed in regular and due time, form and manner as required by law, and that the Trustee is duly authorized to execute and deliver this Certificate, and that the Principal Component of this Certificate, together with all other Certificates executed and delivered under the Trust Agreement, is not in excess of the Principal Components of Certificates authorized to be executed and delivered thereunder.
THE LESSEE HAS CERTIFIED, RECITED AND DECLARED that all acts, conditions and things required by the Constitution and statutes of the State of California and the provisions of the Trust Agreement to exist, to have happened and to have been performed precedent to and in the execution and delivery of this Certificate, do exist, have happened and have been performed in due time, form and manner as required by law.
THE TRUSTEE HAS NO OBLIGATION OR LIABILITY TO THE REGISTERED
OWNERS TO MAKE PAYMENTS OF PRINCIPAL COMPONENTS OR INTEREST
COMPONENTS OR LEASE PAYMENTS PERTAINING TO THE CERTIFICATES EXCEPT
FROM LEASE PAYMENTS PAID TO THE TRUSTEE AND FROM THE VARIOUS FUNDS AND ACCOUNTS ESTABLISHED UNDER THE TRUST AGREEMENT. THE TRUST
AGREEMENT PROVIDES THAT THE RECITALS OF FACTS, COVENANTS AND
AGREEMENTS IN THE CERTIFICATE SHALL BE TAKEN AS STATEMENTS,
COVENANTS AND AGREEMENTS OF THE LESSEE, AND THE TRUSTEE ASSUMES NO RESPONSIBILITY FOR THE CORRECTNESS OF THE SAME.
The Trustee has executed this Certificate solely in its capacity as Trustee under the Trust Agreement and not in its individual or personal capacity.
IN WITNESS WHEREOF, this Certificate has been executed and delivered by the Trustee, acting pursuant to the Trust Agreement.
U.S. BANK [TRUST COMPANY,]
NATIONAL ASSOCIATION, as Trustee
By:
Authorized Signatory
Date of Execution: __________, 20__
104800735.4 A-5
FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the Undersigned hereby sells, assigns and transfers unto:
______________________________________________________________________________ (please print or typewrite name, address and social security or other identifying number of Transferee) the within Certificate and all rights thereunder, and hereby irrevocably constitutes and appoints: __________________________________________________________________ attorney, to transfer the within Certificate on the books kept for registration thereof, with full power of substitution in the premises.
Dated:
Signature Guaranteed By:
_____________________
NOTICE: Signature guarantee shall
be made by a guarantor institution
participating in the Securities Transfer
Agents Medallion Program or in such
other guarantee program acceptable to
the Trustee.
Notice: The signature to this assignment must
correspond with the signature as it appears upon
the face of the within Certificate in every
particular, without alteration or enlargement or
any change whatever.
104800735.4 B-1
EXHIBIT B
SCHEDULE OF PRINCIPAL AND INTEREST COMPONENTS
Payment
Date Principal Interest
Debt
Service
Annual Debt
Service
104800735.4 C-1
EXHIBIT C
FORM OF PURCHASER LETTER
Municipal Finance Corporation
2111 Palomar Airport Road, #320
Carlsbad, CA 92011
City of Maywood
4319 E. Slauson Avenue
Maywood, CA 90270
U.S. Bank [Trust Company,] National Association
633 West Fifth Street, 24th Floor
Los Angeles, California 90071
Raymond James & Associates, Inc.
[city, state, zip]
$[PAR AMOUNT]
City of Maywood Certificates of Participation,
2022 Series A
To the Addressees:
The undersigned is a duly authorized officer of ____________________________, a [state/federal bank] organized and existing under the laws of the [State of STATE/United States of America] (the “Purchaser”). The undersigned acknowledges receipt, on behalf of Purchaser, of the fully executed [issuer name] (STATE) (the “Issuer”) [name of bonds], Series 20__, dated __________, 20___, in the principal amount of $_______________ (the “Bonds”). The undersigned represents, warrants, and covenants in conjunction with its purchase of the Bonds that:
1) Purchaser agrees to the terms and provisions set forth in the Bonds. 2) Purchaser has such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of prospective financial obligations, such as the Bonds, without reliance upon others. In reaching the conclusion that it desires to acquire the Bonds, Purchaser has carefully evaluated all risks associated with this purchase and acknowledges that it is able to bear the economic risk of this purchase. Purchaser is a “qualified institutional buyer” as defined in Rule 144A promulgated under the Securities Act of 1933, as amended (the “1933 Act”).
3) Purchaser presently intends to hold the Bonds to maturity, earlier redemption, or mandatory tender. Purchaser is purchasing the Bonds for its loan portfolio and is not purchasing the Bonds for resale or other disposition, and Purchaser has no present intention of reselling or
104800735.4 C-2
otherwise disposing of all or any part of the Bonds or dividing its interest therein; however, Purchaser reserves the right to sell participation interests in or otherwise dispose of the Bonds in the future as it chooses. Purchaser agrees that it will not sell, transfer, assign, or otherwise dispose of the Bonds or such ownership interests therein (1) unless it obtains from the purchaser and delivers to the Issuer either (a) an agreement similar in form and substance to this agreement, or (b) a written acknowledgement that such purchaser is either (i) an institutional “accredited investor” within the meaning of Rule 501 (a) promulgated under the 1933 Act, or (ii) a “qualified institutional buyer” as defined in Rule 144A promulgated under the 1933 Act; and (2) except in compliance with the applicable provisions of the 1933 Act, the Securities Exchange Act of 1934, as amended (the “1934 Act”), any rules and regulations promulgated under either the 1933 Act or the 1934 Act, and the applicable securities laws of any other jurisdiction, and in connection therewith, Purchaser agrees that it shall furnish to any purchaser of the Bonds all information required by applicable law.
4) Purchaser, through its agents and employees, has investigated the Issuer[borrower] and its financial, statistical, demographic, and other information and acknowledges that it has been furnished with, or has been given access to, without restriction or limitation, all of the underlying documents in connection with this transaction, as well as all other information which a reasonable, prudent, and knowledgeable purchaser would desire in evaluating the purchase of the Bonds without reliance upon others. Further, Purchaser acknowledges that the Issuer and other knowledgeable parties have made available to it and its representatives the opportunity to ask any questions it may have, and receive satisfactory answers, concerning the Issuer and the security and the source of payment of the Bonds. 5) Purchaser has been informed and understands that no Official Statement has been prepared in connection with the sale and delivery of the Bonds, the Bonds are not and will not be rated, and that the Bonds are not subject to any continuing disclosure undertaking pursuant the SEC Rule 15c2-12.
6) Purchaser acknowledges that the Bonds do not constitute a debt or loan of the State of STATE or any political subdivision thereof. The Bonds represent a [pledge of the full faith and credit and taxing power of the Issuer, and that said pledge is on a parity with the Issuer’s outstanding ____________ Bonds, Series 20__]. The security for payment of the Bonds is more particularly described in the Bonds and the [resolution/ordinance/indenture] of the Issuer authorizing the issuance of the Bonds.
7) The representations in this Letter shall not relieve the Issuer from any obligation to disclose any information required by the documents in connection with the issuance of the Bonds or required by applicable law.
8) This Letter will constitute an agreement with respect to the matters herein contained as of the date hereof. This Letter is expressly for your benefit and may not be relied upon by any other party.
9) Purchaser represents and warrants that the execution of this agreement has been duly authorized by the Purchaser and it has been duly executed by an authorized officer thereof.
104800735.4 C-3
Signed and delivered as of the date shown above.
PURCHASER FULL CORPORATE NAME
Signed By:_________________________________
Print Name:________________________________
Print Title:_________________________________
104800735.4 D-1
EXHIBIT D
FORM OF REQUISITION – COSTS OF DELIVERY FUND
U.S. Bank [Trust Company,] National Association, as Trustee 633 West Fifth Street, 24th Floor
Los Angeles, California 90071
Attention: Global Corporate Trust Services
RE: Disbursement from the Costs of Delivery Fund pursuant to the Trust Agreement, dated as of March 1, 2022 (the “Trust Agreement”) by and among the City of Maywood, as Lessee, the Municipal Finance Corporation, as Lessor, and the Trustee REQUISITION NO. __
The undersigned hereby states and certifies:
1. That he/she is the duly appointed, qualified and acting ____________ of the Lessee, which is duly organized and existing under and by virtue of the Constitution and laws of the State of California, and as such, is familiar with the facts herein certified and is authorized and qualified to certify the same;
2. That, pursuant to Article III of the Trust Agreement, the Trustee is hereby requested to disburse from the Costs of Delivery Fund established under the Trust Agreement to the designated payees the amounts set forth opposite such designations for the purposes set forth on Schedule I hereto;
3. That each obligation set forth herein is a proper charge against the Costs of Delivery Fund and has not been the basis of any prior disbursement;
4. That the amount of each disbursement requested herein is for payment authorized under the Trust Agreement;
5. That the amount remaining in the Costs of Delivery Fund after payment of the amount set forth in this Requisition is adequate under Trust Agreement;
6. That no Event of Default, and no event which with notice or lapse of time would constitute an Event of Default, has occurred and is continuing under the Lease;
7. That set forth opposite each obligation in Exhibit A attached hereto is a description of the nature of such obligation; and
104800735.4 D-2
8. That accompanying this Requisition is a bill or statement of account for each obligation included in Exhibit A.
Dated: __________, 20__
CITY OF MAYWOOD, as Lessee
By:
Authorized Signatory
NRF/104799876.2
AFTER RECORDATION PLEASE RETURN TO:
Norton Rose Fulbright US LLP
555 South Flower Street, Suite 4100
Los Angeles, California 90071
Attention: Russell C. Trice, Esq.
SITE LEASE
by and between
CITY OF MAYWOOD,
as Lessor
and
MUNICIPAL FINANCE CORPORATION,
as Lessee
Dated as of March 1, 2022
THIS IS A FINANCING DOCUMENT:
NO DOCUMENT TRANSFER TAX IS DUE
PURSUANT TO GOVERNMENT CODE SECTION 27383
TABLE OF CONTENTS
Page
104799876.2 -iSECTION 1. Definitions..............................................................................................................1 SECTION 2. Site Lease. ..............................................................................................................1 SECTION 3. Term. ......................................................................................................................1 SECTION 4. Rental. ....................................................................................................................1 SECTION 5. Purpose...................................................................................................................1 SECTION 6. Owner in Fee..........................................................................................................2 SECTION 7. Substitution of Leased Property.............................................................................2 SECTION 8. Assignments and Subleases. ..................................................................................2 SECTION 9. Right of Entry.........................................................................................................2 SECTION 10. Termination............................................................................................................2 SECTION 11. Default....................................................................................................................2 SECTION 12. Quiet Enjoyment. ...................................................................................................3 SECTION 13. Waiver of Personal Liability. .................................................................................3 SECTION 14. Taxes. .....................................................................................................................3 SECTION 15. Eminent Domain. ...................................................................................................3 SECTION 16. Partial Invalidity.....................................................................................................3 SECTION 17. Notices. ..................................................................................................................3 SECTION 18. Amendment............................................................................................................3 SECTION 19. No Merger of Interests. ..........................................................................................3 SECTION 20. Section Headings....................................................................................................4 SECTION 21. Compliance with Laws and Regulations................................................................4 SECTION 22. Environmental Compliance....................................................................................4 SECTION 23. Execution. ..............................................................................................................6 SECTION 24. Third-Party Beneficiaries.......................................................................................6 EXHIBIT A – LEGAL DESCRIPTION OF LEASED PROPERTY
104799876.2
SITE LEASE
THIS SITE LEASE, dated as of March 1, 2022 (this “Site Lease”), by and between the CITY OF MAYWOOD, a general law city duly organized and existing under and by virtue of the laws of the State of California (the “City”), as lessor (the “Lessor”), and the MUNICIPAL FINANCE CORPORATION, a corporation duly organized and validly existing under and by virtue of the laws of the State of California (the “Corporation”), as lessee (the “Lessee”); W I T N E S S E T H:
WHEREAS, the Corporation intends to assist the City to refund all or a portion of the Lessor’s outstanding Maywood Public Financing Authority 2008 Lease Revenue Refunding Bonds, Series A (Infrastructure Refinancing Project) (the “2008 Bonds”), and to lease certain Leased Property (as defined herein) to the City under a Lease Agreement, dated of even date herewith (the “Lease”), by and between the City and the Corporation, and the City proposes to enter into this Site Lease with the Corporation as a material consideration for the Corporation’s agreement to refund all or a portion of the Lessor’s outstanding 2008 Bonds; NOW, THEREFORE, IT IS HEREBY MUTUALLY AGREED as follows:
SECTION 1. Definitions Unless the context otherwise requires, all capitalized terms used in this Site Lease and not defined herein shall for all purposes of this Site Lease have the meaning specified therefor in the Lease or in the Trust Agreement, dated as of the date hereof (the “Trust Agreement”), by and among the City, the Corporation and U.S. Bank National Association, as trustee (the “Trustee”).
SECTION 2. Site Lease The City hereby leases to the Corporation and the Corporation hereby hires from the City, on the terms and conditions hereinafter set forth, the real property situated in the County of Los Angeles, State of California as more particularly described in Exhibit A attached hereto and made a part hereof (the “Leased Property”).
SECTION 3. Term The term of this Site Lease shall commence on the Closing Date and shall remain in effect until the term of the Lease expires as provided by Article IV, Section
4.2 thereof, provided, however, that if Lease Payments (as defined therein) due under the Lease remain unpaid at the expiration of the Lease term, or provision shall not have been made for their payment, then this Site Lease shall not terminate until the earlier of (i) _______ 1, 20__, or, if later, (ii) the date on which the $[PAR AMOUNT] City of Maywood Certificates of Participation, 2022 Series A (the “Certificates”) have been paid in full.
SECTION 4. Rental The City acknowledges receipt from the Corporation as and for rental hereunder the sum of One Dollar ($1.00), on or before the date of delivery of the Certificates to the Certificate holders thereof.
SECTION 5. Purpose The Corporation shall use the Leased Property solely for the purpose of leasing the Leased Property to the City pursuant to the Lease, and for such purposes as may be incidental thereto; provided, that in the event of default by the City under the Lease, the Corporation and its assigns may exercise the remedies provided in the Lease.
2 SECTION 6. Owner in Fee The City covenants, represents and warrants that it is the owner in fee of the Leased Property.
SECTION 7. Substitution of Leased Property From time to time, the City may authorize the Substitution of alternate real property or equipment for the Leased Property, the Removal of real property or equipment from the Leased Property or the addition of real property or equipment to the Leased Property pursuant to the Lease, with the prior written consent of the Certificate holders of the majority in aggregate principal amount of Certificates then Outstanding, only by providing the Trustee with a supplement to the Lease and the satisfaction of certain conditions contained in Article III, Section 3.8 of the Lease. In connection therewith, the City and the Corporation shall enter into a duly recorded amendment or supplement to this Site Lease. If the City effects a substitution of all or a portion of the Leased Property hereunder, all or a designated portion of the Leased Property formerly subjected to this Site Lease shall be released from the lien hereof upon receipt by the Trustee of (a) the written request of the City to that effect, and (b) a further opinion of Special Counsel to the effect that such release will have no material adverse effect upon the Certificate holders. After any such release, the term “Leased Property” shall be defined as the remaining portion of the Leased Property.
SECTION 8. Assignments and Subleases Unless the City shall be in default under the Lease, the Corporation may not assign its rights under this Site Lease or sublet the Leased Property, except as provided in the Lease and the Assignment Agreement, without the written consent of the City and the Certificate holders of the majority in aggregate principal amount of Certificates then Outstanding.
SECTION 9. Right of Entry The City reserves the right for any of its duly authorized representatives to enter upon the Leased Property at any reasonable time to inspect the same or to make any repairs, improvements or changes necessary for the preservation thereof.
SECTION 10. Termination The Corporation agrees, upon the termination of this Site Lease, to quit and surrender the Leased Property in the same good order and condition as the same were in at the time of commencement of the term hereunder, reasonable wear and tear excepted, and agrees that any permanent improvements and structures existing upon the Leased Property at the time of the termination of this Site Lease shall remain thereon and title thereto shall vest in the City.
SECTION 11. Default If the Corporation shall be in default in the performance of any obligation of its part to be performed under the terms of this Site Lease, which default continues for 30 Business Days following notice and demand for correction thereof to the Corporation, the City may exercise any and all remedies granted by law, except that no merger of this Site Lease and of the Lease shall be deemed to occur as a result thereof; provided, that the Trustee acting on behalf of the Certificate holders shall be entitled to control and direct the enforcement of all rights and remedies granted to the City under this Site Lease; and provided, however, that so long as any of the Certificates are Outstanding and unpaid in accordance with the terms thereof, the Lease Payments assigned by the Corporation to the Trustee under the Trust Agreement shall continue to be paid to the Trustee.
3 SECTION 12. Quiet Enjoyment The Corporation at all times during the term of this Site Lease shall peaceably and quietly have, hold and enjoy all of the Leased Property, subject to the provisions of the Lease and the Trust Agreement.
SECTION 13. Waiver of Personal Liability All liabilities under this Site Lease on the part of the Corporation are solely liabilities of the Corporation, as a separate legal entity, and the City hereby releases each and every member, director and officer of the Corporation of and from any personal or individual liability under this Site Lease. No member, director or officer of the Corporation shall at any time or under any circumstances be individually or personally liable under this Site Lease for anything done or omitted to be done by the Corporation hereunder.
SECTION 14. Taxes The City covenants and agrees to pay any and all assessments of any kind or character and also all taxes, including possessory interest taxes, levied or assessed upon the Leased Property (including both land and improvements).
SECTION 15. Eminent Domain If the whole or any part of the Leased Property shall be taken by eminent domain proceedings, the interest of the Corporation shall be recognized and is hereby determined to be the amount of the then-unpaid Certificates, including the unpaid principal and interest with respect to any then-Outstanding Certificates and any amounts due to the Trustee, and the balance of the award, if any, shall be paid to the City.
SECTION 16. Partial Invalidity If any one or more of the terms, provisions, covenants or conditions of this Site Lease shall to any extent be declared invalid, unenforceable, void or voidable for any reason whatsoever by a court of competent jurisdiction, the finding or order or decree of which becomes final, none of the remaining terms, provisions, covenants and conditions of this Site Lease shall be affected thereby, and each provision of this Site Lease shall be valid and enforceable to the fullest extent permitted by law.
SECTION 17. Notices All notices, statements, demands, consents, approvals, authorizations, offers, designations, requests or other communications hereunder by either party to the other shall be in writing and shall be sufficiently given and served upon the other party if delivered personally or if mailed by United States registered mail, return receipt requested, postage prepaid, and, if to the City, addressed to City of Maywood 4319 E. Slauson Avenue, Maywood, CA 90270, Attention: City Manager, or if to the Corporation, addressed to MUNICIPAL FINANCE CORPORATION 2111 Palomar Airport Road, #320, Carlsbad, CA 92011, Attention: __________, or to such other addresses as the respective parties may from time to time designate by notice in writing.
SECTION 18. Amendment This Site Lease may not be altered, modified or amended except as permitted by Article X of the Trust Agreement or to permit the Substitution or Removal of Leased Property Components pursuant to Article III, Section 3.8 of the Lease and to modify the description of the site on which the Leased Property Components are located.
SECTION 19. No Merger of Interests The leasehold estates under this Site Lease and the Lease shall not merge, whether by the exercise of any right or remedy hereunder or thereunder, by operation of law, or otherwise.
4 SECTION 20. Section Headings All section headings contained herein are for convenience of reference only and are not intended to define or limit the scope of any provision of this Site Lease.
SECTION 21. Compliance with Laws and Regulations
(a) The City has, after due inquiry, no knowledge and has not given or received any written notice indicating that the Leased Property or the past or present use thereof or any practice, procedure or policy employed by it in the conduct of its business materially violates any applicable law, regulation, code, order, rule, judgment or consent agreement, including, without limitation, those relating to zoning, building, use and occupancy, fire safety, health sanitation, air pollution, ecological matters, environmental protection, hazardous or toxic materials, substances or wastes, conservation, parking, architectural barriers to the handicapped, or restrictive covenants or other agreements affecting title to the Leased Property (collectively, “Laws and Regulations”). Without limiting the generality of the foregoing, neither the City nor to the best of its knowledge, after due inquiry, any prior or present owner, tenant or subtenant of any of the Leased Property has, other than as set forth in subsections (a) and (b) of this Section or as may have been remediated in accordance with Laws and Regulations, (i) used, treated, stored, transported or disposed of any material amount of flammable explosives, polychlorinated biphenyl compounds, heavy metals, chlorinated solvents, cyanide, radon, petroleum products, asbestos or any Asbestos Containing Materials, methane, radioactive materials, pollutants, hazardous materials, hazardous wastes, hazardous, toxic, or regulated substances or related materials, as defined in CERCLA, RCRA, CWA, CAA, TSCA and Title III, and the regulations promulgated pursuant thereto, and in all other Environmental Regulations applicable to the City, any of the Leased Property or the business operations conducted by the City thereon (collectively, “Hazardous Materials”) on, from or beneath its Leased Property, (ii) pumped, spilled, leaked, disposed of, emptied, discharged or released (hereinafter collectively referred to as “Release”) any material amount of Hazardous Material on, from or beneath the Leased Property, or (iii) stored any material amount of petroleum products at the Leased Property in underground storage tanks.
(b) Excluded from the representations and warranties in subsection (a) hereof with respect to Hazardous Materials are those Hazardous Materials in those amounts ordinarily found in the inventory of or used in the operation of a city, the use, treatment, storage, transportation and disposal of which has been and shall be in compliance with all Laws and Regulations.
(c) No part of the Leased Property is located in an area of high potential incidence of radon has an unventilated basement or subsurface portion which is occupied or used for any purpose other than the foundation or support of the improvements to such Leased Property.
SECTION 22. Environmental Compliance
(a) The City shall not use or permit the Leased Property or any part thereof to be used to generate, manufacture, refine, treat, store, handle, transport or dispose of, transfer, produce or process Hazardous Materials, except, and only to the extent, if necessary to maintain
5 the improvements on the Leased Property and then, only in compliance with all Environmental Regulations, and any state equivalent laws and regulations, nor shall it permit, as a result of any intentional or unintentional act or omission on its part or by any tenant, subtenant, licensee, guest, invitee, contractor, employee and agent, the storage, transportation, disposal or use of Hazardous Materials or the Release or threat of Release of Hazardous Materials on, from or beneath the Leased Property or onto any other property excluding, however, those Hazardous Materials in those amounts ordinarily found in the inventory of or used in the operation of a city facility, the use, storage, treatment, transportation and disposal of which shall be in compliance with all Environmental Regulations. Upon the occurrence of any Release or threat of Release of Hazardous Materials, the City shall promptly commence and perform, or cause to be commenced and performed promptly, without cost to the Corporation, all investigations, studies, sampling and testing, and all remedial, removal and other actions necessary to clean up and remove all Hazardous Materials so released, on, from or beneath the Leased Property or other property, in compliance with all Environmental Regulations. Notwithstanding anything to the contrary contained herein, underground storage tanks shall only be permitted subject to compliance with subsection (d) hereof and only to the extent necessary to maintain the improvements on the Leased Property.
(b) The City shall comply with, and shall use its best efforts to cause any tenants, subtenants, agents, licensees, employees, contractors, and agents to comply with, all Environmental Regulations and shall keep the Leased Property free and clear from Hazardous Materials; provided, however, that notwithstanding that a portion of this covenant is limited to the City’s use of its best efforts, the City shall remain solely responsible for ensuring such compliance and such limitation shall not diminish or affect in any way the City’s obligations contained in subsection (c) hereof as provided in subsection (c) hereof. Upon receipt of any notice from any Person with regard to the Release of Hazardous Materials on, from or beneath the Leased Property as provided for in Exhibit A attached hereto, the City shall give prompt written notice thereof to the Corporation and the Certificate holders (and, in any event, prior to the expiration of any period in which to respond to such notice under any Environmental Regulation).
(c) Irrespective of whether any representation or warranty contained herein is not true or correct, the City shall defend, indemnify and hold harmless the Certificate holders and the Trustee, its partners, depositors and each of its and their employees, agents, officers, directors, trustees, successors and assigns, from and against any claims, demands, penalties, fines, attorneys’ fees (including, without limitation, attorneys’ fees incurred to enforce the indemnification contained in this Section) consultants’ fees, investigation and laboratory fees, liabilities, settlements (five Business Days’ prior notice of which the Corporation, Trustee or the Certificate holders, as appropriate, shall have delivered to the City), court costs, damages, losses, costs or expenses of whatever kind or nature, known or unknown, contingent or otherwise, occurring in whole or in part, arising out of, or in any way related to, (i) the presence, disposal, Release, threat of Release, removal, discharge, storage or transportation of any Hazardous Materials on, from or beneath the Leased Property, (ii) any personal injury (including wrongful death) or property damage (real or personal) arising out of or related to such Hazardous Materials, (iii) any lawsuit brought or threatened, settlement reached (five Business Days’ prior notice of which the Corporation, the Trustee or the Certificate holders, as appropriate, shall have delivered to the City), or governmental order relating to Hazardous Materials on, from or beneath
6 any of the Leased Property, (iv) any violation of Environmental Regulations or subsection (a) or (b) hereof by it or any of its agents, tenants, employees, contractors, licensees, guests, subtenants or invitees, and (v) the imposition of any governmental Lien for the recovery of environmental cleanup or removal costs. To the extent that the City is strictly liable under any Environmental Regulation, its obligation to the Trustee, the Corporation and the Certificate holders and the other indemnities under the foregoing indemnification shall likewise be without regard to fault on its part with respect to the violation of any Environmental Regulation which results in liability to any indemnitee. Its obligations and liabilities under this subsection (c) shall survive any foreclosure of the security interest in the Leased Property or the delivery of any instrument in lieu of foreclosure, and the satisfaction of all Certificates. (d) The City shall conform to and carry out a reasonable program of maintenance and inspection of all underground storage tanks, and shall maintain, repair, and replace such tanks only in accordance with Laws and Regulations, including but not limited to Environmental Regulations.
SECTION 23. Execution This Site Lease may be executed in any number of counterparts, each of which shall be deemed to be an original but all together shall constitute but one and the same lease.
SECTION 24. Third-Party Beneficiaries The Certificate holders and the Trustee are each expressly recognized as third-party beneficiaries under this Site Lease. [Remainder of page intentionally left blank.]
7 IN WITNESS WHEREOF, the City and the Corporation have caused this Site Lease to be executed by their respective officers thereunto duly authorized, all as of the day and year first above written.
CITY OF MAYWOOD,
as Lessor
By:
[City Manager] [Director of Finance]
MUNICIPAL FINANCE CORPORATION,
as Lessee
By:
Treasurer
8 A NOTARY PUBLIC OR OTHER OFFICER COMPLETING THIS CERTIFICATE
VERIFIES ONLY THE IDENTITY OF THE INDIVIDUAL WHO SIGNED THE
DOCUMENT TO WHICH THIS CERTIFICATE IS ATTACHED, AND NOT THE TRUTHFULNESS, ACCURACY, OR VALIDITY OF THAT DOCUMENT.
STATE OF CALIFORNIA )
) ss:
COUNTY OF LOS ANGELES )
On ______________________________ before me,__________________________(insert name of the officer), Notary Public, personally appeared _________________________, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
_________________________________ [Seal]
104799876.2
EXHIBIT A
LEGAL DESCRIPTION OF LEASED PROPERTY
[to come]
For conveyancing purposes only: APN ____-___-___
Trevor Mael | SVP, Public Finance | Tel: 916.724.2423 | Email: [email protected] February 10, 2022
RE: City of Maywood
Lease Financing
Based upon your request and preliminary review of the information provided to-date, First Foundation Public Finance (“FFPF”) wou ld like express its interest in u nderwriting and obtaining credit approval for the following Credit Facilit y to the City of Maywood, CA (“Borrower”) based on the terms outlined below. This Letter is provided by First Foundation Public Finance for discussion purposes only. It is not intended to be binding, does not create any obligation on the part of First Foundation Public Finance to Sponsor or any third party, and is not a commitment to lend or agreement of any kind. No obligation whatsoeveron the part of First Foundation Public Finance shall arise until execution and delivery of a formal commitment or loan documentation by a duly authorized officer of First FoundationPublic Finance,which obligation shall be subject to allof the conditions contained therein.
Theproposedloan conditions are:
STRUCTURE: Term
PURPOSE: Refinance existing 2008 Lease Revenue Bonds
MAX. LOAN AMT: $2,750,000
INTERESTRATE: Tax-Exempt NBQ: 2.44%(3.29% taxable equivalent) RATE LOCK: The Rate will be locked for 60-days. If the Credit Facility fails to close within this period, FFPFreserves the right to adjust the rate.
TERM: 16-years
REPAYMENT: Semi-annual interest and principal payments
AVERAGE LIFE: 9.4-years
PRE-PAYMENT: Repayable at 103% of par in years 1-2, declining to 102% in years 3-4, and 101% in years 5-6. Redeemable at par beginning in year 7.
COLLATERAL: Lease payments to be paid by the Borrower from any legally available funds. The Credit Facility will be secured with a leasehold interest in an essential asset of the Borrower (with insured value to meet or exceed the Loan Amount).
ADDITIONAL TERMS:Documents to be prepared by the Borrower’s Bond Counsel for review by FFPF’s counsel Nixon Peabody, LLP.
Legal fees and expenses of Nixon Peabody, LLP should not exceed $12,500. All other filing fees and related fees shall be paid by the Borrowerin connection with the issuance (including applicable CDIAC fees).
Periodic financial and collateral reporting by the Borrower, as well as representations and warranties of the Borrower regarding its status and ability to repay, taxability gross-up and covenants and conditions that are appropriate for a Credit Facility of the scope and nature proposed above will be determined as part of FFPF’s underwriting and credit approval process.
PDF’s of all executed and other documents listed on the Closing Index shall be provided to FFPF no later than 24 hours before the time of the requested wire; provided, that if any documents can only be signed after receipt of the wire, those documents shall be provided immediately after receipt of the wire.
In an event of default, a default rate equal to the Interest Rate + 3.00% will be required.
Notice: The Federal Equal Credit Opportunity Act prohibits creditors from discriminating against credit applicants on the basis of race, color, religion, national origin, sex, marital status, age (provided the applicant has the capacity to enter into a binding contract); because all or part of the applicant's income derives from any public assistance program; or because the applicant has in good faith exercised any right under the Consumer Credit Protection Act. The federal agency that administers compliance w ith this law concerning this creditor is the Federal Deposit Insurance Corporation, Consumer Response Center, 1100 Walnut Street, Box #11, Kansas City, MO 64106.
AGENDA REPORT
CITY OF MAYWOOD
AGENDA ITEM NO. 5.
DATE: March 9, 2022
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: JENNIFER VASQUEZ, CITY MANAGER
BY: ROXANNE DIAZ, CITY ATTORNEY
SUBJECT: DISCUSSION AND DIRECTION REGARDING FILLING THE CITY CLERK VACANCY PURSUANT TO GOVERNMENT CODE SECTION 36512 CAUSED BY A
RESIGNATION
RECOMMENDATION:
Staff recommends that the City Council discuss the options outlined in the agenda report and provide Staff with direction.
BACKGROUND:
Elected City Clerk Flor Aguiluz submitted a letter of resignation to the City Manager as she will be moving out of the City of Maywood. The effective date of her resignation is March 1, 2022. Pursuant to Government Code Section 1770(c), City Clerk Aguiluz’s resignation created a vacancy of the elected City Clerk position.
Government Code Section 36512(b) outlines the options for the City Council with regard to the vacancy.
DISCUSSION:
Government Code 36512(b) is the relevant code section and provides as follows: “If a vacancy occurs in an elective office provided for in this chapter, the council shall, within 60 days from the commencement of the vacancy, either fill the vacancy by appointment or call a special election to fill the vacancy.” The 60th day following the vacancy date is April 30, 2022.
The following outlines the process to be followed for either an appointment or special election.
Process for Making an Appointment
Once the office is effectively vacant, the City Council has 60 days from the date of the vacancy to appoint a replacement City Clerk. State law does not specify a particular process for such selection and there are a variety of ways in which an appointee can be selected.
For example, the City Council could, but it is not required to, solicit resumes and statements of interest from residents who wish to be considered. The City Council could designate an ad hoc committee of the City Council to review these resumes and make a recommendation to the entire City Council. The City Council could also decide to have the entire City Council review the resumes and statements. In that case, the review of the resumes and statements would be conducted at a duly noticed meeting in accordance with the Brown Act. The City Council could, but is not required to, have interviews of the applicants, but those interviews would also occur in open session. Alternatively, the City Council can seek out potential replacements without
the formality of an application process or if it desires to use an ad hoc committee process, it may direct the ad hoc committee to do so and the ad hoc committee can make a recommendation to the entire City Council.
It should be noted that the above are suggestions that have been followed by other cities when faced with a vacancy on their city council—the process for filling the City Clerk position is the same. The City Council is not obligated to follow the procedures outlined above, nor is the City Council obligated to appoint a replacement from among the persons who filed resumes or statements or from those recommended by an ad hoc committee, should the Council use an ad hoc committee. Regardless of the method, if the City Council desires to appoint, the City Council should discuss the manner in which it desires to solicit a potential appointee and provide direction to City Staff.
The length of office for an appointed City Clerk is also provided for in Government Code Section 36512. In this case, because the City Clerk resigned in the first half of her term of office and at least 130 days prior to the next general municipal election, Government Code Section 36512(b)(2)(A) states that the appointed City Clerk shall hold office until the next general municipal election, which is November 8, 2022. At that time, the City Council would be required to hold a special election to fill the position and that person would hold office for the remainder of the City Clerk term, which is until November 2024.
Calling a Special Election
Alternatively, the City Council could choose to call an election to fill the remaining portion of City Clerk Aguiluz’s term. Under Government Code Section 36512(b), that election shall be held on the next “regularly established election date” at least 114 days after the vacancy date. Under Elections Code Section 1000, the next “regularly established election date” following the vacancy date is November 8, 2022. The person elected at the election shall serve the remainder of City Clerk Aguiluz’s term until the election in November of 2024. If the City Council chooses to call a special election, the City Clerk position would remain vacant until then.
In conclusion, any decision must be made by April 30, 2022. There is no cost if the City Council chooses to appoint a City Clerk until the office is filled by a special election to be held with the next general municipal election in November 2022. At that time, it is expected the cost would be minimal as the City is already having a city council election. Alternatively, the City Council could leave the office vacant and hold a special election in November 2022. The person elected would serve the remaining term until 2024.
LEGAL REVIEW:
The City Attorney drafted this report.
FISCAL IMPACT:
There is no fiscal impact involved with this item.
ATTACHMENT(S)