OH&S
DRAFT
09/03/26
4123-2091-8123.4
______________________________________________________________________________ ______________________________________________________________________________
ISSUING AND PAYING AGENT AGREEMENT
between
CITY OF SAN JOSE FINANCING AUTHORITY
and
U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION,
as Issuing and Paying Agent
Dated as of October 1, 2026
Relating To
CITY OF SAN JOSE FINANCING AUTHORITY
SUBORDINATE WASTEWATER REVENUE
COMMERCIAL PAPER NOTES
______________________________________________________________________________ ______________________________________________________________________________
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
TABLE OF CONTENTS
Page
-i-
4123-2091-8123.4
ARTICLE I EQUALITY OF SECURITY; DEFINITIONS; CONTENT OF CERTIFICATES AND OPINIONS; AUTHORITY ......................................2 Section 1.01. Equality of Security ...........................................................................2 Section 1.02. Definitions .........................................................................................2 Section 1.03. Rules of Construction ...................................................................... 11 Section 1.04. Content of Certificates and Opinions ............................................... 11 Section 1.05. Security for Notes and Related Obligations ...................................... 12 ARTICLE II THE NOTES ............................................................................................... 13 Section 2.01. Authorization of Notes; Supply of Notes .......................................... 13 Section 2.02. Terms of the Notes .......................................................................... 14 Section 2.03. Form of Notes .................................................................................. 15 Section 2.04. Execution of Notes .......................................................................... 15 Section 2.05. Authentication of Notes ................................................................... 16 Section 2.06. Notes Mutilated, Lost, Destroyed or Stolen ...................................... 17 Section 2.07. Cancellation of Notes....................................................................... 17 Section 2.08. Master Note; Registration of Notes .................................................. 17 ARTICLE III ISSUE AND SALE OF NOTES .................................................................. 19 Section 3.01. Issuance and Sale of Notes ............................................................... 19 Section 3.02. Proceeds of the Sale of a Series of Notes ......................................... 21 Section 3.03. Issuance of Additional Series of Notes ............................................. 22 Section 3.04. Proceedings for Issuance of Additional Series of Notes.................... 23 ARTICLE IV FUNDS AND ACCOUNTS; DRAWS UNDER LETTERS OF
CREDIT ...................................................................................................... 23 Section 4.01. Establishment and Application of Note Proceeds Fund .................... 23 Section 4.02. Establishment and Application of Note Repayment Fund and Related Accounts; Demand for Payment Under Letter of Credit ...... 24 Section 4.03. Draws Under Letters of Credit; Establishment of Reimbursement Agreement Fund; Enforcement of Provisions of Letters of Credit .......................................................................... 26 Section 4.04. Moneys in Funds and Accounts ....................................................... 29 Section 4.05. Investment of Moneys in Funds ....................................................... 29 ARTICLE V COVENANTS OF THE AUTHORITY ....................................................... 29 Section 5.01. Punctual Payment and Performance ................................................. 29 Section 5.02. Extension of Payment of Notes ........................................................ 30 Section 5.03. Waiver of Laws ............................................................................... 30
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
TABLE OF CONTENTS
(continued)
Page
-ii-
4123-2091-8123.4
Section 5.04. Further Assurances .......................................................................... 30 Section 5.05. Rebate Fund..................................................................................... 30 Section 5.06. Tax Covenants ................................................................................. 31 Section 5.07. Maintenance of Issuing and Paying Agent ....................................... 31 Section 5.08. Letters of Credit; Alternate Letter of Credit ..................................... 31 Section 5.09. Appointment of Dealer .................................................................... 32 Section 5.10. Provision of Report to Bank ............................................................. 32 ARTICLE VI EVENTS OF DEFAULT AND REMEDIES OF NOTEHOLDERS ............ 33 Section 6.01. Events of Default ............................................................................. 33 Section 6.02. Right to Accelerate Upon Default .................................................... 33 Section 6.03. [Reserved] ....................................................................................... 34 Section 6.04. Issuing and Paying Agent to Represent Noteholders ........................ 34 Section 6.05. Noteholders’ Direction of Proceedings ............................................. 34 Section 6.06. Limitation on Noteholders’ Right to Sue .......................................... 35 Section 6.07. Absolute Obligation of the Authority ............................................... 35 Section 6.08. Termination of Proceedings ............................................................. 36 Section 6.09. Remedies Not Exclusive .................................................................. 36 Section 6.10. No Waiver of Default ...................................................................... 36 Section 6.11. Appointment of a Receiver .............................................................. 36 ARTICLE VII THE ISSUING AND PAYING AGENT ..................................................... 36 Section 7.01. Appointment: Duties, Immunities and Liabilities of Issuing and Paying Agent............................................................................. 36 Section 7.02. Merger or Consolidation .................................................................. 38 Section 7.03. Liability of Issuing and Paying Agent .............................................. 38 Section 7.04. Right of Issuing and Paying Agent to Rely on Documents ............... 40 Section 7.05. Compensation and Indemnification of Issuing and Paying Agent ............................................................................................... 41 Section 7.06. Commercial Paper Reports .............................................................. 41
ARTICLE VIII MODIFICATION OR AMENDMENT OF THIS ISSUING AND PAYING AGENT AGREEMENT .............................................................. 41 Section 8.01. Amendments Permitted .................................................................... 41 Section 8.02. Effect of Supplement ....................................................................... 43 Section 8.03. Amendment of Particular Notes ....................................................... 43
ARTICLE IX DE
FEASANCE ........................................................................................... 43 Section 9.01. Payment of Notes............................................................................. 43
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
TABLE OF CONTENTS
(continued)
Page
-iii-
4123-2091-8123.4
Section 9.02. Discharge of Liability on Notes ....................................................... 44 Section 9.03. Payment of Notes After Discharge of Issuing and Paying Agent Agreement ....................................................................................... 44 ARTICLE X MISCELLANEOUS.................................................................................... 45 Section 10.01. Successor Is Deemed Included in All References to Predecessor ...................................................................................... 45 Section 10.02. Limitation of Rights to Authority, Issuing and Paying Agent, Banks and Noteholders .................................................................... 45 Section 10.03. Waiver of Notice ............................................................................. 45 Section 10.04. Destruction or Delivery of Canceled Notes ...................................... 45 Section 10.05. Severability of Invalid Provisions .................................................... 45 Section 10.06. Notices ............................................................................................ 46 Section 10.07. Notice to Rating Agencies ............................................................... 47 Section 10.08. Evidence of Rights of Noteholders ................................................... 47 Section 10.09. Disqualified Notes ........................................................................... 48 Section 10.10. Money Held for Particular Notes ..................................................... 48 Section 10.11. Waiver of Personal Liability ............................................................ 48 Section 10.12. Governing Law ................................................................................ 48 Section 10.13. Business Day ................................................................................... 48 Section 10.14. Effective Date of Issuing and Paying Agent Agreement ................... 48 Section 10.15. Electronic Signature......................................................................... 48 Section 10.16. Execution in Counterparts ................................................................ 49 EXHIBIT A FORM OF NOTE ............................................................................................ A-1 EXHIBIT B FORM OF DTC MUNICIPAL COMMERCIAL PAPER MASTER NOTE ...... B-1 EXHIBIT C FORM OF ISSUANCE REQUEST TO PAYING AGENT ............................... C-1
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
4123-2091-8123.4
ISSUING AND PAYING AGENT AGREEMENT
THIS ISSUING AND PAYING AGENT AGREEMENT , dated as of October 1, 2026 (as originally executed and as it may from time to time be amended or supplemented in accordance with the terms hereof, this “Issuing and Paying Agent Agreement”), between the CITY OF SAN JOSE FINANCING AUTHORITY, a joint exercise of powers authority duly organized and existing under the laws of the State of California (the “Authority”), and U.S.
BANK TRUST COMPANY, NATIONAL ASSOCIATION, a national banking association duly established and existing under and pursuant to the laws of the United States of America, as issuing and paying agent (the “Issuing and Paying Agent”); W I T N E S S E T H:
WHEREAS, the Authority is a joint exercise of powers authority duly organized and existing under and by virtue of a Joint Exercise of Powers Agreement, dated December 8, 1992, by and between the City of San José (the “City”) and the former Redevelopment Agency of the City of San José (the “Former Agency”) and Chapter 5 of Division 7 of Title 1 of the Government Code of the State of California, as amended (the “Act”); and WHEREAS, the Former Agency, as of February 1, 2012, has been dissolved and the City has become the successor agency of the Former Agency pursuant to Part 1.85 of Division 24 of the California Health and Safety Code and pursuant to California Health and Safety Code Section 34178(b)(3), the joint exercise of powers agreement establishing the Authority remains in effect; and
WHEREAS, the Act authorizes and empowers the Authority to issue revenue bonds, notes and other evidences of indebtedness to assist local agencies with the financing and refinancing of public capital improvements, and to issue revenue bonds, notes and other evidences of indebtedness to refund such bonds, notes and other evidences of indebtedness; and WHEREAS, the Authority has determined to issue from time to time one or more series of Notes (as defined herein) to assist the City with the financing and refinancing of the acquisition, construction and installation from time to time of certain Projects (as defined herein), including through the refunding of the Authority’s outstanding Subordinate Wastewater Revenue Notes (the “Prior Notes”) and the refunding of any other bonds, notes or other evidences of indebtedness of the Authority or the City issued or incurred for such purpose (together with the Prior Notes, the “Refunded Obligations”); WHEREAS, the Authority has determined to provide for the authentication and delivery of the Notes in one or more series as the Authority may from time to time authorize pursuant to this Issuing and Paying Agent Agreement;
WHEREAS, in order to provide credit support and liquidity for the payment of the principal of and interest on each Series of Notes , the Authority has determined to enter into Reimbursement Agreements (as defined herein) from time to time , pursuant to which each Bank (as defined herein) will deliver a Letter of Credit (as defined herein), which Letter of Credit will be drawn upon by the Issuing and Paying Agent to pay the principal of, and interest on, the related Series of Notes on their respective maturity dates;
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
2 4123-2091-8123.4
WHEREAS, the Authority has issued Bank Note s (as defined herein) evidencing the obligations of the Authority owed to each of the Banks under the applicable Reimbursement Agreement;
WHEREAS, in order to provide for the offering and sale of each Series of Notes, the Authority has determined to enter into Dealer Agreements (as defined herein) with Dealers (as defined herein) from time to time; and
WHEREAS, the Authority has determined that all acts, conditions and things required by law to exist, to have happened and to have been performed precedent to and in connection with the execution and delivery of this Issuing and Paying Agent Agreement do exist, have happened and have been performed in regular and due time, form and manner as required by law, and the parties hereto are now duly authorized to execute and deliver this Issuing and Paying Agent Agreement;
NOW, THEREFORE, THE PARTIES TO THIS ISSUING AND PAYING AGENT AGREEMENT HEREBY AGREE, that in order to secure the payment of the principal of and the interest on all Notes at any time issued, authenticated and delivered hereunder, the performance and observance of all the covenants and conditions set forth herein, the payment of the Payment Obligations and the performance and observance of all the covenants and conditions set forth in each Reimbursement Agreement, and to declare the terms and conditions upon and subject to which the Notes are to be issued, and in consideration of the premises and of the material covenants herein contained and of the purchase and acceptance of the Notes by the Owners thereof, and for other valuable consideration, the receipt of which is hereby acknowledged, the Authority does hereby agree and covenant with the Issuing and Paying Agent for the benefit of the respective Owners from time to time of the Notes and each Bank, as follows:
ARTICLE I
EQUALITY OF SECURITY; DEFINITIONS;
CONTENT OF CERTIFICATES AND OPINIONS; AUTHORITY
Section 1.01. Equality of Security. In consideration of the acceptance of the Notes by the Owners thereof from time to time, this Issuing and Paying Agent Agreement shall be deemed to be and shall constitute a contract among the Authority, the Issuing and Paying Agent , the Banks and the Owners from time to time of the Notes and the covenants and agreements herein set forth to be performed by or on behalf of the Authority or the Issuing and Paying Agent shall be for the equal and proportionate benefit, security and protection of the Banks and all Owners of the Notes, without preference, priority or distinction as to security or otherwise of any of the Notes over any of the others by reasons of the series, time of issue, sale or negotiation thereof or for any cause whatsoever, except as expressly provided therein or herein. Nothing herein shall prevent additional security being provided to particular Notes under any Supplement.
Section 1.02. Definitions. Unless the context otherwise requires, the terms defined in this Section shall for all purposes of this Issuing and Paying Agent Agreement and of any certificate, opinion or other document herein mentioned, have the meanings herein specified.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
3 4123-2091-8123.4
“Advance” shall have the meaning given such term in the applicable Reimbursement Agreement, and shall include any interest due thereon at the rate set forth in the applicable Reimbursement Agreement.
“Advice” means a notice or a written instrument prepared and executed by the Issuing and Paying Agent and delivered to the Depository which specifies the amount by which the indebtedness evidenced by a Master Note is to be increased or decreased on any particular date, and such other information as may be required pursuant to the systems and procedures of the Depository applicable to implementation of its book- entry program for obligations of the character of the Notes.
“Additional Series of Notes” means an additional Series of Notes issued pursuant to Section 3.03.
“Alternate Letter of Credit ” means a letter of credit issued by a bank or financial institution (or a syndicate of such institutions acting jointly or severally), delivered to the Issuing and Paying Agent pursuant to the provisions of Section 5.08, which replaces a Letter of Credit then in effect.
“Authorized Representative” means the Executive Director of the Authority, the Treasurer of the Authority, the Director of Finance of the City, the Assistant Director of Finance of the City, the Deputy Director of Finance of the City responsible for managing the City’s debt programs, or any other person designated to complete and deliver Issuance Requests, in each case who has been identified in a Certificate of the Authority delivered to the Issuing and Paying Agent.
“Available Amount” means, with respect to a Letter of Credit and all Notes of any Series, as applicable, supported thereby, the aggregate initial amount available to be drawn on the Letter of Credit as set forth therein, as such amount may be reduced and/or reinstated pursuant to the terms thereof, including as such amounts may be reduced by the amount of Advances or Unreimbursed Drawings outstanding.
“Bank” means (a) with respect to the Series A Notes, initially, Bank of America, N.A. and, upon replacement of the Initial Letter of Credit with an Alternate Letter of Credit pursuant to the provisions of Section 5.08, any other bank or financial institution that issues an Alternate Letter of Credit securing the Series A Notes and (b) with respect to any other Series of Notes, any bank or financial institution that issues a Letter of Credit securing such Series of Notes. “Bank Note” means (a) initially, the bank note in substantially the form attached as Exhibit A to the Initial Reimbursement Agreement, issued by the Authority to Bank of America, N.A., evidencing all principal and interest obligations related to Unreimbursed Drawings and Advances owed to the Bank under or with respect to the Initial Reimbursement Agreement and (b) any other revolving note, with respect to a Series of Notes, issued by the Authority to the related Bank, evidencing all principal and interest obligations related to Unreimbursed Drawings and Advance s owed to such Bank under or with respect to the related Reimbursement Agreement.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
4 4123-2091-8123.4
“Bond Counsel” means an attorney -at-law, or firm of such attorneys, of nationally recognized standing in matters pertaining to the tax- exempt nature of interest on obligations issued by states and their political subdivisions selected by the Authority. “Business Day” means any day other than ( a) a Saturday or Sunday, ( b) a day on which banks located in the State of New York or State of California are required or authorized by law or executive order to be closed, ( c) a day on which the New York Stock Exchange is closed, or (d) any day which is a day on which commercial banks in the city at which drawing requests under the applicable Letter of Credit are to be presented are required or authorized to close. “Certificate,” “Statement,” “Request,” “Requisition” and “Order” of the Authority mean, respectively, a written certificate, statement, request, requisition or order signed in the name of the Authority by an Authorized Representative subject to Section 1.04. Any such instrument and supporting opinions or representations, if any, may, but need not, be combined in a single instrument with any other instrument, opinion or representation, and the two or more so combined shall be read and construed as a single instrument. “City” means the City of San José, a municipal corporation, duly organized and existing under and by virtue of its charter and the Constitution of the State. “Code” means the Internal Revenue Code of 1986 and the regulations of the United States Department of the Treasury issued thereunder, and in this regard reference to any particular section of the Code shall include reference to all successors to such section of the Code.
“Corporate Trust Office” means the corporate trust office of the Issuing and Paying Agent at 100 Wall Street, 20
th Floor, New York, New York 10005, or such other or additional offices as may be designated by the Issuing and Paying Agent. “Costs of Issuance” means all costs, expenses and fees directly or indirectly payable by or reimbursable to the Authority or the City related to the authorization, execution and delivery of the Installment Purchase Contract and any amendment of the Installment Purchase Contract , this Issuing and Paying Agent Agreement and all Supplements, and the Notes, including but not limited to advertising and printing costs, costs of preparation and reproduction of documents, filing and recording fees, travel expenses and costs relating to rating agency meetings and other meetings concerning the Notes, initial fees and charges of the Issuing and Paying Agent, legal fees and charges, fees and disbursements of consultants and professionals, including fees of the Dealers, financial or municipal advisor fees and expenses, rating agency fees, fees and charges for preparation, execution, transportation and safekeeping of Notes, surety insurance, liquidity and credit enhancements costs, including, without limitation, fees and expenses payable to a Bank under its Reimbursement Agreement, and any other cost, charge or fee in connection with the delivery of Notes.
“Dealer” means, (a) initially, each of Barclays Capital Inc. , Morgan Stanley & Co. LLC and TD Financial Products LLC and any successors or assigns permitted under the related Dealer Agreement, and (b) any other dealer for the Notes or for any Series thereof that is appointed by the Authority and that has entered into a Dealer Agreement.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
5 4123-2091-8123.4
“Dealer Agreement” means, (a) initially, each Commercial Paper Dealer Agreement, dated as of October 1, 2026, between the Authority and the related Dealer, as originally executed and as amended, supplemented, restated or otherwise modified from time to time in accordance with the terms thereof , and ( b) any other dealer agreement entered into by the Authority and a commercial paper dealer with respect to the Notes or any Series thereof , as originally executed and as it may from time to time be amended, supplemented, restated or otherwise modified in accordance with the terms thereof.
“Defeasance Securities” means any of the following obligations to the extent then permitted by law: (a) cash; (b) direct obligations of the United States of America (including stripped securities derived from direct obligations of the United States of America); and (c) obligations fully guaranteed as to principal and interest by the United States of America. “Depository” means (a) initially, DTC, and ( b) any other qualified securities depository acting as Depository pursuant to Section 2.08.
“Depository System Participant” means any participant in the Depository’s book-entry system.
“DTC” means The Depository Trust Company, a limited purpose trust company organized under the laws of the State of New York or its successors and assigns. “Event of Default” means an event described as such in Section 6.01. “Fee Letter” means each fee letter or fee agreement between the Authority and a Bank, as originally executed and as it may from time to time be amended, supplemented, restated or otherwise modified in accordance with the terms thereof. “Final Drawing Notice” means a notice from a Bank instructing the Issuing and Paying Agent to make the final drawing under the related Letter of Credit to provide for the payment of the principal and interest on Notes issued in accordance with the Issuing and Paying Agent Agreement which are Outstanding on the date of such notice and are maturing or are thereafter to mature and/or that a Letter of Credit will terminate within a certain period due to the occurrence and continuation of an event of default under the related Reimbursement Agreement. “Holder” has the same meaning as Owner.
“Initial Letter of Credit” means the Irrevocable Transferrable Direct -Pay Letter of Credit issued by Bank of America, N.A. pursuant to the Initial Reimbursement Agreement. “Initial Reimbursement Agreement” means the Reimbursement Agreement, dated as of October 1, 2026, among the Authority, the City and Bank of America, N.A., as originally executed or as it may from time to time be amended, supplemented, restated or otherwise modified in accordance with the provisions thereof and this Issuing and Paying Agent Agreement.
“Installment Payments” means all installment payments required to be paid by the City under the Installment Purchase Contract.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
6 4123-2091-8123.4
“Installment Purchase Contract” means the Subordinate Installment Purchase Contract, dated as of October 1, 2026, between the Authority and the City, as originally executed and as it may from time to time be amended in accordance with its terms. “Issuance Request” means a request made by the Authority, acting through an Authorized Representative, to the Issuing and Paying Agent for the authentication and delivery of a Note or Notes, which request shall be substantially in the form attached hereto as Exhibit C. “Issuing and Paying Agent” means U.S. Bank Trust Company, National Association, or its successor, as Issuing and Paying Agent, as provided in Section 7.01. “Issuing and Paying Agent Agreement” means this Issuing and Paying Agent Agreement, dated as of October 1, 2026 , between the Authority and the Issuing and Paying Agent, as originally executed and as it may from time to time be amended , supplemented, restated or otherwise modified in accordance with the terms hereof. “Letter of Credit” means, (a) with respect to the Series A Notes, initially, the Initial Letter of Credit and, upon the replacement of the Initial Letter of Credit with an Alternate Letter of Credit pursuant to the provisions of Section 5.08, the Alternate Letter of Credit then in effect for the Series A Notes and ( b) with respect to any other Series of Notes, an irrevocable, direct-pay letter of credit securing payment of such Series of Notes issued by a Bank pursuant to a Reimbursement Agreement, for the benefit of the Issuing and Paying Agent, including any Alternate Letter of Credit delivered in replacement thereof pursuant to the provisions of Section
5.08. “Letter of Credit Expiration Date” means, with respect to a Letter of Credit, the stated expiration date thereof, taking into account any extension of such stated expiration date. “Letter of Representations” means a letter to the Depository from the Authority representing such matters as shall be necessary to qualify the Notes for the Depository’s book-entry system.
“Master Note” means a Note substantially in the form attached hereto as Exhibit B. “Nominee” means ( a) initially, Cede & Co., as nominee of DTC, and ( b) such other nominee of a Depository designated pursuant to Section 2.08 of this Issuing and Paying Agent Agreement.
“Note Proceeds Fund” means the fund (and all accounts within such fund) by that name established pursuant to Section 4.01 to hold the proceeds of the Notes prior to expenditure on Projects.
“Note Repayment Fund” means the fund (and all accounts within such fund) established pursuant to Section 4.02.
“Noteholder” or “Noteowner” shall have the meaning as Owner.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
7 4123-2091-8123.4
“Notes” means the City of San José Financing Authority Subordinate Wastewater Revenue Commercial Paper Notes authorized by, and at any time Outstanding pursuant to, this Issuing and Paying Agent Agreement.
“Original Issue Notes” has the meaning given to that term in the Tax Certificate. “Outstanding” when used as of any particular time with reference to Notes, means (subject to the provisions of Section 10.09) all Notes theretofore, or thereupon being, authenticated and delivered by the Issuing and Paying Agent under this Issuing and Paying Agent Agreement except ( a) Notes theretofore canceled by the Issuing and Paying Agent or surrendered to the Issuing and Paying Agent for cancellation; ( b) Notes with respect to which all liability of the Authority shall have been discharged in accordance with Section 9.02, including Notes (or portions of Notes) referred to in Section 10.09; and ( c) Notes for the transfer or exchange of or in lieu of or in substitution for which other Notes shall have been authenticated and delivered by the Issuing and Paying Agent pursuant to this Issuing and Paying Agent Agreement.
“Owner” whenever used herein with respect to a Note, means the person in whose name such Note is registered.
“Payment Obligations” means all obligations of the Authority to reimburse each Bank for drawings under the related Letter of Credit (which includes, without limitation, Unreimbursed Drawings, Advance s and all amounts owing to the Bank evidenced by the Bank Note) and to pay all other amounts payable to each Bank arising under or pursuant to each Reimbursement Agreement, each Fee Letter and/or each Bank Note, including in each instance all interest accrued thereon.
“Permitted Investments” means any of the following investments which at the time acquired or made are legal investments for the Authority under applicable State laws, to the extent permitted by the City’s Investment Policy, as amended from time to time by the City, and as directed by the Director of Finance of the City for the moneys held hereunder then proposed to be invested therein:
(1) Defeasance Securities;
(2) Obligations of any of the following federal agencies which obligations represent the full faith and credit of the United States of America, including:
• Export-Import Bank
• Rural Economic Community Development Administration
• U.S. Maritime Administration
• Small Business Administration
• U.S. Department of Housing & Urban Development (PHAs) • Federal Housing Administration
• Federal Financing Bank;
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
8 4123-2091-8123.4
(3) Direct obligations of federal agencies which obligations are not fully guaranteed by the full faith and credit of the United States of America; (4) U.S. dollar denominated deposit accounts, federal funds and bankers’ acceptances with domestic commercial banks which have a rating on their short -term certificates of deposit on the date of purchase of “P -1” by Moody’s and “A -1” or “A -1+” by S&P and maturing not more than three hundred sixty (360) calendar days after the date of purchase. (Ratings on holding companies are not considered as the rating of the bank):
(5) Commercial paper which is rated at the time of purchase in the single highest classification, “P-1” by Moody’s and “A -1+” by S&P and which matures not more than two hundred seventy (270) calendar days after the date of purchase; (6) Investments in a money market fund rated “AAAm” or “AAAm -G” or better by S&P, excluding those with a floating net asset value, including funds for which the Issuing and Paying Agent or an affiliate provides investment advice or other services; (7) Pre-refunded municipal obligations defined as follows: Any bonds or other obligations of any state of the United States of America or of any agency, instrumentality or local governmental unit of any such state which are not callable at the option of the obligor prior to maturity or as to which irrevocable instructions have been given by the obligor to call on the date specified in the notice; and
(A) which are rated, based on an irrevocable escrow account or fund (the “escrow”), in the highest rating category of Moody’s and S&P or any successors thereto; or
(B) (i) which are fully secured as to principal and interest and redemption premium, if any, by an escrow consisting only of cash or obligations described in paragraph (2) of the definition of Defeasance Securities, which escrow may be applied only to the payment of such principal of and interest and redemption premium, if any, on such bonds or other obligations on the maturity date or dates thereof or the specified redemption date or dates pursuant to such irrevocable instructions, as appropriate, and (ii) which escrow is sufficient, as verified by a nationally recognized verification agent, to pay principal of and interest and redemption premium, if any, on the bonds or other obligations described in this paragraph on the maturity date or dates specified in such irrevocable instructions, as appropriate;
(8) Municipal obligations rated “Aaa/AAA” or general obligations of states with a rating of at least “A2/A” or higher by both Moody’s and S&P; (9) United States dollar denominated senior unsecured unsubordinated obligations issued or unconditionally guaranteed by the International Bank for Reconstruction and Development, International Finance Corporation, or Inter -American Development Bank, with a maximum remaining maturity of five years or less, and eligible for purchase and sale within the United States;
(10) Local Agency Investment Fund of the State of California (LAIF); and
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
9 4123-2091-8123.4
(11) Investment agreements (supported by appropriate opinions of counsel). “Project” means any improvements, additions, and betterments to, and extensions and rehabilitations of, the Wastewater System.
“Rating Agency” means Fitch, Moody’s or S&P, but in each case only to the extent that such municipal securities rating agency is then maintaining a rating on any of the Notes at the request of the Authority.
“Rebate Fund” means the fund by that name established pursuant to Section 5.05. “Rebate Requirement” means the Rebate Requirement defined in the Tax Certificate. “Reimbursement Agreement” means (a) with respect to the Series A Notes, initially, the Initial Reimbursement Agreement and upon replacement of the Initial Letter of Credit with an Alternate Letter of Credit, the reimbursement agreement entered into by the Authority , the City and a Bank relating to such Alternate Letter of Credit and ( b) with respect to any other Series of Notes, any reimbursement agreement entered into by the Authority , the City and a Bank pursuant to which a Letter of Credit or an Alternate Letter of Credit is issued, in each case as originally executed or as they may from time to time be amended, supplemented, restated or otherwise modified in accordance with the provisions thereof and this Issuing and Paying Agent Agreement.
“Reimbursement Agreement Fund” means the fund by that name established pursuant to Section 4.03.
“Refunded Obligations” has the meaning given to such term in the recitals to this Issuing and Paying Agent Agreement.
“Series” or “Series of Notes” whenever used herein with respect to the Notes, means all of the Notes designated as being of the same series, regardless of variations in maturity, interest rate and other provisions.
“Series A Notes” means, collectively, the Series A-1 Notes and the Series A-2 Notes. “Series A-1 Note Interest Subaccount” means the subaccount by that name established within the Series A-1 Note Repayment Account of the Note Repayment Fund pursuant to Section
4.02. “Series A-1 Note Principal Subaccount” means the subaccount by that name established within the Series A-1 Note Repayment Account of the Note Repayment Fund pursuant to Section 4.02.
“Series A-1 Note Proceeds Account” means the account by that name established within the Note Proceeds Fund pursuant to Section 4.01. “Series A-1 Note Repayment Account” means the account by that name established within the Note Repayment Fund pursuant to Section 4.02.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
10 4123-2091-8123.4
“Series A-1 Notes” means the City of San José Financing Authority Subordinate Wastewater Revenue Commercial Paper Notes, Series A-1.
“Series A-1 Reimbursement Agreement A ccount” means the account by that name established within the Reimbursement Agreement Fund pursuant to Section 4.03. “Series A-2 Note Interest Subaccount” means the subaccount by that name established within the Series A-2 Note Repayment Account of the Note Repayment Fund pursuant to Section
4.02. “Series A -2 Note Principal Subaccount” means the subaccount by that name established within the Series A-2 Note Repayment Account of the Note Repayment Fund pursuant to Section 4.02.
“Series A-2 Note Proceeds Account” means the account by that name established within the Note Proceeds Fund pursuant to Section 4.01. “Series A-2 Note Repayment Account” means the account by that name established within the Note Repayment Fund pursuant to Section 4.02. “Series A-2 Notes” means the City of San José Financing Authority Subordinate Wastewater Revenue Commercial Paper Notes, Series A-2 (Federally Taxable). “Series A-2 Reimbursement Agreement A ccount” means the account by that name established within the Reimbursement Agreement Fund pursuant to Section 4.03. “Stop Order” means (a) a Notice of Non -Issuance Instruction in substantially the form attached as Exhibit B to the Initial Reimbursement Agreement and (b) an y other order from a Bank to stop issuing Notes supported by its Letter of Credit pursuant to the terms and conditions of the related Reimbursement Agreement.
“Supplement” means any supplement or amendment to this Issuing and Paying Agent Agreement, supplementing, modifying or amending this Issuing and Paying Agent Agreement, but only if and to the extent that such Supplement is specifically authorized hereunder. “Taxable Notes” means (a) initially, the Series A-2 Notes and (b) any other Series of Notes the interest on which is not intended to be excludable from gross income of the holders thereof for federal income tax purposes.
“Tax Certificate” means (a) the Tax Certificate delivered by the Authority at the time of the authorization and initial issuance and delivery of the Series A-1 Notes, as may be amended or supplemented in accordance with its terms, and (b) the Tax Certificate delivered by the Authority at the time of the authorization and initial issuance and delivery of any other Series of Tax- Exempt Notes, as may be amended or supplemented in accordance with its terms. “Tax-Exempt Notes” means (a) the Series A-1 Notes, and (b) any other Series of Notes the interest on which is intended to be excludable from gross income of the holders thereof for federal income tax purposes.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
11 4123-2091-8123.4
“Unreimbursed Drawing” means each drawing or portion thereof under a Letter of Credit which has not been repaid by the Authority and has not been converted to an Advance and shall include any interest due thereon at the rate set forth in the applicable Reimbursement Agreement.
Section 1.03. Rules of Construction . (a) The terms defined herein expressed in the singular shall, unless the context otherwise indicates, include the plural and vice versa. (b) The use herein of the masculine, feminine or neuter gender is for convenience only and shall be deemed and construed to include correlative words of the masculine, feminine or neuter gender, as appropriate.
(c) References herein to a document shall include all amendments, supplements or other modifications to such document, and any replacements, substitutions or novation of, that document.
(d) Any term defined herein by reference to another document shall continue to have the meaning ascribed thereto whether or not such other document remains in effect. (e) The use herein of the words “including” and “includes,” and words of similar import, shall be deemed to be followed by the phrase “without limitation.” (f) Headings of Articles and Sections herein and the table of contents hereof are solely for convenience of reference, do not constitute a part hereof and shall not affect the meaning, construction or effect hereof.
(g) All references herein to designated “Articles,” “Sections,” “Exhibits,” “subsections,” “paragraphs,” “clauses,” and other subdivisions are to the designated Articles, Sections, Exhibits, subsections, paragraphs, clauses, and other subdivisions of this Issuing and Paying Agent Agreement.
(h) The words “hereof” (except when preceded by a specific Section or Article reference) “herein,” “hereby,” “hereunder,” “hereinabove,” “hereinafter,” and other equivalent words and phrases used herein refer to this Issuing and Paying Agent Agreement and not solely to the particular portion hereof in which any such word is used. (i) Any reference to a Person, or a Person in a specified capacity, shall be construed to include such Person’s successors or such Person’s successors in such capacity, as the case may be.
Section 1.04. Content of Certificates and Opinions . Any certificate or opinion made or given by an officer of the Authority may be based, insofar as it relates to legal or accounting matters, upon a certificate or opinion of or representation by counsel, an accountant, a financial or municipal advisor, an investment banker or an independent consultant, unless such officer knows, or in the exercise of reasonable care should have known, that the certificate, opinion or representation with respect to the matters upon which such certificate or statement may be based, as aforesaid, is erroneous. Any such certificate or opinion made or given by counsel, an accountant or an independent consultant may be based, insofar as it relates to factual matters
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
12 4123-2091-8123.4
(with respect to which information is in the possession of the Authority) upon a certificate or opinion of or representation by an officer of the Authority, unless such counsel, accountant or independent consultant knows, or in the exercise of reasonable care should have known, that the certificate or opinion or representation with respect to the matters upon which such person’s certificate or opinion or representation may be based, as aforesaid, is erroneous. The same officer of the Authority, or the same counsel or accountant or independent consultant, as the case may be, need not certify to all of the matters required to be certified under any provision of this Issuing and Paying Agent Agreement, but different officers, counsel, accountants or independent consultants may certify to different matters, respectively.
Section 1.05. Security for Notes and Related Obligations . (a) The Notes are limited obligations of the Authority and are payable as to both principal and interest, first, from drawings on the related Letter of Credit, and to the extent that any drawings on the related Letter of Credit are insufficient, second, from the Installment Payments and other amounts held by the Issuing and Paying Agent hereunder (except for amounts held in the Rebate Fund, and provided that amounts in each account of the Reimbursement Agreement Fund, the Note Repayment Fund and the Note Proceeds Fund shall secure only the Series of Notes with the same Series designation). (b) Subject only to the provisions of this Issuing and Paying Agent Agreement permitting the application thereof for the purposes and on the terms and conditions set forth herein and therein, the Authority hereby grants, bargains, sells, releases, conveys, assigns, transfers and pledges, and grants a lien on and security interest in, to secure the payment of the principal of and the interest on all Notes at any time issued, authenticated and delivered hereunder, the performance and observance of all the covenants and conditions set forth herein, the payment of the principal of and the interest on all Bank Notes, the payment of the Payment Obligations, and the performance and observance of all the covenants and conditions set forth in each Reimbursement Agreement, for the benefit of the respective Owners from time to time of the Notes and each Bank, as applicable, (i) all of the Installment Payments and (ii) all amounts held by the Issuing and Paying Agent hereunder (except for amounts held in the Rebate Fund , and provided that amounts in each account of the Reimbursement Agreement Fund, the Note Repayment Fund and the Note Proceeds Fund shall secure only the Series of Notes with the same Series designation).
(c) The pledge set forth in subsection (b) of this Section is a first priority pledge and shall be perfected and be valid and binding from the date of execution and delivery of this Issuing and Paying Agent Agreement without any physical delivery thereof or further act. (d) In order to secure the pledge of the Installment Payments hereunder, the Authority hereby transfers, conveys and assigns to the Issuing and Paying Agent , for the benefit of the Owners from time to time of the Notes and each Bank , all of the Authority’s rights under the Installment Purchase Contract (excepting any of its rights to indemnification thereunder), including the right to receive the Installment Payments from the City, and the right to exercise any remedies provided therein in the event of a default by the City thereunder. The Issuing and Paying Agent hereby accepts said assignment for the benefit of the Owners from time to time of the Notes and each Bank subject to the provisions of this Issuing and Paying Agent Agreement.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
13 4123-2091-8123.4
(e) The full faith and credit of the Authority is not pledged for the payment of the interest on or the principal of the Notes , and no tax or assessment shall ever be levied or collected to pay the interest on or the principal of the Notes . The Notes are not secured by a legal or equitable pledge of or charge, lien or encumbrance upon any property of the Authority or any of its income or receipts except the Installment Payments and the other amounts pledged hereunder. The Notes do not constitute an indebtedness of the Authority within the meaning of any constitutional or statutory debt limitation or restriction, and neither the Authority nor any officer or employee thereof shall be liable for the payment of the interest thereon or the principal thereof otherwise than from the Installment Payments and the other amounts pledged hereunder.
ARTICLE II
THE NOTES
Section 2.01. Authorization of Notes; Supply of Notes . (a) Notes may be issued hereunder, in registered form, from time to time as authorized by this Article. The maximum principal amount of Notes which may be issued hereunder is not limited; subject, however, to any limitations contained in the laws of the State and to the right of the Authority, which is hereby reserved, to limit the aggregate principal amount of Notes which may be issued or Outstanding hereunder. The Notes are designated generally as “City of San José Financing Authority Subordinate Wastewater Revenue Commercial Paper Notes”; each Series thereof to bear such additional designation as may be necessary or appropriate to distinguish such Series from every other Series of Notes.
(b) A Series of Notes entitled the “City of San José Financing Authority Subordinate Wastewater Revenue Commercial Paper Notes, Series A-1” is hereby authorized to be issued.
The Series A-1 Notes shall be issued from time to time as provided herein to finance and refinance acquisition, construction and installation from time to time of certain Projects , including through the refunding of any outstanding Refunded Obligations, and pay Costs of Issuance. Proceeds of the Series A-1 Notes may be used to pay maturing Series A-1 Notes and to reimburse the applicable Bank for Unreimbursed Drawings or Advances used to pay maturing Series A-1 Notes. Proceeds of the Series A-1 Notes also may be used to pay maturing Notes of other Series and to reimburse the applicable Bank for Unreimbursed Drawings or Advances used to pay such maturing Notes, if and to the extent not prohibited in the applicable Reimbursement Agreement or Tax Certificate. Such authorization specifically includes the authorization to issue and reissue Series A-1 Notes for such purposes.
(c) A Series of Notes entitled “ City of San José Financing Authority Subordinate Wastewater Revenue Commercial Paper Notes, Series A-2 ( Federally Taxable)” is hereby authorized to be issued. The Series A-2 Notes shall be issued from time to time as provided herein to finance and refinance the acquisition, construction and installation from time to time of certain Projects, including through the refunding of any Refunded Obligations, and pay Costs of Issuance. Proceeds of the Series A-2 Notes may be used to pay maturing Series A-2 Notes and to reimburse the applicable Bank for Unreimbursed Drawings or Advances used to pay maturing Series A-2 Notes. Proceeds of the Series A-2 Notes also may be used to pay maturing Notes of other Series and to reimburse the applicable Bank for Unreimbursed Drawings or Advance s used to pay such maturing Notes if and to the extent not prohibited in the applicable Reimbursement
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
14 4123-2091-8123.4
Agreement. Such authorization specifically includes the authorization to issue and reissue Series A-2 Notes for such purposes.
(d) The aggregate principal amount of, plus the amount of interest due at maturity on, all Notes of all Series Outstanding hereunder and payable from a single Letter of Credit shall not, at any one time, exceed the Available Amount with respect to such Letter of Credit or, if a Final Drawing Notice has been provided by the Bank providing such Letter of Credit and the Available Amount has been terminated pursuant thereto, the amount set forth in such Final Drawing Notice.
(e) The Authority agrees to furnish the Issuing and Paying Agent with an adequate supply of Notes from time to time, which will be serially numbered and which will have been executed in accordance with Section 2.04, with the principal amount, date of issue, registered Owner, maturity date, interest rate and amount of interest left blank. The Issuing and Paying Agent agrees to hold the Notes in safekeeping for the account of the Authority in accordance with the customary practice of the Issuing and Paying Agent pending authentication and delivery of Notes pursuant to Section 3.01.
Section 2.02. Terms of the Notes . (a) Subject to Section 2.08, t he Notes (i) shall be dated the date of their respective authentication and issuance, (ii) shall be issued in registered form, registered as designated by the Dealer , (iii) shall be issued in denominations of $100,000 and in integral multiples of $1,000 in excess thereof , and (iv) interest on the Notes, if any, shall be separately stated by rate and amount on the face of each Note. Notes shall bear interest, if any, from their respective dates, payable on their respective maturity dates. (b) Except as provided in subsection (f) of this Section, the Notes:
(i) shall bear interest payable at maturity at a rate not to exceed 12% per annum (calculated on the basis of a year consisting of 365/366 days and actual number of days elapsed),
(ii) shall mature not more than 270 days after their respective dates, but, in no event later than one Business Day prior to the Letter of Credit Expiration Date for such Notes,
(iii) shall be sold at a price of not less than the principal amount thereof, and (iv) shall mature on a Business Day.
The stated interest rate, maturity date and other terms of each Note, so long as not inconsistent with the terms of this Issuing and Paying Agent Agreement, shall be determined as provided in Section 3.01.
(c) The Notes shall not be subject to prepayment prior to maturity. (d) Within each Series, Notes shall be numbered consecutively from No. 1 upward.
The Issuing and Paying Agent may make additional provisions for numbering, including additional prefixes and suffixes, as it may deem appropriate.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
15 4123-2091-8123.4
(e) The principal of and the interest on the Notes shall be paid in federal or other immediately available funds in such currency of the United States of America as, at the respective times of payment, is legal tender for the payment of public and private debts. The principal of and the interest on the Notes, if any, shall be payable at the Corporate Trust Office of the Issuing and Paying Agent on any Business Day upon which such Notes have become due and payable on or before the close of business on such Business Day provided that such Notes are presented and surrendered on a timely basis. Upon presentation of such a Note to the Issuing and Paying Agent no later than 2:15 p.m. (New York City time) on or after any Business Day upon which such Notes have become due and payable, payment for such Note shall be made by the Issuing and Paying Agent in immediately available funds on such Business Day. If a Note is presented for payment after 2:15 p.m. (New York City time) on such Business Day, payment therefor shall be made by the Issuing and Paying Agent on the next succeeding Business Day without the accrual of additional interest thereon.
(f) Notwithstanding any other provisions of this Section, Taxable Notes may be issued and sold at a price less than the principal amount thereof, as determined by an Authorized Representative at the time any Taxable Notes are issued; and interest, if any, payable on Taxable Notes shall accrue from their respective dates and be payable at maturity, and shall be calculated on the basis of a 360- day year and actual number of days elapsed; provided, however, that in no case shall the total amount due on a Series of Taxable Notes, together with the amounts due on any other Series of Notes payable from the same Letter of Credit as such Series of Taxable Notes, exceed the Available Amount under the applicable Letter of Credit or, if a Final Drawing Notice has been provided by the Bank providing such Letter of Credit and the related Available Amount has been terminated pursuant thereto, the amount set forth in such Final Drawing Notice. For the avoidance of doubt, with respect to Taxable Notes issued and sold at a price less than the principal amount thereof, the face amount of such Taxable Notes outstanding shall be used for calculating the Available Amount under the applicable Letter of Credit.
Section 2.03. Form of Notes . The Notes shall be substantially in the form set forth in Exhibit A hereto, unless otherwise specified in a Supplement. Notwithstanding the foregoing, the Authority may deliver the Notes in the form of a Master Note representing the Notes of each Series to be issued from time to time, each maturing no later than the date established pursuant to Section 2.02(b)(ii). Each Master Note may be replaced by a new Master Note. Each Master Note shall evidence indebtedness of the Authority as set forth in the Advices. Each Advice shall have the limitations on Notes set forth in Sections 2.01 and 2.02. The aggregate indebtedness evidenced by the Master Notes of all Series of Notes payable from a Letter of Credit shall at all times equal or be less than the Available Amount under such Letter of Credit or, if a Final Drawing Notice has been provided by the Bank providing such Letter of Credit and the related Available Amount has been terminated pursuant thereto, the amount set forth in such Final Drawing Notice. References herein to Notes when a Master Note has been issued therefor shall refer to the indebtedness under the Master Note or the Advice issued with respect thereto.
Section 2.04. Execution of Notes . The Notes shall be executed in the name and on behalf of the Authority with the manual or facsimile signature of an Authorized Representative, except in the case of Master Notes, which shall be executed by the manual signature of an Authorized Representative. In case any officer of the Authority who shall have executed any of the Notes shall cease to be such officer of the Authority before the Notes so executed shall have
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
16 4123-2091-8123.4
been authenticated or delivered by the Issuing and Paying Agent or issued by the Authority, such Notes may nevertheless be authenticated, delivered and issued and, upon such authentication, delivery and issue, shall be as binding upon the Authority as though the officer who executed the same had continued to be such officer of the Authority until such authentication, delivery and issuance. Also, any Note may be executed on behalf of the Authority by any Authorized Representative who on the actual date of the execution of such Note shall be the proper Authorized Representative, although on the nominal date of such Note such person shall not have been such Authorized Representative.
Section 2.05. Authentication of Notes . (a) Each Note shall be authenticated by manual signature of the Issuing and Paying Agent who shall, pursuant to the provisions hereof, authenticate and deliver Notes in accordance with the terms of Section 3.01. Notwithstanding anything to the contrary, the Issuing and Paying Agent shall not authenticate any Note if:
(i) such delivery would result in the principal amount of the Notes Outstanding hereunder payable from a Letter of Credit, plus the amount of interest due on all such Outstanding Notes at the maturity thereof, being in excess of the Available Amount with respect to such Letter of Credit; or
(ii) would result in the delivery of the Notes bearing interest at an interest rate per annum to the maturity date of such Notes in excess of 12% per annum; or (iii) the maturity date for such Notes exceeds the limitation established in Section 2.02(b)(ii); or
(iv) the Issuing and Paying Agent shall have actual knowledge or shall have been given written notice that an Event of Default under this Issuing and Paying Agent Agreement (other than an Event of Default described in subsections (d) and (e) of Section 6.01) shall have occurred and is continuing, or shall have received written notice from a Bank or the Authority that an Event of Default described in subsections (d) and (e) of Section 6.01 has occurred and is continuing; or
(v) the Issuing and Paying Agent is in receipt of a Stop Order or Final Drawing Notice with respect to such Series of Notes; or (vi) the Issuing and Paying Agent shall have received notice that any Opinion of Bond Counsel delivered regarding the exclusion of interest on the Tax- Exempt Notes from the gross income of the Holders thereof for federal income tax purposes has been or is being withdrawn, which notice shall be concurrently delivered by such Bond Counsel to the Authority.
(b) Only such of the Notes as shall bear thereon a certificate of authentication substantially in the form set forth in Exhibit A hereto, or as set forth in the Supplement creating such Series, manually executed by the Issuing and Paying Agent, shall be valid or obligatory for any purpose or entitled to the benefits of this Issuing and Paying Agent Agreement, and such certificate of authentication when manually executed by the Issuing and Paying Agent shall be conclusive evidence that the Notes so authenticated have been duly executed, authenticated and delivered hereunder and are entitled to the benefits of this Issuing and Paying Agent Agreement.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
17 4123-2091-8123.4
(c) The Authority agrees to furnish, from time to time, the Issuing and Paying Agent with a certificate certifying the incumbency and specimen signatures of Authorized Representatives. Until the Issuing and Paying Agent receives a subsequent incumbency certificate of the Authority, the Issuing and Paying Agent is entitled to rely on the last such certificate delivered to it for purposes of determining the Authorized Representatives.
Section 2.06. Notes Mutilated, Lost, Destroyed or Stolen . If any Note shall become mutilated, the Authority, at the expense of the Holder of said Note, shall execute and deliver a new Note of like tenor and number in exchange and substitution for the Note so mutilated, but only upon surrender to the Authority of the Note so mutilated. If any Note shall be lost, destroyed or stolen, evidence of such loss, destruction or theft may be submitted to the Authority and, if such evidence be satisfactory to it and the Issuing and Paying Agent and indemnity satisfactory to the Issuing and Paying Agent shall be given to it, the Authority, at the expense of the Owner, shall execute and deliver a new Note of like tenor in lieu of and in substitution for the Note so lost, destroyed or stolen. Neither the Authority nor the Issuing and Paying Agent shall be required to treat both the original Note and any replacement Note as being Outstanding for the purpose of determining the principal amount of Notes which may be issued hereunder, but both the original and the replacement Note shall be treated as one and the same.
Section 2.07. Cancellation of Notes. The Issuing and Paying Agent agrees promptly to cancel the Note(s) presented for payment and return such Notes to the Authority. Promptly upon the Request of the Authority, the Issuing and Paying Agent agrees to cancel and return to the Authority all unissued Notes in the possession of the Issuing and Paying Agent at the time of such request.
Section 2.08. Master Note; Registration of Notes . (a) Each Series of Notes shall be initially delivered in the form of a Master Note registered in the name of the Depository or its Nominee, or any successor or assignee.
(b) The Issuing and Paying Agent shall maintain such books, records and accounts as may be necessary to evidence the obligations of the Authority resulting from each Master Note and each Advice delivered by the Issuing and Paying Agent, the principal amounts owing thereunder, the maturity schedule therefor, the respective rates of interest thereon and the principal and interest paid from time to time thereunder. In any legal action or proceeding in respect of any Master Note, the entries made in such books, records or accounts shall be, absent manifest error, conclusive evidence of the existence and the amounts of the obligations of the Authority therein recorded.
(c) The Issuing and Paying Agent may treat and consider the person in whose name each Note is registered as the absolute Owner of such Note for the purpose of payment of principal and interest on such Note, for the purpose of giving notices and other matters with respect to such Note, for the purpose of registering transfers of ownership of such Note, and for all other purposes whatsoever. The Issuing and Paying Agent shall pay the principal of and the interest on the Notes only to the respective Owners of the Notes or their respective attorneys duly authorized in writing, and all such payments shall be valid and effective to fully satisfy and discharge all obligations with respect to payment of principal of and interest on the Notes to the extent of the sum or sums so paid. No person other than the Owner of a Note shall receive a
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
18 4123-2091-8123.4
Note evidencing the obligation of the Authority to make payments of principal and interest pursuant to this Issuing and Paying Agent Agreement.
(d) Notwithstanding any other provision of this Issuing and Paying Agent Agreement to the contrary, so long as any Series of Notes are held by DTC in the form of a Master Note , the Issuing and Paying Agent shall deliver Notes of such Series in accordance with the terms of the Letter of Representations and DTC ’s applicable rules, regulations and procedures for book-entry commercial paper program . Notwithstanding the effectiveness of the Letter of Representations and a book-entry system with respect to the Notes, the Issuing and Paying Agent shall (i) furnish to the Bank s a copy of each notice or other communication provided or required to be provided to Owners pursuant to this Issuing and Paying Agent Agreement, and (ii) ensure that amounts drawn under each Letter of Credit are applied in accordance with the provisions of this Issuing and Paying Agent Agreement.
(e) In the event that either (i) the Depository determines not to continue to act as Depository for a Series of Notes, or (ii) the Authority determines to terminate the Depository as such, then the Authority shall thereupon discontinue the book-entry system with such Depository with respect to such Series of Notes. In such event, the Depository shall cooperate with the Authority and the Issuing and Paying Agent in the issuance of replacement Notes by providing the Issuing and Paying Agent with a list showing the interests of the Depository System Participants in such Series of Notes and by surrendering such Notes registered in the name of the Nominee to the Issuing and Paying Agent on or before the date such replacement Notes are to be issued. The Depository by accepting delivery of such Notes, agrees to be bound by the provisions of this subsection. If, prior to the termination of the Depository acting as such, the Authority fails to identify another qualified securities depository to replace the Depository, then the Notes shall no longer be required to be re-registered in the name of the Nominee, but shall be re-registered in whatever name or names the Owners of the Notes transferring or exchanging Notes shall designate, in accordance with the provisions of this Section. (f) In the event the Authority determines that it is in the best interests of the beneficial owners of a Series of Notes that they be able to obtain certificated Notes, the Authority may notify the Depository System Participants of the availability of such certificated Notes through the Depository. In such event the Issuing and Paying Agent will issue, transfer and exchange Notes, at the expense of the Authority, as required by the Depository and others in appropriate amounts, and whenever the Depository in taking appropriate action (i) to make available one or more separate certificates evidencing such Series of Notes to any Depository System Participant having such Notes credited to its account with the Depository, or (ii) to arrange for another qualified securities depository to maintain custody of a single certificate evidencing such Series of Notes, all at the Authority’s expense. (g) Any Note may, in accordance with its terms, be transferred, upon the register required to be kept pursuant to the provisions of this Section by the person in whose name it is registered, in person or by such person’s duly authorized attorney, upon surrender of such Note for cancellation, accompanied by delivery of a written instrument of transfer, duly executed in a form approved by the Issuing and Paying Agent.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
19 4123-2091-8123.4
(i) Whenever any Note or Notes shall be surrendered for transfer, the Authority shall execute and the Issuing and Paying Agent shall authenticate and deliver a new Note or Notes, of the same Series, tenor, maturity and interest rate and for a like aggregate principal amount. The Issuing and Paying Agent shall require the Owner of the Note requesting such transfer to pay any tax or other governmental charge required to be paid with respect to such transfer.
(ii) The Issuing and Paying Agent will keep or cause to be kept at its Corporate Trust Office sufficient books for the registration and transfer of Notes, which shall at all times be open to inspection during normal business hours by the Authority upon reasonable prior notice, and upon presentation for such purpose, the Issuing and Paying Agent shall, under reasonable regulations as it may prescribe, register or transfer or cause to be registered or transferred on such books the Notes, as herein provided.
ARTICLE III
ISSUE AND SALE OF NOTES
Section 3.01. Issuance and Sale of Notes . (a) Except as provided in subsection (b) of this Section, whenever an Authorized Representative determines that the Authority shall sell or issue Notes, such Authorized Representative shall deliver an Issuance Request to the Issuing and Paying Agent prescribing the terms of such Notes and the sale or issuance thereof in accordance with Section 2.02. Each Issuance Request and each issuance of Notes pursuant to this Section
3.01 shall certify or constitute a representation and warranty that:
(i) all action on the part of the Authority necessary for the valid issuance of the Notes then to be issued has been taken and has not been rescinded or revoked; (ii) such Notes in the hands of the Owners thereof will be valid and binding obligations of the Authority according to their terms.
(iii) no Event of Default under Section 6.01 has occurred and is continuing as of the date of issuance of such Notes;
(iv) the Authority has not received a copy of any Stop Order or Final Drawing Notice with respect to such Notes; and
(v) the Authority is in compliance with the covenants set forth in Article V, including, except in the case of any Taxable Notes, the tax covenants contained in Sections 5.05 and 5.06 and the applicable Tax Certificate, as of the date of issuance of such Notes.
(b) In the event that an Authorized Representative has not delivered an Issuance Request on the maturity date of any Outstanding Note , the Issuing and Paying Agent shall authenticate and deliver an additional Note or Notes either, (i) if the Authority has previously transferred moneys for deposit in the applicable interest account of the Note Repayment Fund in an amount sufficient to reimburse the applicable Bank for the interest portion of the draw on the Letter of Credit to pay interest on the maturing Notes , in an aggregate principal amount equal to the aggregate principal amount of Notes maturing on such date and issued to refund such Notes
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
20 4123-2091-8123.4
or (ii) if the Authority has not previously transferred moneys for deposit in the applicable accounts of the Note Repayment Fund in an amount sufficient to reimburse the applicable Bank in full for the draw on the Letter of Credit to pay the maturing Notes , in an aggregate principal amount equal to the aggregate principal amount of and interest due on Notes maturing on such date and issued to refund such Notes, rounding up to the nearest authorized denomination to cover such amount, such additional Note or Notes to be delivered to or upon the order of the Dealer (upon which the Issuing and Paying Agent shall be able to conclusively rely) against receipt of the purchase price thereof from time to time. No Issuance Request shall be required for Notes authenticated and delivered pursuant to this subsection (b). Notwithstanding the foregoing, if the Authority has provided notice to the Issuing and Paying Agent that it intends to pay any Outstanding Note in accordance with Section 9.01(a), the Issuing and Paying Agent shall not authenticate and deliver an additional Note or Notes in accordance with this subsection (b).
(c) So long as any Master Note is held by the Depository as provided in Section 2.08, the Issuing and Paying Agent shall deliver Notes thereunder in accordance with the terms of the Letter of Representations.
(d) Each Issuance Request will be given by an Authorized Representative in writing (which writing may be transmitted by electronic mail or other electronic means acceptable to the Issuing and Paying Agent and the Authority). The Issuing and Paying Agent shall incur no liability to the Authority in acting hereunder upon instructions contemplated hereby which the recipient thereof believed in good faith to have been given by an Authorized Representative. (e) Upon receipt of an Issuance Request, the Issuing and Paying Agent shall authenticate and deliver the Notes to the Dealer for the consideration and in the manner hereinafter provided, but only if the Issuing and Paying Agent shall have received such Issuance Request no later than 12:30 p.m. (New York City time) on the Business Day on which such Notes are to be delivered. If an Issuance Request is received after 12:30 p.m. (New York City time) on a given day, the Issuing and Paying Agent shall not be obligated to deliver the requested Notes until the next succeeding Business Day. In the case of book- entry Notes , the time provided above shall instead be 1:00 p.m. (New York City time). On the maturity date of an Outstanding Note or Notes as described in subsection (b) of this Section, or upon receipt of an Issuance Request as described in subsection ( d) of this Section , and except as provided in subsection (c) of this Section, the Issuing and Paying Agent agrees to withdraw the necessary Note(s) from safekeeping and agrees to:
(i) complete each Note as to principal amount (in denominations as prescribed by Section 2.02(a)), date of issue, maturity date, interest rate and amount of interest thereon (or, in the case of Taxable Notes issued at a price below the principal amount thereof, initial amount and value at maturity) and to register such Note as directed by the applicable Dealer, unless it has received express instructions as to registration from the applicable Dealer;
(ii) manually authenticate each Note by any officer or employee duly authorized and designated for such purpose;
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
21 4123-2091-8123.4
(iii) deliver the Note(s) to or upon the order of the applicable Dealer or its agent, which delivery shall be against receipt for payment as herein provided or as otherwise provided in an Issuance Request (if such Issuance Request does not provide for such receipt, the appliable Dealer shall nevertheless pay the purchase price for the Note(s) in accordance with subsection (f) of this Section); and (iv) retain one (1) of the nonnegotiable copies of each Note for its records and promptly forward one (1) nonnegotiable copy of each Note to the Authority and the applicable Bank.
(f) The Authority understands that although the Issuing and Paying Agent has been instructed and has agreed to deliver the Notes against payment, in accordance with the custom prevailing in the commercial paper market, delivery of the Notes will be made before receipt of payment in immediately available funds. Therefore, once the Issuing and Paying Agent has delivered a Note to the applicable Dealer or its agent, as provided in subsection ( e)(iii) of this Section, the Authority agrees to bear the risk that such Dealer or its agent shall fail to remit payment for the Note to the Issuing and Paying Agent. The Issuing and Paying Agent shall have no liability to the Authority for any failure or inability on the part of a Dealer to make payment for the Notes. It is understood that each delivery of Notes hereunder shall be subject to the rules of the New York Clearing House in effect at the time of such delivery and, in accordance therewith, Notes are to be delivered by 2:15 p.m. (New York City time). (g) Notwithstanding any other provision of this Issuing and Paying Agent Agreement to the contrary, no such Notes shall be delivered by the Issuing and Paying Agent if the delivery of such Notes would result in violation of any of the prohibitions respecting authentication of Notes set forth in Section 2.05. If the Issuing and Paying Agent is unable to comply with an Issuance Request or the provisions of subsection (b) of this Section, the Issuing and Paying Agent shall immediately notify the Authority and the Dealer of the circumstances prohibiting the issuance of the Notes.
(h) Notwithstanding any other provision hereof, if a Stop Order or Final Drawing Notice, as applicable, has been delivered and has not been withdrawn pursuant to a written withdrawal of such Stop Order or Final Drawing Notice, as applicable, by the applicable Bank or Banks, the Issuing and Paying Agent shall not issue or authenticate any Notes hereunder which are affected by such Stop Order or Final Drawing Notice, as applicable, except to effect transfers or exchanges of Outstanding Notes as provided in Sections 2.06, 2.07 and 2.08(g). In the event that issuance of Notes, whether pursuant to an Issuance Request or pursuant to subsection (b) of this Section, would violate a Stop Order or Final Drawing Notice, as applicable, the Issuing and Paying Agent shall provide the Authority with a copy of the Stop Order or Final Drawing Notice, as applicable, and shall notify the applicable Dealer and the Authority that it is not permitted to issue or authenticate any Notes hereunder while such Stop Order or Final Drawing Notice, as applicable, remains effective.
Section 3.02. Proceeds of the Sale of a Series of Notes . Except as is otherwise provided in the Supplement establishing the terms and provisions of a Series of Notes issued subsequent to the Series A Notes, upon receipt from a Dealer of the proceeds of issuance and sale of a Series of Notes, the Issuing and Paying Agent shall:
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
22 4123-2091-8123.4
(a) deposit such proceeds to the credit of the applicable principal subaccount in the applicable account of the Note Repayment Fund created hereunder or in a Supplement entered into in connection with the issuance of a Series of Notes, to the extent necessary for the reimbursement of Payment Obligations under the Letter of Credit delivered in connection with such Series of Notes or for the payment of the principal of and interest on Notes of the applicable Series then due and payable or becoming due and payable on the day of receipt of such proceeds; provided, however, that such proceeds shall be applied to the payment of the principal of and interest on Notes of the applicable Series then due and payable or becoming due and payable on the day of receipt of such proceeds only to the extent that amounts held on deposit in the applicable account of the Reimbursement Agreement Fund are insufficient to pay such principal or interest; and
(b) deposit in the applicable account or accounts in the Note Proceeds Fund established pursuant to Section 4.01, any remaining proceeds; provided that if proceeds are to be applied to refund any Refunded Obligations other than Notes, the Authority may elect to direct the Issuing and Paying Agent to transfer such proceeds directly to the trustee , escrow agent or other payee for the Refunded Obligations being refunded.
Section 3.03. Issuance of Additional Series of Notes . The Authority may by Supplement establish one or more additional Series of Notes, and the Authority may issue, and the Issuing and Paying Agent may authenticate and deliver to the Dealer (except as provided in Section 3.01( g)), Notes of any Series so established, in such principal amount as shall be determined by the Authority, but only, with respect to each such additional Series of Notes issued hereunder after the Series A Notes, upon compliance by the Authority with the provisions of Section s 3.03 and 3.04 and any additional requirements set forth in said Supplement and subject to the following specific conditions, which are hereby made conditions precedent to the issuance of any such additional Series of Notes:
(a) No Event of Default shall have occurred and then be continuing. (b) The aggregate principal amount of Notes authorized to be issued hereunder plus the aggregate amount of interest due on all Outstanding Notes at the maturity thereof shall not exceed any limitation imposed by law, by resolution or by any Supplement. (c) The Authority shall have obtained and placed on file with the Issuing and Paying Agent a Letter of Credit (or amendment to an existing Letter of Credit ) securing the payment of the principal of and interest on the additional Series of Notes. (d) The Authority shall certify that all of the requirements for the issuance of such additional Series of Notes contained herein have been met. (e) The Authority shall furnish to the Issuing and Paying Agent written evidence from each Rating Agency, in each case to the effect that such Rating Agency has reviewed the proposed Supplement and that the issuance of the additional Series of Notes will not, by itself, result in a reduction or withdrawal of its rating of the Notes which then prevails. (f) Nothing in this Section or in this Issuing and Paying Agent Agreement shall prevent or be construed to prevent the Supplement providing for the issuance of an additional
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
23 4123-2091-8123.4
Series of Notes from pledging or otherwise providing, in addition to the security given or intended to be given by this Issuing and Paying Agent Agreement, additional security for the benefit of such additional Series of Notes or any portion thereof.
Section 3.04. Proceedings for Issuance of Additional Series of Notes . (a) Whenever the Authority shall determine to issue an additional Series of Notes pursuant to Section 3.03 , the Authority shall authorize the execution of a Supplement specifying the aggregate principal amount, and prescribing the forms of Notes of such additional Series and providing the terms, conditions, distinctive designation, denominations, Letter of Credit to be provided with respect to such Notes and any other provisions respecting the Notes of such Series not inconsistent with the terms of this Issuing and Paying Agent Agreement.
(b) Before such additional Series of Notes shall be issued and delivered, the Authority shall file the following documents with the Bank s and the Issuing and Paying Agent (upon which documents the Issuing and Paying Agent may conclusively rely in determining whether the conditions precedent to the issuance of such Series of Notes have been satisfied):
(i) An executed copy of the Supplement authorizing such Series. (ii) An executed copy of the Dealer Agreement , the Reimbursement Agreement and Letter of Credit executed in connection with the issuance and delivery of such additional Series of Notes.
(iii) A Certificate of the Authority certifying that the requirements of Section
3.03 have been satisfied.
(iv) An Opinion of Bond Counsel to the effect that such Series of Notes, when duly executed by the Authority and authenticated and delivered by the Issuing and Paying Agent, will be valid and binding obligations of the Authority. (v) A Letter of Credit meeting the requirement of Section 3.03(c). (c) Notwithstanding anything herein to the contrary, the issuances of Notes and any draw on a Letter of Credit with respect to such Notes shall not be considered the issuance of an Additional Series of Notes within the provisions of this Article, and no limitation contained in this Article shall apply to the issuance of Notes or any such draw on a Letter of Credit with respect thereto.
ARTICLE IV
FUNDS AND ACCOUNTS; DRAWS UNDER LETTERS OF CREDIT
Section 4.01. Establishment and Application of Note Proceeds Fund. (a) The Issuing and Paying Agent shall establish, maintain and hold a separate fund designated as the “Note Proceeds Fund.” The Issuing and Paying Agent shall also establish, maintain and hold within the Note Proceeds Fund separate accounts designated as the “Series A-1 Note Proceeds Account” and the “Series A-2 Note Proceeds Account,” and an account for each Additional Series of Notes, designated the “Series ___ Note Proceeds Account,” completing the name with the appropriate Series designation, as appropriate, for such Notes.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
24 4123-2091-8123.4
(i) Amounts deposited in the Note Proceeds Fund by the Issuing and Paying Agent pursuant to Section 3.02 from the proceeds of the Series A-1 Notes shall be deposited in the Series A-1 Note Proceeds Account within the Note Proceeds Fund. (ii) Amounts deposited in the Note Proceeds Fund by the Issuing and Paying Agent pursuant to Section 3.02 from the proceeds of the Series A-2 Notes shall be deposited in the Series A-2 Note Proceeds Account within the Note Proceeds Fund. (iii) All investment earnings on funds held within each account in the Note Proceeds Fund shall be retained in each such account unless otherwise directed by the Authority.
(b) All money in each separate account in the Note Proceeds Fund shall be used and withdrawn by the Issuing and Paying Agent to pay the costs of Projects and/or Costs of Issuance upon receipt of a Request of the Authority filed with the Issuing and Paying Agent , each of which shall be sequentially numbered and shall state the person to whom payment is to be made (which may be the City), the amount to be paid, the purpose for which the obligation was incurred and that such payment is a proper charge against such account. (c) Any remaining balance in each separate account in the Note Proceeds Fund (after the completion of the payment of the costs of the applicable Projects for which such Note proceeds were deposited, as determined by the Authority in a Certificate of the Authority) shall be transferred by the Issuing and Paying Agent to the appropriate account in the Note Repayment Fund and the Issuing and Paying Agent shall apply such funds as soon as practicable to the payment of amounts owing to the applicable Bank with respect to the applicable Series of Notes; provided that proceeds of a given Series of Notes may also be applied to the payment of amounts owing to the applicable Bank with respect to other Series of Notes , as directed by the Authority, but only to the extent such application is permitted pursuant to the applicable provisions of Section 2.01.
Section 4.02. Establishment and Application of Note Repayment Fund and Related Accounts; Demand for Payment Under Letter of Credit . (a) Concurrently with the execution and delivery of this Issuing and Paying Agent Agreement, the Issuing and Paying Agent shall establish maintain and hold in trust for the benefit of the Banks and the Owners of the Notes a separate fund designated as the “Note Repayment Fund.” Within the Note Repayment Fund, the Issuing and Paying Agent shall establish and maintain the following accounts and subaccounts:
(i) an account designated as the “Series A-1 Note Repayment Account,” and within the Series A-1 Note Repayment Account shall establish and maintain the Series A- 1 Note Interest Subaccount and the Series A-1 Note Principal Subaccount, each in accordance with the provisions set forth herein;
(ii) an account designated as the “Series A-2 Note Repayment Account,” and within the Series A-2 Note Repayment Account shall establish and maintain the Series A- 2 Note Interest Subaccount and the Series A-2 Note Principal Subaccount, each in accordance with the provisions set forth herein;
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
25 4123-2091-8123.4
(b) By 2:00 p.m. New York City time on the date that any Notes are scheduled to mature, the Authority agrees that the Authority shall have provided, or caused to be provided, to the Issuing and Paying Agent, sufficient funds from which to pay the maturing Notes and the interest thereon, which shall be paid from the funds provided as set forth in this Section 4.02 and in Section 4.03, and if any such funds shall be provided directly by the Authority, the Authority further agrees that the Authority shall provide such funds by 1:00 p.m. New York City time to the Issuing and Paying Agent. When any matured Note of a Series is presented to the Issuing and Paying Agent for payment by the Holder thereof, payment shall be made from funds held pursuant to this Section 4.02 and Section 4.03.
(c) On each day on which the Issuing and Paying Agent receives funds from the Authority with respect to interest due or to become due on Notes of a Series, the Issuing and Paying Agent shall deposit all such amounts in the interest subaccount for the applicable Series of Notes.
(d) On each day on which the Issuing and Paying Agent receives funds from the Authority with respect to principal due or to become due on Notes of a Series, the Issuing and Paying Agent shall deposit all such amounts in the principal subaccount for the applicable Series of Notes.
(e) On each day on which the Dealer for a Series of Notes or its agent takes delivery of Notes of such Series, the applicable Dealer or its agent shall pay the purchase price for such Series of Notes in immediately available funds to the Issuing and Paying Agent who shall deposit amounts received from such Dealer with respect to the interest of such Series of Notes in the interest subaccount for the applicable Series of Notes and with respect to the principal of such Series of Notes in the principal subaccount for the applicable Series of Notes. (f) On any date on which Notes of a Series supported by a Letter of Credit are maturing, the Issuing and Paying Agent shall draw on the applicable Letter of Credit by the times and in accordance with the terms thereof, in amounts sufficient to pay the principal of, and interest on, such Series of Notes when due, from moneys drawn under the applicable Letter of Credit and deposited in the account within the Reimbursement Agreement Fund for the applicable Series of Notes as provided in Section 4.03 hereof. T o the extent that any drawings on the applicable Letter of Credit are insufficient, then the principal of, and interest on, such Series of Notes when due will be paid from the Installment Payments and other funds pledged hereunder. If a drawing on the applicable Letter of Credit is received by the Bank by the times and in accordance with the terms thereof on a Business Day, the Bank has agreed to honor such drawing no later than 2:00 p.m., New York City time, on the day such drawing is presented, by making a wire transfer to the Issuing and Paying Agent, in accordance with instructions set forth in such Letter of Credit , the amount so demanded in immediately available funds. To the extent that principal of and interest on maturing Notes of such Series are paid from amounts drawn under the applicable Letter of Credit, the Issuing and Paying Agent shall apply amounts on deposit in the interest subaccount of the Note Repayment Fund for the applicable Series to reimburse the applicable Bank for the interest portion of such draw and shall apply amounts on deposit in the principal subaccount of the Note Repayment Fund for the applicable Series to reimburse the applicable Bank for any remaining interest portion of such draw and the principal portion of such draw, each drawing to be reimbursed by 4:00 p.m. New York City time on the
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
26 4123-2091-8123.4
date of such drawing. In the event that amounts held by the Issuing and Paying Agent on deposit in the interest subaccount of the Note Repayment Fund for the applicable Series are insufficient to reimburse the applicable Bank for the interest portion of such draw or amounts held by the Issuing and Paying Agent on deposit in the principal subaccount of the Note Repayment Fund for the applicable Series are insufficient to reimburse the applicable Bank for any remaining interest portion of such draw and the principal portion of such draw, the Issuing and Paying Agent shall promptly notify the Authority of the additional amount required to reimburse the applicable Bank for the interest portion or principal portion of such draw, as applicable, which amounts shall constitute a Payment Obligation with respect to such Series of Notes, and the Authority shall transfer to the Issuing and Paying Agent the Installment Payments required to be paid by the City pursuant to the Installment Purchase Contract . To the extent that Payment Obligations with respect to such Series of Notes are outstanding, the Issuing and Paying Agent shall then apply remaining amounts on deposit in the interest subaccount of the Note Repayment Fund for the applicable Series to reimburse the applicable Bank for the interest portion of such Payment Obligations and shall apply amounts on deposit in the principal subaccount of the Note Repayment Fund for the applicable Series to reimburse the applicable Bank for any remaining interest portion and the principal portion of such Payment Obligations, each payment to be made by 4:00 p.m. New York City time on such date. In the event that the Issuing and Paying Agent issues any Notes while any Unreimbursed Drawing or Advance , or any portion of any Unreimbursed Drawing or Advance , remains unpaid, the Issuing and Paying Agent shall apply any remaining amounts on deposit in the applicable account of the Note Repayment Fund to the prepayment of such outstanding Unreimbursed Drawing or Advance, as the case may be. (g) The Authority shall transfer to the Issuing and Paying Agent for deposit in the applicable account of the Note Repayment Fund (as such amounts become payable) all Installment Payments required to be paid by the City pursuant to the Installment Purchase Contract.
(h) On any date on which Notes of a Series are issued, subsequent to the payment of principal of and interest on any maturing Notes, reimbursement of the applicable Bank for the drawings under the applicable Letter of Credit, and payment to the applicable Bank for any outstanding Payment Obligations, the Issuing and Paying Agent shall transfer amounts on deposit in the applicable principal subaccount, if any, to the applicable account of the Note Proceeds Fund established pursuant to Section 4.01.
(i) The Issuing and Paying Agent shall hold the funds in the applicable account of the Note Repayment Fund (i) for the payment of the related Series of Notes or (ii) for the reimbursement of the applicable Bank for the drawings under the applicable Letter of Credit and the payment of Payment Obligations in accordance with Section 4.02(f). The Issuing and Paying Agent shall set such funds aside exclusively for the purposes hereinabove described, and shall apply such amounts as hereinabove described. The Issuing and Paying Agent shall not have a lien on the Note Repayment Fund or any account therein for the payment of any fees or expenses or other obligations owing to the Issuing and Paying Agent hereunder.
Section 4.03. Draws Under Letters of Credit; Establishment of Reimbursement Agreement Fund; Enforcement of Provisions of Letters of Credit . (a) The Issuing and Paying Agent shall draw upon the Letters of Credit by the times and in accordance with the
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
27 4123-2091-8123.4
terms thereof (including, without limitation, in the event of a Final Drawing Notice or drawings to be made prior to the maturity date of the Notes in the applicable Letter of Credit, prior to the termination of such Letter of Credit), in amounts sufficient to pay the interest on and principal of the related Series of Notes when due at maturity from moneys drawn under such Letter of Credit.
To the extent that any drawings on the applicable Letter of Credit are insufficient, then the principal of, and interest on, such Series of Notes when due will be paid from the Installment Payments and other funds pledged hereunder.
(b) The Issuing and Paying Agent shall establish, maintain and hold in trust for the benefit of the Banks and the Owners of the Notes a separate fund designated as the “Reimbursement Agreement Fund.”
(c) Pending application as set forth in subsection (a) of this Section, moneys drawn under a Letter of Credit in order to pay principal and interest on a Series of Notes when due shall be deposited in an account within the Reimbursement Agreement Fund related to such Series of Notes, which the Issuing and Paying Agent shall establish and maintain, and will be designated as follows:
(i) “Series A-1 Reimbursement Agreement Account”;
(ii) “Series A-2 Reimbursement Agreement Account”; and
(iii) an account for each Additional Series of Notes, designated the “Series ___ Reimbursement Agreement Account.”
The Issuing and Paying Agent shall hold the funds in the applicable account solely for the purpose of paying the maturing Series of Notes for which the draw on the applicable Letter of Credit was made, shall set such funds aside exclusively for the payment of the principal of and interest on the Series of Notes for which the draw on the applicable Letter of Credit was made, and shall apply such amounts to the payment of such principal of and interest on such Series of Notes, upon presentation thereof for payment, in accordance with the terms of this Issuing and Paying Agent Agreement. The Issuing and Paying Agent shall not have a lien on the accounts within the Reimbursement Agreement Fund for the payment of any fees or expenses or other obligations owing to the Issuing and Paying Agent hereunder. Moneys in each account of the Reimbursement Agreement Fund shall be held in cash, uninvested. Any moneys drawn under the applicable Letter of Credit not needed to pay the interest on and principal of the applicable Series of Notes shall be promptly remitted by the Issuing and Paying Agent to the applicable Bank.
(d) In the event a Bank providing a Letter of Credit delivers a Final Drawing Notice to the Issuing and Paying Agent with respect to a Series of Notes, the Issuing and Paying Agent shall draw on such Letter of Credit in accordance with the terms of such Final Drawing Notice and not later than the Business Day preceding the termination date of such Letter of Credit referenced in such Final Drawing Notice in an amount equal to the principal of and interest to become due on the Series of Notes supported by such Letter of Credit and shall hold the funds received from such drawing for the payment of the principal of and interest on such Series of
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
28 4123-2091-8123.4
Notes in the applicable account within the Reimbursement Agreement Fund solely for the payment of such Series of Notes upon the maturity thereof. (e) The Authority hereby directs the Issuing and Paying Agent to diligently enforce all terms, covenants and conditions of the Letters of Credit, including payment when due of any draws on the Letters of Credit, and the provisions thereof relating to the payment of draws on, and the increase or reinstatement of the Available Amount under the Letters of Credit, and to refrain from consenting to or agreeing to or permitting any amendment or modification thereof which would materially adversely affect the rights or security of the Holders of the Series of Notes to which the Letters of Credit relate. If at any time during the term of the Letters of Credit any successor Issuing and Paying Agent shall be appointed and qualified under this Issuing and Paying Agent Agreement, the resigning or removed Issuing and Paying Agent shall request that each Bank transfer the Letter of Credit which such Bank is providing to the successor Issuing and Paying Agent. If the resigning or removed Issuing and Paying Agent fails to make such request, the successor Issuing and Paying Agent shall make such request before accepting appointment. When a Letter of Credit expires in accordance with its terms or is replaced by an Alternate Letter of Credit in accordance with terms set forth in Section 5.08, the Issuing and Paying Agent shall promptly surrender such Letter of Credit to the applicable Bank. (f) In making draws upon the Letters of Credit, the Issuing and Paying Agent shall be acting as the agent solely of, and for the exclusive benefit of, the Holders of the Notes for which the draw is being made, and shall not be acting as the agent of the Authority. The Authority shall not have any right, title, or interest in or to the Reimbursement Agreement Fund, the accounts or funds therein, or funds derived from a draw under the Letters of Credit. (g) From time to time, the Authority may request an increase or a decrease in the Available Amount under a Letter of Credit pursuant to the provisions of such Letter of Credit and the applicable Reimbursement Agreement entered into in connection with such Letter of Credit; provided, however, the Authority may not request that the Available Amount under such Letter of Credit be reduced to an amount less than the aggregate principal amount of the related Series of Notes outstanding and interest to accrue thereon to the maturity dates of such Notes as of the effective date of any permanent reduction. If such request is granted by the applicable Bank pursuant to the provisions of the applicable Reimbursement Agreement, then the applicable Bank will send written notice of an increase or decrease in the Available Amount under such Letter of Credit to the Issuing and Paying Agent. Upon receipt of any such notice, the Issuing and Paying Agent shall promptly notify each Rating Agency then rating the related Series of Notes of the new Available Amount under such Letter of Credit and the effective date of such change in the Available Amount.
(h) Any provisions herein requiring notice to or from a Bank or the consent of a Bank prior to any action by the Issuing and Paying Agent or the Authority shall have no force or effect (A) following the later of ( 1) the expiration or termination of such Bank ’s Letter of Credit and (2) upon such expiration or termination the repayment of all monetary obligations owing to such Bank under its Reimbursement Agreement or ( B) during any period in which such Bank is continuing to dishonor a properly presented and conforming draw certificate or certificates under its Letter of Credit.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
29 4123-2091-8123.4
Section 4.04. Moneys in Funds and Accounts . (a) All funds or accounts held by the Issuing and Paying Agent hereunder shall be accounted for separately as required by this Issuing and Paying Agent Agreement and the Issuing and Paying Agent shall segregate such funds and accounts if so instructed by the Authority to assist in the calculation of the Rebate Requirement. (b) The Issuing and Paying Agent shall keep proper books of record and accounts containing complete and correct entries of all transactions made by it relating to the receipt, disbursement, allocation and application of the moneys related to the Notes, including moneys derived from, pledged to, or to be used to make payments on the Notes. Such records shall specify the account or fund to which such moneys are to be allocated. (c) Any fund required by this Issuing and Paying Agreement to be established and maintained by the Issuing and Paying Agent may be established and maintained in the accounting records of the Issuing and Paying Agent, either as a fund or an account, and may, for the purposes of such records, any audits thereof and any reports or statements with respect thereto, be treated either as a fund or as an account; but all such records with respect to all such funds shall at all times be maintained in accordance with customary standards of the industry, to the extent practicable, and with due regard for the protection of the security of the Notes and the rights of every Holder thereof.
Section 4.05. Investment of Moneys in Funds . (a) Moneys held by the Issuing and Paying Agent hereunder in the Reimbursement Agreement Fund shall be held uninvested, in cash, and shall not be commingled with any other funds held hereunder. M oneys held by the Issuing and Paying Agent in the Note Repayment Fund hereunder shall, at the Request of the Authority, be invested in Permitted Investments, maturing not later than the date on which such moneys are required for payment by the Issuing and Paying Agent. Investment earnings on amounts in the Note Repayment Fund shall be deposited therein. Moneys held by the Issuing and Paying Agent in the Note Proceeds Fund hereunder shall, at the Request of the Authority, be invested in Permitted Investments which mature or which may be drawn upon not later than such times as shall be necessary to provide moneys when reasonably expected to be needed for payments to be made from such fund.
(b) The Issuing and Paying Agent may sell or present for redemption any obligations so purchased by it whenever it shall be necessary in order to provide moneys to meet any payment, and the Issuing and Paying Agent shall not be liable or responsible for any loss resulting from such investment.
ARTICLE V
COVENANTS OF THE AUTHORITY
Section 5.01. Punctual Payment and Performance. The Authority shall punctually pay or cause to be paid the principal of and interest on all the Notes and Payment Obligations from the Installment Payments and other amounts pledged in accordance with this Issuing and Paying Agent Agreement in strict conformity with the terms of the Notes, the Reimbursement Agreements, the Bank Notes and this Issuing and Paying Agent Agreement.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
30 4123-2091-8123.4
Section 5.02. Extension of Payment of Notes . The Authority will not directly or indirectly extend or assent to the extension of the maturity of any of the Notes or the time of payment of any Notes or claims for interest by the purchase or funding of such Notes or claims for interest by any other arrangement and in case the maturity of any of the Notes or the time of payment of any such claims for interest shall be extended, such Notes or claims for interest shall not be entitled, in case of any default hereunder, to the benefits of this Issuing and Paying Agent Agreement, except subject to the prior payment in full of the principal of all of the Notes then Outstanding and of all claims for interest thereon which shall not have been so extended.
Nothing in this Section shall be deemed to limit the right of the Authority to issue debt for the purpose of refunding any Outstanding Notes, and such issuance shall not be deemed to constitute an extension of the maturity of Notes.
Section 5.03. Waiver of Laws. The Authority will not at any time insist upon or plead in any manner whatsoever, or claim or take the benefit or advantage of, any stay or extension law now or at any time hereafter in force that may affect the covenants and agreements contained in this Issuing and Paying Agent Agreement or in the Notes, and all benefit or advantage of any such law or laws is hereby expressly waived by the Authority to the extent permitted by law.
Section 5.04. Further Assurances. The Authority will make, execute and deliver any and all such instruments and assurances as may be reasonably necessary or proper to carry out the intention or to facilitate the performance of this Issuing and Paying Agent Agreement and for the better assuring and confirming unto the Owners of the Notes of the rights and benefits provided in this Issuing and Paying Agent Agreement.
Section 5.05. Rebate Fund . (a) The Issuing and Paying Agent shall establish and maintain a fund separate from any other fund established and maintained hereunder designated as the Rebate Fund. Within the Rebate Fund, the Issuing and Paying Agent shall maintain such accounts as shall be necessary in order to comply with the terms and requirements of each Tax Certificate. Subject to the transfer provisions provided in subsection (c) of this Section, all money at any time deposited in the Rebate Fund shall be held by the Issuing and Paying Agent for the account of the Authority in trust, to the extent required to satisfy the Rebate Requirement (as defined in the applicable Tax Certificate), for payment to the federal government of the United States of America, and neither the Issuing and Paying Agent nor the Owner of any Notes nor any Bank shall have any rights in or claim to such money. All amounts deposited into or on deposit in the Rebate Fund shall be governed by this Issuing and Paying Agent Agreement and by the applicable Tax Certificate (each of which is incorporated herein by reference). The Authority hereby covenants to comply with the directions contained in each Tax Certificate and the Issuing and Paying Agent hereby covenants to comply with all Requests of the Authority delivered to the Issuing and Paying Agent pursuant to each Tax Certificate (which instructions shall state the actual amounts to be deposited in or withdrawn from the Rebate Fund and shall not require the Issuing and Paying Agent to make any calculations with respect thereto). The Issuing and Paying Agent shall be deemed conclusively to have complied with the provisions of this Section 5.05(a) if it follows such instructions of the Authority, and the Issuing and Paying Agent shall have no liability or responsibility to enforce compliance by the Authority with the terms of any Tax Certificate nor to make computations in connection therewith.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
31 4123-2091-8123.4
(b) The Issuing and Paying Agent shall hold all amounts in the Rebate Fund uninvested, subject to the restrictions set forth in each Tax Certificate. (c) Upon receipt of the R equest of the Authority, the Issuing and Paying Agent shall remit part or all of the balances in the Rebate Fund to the federal government of the United States of America, as directed. In addition, if such instructions so direct, the Issuing and Paying Agent will deposit moneys into or transfer moneys out of the Rebate Fund from or into such accounts or funds as directed. Any funds remaining in the Rebate Fund after payment of all of the Notes and payment and satisfaction of any Rebate Requirement, shall be withdrawn and remitted to the Authority in accordance with the Request of the Authority. (d) Notwithstanding any other provision of this Issuing and Paying Agent Agreement, including in particular Article IX, the obligation to remit the Rebate Requirement to the federal government of the United States of America and to comply with all other requirements of this Section and the Tax Certificate shall survive the defeasance or payment in full of the Notes. (e) The Authority shall retain all records with respect to the calculations and instructions required by this Section for the period of time specified in each Tax Certificate.
Section 5.06. Tax Covenants. The Authority covenants that it will not take any action, or fail to take any action, if any such action or failure to take action would adversely affect the exclusion from gross income of the interest on the Tax- Exempt Notes under Section 103 of the Code; provided that, prior to the issuance of any Series of Notes, the Authority may exclude the application of the covenants contained in this Section and Section 5.05 to such Series of Notes, and provided further that the Authority hereby excludes the Taxable Notes from such application. Without limiting the generality of the foregoing, the Authority shall comply with all requirements and covenants contained in each Tax Certificate. In the event that at any time the Authority is of the opinion that for purposes of this Section it is necessary to restrict or limit the yield on the investment of any moneys held by the Issuing and Paying Agent under this Issuing and Paying Agent Agreement, the Authority shall so instruct the Issuing and Paying Agent in writing, and the Issuing and Paying Agent shall take such action as may be necessary in accordance with such instructions.
Notwithstanding any provision of this Section and Section 5.05, if the Authority shall receive an Opinion of Bond Counsel to the effect that any action required under any Tax Certificate or this Section and Section 5.05 is no longer required, or to the effect that some further action is required, to maintain the exclusion from gross income of the interest on the Notes pursuant to Section 103 of the Code, the Authority and the Issuing and Paying Agent may rely conclusively on such opinion in complying with the provisions hereof, and the covenants hereunder shall be deemed to be modified to that extent.
Section 5.07. Maintenance of Issuing and Paying Agent . The Authority will at all times maintain an Issuing and Paying Agent for the Notes, in accordance with the provisions of Article VII.
Section 5.08. Letters of Credit; Alternate Letter of Credit . Subject to Section
2.02(f), t he Authority will at all times maintain in effect a Letter or Letters of Credit in an
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
32 4123-2091-8123.4
aggregate Available Amount equal to at least the sum of the principal amount of all Series of Notes Outstanding hereunder plus interest due at maturity thereof. Notwithstanding anything contained herein to the contrary, the Authority may obtain an Alternate Letter of Credit to replace one or more of the Letters of Credit then in effect, provided that (i) the Letter or Letters of Credit being replaced (in this Section, the “Existing Letter of Credit”) remains in effect and is drawn upon to pay the principal and interest on all Outstanding Notes payable from draws under such Existing Letter of Credit and (ii) the Alternate Letter of Credit is in effect at the time the Existing Letter of Credit is terminated or expires. Any assignment of a Letter of Credit by one Bank to another Bank (excluding assignments between agencies or branches of the same Bank) shall be deemed to be a substitution of the Letter of Credit for the purposes of this Section. The Authority and the Issuing and Paying Agent agree that the Issuing and Paying Agent will not release an Existing Letter of Credit or accept an Alternate Letter of Credit unless:
(a) the Authority gives at least 20 calendar days’ prior written notice of the effective date of the proposed substitution to the Issuing and Paying Agent, each Dealer for the Series of Notes supported by such Existing Letter of Credit, and each Bank whose Existing Letter of Credit is to be replaced;
(b) the Issuing and Paying Agent gives at least 15 calendar days’ prior written notice of the proposed substitution to the Owners of the Outstanding Notes payable from such Existing Letter of Credit, which notice shall indicate the date of the proposed substitution, the Bank or Banks that are expected to provide the Alternate Letter of Credit and the ratings that are expected to apply to the Notes after the provision of the Alternate Letter of Credit; (c) the Alternate Letter of Credit is delivered to the Issuing and Paying Agent and becomes effective pursuant to its terms on the maturity date of all Outstanding Notes payable from the Existing Letter of Credit;
(d) the Issuing and Paying Agent shall make a draw on the Existing Letter of Credit on the substitution date, which must be the maturity date for all of the Outstanding Notes payable from the Existing Letter of Credit, in an amount sufficient to pay the entire amount of principal and interest becoming due on such substitution date on all of the Notes payable from such Existing Letter of Credit; and
(e) the Issuing and Paying Agent shall not surrender the Existing Letter of Credit unless and until the Issuing and Paying Agent receives all of the funds drawn as required by clause (d) of this Section.
Section 5.09. Appointment of Dealer. The Authority covenants and agrees to take all reasonable steps necessary to ensure that, at all times, there shall be a Dealer for the Notes, and to that end shall from time to time enter into a Dealer Agreement with one or more Dealers, providing for the services specified in such Dealer Agreement to be performed by such Dealers, in connection with the offering, sale and issuance of Notes.
Section 5.10. Provision of Report to Bank . The Issuing and Paying Agent shall furnish to each Bank such information regarding the trades, maturities, principal amounts and
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
33 4123-2091-8123.4
interest rates for the Notes, and covering such time periods, as may be reasonably requested by the Bank or the Authority from time to time.
ARTICLE VI
EVENTS OF DEFAULT AND REMEDIES OF NOTEHOLDERS
Section 6.01. Events of Default. The following shall be Events of Default hereunder:
(a) default in the due and punctual payment of the principal of any Note when and as the same shall become due and payable, whether at maturity as therein expressed or otherwise; (b) default in the due and punctual payment of any installment of interest on any Note when and as such interest installment shall become due and payable; (c) the Authority shall fail to observe or perform any covenant, condition, agreement or provision in this Issuing and Paying Agent Agreement on its part to be observed or performed, other than as referred to in subsection (a) or (b) of this Section, for a period of 120 days after written notice, specifying such failure and requesting that it be remedied, has been given to the Authority by the Issuing and Paying Agent; except that, if such failure can be remedied but not within such 120 day period and if the Authority has taken action to reasonably remedy such failure within such 120 day period, such failure shall not become an Event of Default for so long as the Authority shall diligently proceed to remedy the same in accordance with and subject to any directions or limitations of time established by the Issuing and Paying Agent; (d) an Event of Default (as defined in any Reimbursement Agreement) has occurred and is continuing under any Reimbursement Agreement; and (e) an Event of Default (as defined in the Installment Purchase Contract) has occurred and is continuing under the Installment Purchase Contract.
Section 6.02. Right to Accelerate Upon Default . (a) Notwithstanding anything contrary in this Issuing and Paying Agent Agreement, t he Notes are not subject to acceleration upon the occurrence of an Event of Default.
(b) Notwithstanding anything contrary in this Issuing and Paying Agent Agreement, unless the principal of all the Outstanding Payment Obligations shall have already become due and payable, upon the occurrence of an Event of Default, the Issuing and Paying Agent may, with the consent of the related Bank, and shall, at the direction of the related Bank, by written notice to the Authority, declare the principal of the Outstanding Payment Obligations related to such Bank to be immediately due and payable, whereupon the principal of such Payment Obligations thereby coming due and the interest thereon accrued to the date of payment shall, without further action, become and be immediately due and payable.
This Section, however, is subject to the condition that if, at any time after the principal of the applicable Payment Obligations shall have been so declared due and payable, and before any judgment or decree for the payment of the moneys due shall have been obtained or entered as hereinafter provided, there shall have been deposited with the Issuing and Paying Agent a sum sufficient to pay the principal of the applicable Payment Obligations matured and coming due
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
34 4123-2091-8123.4
prior to such declaration, with interest on such overdue principal at the rate determined in accordance with the applicable Reimbursement Agreement, the accrued interest on such Payment Obligations due prior to such declaration and the commercially reasonable fees and expenses of the Issuing and Paying Agent (including but not limited to those of its attorneys), and any and all other defaults known to the Issuing and Paying Agent (other than in the payment of the principal of and accrued interest on such Payment Obligations due and payable solely by reason of such declaration) shall have been made good or cured to the satisfaction of the Issuing and Paying Agent or provision deemed by the Issuing and Paying Agent to be adequate shall have been made therefor, then, and in every such case, the applicable Bank, by written notice to the Authority and to the Issuing and Paying Agent, may rescind and annul such declaration and its consequences and waive such default; but no such rescission and annulment shall extend to or shall affect any subsequent default, or shall impair or exhaust any right or power consequent thereon.
Section 6.03. [Reserved].
Section 6.04. Issuing and Paying Agent to Represent Noteholders . Upon the occurrence and continuance of an Event of Default, the Issuing and Paying Agent in its discretion may, and upon the written request of the related Bank , and upon being indemnified to its commercially reasonable satisfaction therefor, shall, at the direction of the related Bank, proceed to protect or enforce the security interest in, pledge of and lien on the Installment Payments granted pursuant to this Issuing and Paying Agent Agreement, its rights or the rights of such Owners by such appropriate action, suit, mandamus or other proceedings, as it shall deem most effectual to protect and enforce any such right, at law or in equity, either for damages, the specific performance of any covenant or agreement contained herein, or in aid of the execution of any power herein granted, or for the enforcement of any other appropriate legal or equitable right or remedy vested in the Issuing and Paying Agent or in such Owners under this Issuing and Paying Agent Agreement or the Installment Purchase Contract , and upon instituting such proceeding, the Issuing and Paying Agent shall be entitled, as a matter of right, to the appointment of a receiver of the amounts to be transferred by the Authority to the Issuing and Paying Agent in accordance with Section 6.11 of this Issuing and Paying Agent Agreement pending such proceedings. All rights of action under this Issuing and Paying Agent Agreement or the Notes or otherwise may be prosecuted and enforced by the Issuing and Paying Agent without the possession of any of the Notes, the Bank Notes or the production thereof in any proceeding relating thereto, and any such suit, action or proceeding instituted by the Issuing and Paying Agent shall be brought in the name of the Issuing and Paying Agent for the benefit and protection of all the Owners of such Notes, subject to the provisions of this Issuing and Paying Agent Agreement (including Section 6.06).
Section 6.05. Noteholders’ Direction of Proceedings . Anything in this Issuing and Paying Agent Agreement to the contrary notwithstanding, the Owners of a majority in aggregate principal amount of the Notes then Outstanding (with the prior written consent of the Banks), or each Bank with respect to the related Notes and Payment Obligations, shall have the right, by an instrument or concurrent instruments in writing executed and delivered to the Issuing and Paying Agent and upon furnishing the Issuing and Paying Agent with indemnification commercially reasonably satisfactory to it, to direct the method of conducting all remedial proceedings taken by the Issuing and Paying Agent hereunder with respect to the related Notes and Payment
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
35 4123-2091-8123.4
Obligations, as applicable, provided that such direction shall not be otherwise than in accordance with law and the provisions of this Issuing and Paying Agent Agreement, that the Issuing and Paying Agent may take any other action deemed proper by the Issuing and Paying Agent which is not inconsistent with such direction. In the event of any conflict between the direction of the Banks and that of the Owners, the Issuing and Paying Agent shall follow the direction of the Bank with respect to the related Notes and Payment Obligations that has not failed to honor a properly presented and conforming draw certificate under their respective Letters of Credit.
Section 6.06. Limitation on Noteholders’ Right to Sue . N o Owner of any Note shall have the right to institute any suit, action or proceeding at law or in equity, for the protection or enforcement of any right or remedy under this Issuing and Paying Agent Agreement, or any applicable law with respect to such Note, unless (1) such Owner shall have given to the Issuing and Paying Agent written notice of the occurrence of an Event of Default; (2) the Owners of not less than a majority in aggregate principal amount of the Notes then Outstanding shall have made written request upon the Issuing and Paying Agent to exercise the powers hereinbefore granted; (3) such Owner or said Owners shall have tendered to the Issuing and Paying Agent reasonable indemnity against the costs, expenses and liabilities to be incurred in compliance with such request; (4) the Issuing and Paying Agent shall have refused or omitted to comply with such request for a period of sixty (60) days after such written request shall have been received by, and said tender of indemnity shall have been made to, the Issuing and Paying Agent; and (5) the Issuing and Paying Agent shall not have received contrary directions from the Owners of a majority in aggregate principal amount of the Notes then Outstanding.
Such notification, request, tender of indemnity and refusal or omission are hereby declared, in every case, to be conditions precedent to the exercise by any Owner of Notes of any remedy hereunder or under law; it being understood and intended that no one or more Owners of Notes shall have any right in any manner whatever by his or their action to affect, disturb or prejudice the security of this Issuing and Paying Agent Agreement or the rights of any other Owners of Notes, or to enforce any right under this Issuing and Paying Agent Agreement, or under applicable law with respect to the Notes, except in the manner herein provided, and that all proceedings at law or in equity to enforce any such right shall be instituted, had and maintained in the manner herein provided and for the benefit and protection of all Owners of the Outstanding Notes, subject to the provisions of this Issuing and Paying Agent Agreement.
For avoidance of doubt, this Section does not apply to any remedies pursued by a Bank relating to Payment Obligations, including a Bank Note, under the related Reimbursement Agreement.
Section 6.07. Absolute Obligation of the Authority. Nothing in Section 6.06 or in any other provision of this Issuing and Paying Agent Agreement, or in the Notes, contained shall affect or impair the obligation of the Authority, which is absolute and unconditional, to pay the principal of and interest on the Notes to the respective Owners of the Notes at their respective dates of maturity and to pay the other Payment Obligations, but only out of the Installment Payments and other amounts pledged in accordance with this Issuing and Paying Agent Agreement, or affect or impair the right of such Owners or any Bank, which is also absolute and unconditional, to enforce such payment by virtue of the contract embodied in the Notes and herein.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
36 4123-2091-8123.4
Section 6.08. Termination of Proceedings . In case any proceedings taken by the Issuing and Paying Agent or any one or more Noteholders on account of any Event of Default shall have been discontinued or abandoned for any reason or shall have been determined adversely to the Issuing and Paying Agent or the Noteholders, then in every such case the Authority, the Issuing and Paying Agent and the Noteholders, subject to any determination in such proceedings, shall be restored to their former positions and rights hereunder, severally and respectively, and all rights, remedies, powers and duties of the Authority, the Issuing and Paying Agent and the Noteholders shall continue as though no such proceedings had been taken.
Section 6.09. Remedies Not Exclusive. No remedy herein conferred upon or reserved to the Issuing and Paying Agent or to the Owners of the Notes is intended to be exclusive of any other remedy or remedies, and each and every such remedy, to the extent permitted by law, shall be cumulative and in addition to any other remedy given hereunder or now or hereafter existing at law or in equity or otherwise.
Section 6.10. No Waiver of Default . No delay or omission of the Issuing and Paying Agent or of any Owner of the Notes to exercise any right or power arising upon the occurrence of any default shall impair any such right or power or shall be construed to be a waiver of any such default or an acquiescence therein; and every power and remedy given by this Issuing and Paying Agent Agreement to the Issuing and Paying Agent or to the Owners of the Notes may be exercised from as often as may be deemed expedient.
Section 6.11. Appointment of a Receiver. If an Event of Default shall happen and shall not have been remedied, and upon the filing of a suit or other commencement of judicial proceedings to enforce the rights of the Issuing and Paying Agent and of the Banks under this Issuing and Paying Agent Agreement, the Issuing and Paying Agent shall , upon being indemnified to its commercially reasonable satisfaction therefor, be entitled to make application for the appointment of a receiver or custodian of the Installment Payments and other amounts pledged in accordance with this Issuing and Paying Agent Agreement pending such proceedings, with such power as the court making such appointment shall confer. If an Event of Default shall happen and shall not have been remedied, upon the written request of the Issuing and Paying Agent or a Bank, the Authority shall transfer to the Issuing and Paying Agent all Installment Payments held by the Authority, if any.
ARTICLE VII
THE ISSUING AND PAYING AGENT
Section 7.01. Appointment: Duties, Immunities and Liabilities of Issuing and Paying Agent. (a) U.S. Bank Trust Company, National Association is appointed as Issuing and Paying Agent under this Issuing and Paying Agent Agreement and hereby accepts the duties imposed upon it as Issuing and Paying Agent hereunder and to perform all the functions and duties of the Issuing and Paying Agent hereunder, subject to the terms and conditions set forth in this Issuing and Paying Agent Agreement. The Issuing and Paying Agent shall, prior to an Event of Default, and after the curing of all Events of Default which may have occurred, perform such duties and only such duties as are specifically set forth in this Issuing and Paying Agent Agreement and no implied covenants shall be read into this Issuing and Paying Agent Agreement against the Issuing and Paying Agent.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
37 4123-2091-8123.4
(b) The Authority may remove the Issuing and Paying Agent at any time unless an Event of Default shall have occurred and then be continuing, and shall remove the Issuing and Paying Agent if at any time requested to do so by an instrument or concurrent instruments in writing signed by the Owners of not less than a majority in aggregate amount of principal of the Notes then Outstanding (or their attorneys duly authorized in writing) or if at any time the Issuing and Paying Agent shall cease to be eligible in accordance with subsection (e) of this Section, or shall become incapable of acting, or shall be adjudged a bankrupt or insolvent, or a receiver of the Issuing and Paying Agent or its property shall be appointed, or any public officer shall take control or charge of the Issuing and Paying Agent or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, in each case by giving written notice of such removal to the Issuing and Paying Agent, and thereupon shall appoint a successor Issuing and Paying Agent by an instrument in writing.
(c) The Issuing and Paying Agent may at any time resign by giving written notice of such resignation to the Authority, the Bank s and the Dealer s. Upon receiving such notice of resignation, the Authority shall promptly appoint a successor Issuing and Paying Agent by an instrument in writing. Prior to any voluntary resignation or any sale, assignment, merger, consolidation or reorganization by the Issuing and Paying Agent, the Issuing and Paying Agent shall pay to the Authority any and all amounts which will be payable by the Authority to the Banks due to any resulting transfer of a Letter of Credit. (d) Any removal or resignation of the Issuing and Paying Agent and appointment of a successor Issuing and Paying Agent shall become effective upon acceptance of appointment by the successor Issuing and Paying Agent. If no successor Issuing and Paying Agent shall have been appointed and have accepted appointment within sixty (60) days of giving notice of removal or notice of resignation as aforesaid, the resigning Issuing and Paying Agent or any Noteholder (on behalf of himself and all other Noteholders) may petition any court of competent jurisdiction for the appointment of a successor Issuing and Paying Agent, and such court may thereupon, after such notice (if any) as it may deem proper, appoint such successor Issuing and Paying Agent. Any successor Issuing and Paying Agent appointed under this Issuing and Paying Agent Agreement, shall signify its acceptance of such appointment by executing and delivering to the Authority and to its predecessor Issuing and Paying Agent a written acceptance thereof, and thereu pon such successor Issuing and Paying Agent, without any further act, deed or conveyance, shall become vested with all the moneys, estates, properties, rights, powers, trusts, duties and obligations of such predecessor Issuing and Paying Agent, with like effect as if originally named Issuing and Paying Agent herein; but, nevertheless at the R equest of the Authority or the written request of the successor Issuing and Paying Agent, such predecessor Issuing and Paying Agent shall execute and deliver any and all instruments of conveyance or further assurance and do such other things as may reasonably be required for more fully and certainly vesting in and confirming to such successor Issuing and Paying Agent all the right, title and interest of such predecessor Issuing and Paying Agent in and to any property held by it under this Issuing and Paying Agreement and shall pay over, transfer, assign and deliver to the successor Issuing and Paying Agent any money or other property subject to the trusts and conditions herein set forth. Upon request of the successor Issuing and Paying Agent, the Authority shall execute and deliver any and all instruments as may be reasonably required for more fully and certainly vesting in and confirming to such successor Issuing and Paying Agent all such moneys, estates, properties, rights, powers, trusts, duties and obligations. Upon
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
38 4123-2091-8123.4
acceptance of appointment by a successor Issuing and Paying Agent as provided in this subsection, the Authority shall give notice of the succession of such Issuing and Paying Agent to the trusts hereunder by mail to the Banks and the Dealer. (e) Any Issuing and Paying Agent appointed under the provisions of this Section in succession to the Issuing and Paying Agent shall be a national association, trust company or bank having the powers of a trust company having a combined capital and surplus of at least one hundred million dollars ($100,000,000), subject to supervision or examination by federal or state authority. If such national association, trust company or bank publishes a report of condition at least annually, pursuant to law or to the requirements of any supervising or examining authority above referred to, then for the purpose of this subsection the combined capital and surplus of such national association, trust company or bank shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. In case at any time the Issuing and Paying Agent shall cease to be eligible in accordance with the provisions of this subsection, the Issuing and Paying Agent shall resign immediately in the manner and with the effect specified in this Section.
(f) If, by reason of the judgment of any court, the Issuing and Paying Agent or any successor Issuing and Paying Agent is rendered unable to perform its duties hereunder, and if no successor Issuing and Paying Agent be then appointed, all such duties and all of the rights and powers of the Issuing and Paying Agent hereunder shall be assumed by and vest in the Treasurer of the Authority in trust for the benefit of the Noteowners.
Section 7.02. Merger or Consolidation . Any company into which the Issuing and Paying Agent may be merged or converted or with which it may be consolidated or any company resulting from any merger, conversion or consolidation to which it shall be a party or any company to which the Issuing and Paying Agent may sell or transfer all or substantially all of its corporate trust business, provided such company shall be eligible under subsection (e) of Section 7.01, shall be the successor to such Issuing and Paying Agent without the execution or filing of any paper or any further act, anything herein to the contrary notwithstanding.
Section 7.03. Liability of Issuing and Paying Agent . (a) The recitals of facts herein and in the Notes contained shall be taken as statements of the Authority, and the Issuing and Paying Agent assumes no responsibility for the correctness of the same, and makes no representations as to the validity or sufficiency of this Issuing and Paying Agreement or of the Notes, or as to the financial or technical feasibility of any portion of any Project and shall not incur any responsibility in respect of any such matter, other than in connection with the duties or obligations expressly herein or in the Notes assigned to or imposed upon it. The Issuing and Paying Agent shall not be liable in connection with the performance of its duties hereunder, except for its own negligence or willful misconduct. The Issuing and Paying Agent and its directors, officers, employees or agents may in good faith buy, sell, own, hold and deal in any of the Notes and may join in any action which any Owner of a Note may be entitled to take, with like effect as if the Issuing and Paying Agent was not the Issuing and Paying Agent under this Issuing and Paying Agreement. The Issuing and Paying Agent may in good faith hold any other form of indebtedness of the Authority, own, accept or negotiate any drafts, bills of exchange, acceptances or obligations of the Authority and make disbursements for the Authority and enter into any commercial or business arrangement therewith, without limitation.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
39 4123-2091-8123.4
(b) The Issuing and Paying Agent shall not be liable for any error of judgment made in good faith by a responsible officer unless it shall be proved that the Issuing and Paying Agent was negligent in ascertaining the pertinent facts. The Issuing and Paying Agent may execute any of the trusts or powers hereof and perform the duties required of it hereunder by or through attorneys, agents, or receivers, and shall be entitled to advice of counsel concerning all matters of trust and its duty hereunder, but the Issuing and Paying Agent shall not be liable for the negligence or misconduct of any such attorney, agent, or receiver selected by it with due care by it under this Issuing and Paying Agent Agreement if the Authority has a right to proceed directly against such attorney, agent, or receiver for any such negligence or misconduct for recovery. (c) The Issuing and Paying Agent shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Owners of not less than a majority in aggregate principal amount of the Notes at the time Outstanding, and with the consent of the Bank related to such Notes , relating to the time, method and place of conducting any proceeding for any remedy available to the Issuing and Paying Agent, or exercising any trust or power conferred upon the Issuing and Paying Agent under this Issuing and Paying Agreement.
(d) Except for the obligation of the Issuing and Paying Agent to draw on the Letters of Credit in amounts sufficient to pay the interest on and principal of the Notes when due pursuant to Section 4.03, the Issuing and Paying Agent shall be under no obligation to exercise any of the rights or powers vested in it by this Issuing and Paying Agreement at the request, order or direction of any of the Noteholders pursuant to the provisions of this Issuing and Paying Agreement, including, without limitation, the provisions of Article VI, unless such Noteholders shall have offered to the Issuing and Paying Agent security or indemnity satisfactory to it against the costs, expenses and liabilities which may be incurred therein or thereby. (e) No provision of this Issuing and Paying Agreement shall require the Issuing and Paying Agent to expend or risk its own funds or otherwise incur any financial liability in the performance or exercise of any of its duties hereunder, or in the exercise of its rights or powers, if repayment of such funds or adequate indemnity against such risk or liability is not assured to its satisfaction.
(f) The Issuing and Paying Agent shall not be deemed to have knowledge of and shall not be required to take any action with respect to, any Event of Default (other than an Event of Default described in subsections (a) or (b) of Section 6.01) or event which would, with the giving of notice, the passage of time or both, constitute an Event of Default, unless the Issuing and Paying Agent shall have actual knowledge of such event or shall have been notified of such event by the Authority, a Bank, or the Owners of a majority of the aggregate principal amount of the Notes Outstanding. Without limiting the generality of the foregoing, the Issuing and Paying Agent shall not be required to ascertain, monitor or inquire as to the performance or observance by the Authority of the terms, conditions, covenants or agreements set forth in Article V (including, without limitation, the covenants of the Authority set forth in Sections 5.05 and 5.06), other than the covenants of the Authority to make payments with respect to the Notes when due as set forth in Section 5.01 and to file with the Issuing and Paying Agent when due, such reports and certifications as the Authority is required to file with the Issuing and Paying Agent hereunder, or set forth in the Reimbursement Agreements.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
40 4123-2091-8123.4
(g) No permissive power, right or remedy conferred upon the Issuing and Paying Agent hereunder shall be construed to impose a duty to exercise such power, right or remedy. (h) The Issuing and Paying Agent shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, coupon or other paper or document but the Issuing and Paying Agent, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Issuing and Paying Agent shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Authority, personally or by agent or attorney. (i) The Issuing and Paying Agent shall not be responsible for:
(i) the application or handling by the Authority of any moneys transferred to or pursuant to the Request of the Authority in accordance with the terms and conditions hereof;
(ii) the application and handling by the Authority of any other fund or account designated to be held by the Authority hereunder;
(iii) any error or omission by the Authority in making any computation or giving any instruction pursuant to Sections 5.05 and 5.06 and may rely conclusively on any computations or instructions furnished to it by the Authority in connection with the requirements of Sections 5.05 and 5.06 and the Tax Certificate; (iv) the construction, operation or maintenance of any portion of any Project. (j) Whether or not therein expressly so provided, every provision of this Issuing and Paying Agreement relating to the conduct or affecting the liability of or affording protection to the Issuing and Paying Agent shall be subject to the provisions of this Article VII.
Section 7.04. Right of Issuing and Paying Agent to Rely on Documents . The Issuing and Paying Agent shall be protected in acting upon any notice, resolution, request, consent, order, certificate, report, opinion, note or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties.
Whenever in the administration of the trusts imposed upon it by this Issuing and Paying Agreement the Issuing and Paying Agent shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering any action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by a Certificate of the Authority, and such Certificate shall be full warrant to the Issuing and Paying Agent for any action taken or suffered in good faith under the provisions of this Issuing and Paying Agreement in reliance upon such Certificate, but in its discretion the Issuing and Paying Agent may, in lieu thereof, accept other evidence of such matter or may require such additional evidence as to it may seem reasonable. The Issuing and Paying Agent may also rely conclusively on any report or certification of any certified public accountant, investment banker, financial or municipal advisor, or other expert selected by the
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
41 4123-2091-8123.4
Authority in connection with matters required to be proven or ascertained in connection with its administration of the trusts created hereby.
Section 7.05. Compensation and Indemnification of Issuing and Paying Agent . The Authority covenants to pay to the Issuing and Paying Agent from time to time, and the Issuing and Paying Agent shall be entitled to, reasonable compensation for all services rendered by it in the exercise and performance of any of the powers and duties hereunder of the Issuing and Paying Agent, and the Authority will pay or reimburse the Issuing and Paying Agent upon its request for all expenses, disbursements and advances incurred or made by the Issuing and Paying Agent in accordance with any of the provisions of this Issuing and Paying Agreement (including the reasonable compensation and the expenses and disbursements of its counsel and of all persons not regularly in its employ) except any such expense, disbursement or advance as may arise from its negligence, default or willful misconduct. The Authority, to the extent permitted by law, shall indemnify, defend and hold harmless the Issuing and Paying Agent against any loss, damages, liability or expense incurred without negligence or bad faith on the part of the Issuing and Paying Agent, arising out of or in connection with the acceptance or administration of the trusts created hereby, including costs and expenses (including reasonable attorneys’ fees) of defending itself against any claim or liability in connection with the exercise or performance of any of its powers hereunder. The rights of the Issuing and Paying Agent and the obligations of the Authority under this Section shall survive the discharge of the Notes and this Issuing and Paying Agreement and the resignation or removal of the Issuing and Paying Agent.
Section 7.06. Commercial Paper Reports . The Issuing and Paying Agent shall provide each Bank with read-only access to an online system with respect to the applicable Notes and ensure such access allows each Bank to review information regarding the trades, maturities, principal amounts and interest rates for the applicable Notes. The Issuing and Paying Agent shall provide each Bank with a monthly report within two (2) Business Days following the end of each calendar month showing the aggregate principal amount and maturity dates of the applicable Notes (even if zero) that were outstanding on each day of the related calendar month.
ARTICLE VIII
MODIFICATION OR AMENDMENT OF THIS
ISSUING AND PAYING AGENT AGREEMENT
Section 8.01. Amendments Permitted. (a) This Issuing and Paying Agent Agreement and the rights and obligations of the Authority, the Owners of the Notes and the Issuing and Paying Agent may be modified or amended at any time by a Supplement, which the Authority and the Issuing and Paying Agent may enter into with the written consent of each Bank and which shall have been filed with the Issuing and Paying Agent. (b) No such modification or amendment under this Section shall (A) extend the fixed maturity of any Note, or reduce the amount of principal thereof, or extend the time of payment provided for any Note, or reduce the rate of interest thereon, or extend the time of payment of interest thereon, without the consent of the Owner of each Note so affected, or (B) modify or amend the aforesaid required consents to effect any such modification or amendment, without the consent of the Owners of all of the Notes then Outstanding and the Bank s. It shall not be
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
42 4123-2091-8123.4
necessary for the consent of the Noteholders to approve the particular form of any Supplement, but it shall be sufficient if such consent shall approve the substance thereof. (c) This Issuing and Paying Agreement and the rights and obligations of the Authority, the Owners of the Notes and the Issuing and Paying Agent may also be modified or amended at any time by a Supplement, which the Authority and the Issuing and Paying Agent may enter into without the consent of any Noteholders or each Bank but only to the extent permitted by law and only for any one or more of the following purposes:
(i) to add to the covenants and agreements of the Authority in this Issuing and Paying Agreement contained other covenants and agreements thereafter to be observed, to pledge or assign additional security for the Notes or a Reimbursement Agreement (or any portion thereof), or to surrender any right or power herein reserved to or conferred upon the Authority;
(ii) to make provisions for the purpose of curing any ambiguity, inconsistency or omission, or of curing or correcting any defective provision, contained in this Issuing and Paying Agreement;
(iii) to modify, amend or supplement this Issuing and Paying Agreement in such manner as to permit the qualification hereof under the Trust Indenture Act of 1939, as amended, or any similar federal statute hereafter in effect, and to add such other terms, conditions and provisions as may be permitted by said act or similar federal statute, and which shall not materially and adversely affect the interests of the Owners of the Notes; (iv) to provide for the issuance of Notes in book- entry form, provided that no such provision shall materially and adversely affect the interests of the Owners of the Notes;
(v) to make modifications or adjustments necessary, appropriate or desirable to accommodate any Alternate Letter of Credit , provided that no such provision shall materially and adversely affect the interests of the Owners of the Notes; (vi) if the Authority agrees in a Supplement to maintain the exclusion of interest on a Series of Notes from gross income for purposes of federal income taxation, to make such provisions as are necessary or appropriate to ensure such exclusion; (vii) to provide for the issuance of an A dditional Series of Notes pursuant to Article III; and
(viii) for any other purpose that does not materially and adversely affect the interests of the Owners of the Notes or the Bank s, including, without limitation, to provide for changes requested by a Rating Agency in order to obtain or maintain a credit rating for any Series of Notes.
(d) Notwithstanding any other provision hereof, no modification or amendment hereto shall affect the rights, remedies or security of the Banks hereunder without the prior written consent of the Banks. Notwithstanding any other provision hereof, no modification or
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
43 4123-2091-8123.4
amendment hereto shall affect the rights of the Issuing and Paying Agent hereunder without the prior written consent of the Issuing and Paying Agent.
(e) Each Bank shall be deemed to be the sole Holder of any Notes its Letter of Credit supports for the purpose of exercising any voting rights or privilege or giving any consent or direction or taking any other action that the Holders are entitled to take pursuant to this Issuing and Paying Agent Agreement and under the Installment Purchase Contract pertaining to (i) defaults and remedies, (ii) the duties and obligations of the Issuing and Paying Agent and (iii) amendments to the Issuing and Paying Agent Agreement and the Installment Purchase Contract.
Section 8.02. Effect of Supplement. From and after the time any Supplement becomes effective pursuant to this Article, this Issuing and Paying Agreement shall be deemed to be modified and amended in accordance therewith, and the respective rights, duties and obligations under this Issuing and Paying Agreement of the Authority, the Bank s, the Issuing and Paying Agent and all Owners of Notes Outstanding shall thereafter be determined, exercised and enforced hereunder subject in all respects to such modification and amendment, and all the terms and conditions of any such Supplement shall be deemed to be part of the terms and conditions of this Issuing and Paying Agreement for any and all purposes.
Section 8.03. Amendment of Particular Notes. The provisions of this Article shall not prevent any Noteholder from accepting any amendment as to the particular Notes held by him, provided that due notation thereof is made on such Notes.
ARTICLE IX
DEFEASANCE
Section 9.01. Payment of Notes . (a) Notes of any Series or a portion thereof may be paid by the Authority in any of the following ways:
(i) by paying or causing to be paid the principal of and interest on such Outstanding Notes, as and when the same become due and payable; (ii) by depositing with the Issuing and Paying Agent, an escrow agent or other fiduciary, in trust, at or before maturity, money held uninvested or Defeasance Securities in the necessary amount (as provided in Section 9.02) to pay such Outstanding Notes; or (iii) by delivering to the Issuing and Paying Agent, for cancellation by it, such Outstanding Notes.
(b) If the Authority shall pay all Series for which any Notes are Outstanding and also pay or cause to be paid all other sums payable hereunder by the Authority and shall pay all Payment Obligations, then and in that case, at the election of the Authority (evidenced by a Certificate of the Authority, filed with the Issuing and Paying Agent and the Bank s, signifying the intention of the Authority to discharge all such indebtedness and this Issuing and Paying Agreement), and notwithstanding that any Notes shall not have been surrendered for payment, this Issuing and Paying Agreement and, except as provided in Sections 5.05 and 7.05 , all covenants, agreements and other obligations of the Authority under this Issuing and Paying Agreement shall cease, terminate, become void and be completely discharged and satisfied. In
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
44 4123-2091-8123.4
such event, upon R equest of the Authority, the Issuing and Paying Agent shall cause an accounting for such period or periods as may be requested by the Authority to be prepared and filed with the Authority and shall execute and deliver to the Authority all such instruments as may be necessary or desirable to evidence such discharge and satisfaction, and the Issuing and Paying Agent shall pay over, transfer, assign or deliver to the Authority all moneys or securities or other property held by it pursuant to this Issuing and Paying Agreement which, as evidenced by a verification report, upon which the Issuing and Paying Agent may conclusively rely, from a firm of independent certified public accountants, or other firm acceptable to the Issuing and Paying Agent, are not required for the payment of Notes not theretofore surrendered for such payment.
Section 9.02. Discharge of Liability on Notes . Upon the deposit with the Issuing and Paying Agent, escrow agent or other fiduciary, in trust, at or before maturity, of money held uninvested or Defeasance Securities the principal of and the interest on which when due shall be in an amount which shall be sufficient to pay any Outstanding Note, as evidenced by a verification report, upon which the Issuing and Paying Agent may conclusively rely, from a firm of independent certified public accountants, or other firm acceptable to the Issuing and Paying Agent, then (provided that the applicable Bank or Banks have been paid in full all Payment Obligations) all liability of the Authority in respect of such Note shall cease, terminate and be completely discharged, provided that the Owner thereof shall thereafter be entitled to the payment of the principal of and interest on such Note, and the Authority shall remain liable for such payment, but only out of such money or Defeasance Securities deposited as aforesaid for their payment, subject, however, to the provisions of Section 9.03.
If prior to the maturity date of any Note such Note is deemed to have been paid within the meaning of and with the effect expressed in this Section, the Authority shall have given to the Issuing and Paying Agent , in form satisfactory to it, irrevocable instructions to mail a notice to the Noteowner of such Note and each Rating Agency then rating such Series of Note s, that the deposit required by the first paragraph of this Section has been made with the Issuing and Paying Agent, escrow agent or other fiduciary , and that such Note is deemed to have been paid in accordance with this Section and stating the maturity date upon which money is to be available for the payment of such Note.
The Authority may at any time surrender to the Issuing and Paying Agent for cancellation by it any Notes previously issued and delivered, which the Authority may have acquired in any manner whatsoever, and such Notes, upon such surrender and cancellation, shall be deemed to be paid and retired.
Section 9.03. Payment of Notes After Discharge of Issuing and Paying Agent Agreement. Provided that each Bank has been paid in full all Payment Obligations and the Letters of Credit have terminated, any moneys held by the Issuing and Paying Agent in trust for the payment of the principal of, or interest on, any Notes and remaining unclaimed for two (2) years after the principal of all of the Notes has become due and payable, if such moneys were so held at such date, or two (2) years after the date of deposit of such moneys if deposited after said date when all of the Notes became due and payable, shall, upon R equest of the Authority, be transferred to the Authority, and all liability of the Issuing and Paying Agent with respect to such moneys shall thereupon cease. All moneys held by or on behalf of the Issuing and Paying Agent
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
45 4123-2091-8123.4
for the payment of principal of or interest on Notes remaining unclaimed shall be held uninvested, in trust for the account of the Owners thereof, and the Issuing and Paying Agent shall not be required to pay Owners any interest on, or be liable to the Owners or any other person (other than the Authority) for any interest earned on, moneys so held.
ARTICLE X
MISCELLANEOUS
Section 10.01. Successor Is Deemed Included in All References to Predecessor.
Whenever in this Issuing and Paying Agreement either the Authority or the Issuing and Paying Agent is named or referred to, such reference shall be deemed to include the successors or assigns thereof, and all the covenants and agreements in this Issuing and Paying Agreement contained by or on behalf of the Authority or the Issuing and Paying Agent shall bind and inure to the benefit of the respective successors and assigns thereof whether so expressed or not.
Section 10.02. Limitation of Rights to Authority, Issuing and Paying Agent, Bank s and Noteholders. Nothing in this Issuing and Paying Agreement or in the Notes expressed or implied is intended or shall be construed to give to any person other than the Authority, the Issuing and Paying Agent, the Bank s and the Owners of the Notes, any legal or equitable right, remedy or claim under or in respect of this Issuing and Paying Agreement or any covenant, condition or provision therein or herein contained; all such covenants, conditions and provisions are and shall be held to be for the sole and exclusive benefit of the Authority, the Issuing and Paying Agent, the Bank s and the Owners of the Notes, and the Bank s and the Owners of the Notes shall be third party beneficiaries of this Issuing and Paying Agent Agreement.
Section 10.03. Waiver of Notice . Whenever in this Issuing and Paying 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 such case the giving or receipt of such notice shall not be a condition precedent to the validity of any action taken in reliance upon such waiver.
Section 10.04. Destruction or Delivery of Canceled Notes . Whenever in this Issuing and Paying Agreement provision is made for the cancellation by the Issuing and Paying Agent and the delivery to the Authority of any Notes, the Issuing and Paying Agent may, in its sole discretion, in lieu of such cancellation and delivery, destroy such Notes, and deliver a certificate of such destruction to the Authority.
Section 10.05. Severability of Invalid Provisions . If any one or more of the provisions contained in this Issuing and Paying Agreement or in the Notes shall for any reason be held to be invalid, illegal or unenforceable in any respect, then such provision or provisions shall be deemed severable from the remaining provisions contained in this Issuing and Paying Agreement and such invalidity, illegality or unenforceability shall not affect any other provision of this Issuing and Paying Agreement, and this Issuing and Paying Agreement shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein. The Authority hereby declares that it would have adopted this Issuing and Paying Agreement and each and every other Section, subsection, paragraph, sentence, clause or phrase hereof and authorized the issuance of the Notes pursuant thereto irrespective of the fact that any one or more
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
46 4123-2091-8123.4
Sections, subsections, paragraphs, sentences, clauses or phrases of this Issuing and Paying Agreement may be held illegal, invalid or unenforceable.
Section 10.06. Notices. Except as otherwise provided herein or in the Reimbursement Agreements or the Dealer Agreement s, for the purposes of each such Agreement, respectively, any notice to or demand may be served or presented, and such demand may be made and shall be deemed to have been sufficiently given or served for all purposes by being deposited, first -class mail postage prepaid, in a post office letter box, addressed, as the case may be, to the parties as follows:
Issuing and Paying Agent: U.S. Bank Trust Company, National Association 100 Wall Street, 20th Floor
New York, New York 10005
Attention: Global Corporate Trust – IPA Administration Authority: City of San José Financing Authority
200 East Santa Clara Street, 13th Floor
San José, CA 95113
Attention: Debt Management
Email: [email protected]
Banks:
if to the Banks, with respect to
Drawings under the Letter of
Credit
Bank of America, N.A.
1 Fleet Way
PA6-580-02-30
Scranton, Pennsylvania 18507
Attention: Letter of Credit Department
if to the Banks with respect
to all other matters
Bank of America, N.A.
333 South Hope Street, Suite 3820
CA9-193-38-01
Los Angeles, California 90071-1406
Attention: Greg Bailey
Telephone: (213) 621-7131
Email: [email protected]
With a copy to:
Bank of America, N.A.
333 South Hope Street, Suite 3820
Los Angeles, California 90071-1406
Attention: Lily Azhari
Telephone: (213) 345-3169
Email: [email protected]
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
47 4123-2091-8123.4
Dealers: [to come]
Section 10.07. Notice to Rating Agencies . The Issuing and Paying Agent , at the direction of the Authority, shall give notice to each Rating Agency then rating each Series of Notes of any supplements or amendments to or termination of the Issuing and Paying Agreement, any changes to, or expiration, substitution, termination or extension of the term of, the Reimbursement Agreements or the Letters of Credit, any substitution of the Dealer, and the appointment of a successor Issuing and Paying Agent , defeasance of any Notes, and of when there are no longer any Notes outstanding under the Issuing and Paying Agreement, initially at each respective address given below, or at such other address as may be furnished to the Authority from time to time by each Rating Agency:
[Moody’s Investors Service, Inc.
7 World Trade Center at 250 Greenwich Street
New York, New York 10007
Attn: Public Finance Group - MSPG - 23rd Floor]
[S&P Global Ratings
55 Water Street, 38th Floor
New York, NY 10041
[email protected]
Attn: Municipal Structured Surveillance]
[Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
Attn: Municipal Structured Finance]
Section 10.08. Evidence of Rights of Noteholders . (a) Any request, consent or other instrument required or permitted by this Issuing and Paying Agreement to be signed and executed by Noteholders may be in any number of concurrent instruments of substantially similar tenor and shall be signed or executed by such Noteholders in person or by an agent or agents duly appointed in writing. Proof of the execution of any such request, consent or other instrument or of a writing appointing any such agent, or of the holding by any person of Notes transferable by delivery, shall be sufficient for any purpose of this Issuing and Paying Agreement and shall be conclusive in favor of the Issuing and Paying Agent and of the Authority if made in the manner provided in this Section.
(b) The fact and date of the execution by any person of any such request, consent or other instrument or writing may be proved by the certificate of any notary public or other officer of any jurisdiction, authorized by the laws thereof to take acknowledgments of deeds, certifying that the person signing such request, consent or other instrument acknowledged to him the execution thereof, or by an affidavit of a witness of such execution duly sworn to before such notary public or other officer.
(c) The ownership of Notes shall be proved by the Note registration books held by the Issuing and Paying Agent. The Issuing and Paying Agent may establish a record date as of
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
48 4123-2091-8123.4
which to measure consent of the Noteowners in order to determine whether the requisite consents are received.
(d) Any request, consent, or other instrument or writing of the Owner of any Note shall bind every future Owner of the same Note and the Owner of every Note issued in exchange therefor or in lieu thereof, in respect of anything done or suffered to be done by the Issuing and Paying Agent or the Authority in accordance therewith or reliance thereon.
Section 10.09. Disqualified Notes. In determining whether the Owners of the requisite aggregate principal amount of Notes have concurred in any demand, request, direction, consent or waiver under this Issuing and Paying Agreement, Notes which are owned or held by or for the account of the Authority, or by any other obligor on the Notes, or by any person directly or indirectly controlling or controlled by, or under direct or indirect common control with, the Authority or any other obligor on the Notes, shall be disregarded and deemed not to be Outstanding for the purpose of any such determination. Notes so owned which have been pledged in good faith may be regarded as Outstanding for the purposes of this Section if the pledgee shall establish to the satisfaction of the Issuing and Paying Agent the pledgee’s right to vote such Notes and that the pledgee is not a person directly or indirectly controlling or controlled by, or under direct or indirect common control with, the Authority or any other obligor on the Notes. In case of a dispute as to such right, any decision by the Issuing and Paying Agent taken upon the advice of counsel shall be full protection to the Issuing and Paying Agent.
Section 10.10. Money Held for Particular Notes . The money held by the Issuing and Paying Agent for the payment of the interest or principal due on any date with respect to particular Notes shall, on and after such date and pending such payment, be set aside on its books and held in trust by it for the Owners of the Notes entitled thereto, subject, however, to the provisions of Section 9.03.
Section 10.11. Waiver of Personal Liability. No member, officer, agent or employee of the Authority or the Issuing and Paying Agent shall be individually or personally liable for the payment of the principal of or interest on the Notes or be subject to any personal liability or accountability by reason of the issuance thereof; but nothing herein contained shall relieve any such member, officer, agent or employee of the Authority or the Issuing and Paying Agent from the performance of any official duty provided by law or by this Issuing and Paying Agreement.
Section 10.12. Governing Law. This Issuing and Paying Agreement shall be construed and governed in accordance with the laws of the State of California.
Section 10.13. Business Day . Except as specifically set forth in a Supplement, any payments or transfers which would otherwise become due on any day which is not a Business Day shall become due or shall be made on the next succeeding Business Day.
Section 10.14. Effective Date of Issuing and Paying Agent Agreement . This Issuing and Paying Agent Agreement shall become effective upon execution and delivery hereof.
Section 10.15. Electronic Signature. Each of the parties hereto agrees that the transaction consisting of this Issuing and Paying Agent Agreement may be conducted by
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
49 4123-2091-8123.4
electronic means. Each party agrees, and acknowledges that it is such party’s intent, that if such party signs this Issuing and Paying Agent Agreement using an electronic signature, it is signing, adopting, and accepting this Issuing and Paying Agent Agreement and that signing this Issuing and Paying Agent Agreement using an electronic signature is the legal equivalent of having placed its handwritten signature on this Issuing and Paying Agent Agreement on paper. Each party acknowledges that it is being provided with an electronic or paper copy of this Issuing and Paying Agent Agreement in a usable format.
Section 10.16. Execution in Counterparts . This Issuing and Paying Agent Agreement may be executed in several counterparts, each of which shall be deemed an original, and all of which shall constitute but one and the same instrument.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
SIGNATURE PAGE – ISSUING AND PAYING AGENT AGREEMENT
4123-2091-8123.4
IN WITNESS WHEREOF, the parties hereto have executed this Issuing and Paying Agent Agreement by their officers thereunto duly authorized as of the day and year first written above.
Approved as to form:
SUSANA ALCALA WOOD, City Attorney
By: _______________________________
Rosa Tsongtaatarii
Chief Deputy City Attorney
THE CITY OF SAN JOSE FINANCING
AUTHORITY
By:
Maria Öberg
Treasurer
U.S. BANK TRUST COMPANY,
NATIONAL ASSOCIATION, as Issuing and
Paying Agent
By:
Authorized Officer
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
A-1
4123-2091-8123.4
EXHIBIT A
FORM OF NOTE
UNITED STATES OF AMERICA
STATE OF CALIFORNIA
CITY OF SAN JOSE FINANCING AUTHORITY
COMMERCIAL PAPER NOTES
SERIES __ (_____)
Principal Amount ___________________
Note Number: Interest Rate:
Registered Owner:
Date of Issue:
Maturity Date: Maturity Value: $
The City of San José Financing Authority (the “Authority”), for value received, hereby promises to pay to the Registered Owner des ignated above (herein called the “Owner”), on the Maturity Date identified above, but solely from the revenues, income and other moneys hereinafter mentioned, the Principal Amount identified above, together with interest if any on said Principal Amount at the Interest Rate per annum (calculated on the basis of a year containing 365 or 366 days as applicable and actual number of days elapsed) [ for Taxable Notes, substitute: “(calculated on the basis of a 360- day year containing 12 30- day months and actual number of days elapsed)” ] identified above, upon the presentation and surrender hereof at the Corporate Trust Office of U.S. Bank Trust Company, National Association (together with any successor, the “Issuing and Paying Agent”). For payment of this Note on the Maturity Date hereof, this Note must be presented to the Issuing and Paying Agent no later than 2:15 p.m. (New York City time) on such day. If a Note is presented for payment after 2:15 p.m. (New York City time), payment therefor shall be made by the Issuing and Paying Agent on the next succeeding business day without the accrual of additional interest thereon. The principal of and interest on this Note shall be payable in lawful money of the United States of America. This Note may be transferred or exchanged in accordance with the terms and conditions and upon payment of the charges set forth in the Issuing and Paying Agent Agreement hereinafter described.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
A-2
4123-2091-8123.4
The Authority has entered into an Issuing and Paying Agent Agreement, dated as of October 1, 2026 (as supplemented and amended from time to time, the “Agreement”), with the Issuing and Paying Agent. Such Agreement provides that the Authority may issue additional notes and incur other indebtedness under the terms and conditions set forth in the Agreement.
All notes issued thereunder and secured thereby are collectively referred to herein as “Notes.” This Note is one of a duly authorized issue of Notes issued under, and secured by, the Agreement. The Notes of such issue will, at the time of issuance, be designated as the “City of San José Financing Authority Commercial Paper Notes, Series __.” The Agreement also provides for the issuance of additional Series of Notes, but only subject to the conditions and limitations contained in the Agreement.
The Notes are limited obligations of the Authority and are payable as to both principal and interest, first, from drawings on the related Letter of Credit , and to the extent that any drawings on the related Letter of Credit are insufficient, second, from the Installment Payments and other amounts held by Issuing and Paying Agent under the Agreement (except for amounts held in the Rebate Fund, and provided that amounts in each account of the Reimbursement Agreement Fund, the Note Repayment Fund and the Note Proceeds Fund shall secure only the Series of Notes with the same Series designation).
Subject only to the provisions of the Agreement permitting the application thereof for the purposes and on the terms and conditions set forth therein, the Authority, pursuant to the Agreement, grants, bargains, sells, releases, conveys, assigns, transfers and pledges, and grants a lien on and security interest in, to secure the payment of the principal of and the interest on all Notes at any time issued, authenticated and delivered under the Agreement , the performance and observance of all the covenants and conditions set forth in the Agreement , the payment of the principal of and the interest on all Bank Notes, the payment of the Payment Obligations, and the performance and observance of all the covenants and conditions set forth in each Reimbursement Agreement, for the benefit of the respective Owners from time to time of the Notes and each Bank, as applicable, (i) all of the Installment Payments and (ii) all amounts held by the Issuing and Paying Agent under the Agreement (except for amounts held in the Rebate Fund, and provided that amounts in each account of the Reimbursement Agreement Fund, the Note Repayment Fund and the Note Proceeds Fund shall secure only the Series of Notes with the same Series designation). Said pledge shall be perfected and be valid and binding from the date of execution and delivery of the Agreement without any physical delivery thereof or further act.
The full faith and credit of the Authority is not pledged for the payment of the interest on or the principal of the Notes, and no tax or assessment shall ever be levied or collected to pay the interest on or the principal of the Notes. The Notes are not secured by a legal or equitable pledge of or charge, lien or encumbrance upon any property of the Authority or any of its income or receipts except the Installment Payments and the other amounts pledged under the Agreement .
The Notes do not constitute an indebtedness of the Authority within the meaning of any constitutional or statutory debt limitation or restriction, and neither the Authority nor any officer or employee thereof shall be liable for the payment of the interest thereon or the principal thereof otherwise than from the Installment Payments and the other amounts pledged under the Agreement.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
A-3
4123-2091-8123.4
This Note shall not be entitled to any security or benefit under the Agreement or become valid or obligatory for any purpose until the certificate of authentication hereon endorsed shall have been signed by the Issuing and Paying Agent.
It is hereby certified and recited that all acts, conditions and things required to exist, to happen and to be performed, precedent to and in the incurring of the indebtedness evidenced by this Note and in the issuing of this Note, do exist, have happened and have been performed in due time, form and manner, as required by the Constitution and statutes of the State of California, and that this Note, is within every debt and other limit prescribed by the Constitution and the statutes of the State of California, and is not in excess of the amount of Notes permitted to be issued under the Agreement or the laws of the State.
IN WITNESS WHEREOF, THE CITY OF SAN JOSE FINANCING AUTHORITY has caused this Note to be executed in its name and on its behalf by the facsimile signature of an Authorized Representative and to be dated the date set forth above.
CITY OF SAN JOSE FINANCING
AUTHORITY
By:
Authorized Representative
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
A-4
4123-2091-8123.4
CERTIFICATE OF AUTHENTICATION
This Note is one of an issue described in the Issuing and Paying Agent Agreement mentioned herein.
U.S. BANK TRUST COMPANY,
NATIONAL ASSOCIATION, as
Issuing and Paying Agent
By:
Authorized Signatory
Date of Authentication: __________
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
B-1
EXHIBIT B
FORM OF DTC MUNICIPAL COMMERCIAL PAPER MASTER NOTE
[Attached]
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
C-1
EXHIBIT C
FORM OF ISSUANCE REQUEST TO PAYING AGENT*
Pursuant to Section 3.01 of the Issuing and Paying Agent Agreement, dated as of October 1, 2026 (the “Issuing and Paying Agent Agreement”), between the City of San José Financing Authority (the “Authority”) and U.S. Bank Trust Company, National Association, as Issuing and Paying Agent (the “Issuing and Paying Agent”), the undersigned, an Authorized Representative, does hereby request the Issuing and Paying Agent under the Issuing and Paying Agent Agreement, to issue Commercial Paper Notes, as follows:
1. Date of Requested Issuance: ________________________________________
2. Principal Amounts and Purchase Prices for the Series A Notes:
Series A-1
Notes
Series A-2
Notes
Total Series A
Notes
Principal Amount
Purchase Price
(a) The total aggregate principal amount of Series A Notes to be issued as indicated in the table above $________________;
(b) plus, the previously issued and outstanding aggregate principal amount of Series A Notes $_______________;
(c) less, the aggregate principal amount of Series A Notes maturing on or before the Date of Requested Issuance $_______________;
(d) equals $_________________ aggregate principal amount of outstanding Series A Notes as of the Date of Requested Issuance, which , together with the amount of interest due at maturity thereon, $________, is no more than the Available Amount under the applicable Letter of Credit as of the Date of Requested Issuance.
3. Pursuant to Section 3.01 of the Issuing and Paying Agent Agreement the undersigned hereby certifies as follows:
(a) all action on the part of the Authority necessary for the valid issuance of the Notes to be issued has been taken and has not been rescinded or revoked; (b) the Notes in the hands of the Owners thereof will be valid and binding obligations of the Authority according to their terms;
(c) no Event of Default under Section 6 .01 of the Issuing and Paying Agent Agreement has occurred and is continuing as of the date of this Issuance Request;
* To be given no later than 12:30 p.m. (New York City time) on the Date of Issuance specified in Paragraph 1 herein.
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
C-2
(d) the Authority has not received a copy of any Stop Order or Final Drawing Notice with respect to such Notes; and
(e) the Authority is in compliance with the covenants set forth in Article V of the Issuing and Paying Agent Agreement, and including, without limitation (except in the case of Taxable Notes the interest with respect to which is not expected to be excluded from gross income for federal income tax purposes under the Code), the tax covenants contained in Sections 5.05 and 5.06 and the Tax Certificate and hereby reconfirms all of its expectations set forth in the Tax Certificate, as of the date of this Issuance Request.
All capitalized terms used but not defined herein shall have the meanings ascribed thereto in the Issuing and Paying Agent Agreement.
Date: __________________
Request Number: ____
THE CITY OF SAN JOSE FINANCING
AUTHORITY
________________________________________
Authorized Representative
DRAFT--Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.