Stradling Yocca Carlson & Rauth
Draft dated 9/12/22
(with MLG Comments)
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SANTA CLARITA PUBLIC FINANCING AUTHORITY
LEASE REVENUE BONDS
(ENERGY EFFICIENCY PROGRAM)
SERIES 2022B
BOND PURCHASE AGREEMENT
October ____, 2022
Santa Clarita Public Financing Authority
c/of City of Santa Clarita
23920 Valencia Boulevard
Santa Clarita, California 91355
Attention: Executive Director
City of Santa Clarita
23920 Valencia Boulevard
Santa Clarita, California 91355
Attention: City Manager
Ladies and Gentlemen:
The undersigned, Stifel, Nicolaus & Company, Incorporated (the “Underwriter”), acting not as a fiduciary or agent for you, but on behalf of itself, offers to enter into this Bond Purchase Agreement (which, together with Exhibit A and Exhibit B, is referred to as the “Purchase Agreement”) with the Santa Clarita Public Financing Authority (the “Authority”) and the City of Santa Clarita, California (the “City”), which, upon the acceptance of the Authority and the City, will be binding upon the Authority, the City and the Underwriter. This offer is made subject to acceptance by the Authority and by the City by the execution of this Purchase Agreement and delivery of the same to the Underwriter prior to 5:00 P.M., California Time, on the date hereof, and, if not so accepted, will be subject to withdrawal by the Underwriter upon notice delivered to the Authority and the City at any time prior to the acceptance hereof by the Authority and the City.
Capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Indenture, dated as of June 1, 2016 (the “O riginal Indenture”), as supplemented by the First Supplemental Indenture, dated as of October 1, 2022 (the “First Supplemental Indenture,” and together with the Original Indenture, the “Indenture”), each by and between the Authority and U.S.
Bank Trust Company, National Association, as trustee (the “Trustee”).
Section 1. Purchase and Sale. Upon the terms and conditions and upon the basis of the representations, warranties and agreements herein set forth, the Underwriter hereby agrees to purchase from the Authority, and the Authority here by agrees to issue, sell and deliver to the 2 4865-6627-1027/200356-0552
Underwriter all (but not less than all) of the Santa Clarita Public Financing Authority Lease Revenue Bonds (Energy Efficiency Program) Series 2022B in the aggregate principal amount of $_____ (the “Series B Bonds”). The Series B Bonds will be dated as of their date of delivery. Interest on the Series B Bonds shall be payable semiannually on June 1 and December 1 in each year, commencing December 1, 2022 and will mature, bear interest and be subject to redemption prior to maturity as set forth in Exhibit A hereto. The purchase price for the Series B Bonds shall be equal to $_____ (being the aggregate principal amount thereof [plus][less] [net] original issue [premium][discount] of $_____, less an underwriter’s discount of $_____).
Section 2. The Series B Bonds. The Series B Bonds shall be secured by a pledge of [City Hall Lease Revenues] consisting primarily of Base Rental Payments (the “Base Rental Payments”) to be paid by the City pursuant to the Lease Agreement, dated as of June 1, 2016 (the “Original Lease”), as amended by the First Amendmen t to Lease Agreement, dated as of October 1, 2022 (the “First Amendment to Lease” and together, the “Lease”), each by and between the City and the Authority, relating to the City Hall building and City Hall site located at 23920 Valencia Boulevard in the City, at which the three story, 74,325-square foot City Hall building is located (the “City Hall Leased Property”). The Authority’s right to receive the Base Rental Payments due under the Lease and to exercise remedies upon default under such Lease shall be assigned to the Trustee for the benefit of the owners of the Series B Bonds pursuant to the Assignment Agreement, dated as of June 1, 2016 (the “Assignment Agreement”), by and between the Authority and the Trustee.
The Series B Bonds shall be as described in, and shall be secured under and pursuant to the Indenture substantially in the form previously su bmitted to the Underwriter with only such changes therein as shall be mutually agreed upon by the Authority, the City and the Underwriter.
The proceeds of the Series B Bonds shall be used to: (i) provide funds to pay for a portion of the costs of financing certain energy efficiency improvements for City (the “Project”); and (ii) to pay the costs of issuance of the Series B Bonds.
The Series B Bonds, this Purchase Agreement, th e Indenture, the Lease, the Site and Facility Lease, dated as of June 1, 2016 (the “Site Lease”), by and between the Authority and the City, and the Assignment Agreement are collectively referred to herein as the “Authority Documents.” This Purchase Agreement, the Continuing Disclosure Certificate, dated October __, 2022 (the “Continuing Disclosure Certificate”), executed and delivered by the City, the Lease, and the Site Lease are collectively referred to herein as the “City Documents.” Concurrently with the issuance of the Series B Bonds, the City and the Authority expect that the Authority will issue its Santa Clarita Public Financing Authority Lease Revenue Bonds (Energy Efficiency Program) Series 2022A (the “Series A B onds”), the proceeds of which will be used to (i) provide funds to pay for a portion of the costs of the Project and (ii) to pay the costs of issuance of the Series A Bonds. The Series A Bonds will be issued under a separate indenture and will be secured by lease payments made pursuant to a lease agreement relating to certain property located in the Cit on which The CUBE Ice and Entertainment Ce nter is located, as described in the Official Statement (defined below). The [CUBE Lease Revenues] are not pledged to or available to pay debt service on the Series B Bonds and the [City Hall Lease Revenues] are not pledged to or available to pay debt service on the Series A Bonds.
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Section 3. Public Offering and Establishment of Issue Price. (a) The Underwriter agrees to make an initial public offering of all of the Series B Bonds at the public offering prices (or yields) set forth on Exhibit A attached hereto and incorporated herein by reference. Subsequent to the initial public offering, the Underwriter reserves the right to change the public offering prices (or yields) as the Underwriter deems necessary in connection with the marketing of the Series B Bonds, provided that the Underwriter shall not change the interest rates set forth on Exhibit A. The Series B Bonds may be offered and sold to certain dealers at prices lower than such initial public offering prices. The City and the Authority acknowledge and agree that: (i) the purchase and sale of the Series B Bonds pursuant to this Purchase Agreement is an arm’s-length commercial transaction between the City and the Authority, on one hand, and the Underwriter, on the other; (ii) in connection therewith and with the discussions, undertakings and procedures leading up to the consummation of such transaction, the Underwriter is and has been acting solely as principal and is not acting as a Municipal Advisor (as defined in Section 15B of the Securities Exchange Act of 1934, as amended); (iii) the Underwriter has not assumed an advisory or fiduciary responsibility in fa vor of the City or Authority with respect to the offering contemplated hereby or the discussions, undertakings and procedures leading thereto (irrespective of whether the Underwriter has provided other services or is currently providing other services to the City or Authority on other matters); (iv) the Underwriter has financial and other interests that differ from those of the City and the Authority; and (v) the City and Authority have consulted their own legal, financial and other advisors to the extent they have deemed appropriate. (b) The Underwriter agrees to assist the Authority in establishing the issue price of the Series B Bonds and shall execute and deliver to the Authority at Closing (as defined below) an “issue price” or similar certificate, together with the supporting pricing wires or equivalent communications, substantially in the form attached he reto as Exhibit B, with such modifications as may be appropriate or necessary, in the reasonable judgment of the Underwriter, the Authority and Bond Counsel (as defined below), to accurately reflect, as applicable, the sales price or prices or the initial offering price or prices to the public of the Series B Bonds. (c) Except as set forth in Exhibit A, the Authority will treat the first price at which 10% of each maturity of the Series B Bonds (the “10% test”), identified under the column “10% Test Used” in Exhibit A, is sold to the public as the issue price of that maturity. At or promptly after the execution of this Purchase Agreement, the Underwriter shall report to the Authority the price or prices at which it has sold to the public each maturity of Bonds. If at that time the 10% test has not been satisfied as to any matur ity of the Series B Bonds, the Underwriter agrees to promptly report to the Authority the prices at which it sells the unsold Bonds of that maturity to the public. That reporting obligation shall continue, whether or not the Closing Date (as defined below) has occurred, until either (i) the Underwriter has sold all Bonds of that maturity or (ii) the 10% test has been satisfied as to the Series B Bonds of that maturity, provided that, the Underwriter’s reporting obligation after the Closing Date may be at reasonable periodic intervals or otherwise upon request of the Authority or Bond Counsel. For purposes of this section, if Bonds mature on the same date but have different interest rates, each sepa rate CUSIP number within that maturity will be treated as a separate maturity of the Series B Bonds.
(d) The Underwriter confirms that it has offered the Series B Bonds to the public on or before the date of this Purchase Agreement at the offering price or prices (the “initial offering price”), or at the corresponding price, set forth in Exhibit A attached hereto, except as otherwise set forth therein. Exhibit A also sets forth, identified under the column “Hold the Offering Price Rule 4 4865-6627-1027/200356-0552
Used,” as of the date of this Purchase Agreement, the maturities, if any, of the Series B Bonds for which the 10% test has not been satisfied and for which the Authority and the Underwriter agree that the restrictions set forth in the next sentence shall apply, which will allow the Authority to treat the initial offering price to the public of each such maturity as of the sale date as the issue price of that maturity (the “hold-the-offering-price rule”). So long as the hold-the-offering-price rule remains applicable to any maturity of the Series B Bonds , the Underwriter will neither offer nor sell unsold Bonds of that maturity to any person at a price that is higher than the initial offering price to the public during the period starting on the sale date and ending on the earlier of the following:
(1) the close of the fifth (5th) business day after the sale date; or
(2) the date on which the Underwriter has sold at least 10% of that maturity of the Series B Bonds to the public at a price that is no higher than the initial offering price to the public.
The Underwriter will advise the Authority promptly after the close of the fifth (5th) business day after the sale date whether it has sold 10% of that maturity of the Series B Bonds to the public at a price that is no higher than the initial offering price to the public. (e) The Underwriter confirms that:
(i) any selling group agreement and any third-party distribution agreement relating to the initial sale of the Series B Bonds to the public, together with the related pricing wires, contains or will contain language obligating each dealer who is a member of the selling group and each broker-dealer that is a party to such third-party distribution agreement, as applicable:
(A)(i) to report the prices at which it sells to the public the unsold Bonds of each maturity allocated to it, whether or not the Closing Date has occurred, until either all Bonds of that maturity allocated to it have been sold or it is notified by the Underwriter that the 10% test has been satisfied as to the Series B Bonds of that maturity, provided that, the reporting obligation after the Closing Date may be at reasonable periodic intervals or otherwise upon request of the Underwriter, and (ii) to comply with the hold-th e-offering-price rule, if applicable, if and for so long as directed by the Underwriter,
(B) to promptly notify the Underwriter of any sales of
Bonds that, to its knowledge, are made to a purch aser who is a related party to an underwriter participating in the initial sale of the Series B B onds to the public (each such term being used as defined below), and
(C) to acknowledge that, unless otherwise advised by the dealer or broker-dealer, the Underwriter shall as sume that each order submitted by the dealer or broker-dealer is a sale to the public.
(ii) any selling group agreement relating to the initial sale of the Series B Bonds to the public, together with the related pricing wires, contains or will contain language obligating each dealer that is a party to a thir d-party distribution agreement to be employed in connection with the initial sale of the Series B Bo nds to the public to require each broker-dealer that is a party to such third-party distribution agreement to (A) report the prices at which it sells to the public the unsold Bonds of each maturity allocated to it, whether or not the Closing Date has 5 4865-6627-1027/200356-0552
occurred, until either all Bonds of that maturity allocat ed to it have been sold or it is notified by the Underwriter or the dealer that the 10% test has b een satisfied as to the Series B Bonds of that maturity, provided that, the reporting obligation after the Closing Date may be at reasonable periodic intervals or otherwise upon request of the Underwriter or the dealer, and (B) comply with the hold- the-offering-price rule, if applicable, if and for so long as directed by the Underwriter or the dealer and as set forth in the related pricing wires.
(f) The Authority and the City acknowledge that, in making the representations set forth in this section, the Underwriter will rely on (i) in the event a selling group has been created in connection with the initial sale of the Series B Bonds to the public, the agreement of each dealer who is a member of the selling group to comply with the requirements for establishing issue price of the Series B Bonds, including, but not limited to, its agreement to comply with the hold-the-offering- price rule, if applicable to the Series B Bonds, as set forth in a selling group agreement and the related pricing wires, and (ii) in the event that a third-party distribution agreement was employed in connection with the initial sale of the Series B Bonds to the public, the agreement of each broker- dealer that is a party to such agreement to comply with the requirements for establishing issue price of the Series B Bonds, including, but not limited t o, its agreement to comply with the hold-the- offering-price rule, if applicable to the Series B Bonds, as set forth in the third-party distribution agreement and the related pricing wires. The Authority and the City further acknowledge that the Underwriter shall not be liable for the failure of any dealer who is a member of a selling group, or of any broker-dealer that is a party to a third-party distribution agreement, to comply with its corresponding agreement to comply with the requirements for establishing issue price of the Series B Bonds, including, but not limited to, its agreement to comply with the hold-the-offering-price rule, if applicable to the Series B Bonds.
(g) The Underwriter acknowledges that sales of any Bonds to any person that is a related party to an underwriter participating in the initial sale of the Series B Bonds to the public (each such term being used as defined below) shall not constitute sales to the public for purposes of this section. Further, for purposes of this section:
(i) “public” means any person other than an underwriter or a related party;
(ii) “underwriter” means (A) any person that agrees pursuant to a written contract with the Authority (or with the lead underwriter to form an underwriting syndicate) to participate in the initial sale of the Series B Bo nds to the public and (B) any person that agrees pursuant to a written contract directly or indirec tly with a person described in clause (A) to participate in the initial sale of the Series B B onds to the public (including a member of a selling group or a party to a third-party distribution agreement participating in the initial sale of the Series B Bonds to the public);
(iii) a purchaser of any of the Series B Bonds is a “related party” to an underwriter if the underwriter and the purchaser are s ubject, directly or indirectly, to (A) more than 50% common ownership of the voting power or the total value of their stock, if both entities are corporations (including direct ownership by one corporation of another), (B) more than 50% common ownership of their capital interests or prof its interests, if both entities are partnerships (including direct ownership by one partnership of another), or (C) more than 50% common ownership of the value of the outstanding stock of the corporation or the capital interests or profit interests of the partnership, as applicable, if one entity is a corporation and the other entity is a 6 4865-6627-1027/200356-0552
partnership (including direct ownership of the applicable stock or interests by one entity of the other); and
(iv) “sale date” means the date of execution of this Purchase Agreement by the City and the Underwriter.
Section 4. The Official Statement. By its acceptance of this proposal, the Authority and the City ratify, confirm and approve of the use and distribution by the Underwriter prior to the date hereof of the preliminary official statemen t relating to the Series B Bonds and the Series B Bonds dated October __, 2022 (including the cove r page, all appendices and all information incorporated therein and any supplements or amendm ents thereto and as disseminated in its printed physical form or in electronic form in all respects materially consistent with such physical form, the “Preliminary Official Statement”) that authorized officers of the Authority and the City deemed “final” as of its date, for purposes of Rule 15c2-12 promulgated under the Securities Exchange Act of 1934, as amended (“Rule 15c2-12”), except for certain information permitted to be omitted therefrom by Rule 15c2-12. The Authority and the City hereby agree to deliver or cause to be delivered to the Underwriter, within seven business days of the date hereof, copies of the final official statement, dated the date hereof, relating to the Series B Bonds (including all information previously permitted to have been omitted by Rule 15c2-12), including the cover page, all appendices, all information incorporated therein and any amendments or supplements as have been approved by the Authority, the City and the Underwriter (the “Official Statem ent”) in such quantity as the Underwriter shall reasonably request to comply with Section (b)(4) of Rule 15c2-12 and the rules of the Municipal Securities Rulemaking Board (the “MSRB”).
The Underwriter hereby agrees that it will not request that payment be made by any purchaser of the Series B Bonds prior to delivery by the Underwriter to the purchaser of a copy of the Official Statement. The Underwriter agrees: (i) to provide the Authority and the City with final pricing information on the Series B Bonds on a timely basis; and (ii) to file a copy of the Official Statement, including any supplements prepared by the Authority or the City with the MSRB in accordance with MSRB rules at http://emma.msrb.org. The Authority and the City hereby approve of the use and distribution by the Underwriter of the Preliminary Official Statement in connection with the offer and sale of the Series B Bonds. The Authority and the City will cooperate with the Underwriter in the filing by the Underwriter of the Official Statement with the MSRB.
Section 5. Closing. At 8:30 a.m., California Time, on October __, 2022, or at such other time or date as the Authority and the Underwrite r agree upon (the “Closing Date”), the Authority shall deliver or cause to be delivered to the Trustee, the Series B Bonds, in definitive form, registered in the name of Cede & Co., as the nominee of The Depository Trust Company (“DTC”), so that the Series B Bonds may be authenticated by the Trustee and credited to the account specified by the Underwriter under DTC’s FAST procedures. Concurrently with the delivery of the Series B Bonds, the Authority and the City will deliver the documents hereinafter mentioned at the offices of Norton Rose Fulbright US LLP, Los Angeles, California (“Bond Counsel”), or another place to be mutually agreed upon by the Authority, the City and the Underwriter. The Underwriter will accept such delivery and pay the purchase price of the Series B Bonds as set forth in Section 1 hereof by wire transfer in immediately available funds. This payment for and delivery of the Series B Bonds, together with the delivery of the aforementioned documents, is herein called the “Closing.” The Series B Bonds shall be registered in the name of Cede & Co., as nominee of DTC in denominations of five thousand dollars ($5,000) or a ny integral multiple thereof. The Authority and 7 4865-6627-1027/200356-0552
the City acknowledge that the services of DTC will be used initially by the Underwriter in order to permit the issuance of the Series B Bonds in book-entry form, and agree to cooperate fully with the Underwriter in employing such services.
Section 6. Representations, Warranties and Covenants of the Authority. The Authority represents, warrants and covenants to the Underwriter and the City that:
(a) The Authority is a public body, duly organized and existing under the laws of the State of California (the “State”), including Article 1 of Chapter 5 of Division 7 of Title 1 of the Government Code of the State (the “JPA Act”) and the Joint Exercise of Powers Agreement, dated as of July 9, 1991, and as amended on May 10, 2016 (the “JPA Agreement”), by and among the City, the City as successor agency to the Santa Clarita Redevelopment Agency, and the Santa Clarita Parking Authority.
(b) The Authority has full legal right, power and authority to adopt or enter into, as the case may be, and to carry out and consummate the transactions on its part contemplated by the Authority Documents and the resolution adopted by the Board of Directors of the Authority on September __, 2022 (the “Authority Resolution”) authorizing the issuance of the Series B Bonds and the execution and delivery of the Authority Documents.
(c) By all necessary official action, the Authority has duly authorized and approved the Authority Documents, has duly authorized and approved the Preliminary Official Statement and the Official Statement, and ha s duly authorized and approved the execution and delivery of, and the performance by the Authority of the obligations on its part contained in, the Authority Documents and the consummation by it of all other transactions contemplated by the Authority Documents in connection with the issuance of the Series B Bonds. As of the date hereof, such authorizations and approvals are in full force and effect and have not been amended, modified or rescinded. When executed and delivered, and assuming due execution and delivery by the other parties thereto, if applicable, the Authority Documents will constitute the legally valid and binding obligations of the Authority enforceable in accordance with their respective terms, except as enforcement may be limited by bankruptcy, insolven cy, reorganization, moratorium or similar laws or equitable principles relating to or affecting creditors’ rights generally, or by the exercise of judicial discretion and the limitations on legal remedies agai nst joint powers authorities in the State. The Authority has complied, and will at the Closing be in compliance in all material respects, with the terms of the Authority Documents.
(d) The Authority is not in any material respect in breach of or default under any applicable constitutional provision, law or administrative regulation of any state or of the United States, or any agency or instrumentality of either, or any applicable judgment or decree, or any loan agreement, indenture, bond, note, resolution, agreement or other instrument to which the Authority is a party which breach or default has or may have a materially adverse effect on the ability of the Authority to perform its obligations under the Authority Documents, and no event has occurred and is continuing which with the passage of time or the giving of notice, or both, would constitute such a default or event of default under any such instrument; and the adoption, execution and delivery of the Authority Documents, if applicable, and complia nce with the provisions on the Authority’s part contained therein, will not conflict in any material way with or constitute a material breach of or a material default under any constitutional provision, law, administrative regulation, judgment, decree, loan agreement, indenture, bond, note, resolution, agreement or other instrument to which the Authority is a party, nor will any such execution, delivery, adoption or compliance result in the 8 4865-6627-1027/200356-0552
creation or imposition of any lien, charge or other security interest or encumbrance of any nature whatsoever upon any of the property or assets of th e Authority or under the terms of any such law, regulation or instrument, except as may be provided by the Authority Documents. (e) All material authorizations, approvals, licenses, permits, consents and orders of any governmental authority, legislative body, bo ard, agency or commission having jurisdiction of the matter which are required for the due authorization by, or which would constitute a condition precedent to or the absence of which would materially adversely affect the due performance by the Authority of its obligations in connection with the Authority Documents have been duly obtained or, when required for future performance, are expected to be obtained, other than such approvals, consents and orders as may be required under the Blue Sky or securities laws of any state in connection with the offering and sale of the Series B Bonds; except as described in or contemplated by the Preliminary Official Statement and the Official Statement, all authorizations, approvals, licenses, permits, consents and orders of any gove rnmental authority, board, agency or commission having jurisdiction of the matter which are required for the due authorization by, or which would constitute a condition precedent to or the absence of which would materially adversely affect the due performance by, the Authority of its obligations under the Authority Documents have been duly obtained.
(f) The Authority hereby agrees that it will notify the other parties hereto if, within the period from the date of this Purchase Agreement to and including the date twenty-five (25) days following the end of the underwriting period (as defined herein), the Authority discovers any pre-existing or subsequent fact or becomes aware of the occurrence of any event, in any such case, which might cause the Official Statement (as the same may have then been supplemented or amended) to contain any untrue statement of a material fact or to omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.
(g) As of the time of acceptance hereof and the Closing, except as disclosed in the Official Statement, there is no action, suit, pr oceeding, inquiry or investigation, at law or in equity, before or by any court, governmental authority, public board or body, pending, with service of process upon the Authority having been accomplis hed, or threatened in writing to the Authority:
(i) in any way questioning the corporate existence of the Authority or the titles of the officers of the Authority to their respective offices; (ii) affecting, contesting or seeking to prohibit, restrain or enjoin the issuance or delivery of any of the Series B Bonds, or the payment or collection of Base Rental Payments with respect to the Lease or any amounts pledged or to be pledged to pay the principal of and interest on the Series B Bonds, or in any way c ontesting or affecting the validity of the Series B Bonds or the other Authority Documents or the consummation of the transactions contemplated thereby or hereby, or contesting the exclusion of the interest on the Series B Bonds from taxation or contesting the powers of the Authority or its author ity to issue the Series B Bonds; (iii) which would be likely to result in any material adverse change relating to the business, operations or financial condition of the Authority; or (iv) contesting the completeness or accuracy of the Preliminary Official Statement or the Official Statement or any supplement or amendment thereto or asserting that the Preliminary Official Statement or the Official Statement contained any untrue statement of a material fact or omitted to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. 9 4865-6627-1027/200356-0552
(h) To the Authority’s knowledge, there is no basis for any action, suit, proceeding, inquiry or investigation of the nature described in clauses (i) through (iv) of paragraph 6(g).
(i) As of its date, the information in the Preliminary Official Statement set forth under the caption “THE AUTHORITY” did not, and as of the date hereof does not, contain any untrue statement of a material fact, and as of its da te did not, and as of the date hereof does not, omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. (j) As of the date hereof, the information in the Official Statement set forth under the caption “THE AUTHORITY” does not, and at all times thereafter up to and including the Closing will not, contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.
(k) The Authority will refrain from taking any action, or permitting any action to be taken, with regard to which the Authority may ex ercise control, that results in the loss of the tax-exempt status of the interest on the Series B Bonds. (l) The Authority will refrain from taking any action, or permitting any action to be taken, to reduce the amount of the Base Rental Payments while the Series B Bonds are Outstanding, and the Authority will collect the Base Rental Payments in accordance with the Lease. (m) Any certificate signed by any officer of the Authority authorized to execute such certificate in connection with the execution, sale and delivery of the Series B Bonds and delivered to the Underwriter shall be deemed a representation and warranty of the Authority to the Underwriter and the City as to the statements made therein but not of the person signing such certificate.
Section 7. Representations, Warranties and Covenants of the City. The City represents, warrants and covenants to the Underwriter and the Authority that:
(a) The City is a general law city duly organized and existing under and by virtue of the Constitution and laws of the State.
(b) The City has full legal right, power and authority to adopt or enter into, as the case may be, and to carry out and consummate the transactions on its part contemplated by the City Documents and the resolution adopted by the City Council of the City on September __ 2022 (the “City Resolution”) authorizing the execution and delivery of the City Documents. (c) By all necessary official action, the City has duly authorized and approved the City Documents, has duly authorized and approved the Preliminary Official Statement and the Official Statement, and has duly authorized and approved the execution and delivery of, and the performance by the City of the obligations on its part contained in, the City Documents and the consummation by it of all other transactions contemplated by the City Documents in connection with the issuance of the Series B Bonds. As of the date hereof, such authorizations and approvals are in full force and effect and have not been amended, modified or rescinded. When executed and delivered, and assuming due execution and delivery by the other parties thereto, if applicable, the 10 4865-6627-1027/200356-0552
City Documents will constitute the legally valid a nd binding obligations of the City enforceable in accordance with their respective terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws or equitable principles relating to or affecting creditors’ rights generally, or by the exercise of judicial discretion and the limitations on legal remedies against municipal corporations in the State. The City has complied, and will at the Closing be in compliance in all material respects, with the terms of the City Documents. (d) The City is not in any material respect in breach of or default under any applicable constitutional provision, law or administrative regulation of any state or of the United States, or any agency or instrumentality of either, or any applicable judgment or decree, or any loan agreement, indenture, bond, note, resolution, agreement or other instrument to which the City is a party which breach or default has or may have a materially adverse effect on the ability of the City to perform its obligations under the City Documents, and no event has occurred and is continuing which with the passage of time or the giving of notice, or both, would constitute such a default or event of default under any such instrument; and the adoption, execution and delivery of the City Documents, if applicable, and compliance with the provisions on the City’s part contained therein, will not conflict in any material way with or constitute a ma terial breach of or a material default under any constitutional provision, law, administrative regulation, judgment, decree, loan agreement, indenture, bond, note, resolution, agreement or other instrument to which the City is a party nor will any such execution, delivery, adoption or compliance result in the creation or imposition of any lien, charge or other security interest or encumbrance of any nature whatsoever upon any of the property or assets of the City or under the terms of any such law, regulation or instrument, except as may be provided by the City Documents.
(e) All material authorizations, approvals, licenses, permits, consents and orders of any governmental authority, legislative body, bo ard, agency or commission having jurisdiction of the matter which are required for the due authorization by, or which would constitute a condition precedent to or the absence of which would materially adversely affect the due performance by the City of its obligations in connection with the Ci ty Documents have been duly obtained or, when required for future performance, are expected to be obtained, other than such approvals, consents and orders as may be required under the Blue Sky or securities laws of any state in connection with the offering and sale of the Series B Bonds; except as described in or contemplated by the Preliminary Official Statement, all authorizations, approvals , licenses, permits, consents and orders of any governmental authority, board, agency or commission having jurisdiction of the matter which are required for the due authorization by, or which would constitute a condition precedent to or the absence of which would materially adversely affect the due performance by, the City of its obligations under the City Documents have been duly obtained. (f) As of its date, the Preliminary Official Statement did not, and as of the date hereof, does not, contain any untrue statement of a mate rial fact, and as of its date did not, and as of the date hereof, does not, omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading (except that this representation does not include statements in the Preliminary Official Statement under the captions “THE AUTHORITY” and “UNDERWRITING” and information regarding DTC and its book-entry only system, the Insurer or the Policy, as to which no view is expressed).
(g) As of the date hereof, the Official Statement does not, and at all times thereafter up to and including the Closing will not, contain any untrue statement of a material fact or 11 4865-6627-1027/200356-0552
omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading (except that this representation does not include statements in the Official Statement under the captions “THE AUTHORITY” and “UNDERWRITING” and informa tion regarding DTC and its book-entry only system, the Insurer or the Policy, as to which no view is expressed). (h) The City will advise the Underwriter promptly of any proposal to amend or supplement the Official Statement. The City will advise the Underwriter promptly of the institution of any proceedings known to it by any governmental authority prohibiting or otherwise affecting the use of the Official Statement in connection with th e offering, sale or distribution of the Series B Bonds.
(i) As of the time of acceptance hereof and the Closing, except as disclosed in the Official Statement, there is no action, suit, pr oceeding, inquiry or investigation, at law or in equity, before or by any court, governmental authority, public board or body, pending, with service of process upon the City having been accomplished, or threatened in writing to the City: (i) in any way questioning the corporate existence of the City or the titles of the officers of the City to their respective offices; (ii) affecting, contesting or seeki ng to prohibit, restrain or enjoin the issuance or delivery of any of the Series B Bonds, or the payment or collection of Base Rental Payments with respect to the Lease or of any amounts pledged or to be pledged to pay the principal of and interest on the Series B Bonds, or in any way contesting or affecting the validity of the Series B Bonds, or the City Documents or the consummation of the tran sactions contemplated thereby or hereby, or contesting the exclusion of the interest on the Series B Bonds from taxation, or contesting the powers of the Authority to issue the Series B Bonds; (iii) which would be likely to result in any material adverse change relating to the business, operations or financial condition of the City; and (iv) contesting the completeness or accuracy of th e Preliminary Official Statement or the Official Statement or any supplement or amendment thereto or asserting that the Preliminary Official Statement or the Official Statement contained any untrue statement of a material fact or omitted to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.
(j) To the City’s knowledge, there is no basis for any action, suit, proceeding, inquiry or investigation of the nature described in clauses (i) through (iv) of paragraph 7(i). (k) Until the date which is twenty-five (25) days after the “end of the underwriting period” (as hereinafter defined), if any event shall occur of which the City is aware that would cause the Official Statement to contain any unt rue statement of a material fact or omit to state a material fact necessary in order to make the stat ements in the Official Statement, in light of the circumstances under which they were made, not misleading (except that this representation does not include information regarding DTC and its book entry only system, as to which no view is expressed), the City shall forthwith notify the Underwriter of any such event of which it has knowledge and shall cooperate fully in furnishing any information available to it for any supplement to the Official Statement necessary, in the Underw riter’s reasonable opinion, so that the statements therein as so supplemented will not be misleading in light of the circumstances existing at such time and the City shall promptly furnish to the Unde rwriter a reasonable number of copies of such supplement. As used herein, the term “end of th e underwriting period” means the later of such time as: (i) the Authority delivers the Series B Bonds to the Underwriter; or (ii) the Underwriter does not retain, directly or as a member of an underwriting syndicate, an unsold balance of the Series B Bonds for sale to the public. Unless the Underwrite r gives notice to the contrary, the “end of the 12 4865-6627-1027/200356-0552
underwriting period” shall be deemed to be the Closing Date. Any notice delivered pursuant to this provision shall be written notice delivered to the Unde rwriter at or prior to the Closing Date of the Series B Bonds and shall specify a date (other than the Closing Date) to be deemed the “end of the underwriting period.”
(l) Except as disclosed in the Preliminary Official Statement and the Official Statement, the City has not within the last five y ears failed to comply in any material respect with any continuing disclosure undertakings with regard to Rule 15c2-12, to provide annual reports or notices of material events specified in such rule.
(m) The City will refrain from taking any action, or permitting any action to be taken, with regard to which the City may exercise control, that results in the loss of the tax-exempt status of the interest on the Series B Bonds.
(n) The financial statements relating to the receipts, expenditures and cash balances of the City as of June 30, 2021 attached as Appendix B to the Official Statement fairly represent the receipts, expenditures and cash balances of the City. Except as disclosed in the Official Statement, there has not been any materially adverse change in the financial condition of the City or in its operations since June 30, 2021 and there has been no occurrence, circumstance or combination thereof which is reasonably expected to result in any such materially adverse change. (o) To the extent required by law, the City will undertake, pursuant to the Continuing Disclosure Certificate and the other City Documents, to provide annual reports and notices of certain events, if material. A description of this undertaking is set forth in Appendix D to the Preliminary Official Statement and will also be set forth in the Official Statement. (p) Except in connection with the issuance of refunding bonds pursuant to the terms of the Indenture or as permitted under the Lease due to damage, destruction, or substantial interference with the use and occupancy by the City of the City Hall Leased Property or any portion thereof, the City will refrain from taking any action, or permitting any action to be taken, to reduce the amount of the Base Rental Payments while the Series B Bonds are Outstanding, and the City will pay the Base Rental Payments in accordance with the Lease. (q) Any certificate signed by any officer of the City authorized to execute such certificate in connection with the execution, sale a nd delivery of the Series B Bonds and delivered to the Underwriter shall be deemed a representation and warranty of the City to the Underwriter and the Authority as to the statements made therein but not of the person signing such certificate.
Section 8. Conditions to the Obligatio ns of the Underwriter. The Underwriter has entered into this Purchase Agreement in reliance upon the representations and warranties of the Authority and the City contained herein. The obligations of the Underwriter to accept delivery of and pay for the Series B Bonds on the Closing Date shall be subject, at the option of the Underwriter, to the accuracy in all material respects of the stat ements of the officers and other officials of the Authority and of the City, as well as authorized representatives of Bond Counsel and the Trustee made in any Bonds or other documents furnished pursuant to the provisions hereof; to the performance by the Authority and the City of their obligations to be performed hereunder at or prior to the Closing Date; and to the following additional conditions:
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(a) The representations, warranties and covenants of the City and the Authority contained herein shall be true and correct at the date hereof and at the time of the Closing, as if made on the Closing Date.
(b) At the time of Closing, the City Documents and the Authority Documents shall be in full force and effect as valid and binding agreements between or among the various parties thereto, and the City Documents, the Authority Documents, the City Resolution, the Authority Resolution, and the Official Statement shall not have been amended, modified or supplemented except as may have been agreed to in writing by the Underwriter. (c) At the time of the Closing, no material default shall have occurred or be existing under the City Documents, Authority Documents, or any other agreement or document pursuant to which any of the City’s financial obligations were executed and delivered, and the City shall not be in default in the payment of principal or interest with respect to any of its financial obligations, which default would materially adversel y impact the ability of the City to pay the Base Rental Payments.
(d) In recognition of the desire of the Authority, the City and the Underwriter to effect a successful public offering of the Series B Bonds, and in view of the potential adverse impact of any of the following events on such a public offering, this Purchase Agreement shall be subject to termination in the discretion of the Underwriter by notification, in writing, to the Authority and the City prior to delivery of and payment for the Seri es B Bonds, if at any time prior to such time, regardless of whether any of the following statements of fact were in existence or known of on the date of this Purchase Agreement:
(i) any event shall occur which makes untrue any material statement or results in an omission to state a material fact necessary to make the statements in the Official Statement, in the light of the circumstances under which they were made, not misleading, which event, in the reasonable opinion of the Underwriter would materially or adversely affect the ability of the Underwriter to market the Series B Bonds; or
(ii) the marketability of the Series B Bonds or the market price thereof, in the opinion of the Underwriter, has been materially adversely affected by an amendment to the Constitution of the United States or by any legislati on in or by the Congress of the United States or by the State, or the amendment of legislation pending as of the date of this Purchase Agreement in the Congress of the United States, or the recommendation to Congress or endorsement for passage (by press release, other form of notice or otherwise) of legislation by the President of the United States, the Treasury Department of the United States, the Internal Revenue Service or the Chairman or ranking minority member of the Committee on Finance of the United States Senate or the Committee on Ways and Means of the United States Ho use of Representatives, or the proposal for consideration of legislation by either such Committee or by any member thereof, or the presentment of legislation for consideration as an option by either such Committee, or by the staff of the Joint Committee on Taxation of the Congress of the United States, or the favorable reporting for passage of legislation to either House of the Congress of the United States by a Committee of such House to which such legislation has been referred for cons ideration, or any decision of any federal or state court or any ruling or regulation (final, temporary or proposed) or official statement on behalf of the United States Treasury Department, the Internal Reve nue Service or other federal or State authority affecting the federal or State tax status of the Author ity or the City, or the interest on or with respect to bonds or notes (including the Series B Bonds); or
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(iii) any legislation, ordinance, rule or regulation shall be enacted by any governmental body, department or authority of the State, or a decision by any court of competent jurisdiction within the State shall be rendered which materially adversely affects the market price of the Series B Bonds; or
(iv) an order, decree or injunction issued by any court of competent jurisdiction, or order, ruling, regulation (final, temporary or proposed), official statement or other form of notice or communication issued or made by or on behalf of the Securities and Exchange Commission, or any other governmental authority having jurisdiction of the subject matter, to the effect that: (i) obligations of the general character of the Series B Bonds, or the Series B Bonds, including any or all underlying arrangements, are not exempt from registration under the Securities Act of 1933, as amended, or that the Indenture is not exempt from qualification under the Trust Indenture Act of 1939, as amended; or (ii) the issuan ce, offering or sale of obligations of the general character of the Series B Bonds, or the issuance, offering or sale of the Series B Bonds, including any or all underlying obligations, as contemplated hereby or by the Official Statement, is or would be in violation of the federal securities laws as amended and then in effect; or (v) legislation shall be enacted by the Congress of the United States, or a decision by a court of the United States shall be rendered, to the effect that obligations of the general character of the Series B Bonds, or the Series B Bonds are not exempt from registration under or other requirements of the Securities Act of 1933, as amended and as then in effect, or the Securities Exchange Act of 1934, as amended and as then in effect, or that the Indenture is not exempt from qualification under or other requirements of the Trust Indenture Act of 1939, as amended and as then in effect; or
(vi) additional material restrictions not in force as of the date hereof shall have been imposed upon trading in securities generally by any domestic governmental authority or by any domestic national securities exchange, which ar e material to the marketability of the Series B Bonds; or
(vii) a general banking moratorium shall have been declared by federal, State or New York authorities, or the general suspension of trading on any national securities exchange; or
(viii) in the reasonable judgment of the Underwriter, the market price or marketability of the Series B Bonds, or the ability of the Underwriter to enforce contracts for the sale of the Series B Bonds is materially adversely a ffected by (1) an outbreak or escalation of hostilities or the declaration by the United States of a national emergency or war or (2) any other calamity or crisis in the financial markets of the United States or elsewhere or the escalation of such calamity or crisis; or
(ix) any rating of the Series B Bonds or the rating of any obligations of the City secured by or payable from the City’s general fund shall have been downgraded or withdrawn by a national rating service, which, in the opinion of the Underwriter, materially adversely affects the market price of the Series B Bonds; or
(x) the commencement of any action, suit or proceeding described in Section 6(g) or Section 7(i).
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(e) at or prior to the Closing, the Unde rwriter shall receive the following documents, in each case to the reasonable satisfaction in form and substance of the Underwriter:
(i) The Authority Resolution relating to the Series B Bonds and authorizing the execution and delivery of the Series B Bonds and the Authority Documents and the Official Statement signed by an authorized official of the Authority; (ii) The City Resolution relating to the Series B Bonds and authorizing the execution and delivery of the City Documents and the delivery of the Series B Bonds and the Official Statement signed by an authorized official of the City; (iii) The City Documents and the Authority Documents duly executed and delivered by the respective parties thereto, with only such amendments, modifications or supplements as may have been agreed to in writing by the Underwriter; (iv) The approving opinion of Bond Counsel dated the Closing Date and addressed to the Authority and the City, in substan tially the form attached as [Appendix E-1] to the Official Statement, and a reliance letter thereon addressed to the Underwriter; (v) A supplemental opinion of Bond Counsel dated the Closing Date and addressed to the Underwriter, to the effect that:
(A) the statements on the cover of the Official Statement and in the Official Statement under the captions “INTRODUCTION,” “DESCRIPTION OF THE BONDS,” [“SECURITY AND SOURCES OF PAYMENT FOR THE BONDS,”] and “TAX MATTERS,” and in [Appendix C—“SUMMARY OF CERTAIN PROVISIONS OF THE PRINCIPAL LEGAL DOCUMENTS”] and [Appendix E-1—“SERIES B BONDS - FORM OF OPINION OF BOND COUNSEL,”] excluding any material that may be treated as included under such captions and appendices by any cross-reference, insofar as such statements expressly summarize provisions of the City Documents, the Authority Documents, and Bond Counsel’s final opinion concerning certain federal tax matters relating to the Series B Bonds, are accurate in all material respects as of the Closing Date, provided that Bond Counsel need not express any opinion with respect to any financial or statistical data contained therein or with respect to the book-entry system in which the Series B Bonds are initially delivered;
(B) The Purchase Agreement and the Continuing Disclosure Certificate have been duly authorized, executed and delivered by the City and the Authority, as applicable, and are the valid, legal and binding agreements of the City and the Authority, as applicable, enforceable in accordance with their respective terms, except that the rights and obligations under the Purchase Agreement and the Continuing Disclosure Certificate are subject to bankruptcy, insolvency, reorganization, moratori um, fraudulent conveyance and other similar laws affecting creditors’ rights, to the application of e quitable principles if equitable remedies are sought, to the exercise of judicial discretion in appropriate cases and to limitations on legal remedies against public agencies in the State, and provided that no opinion need be expressed with respect to any indemnification or contribution provisions contained therein; (C) The Series B Bonds are not subject to the registration requirements of the Securities Act of 1933, as amended, and the Indenture is exempt from qualification under the Trust Indenture Act of 1939, as amended; and 16 4865-6627-1027/200356-0552
(vi) The Official Statement, executed on behalf of the Authority and the City, and the Preliminary Official Statement;
(vii) Evidence that the rating or ratings on the Series B Bonds are in effect as described in the Official Statement;
(viii) A certificate, dated the Closing Date, signed by a duly authorized officer of the Authority satisfactory in form and s ubstance to the Underwriter to the effect that:
(i) the representations, warranties and covenants of the Authority contained in this Purchase Agreement are true and correct in all material respects on and as of the Closing Date with the same effect as if made on the Closing Date by the Authority, and the Authority has complied with, in all material respects, all of the terms and conditions of this Purchase Agreement required to be complied with by the Authority at or prior to the Closing Date; and (ii) no event affecting the Authority has occurred since the date of the Official Statement which should be disclosed in the Official Statement for the purposes for which it is to be used or which is necessary to disclose therein in order to make the statements and information therein not misleading in any material respect; (ix) A certificate, dated the Closing Date, signed by a duly authorized officer of the City satisfactory in form and substa nce to the Underwriter to the effect that: (i) the representations, warranties and covenants of the City contained in this Purchase Agreement are true and correct in all material respects on and as of th e Closing Date with the same effect as if made on the Closing Date by the City, and the City has complied with, in all material respects, all of the terms and conditions of the Purchase Agreement required to be complied with by the City at or prior to the Closing Date; and (ii) no event affecting the City has occurred since the date of the Official Statement which should be disclosed in the Official Statement for the purposes for which it is to be used or which is necessary to disclose therein in order to make the statements and information therein not misleading in any material respect;
(x) An opinion dated the Closing Date and addressed to the Underwriter, of the City Attorney, as general counsel to the Authority, to the effect that:
(A) The Authority is a public body, organized and existing under the laws of the State, including the JPA Act and the JPA Agreement; (B) The Authority Resolution has been duly adopted by the Authority, is in full force and effect and has not been modified, amended, rescinded or repealed since its date of adoption;
(C) Except as otherwise disclosed in the Official Statement, there is no litigation, proceeding, action, suit, or investigation at law or in equity before or by any court, governmental authority or body, pending, with service of process upon the Authority having been accomplished, or threatened in writing against the Authority, challenging the creation, organization or existence of the Authority, or the validity of the Authority Documents or seeking to restrain or enjoin the issuance of the Series B Bonds, the collec tion of Base Rental Payments with respect to the Lease or the repayment of the Series B Bonds or in any way contesting or affecting the validity of the Authority Documents or contesting the authority of the Authority to enter into or perform its obligations under any of the Authority Documents;
17 4865-6627-1027/200356-0552
(D) The execution and delivery of the Authority Documents and the issuance of the Series B Bonds and compliance with the provisions thereof, do not and will not in any material respect conflict with or constitute on the part of the Authority a breach of or default under any agreement or other instrument to which the Authority is a party or by which it is bound or any existing law, regulation, court order or consent decree to which the Authority is subject, which breach or default has or may have a material adverse effect on the ability of the Authority to perform its obligations under the Authority Documents; and
(E) No authorization, approval, consent, or other order of the State or any other governmental body within the State is required for the valid authorization, execution and delivery of the Authority Documents or the Official Statement by the Authority or the consummation by the Authority of the transactions on its part contemplated therein, except such as have been obtained and except such as may be required under state securities or Blue Sky laws in connection with the purchase and distribution of the Series B Bonds by the Underwriter; (xi) an opinion dated the Closing Date and addressed to the Underwriter, of the City Attorney, to the effect that:
(A) The City is a general law city, duly organized and existing under and by virtue of the Constitution and laws of the State; (B) The City Resolution has been duly adopted by the City Council, is in full force and effect and has not been modified, amended, rescinded or repealed since its date of adoption;
(C) Except as otherwise disclosed in the Official Statement, there is no litigation, proceeding, action, suit, or investigation at law or in equity before or by any court, governmental authority or body, pending, with service of process upon the City having been accomplished, or threatened in writing against the City, challenging the creation, organization or existence of the City, or the validity of the City Documents or seeking to restrain or enjoin the issuance of the Series B Bonds, the payment of the Base Rental Payments or the repayment of the Series B Bonds or in any way contesting or affecting the validity of the City Documents or contesting the authority of the City to enter into or perform its obligations under any of the City Documents, or which, in any manner, questions the right of the City to pay the Base Rental Payments under the Lease;
(D) The execution and delivery of the City Documents and compliance with the provisions thereof, do not and will not in any material respect conflict with or constitute on the part of the City a breach of or default under any agreement or other instrument to which the City is a party or by which it is bound or any existing law, regulation, court order or consent decree to which the City is subject, which breach or default has or may have a material adverse effect on the ability of the City to perform its obligations under the City Documents; and (E) No authorization, approval, consent, or other order of the State or any other governmental body within the State is required for the valid authorization, execution and delivery of the City Documents or the consummation by the City of the transactions on its part contemplated therein, except such as have been obtained and except such as may be required under state securities or Blue Sky laws in connecti on with the purchase and distribution of the Series B Bonds by the Underwriter;
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(xii) An opinion of Norton Rose Fulbright US LLP, Los Angeles, California, Bond Counsel, in its capacity as Disclosure Counsel, dated the Closing Date and addressed to the Authority, the City and the Underwriter, to the effect that, based upon the information made available to them in the course of their participation in the preparation of the Preliminary Official Statement and the Official Statement and without passing on and without assuming any responsibility for the accuracy, comple teness and fairness of the statements in the Preliminary Official Statement and the Official Statement, and having made no independent investigation or verification thereof, and stated as a matter of fact and not opinion that, during the course of its representation of the Authority and the City on this matter, no facts came to the attention of the attorneys in its firm rendering legal services in connection with the Preliminary Official Statement and the Official Statement which caused them to believe that the Preliminary Official Statement as of its date and as of the date hereof, or the Official Statement as of its date and as of the Closing Date (except any CUSIP numbers, financial, accounting, statistical or economic, engineering or demographic data or forecasts, numbers, charts, tables, graphs, estimates, projections, assumptions or expressions of opinion, environmental litigati on, environmental matters, information relating to The Depository Trust Company and its book-entry system, and the Appendices thereto, included or referred to therein, which shall be expressly excluded from the scope of this paragraph and as to which such firm need not express any opinion or view) contained or contains any untrue statement of a material fact or omitted or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; (xiii) An opinion of Stradling Yocca Carlson & Rauth, a Professional Corporation, counsel to the Underwriter, in form and substance satisfactory to the Underwriter; (xiv) An opinion of counsel to the Trustee, addressed to the Underwriter and dated the Closing Date, in form and substance satisfactory to the Underwriter and to Bond Counsel;
(xv) A certificate, dated the Closing Date, signed by a duly authorized official of the Trustee in form and substance satisfactory to the Underwriter; (xvi) The preliminary and final Statement of Sale required to be delivered to the California Debt and Investment Advisory Commission pursuant to Section 53583 of the Government Code and Section 8855(g) of the Government Code; (xvii) A copy of the executed Blanket Issuer Letter of Representations by the Authority relating to DTC’s book-entry system;
(xviii) Tax and nonarbitrage certifications of the Authority and the City in form and substance to the reasonable satisfaction of Bond Counsel and the Underwriter; (xix) A certificate, dated the date of the Preliminary Official Statement, of the City, as required under Rule 15c2-12;
(xx) A certificate, dated the date of the Preliminary Official Statement, of the Authority, as required under Rule 15c2-12;
(xxi) Certified copies of the JPA Agreement and all amendments thereto and related certificates issued by the Secretary of State of the State; 19 4865-6627-1027/200356-0552
(xxii) A certified copy of the general resolution of the Trustee authorizing the execution and delivery of certain documents by certain officers of the Trustee, which resolution authorizes the execution and delivery of the Indenture and the authentication and delivery of the Series B Bonds by the Trustee;
(xxiii) A copy of a CLTA or ALTA title insurance policy in an amount equal to the principal amount of the Series B Bonds, insuri ng the City’s leasehold interest in the City Hall Leased Property, subject only to permitted encumbrances or such other encumbrances approved in writing by the Underwriter;
(xxiv) Certificates, dated the Closing Date, regarding compliance with the insurance requirements of the Lease;
(xxv) Such additional legal opinions, certif icates, proceedings, instruments or other documents as Bond Counsel or the Underwriter may reasonably request.
Section 9. Changes in Official Statement. After the Closing, neither the Authority nor the City will adopt any amendment of or supplem ent to the Official Statement to which the Underwriter shall reasonably object in writing. Within 90 days after the Closing or within 25 days following the end of the underwriting period, whichever occurs first, if any event relating to or affecting the Series B Bonds, the Trustee, the City or the Authority shall occur as a result of which it is necessary, in the opinion of the Underwriter, to amend or supplement the Official Statement in order to make the Official Statement not misleading in any material respect in the light of the circumstances existing at the time it is delivered to a purchaser, the Authority will forthwith prepare and furnish to the Underwriter an amendment or supplement that will amend or supplement the Official Statement so that it will not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the stat ements therein, in the light of the circumstances existing at the time the Official Statement is delivered to purchaser, not misleading. The City and the Authority shall cooperate with the Underwriter in the filing by the Underwriter of such amendment or supplement to the Official Statement with the MSRB.
Section 10. Expenses. Whether or not the transactions contemplated by this Purchase Agreement are consummated, the Underwriter shall be under no obligation to pay, and the Authority shall pay only from the proceeds of the Series B Bonds , or cause the City to pay out of the proceeds of the Series B Bonds or any other legally available funds of the City or the Authority, but only as the Authority and such other party providing such services may agree, all expenses and costs of the Authority and the City incident to the performance of their obligations in connection with the authorization, execution, sale and delivery of the Series B Bonds to the Underwriter, including, without limitation, printing costs, rating agency fees and charges, initial fees of the Trustee, including fees and disbursements of their counsel, if any, fees and disbursements of Bond Counsel, Disclosure Counsel, the Municipal Advisor, and other professional advisors employed by the Authority or the City, costs of preparation, printing, signing, transportation, delivery and safekeeping of the Series B Bonds and for expenses (included in the expense component of the spread) incurred by the Underwriter on behalf of the City’s employees whic h are incidental to implementing this Purchase Agreement, including, but not limited to, meals, tran sportation, lodging, and entertainment of those employees. The Underwriter shall pay all out-of- pocket expenses of the Underwriter, including, without limitation, the fees and expenses of its counsel, advertising expenses, the California Debt and Investment Advisory Commission fee, CUSIP Services Bureau charges, regulatory fees imposed on new securities issuers and any and all other expenses incurred by the Underwriter in connection with 20 4865-6627-1027/200356-0552
the public offering and distribution of the Series B Bonds. Certain payments may be in the form of inclusion of such expenses in the expense component of the Underwriter’s discount.
Section 11. Notices. Any notice or other communication to be given to the Underwriter under this Purchase Agreement may be given by delivering the same in writing to Stifel, Nicolaus & Company, Incorporated, 2121 Avenue of the Stars, Suite 2100, Los Angeles, California 90067, Attention: Sara Brown. All notices or communications hereunder by any party shall be given and served upon each other party. Any notice or co mmunication to be given the Authority under this Purchase Agreement may be given by delivering the same in writing to the Santa Clarita Public Financing Authority, c/o City of Santa Clarita, 23920 Valencia Boulevard, Santa Clarita, California 91355, Attention: Executive Director. Any notice or communication to be given the City under this Purchase Agreement may be given by delivering the same in writing to the City of Santa Clarita, 23920 Valencia Boulevard, Santa Clarita, California 91355, Attention: City Manager.
Section 12. Parties in Interest. This Purchase Agreement is made solely for the benefit of the Authority, the City and the Underwriter (i ncluding the successors or assigns thereof) and no other person shall acquire or have any right here under or by virtue hereof. All representations, warranties and agreements of the Authority and the City in this Purchase Agreement shall remain operative and in full force and effect regardless of any investigation made by or on behalf of the Underwriter and shall survive the delivery of and payment for the Series B Bonds.
Section 13. Severability. In case any one or more of the provisions contained herein shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision hereof.
Section 14. Counterparts. This Purchase Agreement may be executed by the parties hereto in separate counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute but one and the same instrument. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
S-1
4865-6627-1027/200356-0552
Section 15. Governing Law. This Purchase Agreement shall be governed by and construed in accordance with the laws of the State.
STIFEL, NICOLAUS & COMPANY,
INCORPORATED
By:
Title: Authorized Officer
Accepted as of the date first stated above:
CITY OF SANTA CLARITA
By:
Its: Kenneth W. Striplin, City Manager
Time of Execution: _____ a.m./p.m. California Time
SANTA CLARITA PUBLIC FINANCING AUTHORITY
By:
Its: Kenneth W. Striplin, Executive Director
Time of Execution: _____ a.m./p.m. California Time
A-1
4865-6627-1027/200356-0552
EXHIBIT A
SANTA CLARITA PUBLIC FINANCING AUTHORITY
LEASE REVENUE BONDS
(ENERGY EFFICIENCY PROGRAM)
SERIES 2022B
MATURITY SCHEDULE
Maturity
Date
(December 1)
Principal
Amount Interest Rate
Initial
Offering
Price
10% Test
Used
Hold the
Offering
Price Rule
Used
T
T
T Term Bonds.
C Priced to the first optional redemption date of June 1,____, at par.
REDEMPTION
Optional Redemption . The Series B Bonds maturing on or after December 1, 20__ are subject to redemption prior to their respective maturity dates as a whole or in part on any date on or after December 1, 20__, in any order deemed reasonable by the Authority, and by lot within a maturity, from prepayments of City Hall Base Rent al Payments made at the option of the City pursuant to the City Hall Lease, at a redemption price equal to the principal amount of the Series B Bonds to be redeemed, plus accrued but unpaid interest thereon to the date fixed for redemption, without premium.
Mandatory Sinking Fund Redemption of Term Bonds. The City Hall Term Bonds maturing on December 1, 20___ and December 1, 20___, shall be subject to mandatory redemption, in part by lot, from sinking account payments set forth in the following schedules on December 1, in each year shown below until maturity, at a redemption price equal to the principal amount thereof to be redeemed (without premium), together with interest accrued thereon to the date fixed for redemption.
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City Hall Term Bonds Maturing December 1, ______
Sinking Fund
Redemption Date
(December 1)
Principal Amount
To Be Redeemed
City Hall Term Bonds Maturing December 1, ______
Sinking Fund
Redemption Date
(December 1)
Principal Amount
To Be Redeemed
City Hall Term Bonds Maturing December 1, ______
Sinking Fund
Redemption Date
(December 1)
Principal Amount
To Be Redeemed
Extraordinary Redemption. The Series B Bonds are subject to redemption prior to their respective maturity dates, as a whole or in part on a pro rata basis, on any date from prepayments of the Base Rental Payments made by the City pursuant to the Lease out of funds received by the City due to a taking of the City Hall Leased Property or any portion thereof under the power of eminent domain or from insurance proceeds received by the City due to damage to or destruction of the City Hall Leased Property or any portion thereof, under the circumstances and upon the conditions and terms prescribed in the Indenture and in the Lease. Redemption of the Series B Bonds pursuant to this paragraph will be made at a redemption price equal to the sum of the principal of the Series B Bonds to be redeemed plus accrued but unpaid interest thereon to the date fixed for redemption, without premium.
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EXHIBIT B
SANTA CLARITA PUBLIC FINANCING AUTHORITY
LEASE REVENUE BONDS
(ENERGY EFFICIENCY PROGRAM)
SERIES 2022B
FORM OF ISSUE PRICE CERTIFICATE
The undersigned, on behalf of Stifel, Nicolaus & Company, Incorporated (“Stifel”) hereby certifies as set forth below with respect to the sale and issuance of the above-captioned bonds (the “Bonds”).
1. Sale of the General Rule Maturities . As of the date of this certificate, for each Maturity of the General Rule Maturities, the first price at which at least 10% of such Maturity was sold to the Public is the respective price listed in Schedule A.
2. Initial Offering Price of the Hold-the-Offering-Price Maturities. (a) Stifel offered the Hold-the-Offering-Price Maturities to the Public for purchase at the respective initial offering prices listed in Schedule A (the “Initial Offering Prices”) on or before the Sale Date. A copy of the pricing wire or equivalent communication for the Series A Bonds is attached to this certificate as Schedule B.
(b) As set forth in the Bond Purchase Agreement, dated October __, 2022, by and among Stifel, the Issuer (as defined below) and the C ity of Santa Clarita, Stifel has agreed in writing that, (i) for each Maturity of the Hold-the-Offering -Price Maturities, it would neither offer nor sell any of the Series A Bonds of such Maturity to any person at a price that is higher than the Initial Offering Price for such Maturity during the Holding Period for such Maturity (the “hold-the-offering- price rule”), and (ii) any selling group agreement shall contain the agreement of each dealer who is a member of the selling group, and any retail distribution agreement shall contain the agreement of each broker-dealer who is a party to the retail distribution agreement, to comply with the hold-the- offering-price rule. Pursuant to such agreement, no Underwriter (as defined below) has offered or sold any Maturity of the Hold-the-Offering-Price Maturities at a price that is higher than the respective Initial Offering Price for that Maturity of the Series A Bonds during the Holding Period.
3. Defined Terms.
(a) General Rule Maturities means those Maturities of the Series A Bonds listed in Schedule A hereto as the “General Rule Maturities.”
(b) Hold-the-Offering-Price Maturities means those Maturities of the Series A Bonds listed in Schedule A hereto as the “Hold-the-Offering-Price Maturities.” (c) Holding Period means, with respect to a Hold-the-Offering-Price Maturity, the period starting on the Sale Date and ending on the earlier of (i) the close of the fifth business day after the Sale Date, or (ii) the date on which Stifel has sold at least 10% of such Hold-the-Offering- Price Maturity to the Public at prices that are no higher than the Initial Offering Price for such Hold- the-Offering-Price Maturity.
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(d) Issuer means the Santa Clarita Public Financing Authority. (e) Maturity means Bonds with the same credit and payment terms. Bonds with different maturity dates, or Bonds with the same maturity date but different stated interest rates, are treated as separate maturities.
(f) Public means any person (including an individual, trust, estate, partnership, association, company, or corporation) other than an Underwriter or a related party to an Underwriter.
The term “related party” for purposes of this certificate generally means any two or more persons who have greater than 50 percent common ownership, directly or indirectly. (g) Sale Date means the first day on which there is a binding contract in writing for the sale of a Maturity of the Series A Bonds. The Sale Date of the Series A Bonds is _____, 2022.
(h) Underwriter means (i) any person that agrees pursuant to a written contract with the Issuer (or with the lead underwriter to fo rm an underwriting syndicate) to participate in the initial sale of the Series A Bonds to the Public, and (ii) any person that agrees pursuant to a written contract directly or indirectly with a person described in clause (i) of this paragraph to participate in the initial sale of the Series A Bonds to the Public (including a member of a selling group or a party to a retail distribution agreement participating in the initial sale of the Series A Bonds to the Public).
The representations set forth in this certificate are limited to factual matters only. Nothing in this certificate represents Stifel’s interpretation of any laws, including specifically Sections 103 and 148 of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations thereunder.
The undersigned understands that the foregoing information will be relied upon by the Issuer with respect to certain of the representations set fo rth in the Tax Certificate and with respect to compliance with the federal income tax rules af fecting the Series A Bonds, and by Norton Rose Fulbright US LLP in connection with rendering its opi nion that the interest on the Series A Bonds is excluded from gross income for federal income tax purposes, the preparation of the Internal Revenue Service Form 8038-G, and other federal income tax advice that it may give to the Issuer from time to time relating to the Series A Bonds.
STIFEL, NICOLAUS & COMPANY,
INCORPORATED
By:
Name:
By:
Name:
Dated: _________ __, 2022
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SCHEDULE A
SALE PRICES OF THE GENERAL RULE MATURITIES AND INITIAL OFFERING
PRICES OF THE HOLD-THE-OFFERING-PRICE MATURITIES
(Attached)
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SCHEDULE B
PRICING WIRE OR EQUIVALENT COMMUNICATION
(Attached)