9/15//22
FIRST SUPPLEMENTAL INDENTURE
by and between
SANTA CLARITA PUBLIC FINANCING AUTHORITY
and
U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION
as Trustee
Dated as of October 1, 2022
Relating to:
$[principal amount]
Santa Clarita Public Financing Authority
Lease Revenue Bonds
(Energy Efficiency Program)
Series 2022A
(Green Bonds)
TABLE OF CONTENTS
Page
-i-
PART 1
ADDITION OF ARTICLE X
PART 1.1 ADDITION OF ARTICLE X ...................................................................................... 2 ARTICLE X-2022A BONDS ...................................................... 3 Section 10.01 Definitions.................................................................................................. 3 Section 10.02 Terms of the 2022A Bonds ........................................................................ 4 Section 10.03 Redemption of the 2022A Bonds ............................................................... 5 Section 10.04 Form of the 2022A Bonds............................................................................
Section 10.05 Execution of the 2022A Bonds ....................................................................
Section 10.06 Application of Proceeds of the 2022A Bonds............................................ 5 Section 10.07 Reopening of Co sts of Issuance Fund ........................................................ 5 Section 10.08 2022A Account of the Project Fund .......................................................... 6 Section 10.09 Tax Covenants Re lating to the 2022A Bonds ............................................ 6 Section 10.09 Amendment of Exhibit D ........................................................................... 9 PART 2
MISCELLANEOUS
PART 2.1 EFFECT OF FIRST SUPPLEMENTAL INDENTURE ........................................... 10 PART 2.2 EFFECTIVE DATE OF FIRST SUPPLEMENTAL INDENTURE ......................... 10 PART 2.3 APPLICABLE LAW ................................................................................................. 10 PART 2.4 COUNTERPARTS .................................................................................................... 10
EXHIBIT D – AMENDED FORM OF NET PROCEEDS REQUISITION
EXHIBIT E – FORM OF 2022A BOND
EXHIBIT F – FORM OF 2022A COSTS OF ISSUANCE REQUISITION EXHIBIT G – FORM OF 2022A ACCOUNT OF THE PROJECT FUND REQUISITION
131735222.3
FIRST SUPPLEMENTAL INDENTURE
THIS FIRST SUPPLEMENTAL INDENTURE (thi s “First Supplemental Indenture”) is made, entered into and dated as of Oct ober 1, 2022, by and between the SANTA CLARITA PUBLIC FINANCING AUTHORITY (t he “Authority”), a joint exercise of powers authority organized and existing under the laws of the State of Cali fornia, and U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION (form erly known as U.S. Bank National Association), a national banking as sociation organized and existing under the laws of the United States of America, as Trustee (the “Trustee”).
W I T N E S S E T H :
WHEREAS, the Authority is authorized pursuant to the Marks-Roos Local Bond Pooling Act of 1985 to purchase, with the proceeds of b onds of the Authority, bonds of local agencies within the State of California in order to assist such local agencies in financing or refinancing public capital improvements;
WHEREAS, pursuant to the Indenture, dated as of October 1, 2020 (the “Original Indenture”) by and between the Authority and the Trustee, the Authority issued the $10,645,000 Santa Clarita Public Financing Authority Leas e Revenue Bonds (Recreational Facility) Series 2020A and the $3,625,000 Santa Clarita Public Fina ncing Authority Fede rally Taxable Lease Revenue Bonds (Recreational Facility) Series 20 20A-T (collectively, the “2020 Bonds”), for the purpose of financing the acquisiti on of an approximately 93,000 squa re foot recrea tion facility (the “Facility”) located on an approximately 4.4 acre parcel located at 27745 Smyth Drive within the City (the “Site” and together with the Faci lity, the “Recreational Facility”) (capitalized undefined terms have the meanings ascribed thereto in the Original Indenture); WHEREAS, the Original Indent ure provides that, for any pu rpose the Authority may at any time issue one or more Series of Additio nal Bonds (in addition to the 2020 Bonds) payable from Revenues as provided therein on a parity with all other Bonds theretofore issued thereunder, but only subject to the conditions precedent to the issuance of such Additional Bonds specified in the Original Indenture, including amendment of that certain Lease Agreement, dated as of October 1, 2020 (the “Original Lease”), be tween the Authority and the City, whereby the Authority has agreed to lease the Recreational F acility (the “Leased Prope rty”) to the City, and the City is obligated to make Base Rental Paymen ts (as defined therein) to the Authority for the sublease of the Leased Property; and
WHEREAS, the Authority and the City have entered into a First Amendment to Lease Agreement, dated as of October 1, 2022 (the “Fir st Amendment to Lease,” and together with the Original Lease, as amended, the “Lease”) whic h amendment shall increase the Base Rental Payments payable by the City thereunder by an aggregate amount equal to the principal and interest due and payable on such Additional Bonds;
WHEREAS, the Original Indenture provides th at the Original Indenture and the rights and obligations of the Authorit y, the Trustee and the Owners of the Bonds may be modified or amended from time to time and at any time by a Supplemental Indenture, which the Authority and the Trustee may enter into without the consent of any Bond Owners to provide for the
2 issuance of one or more Seri es of Additional Bonds, and to provide the term s and conditions under which such Series of Additional Bonds may be issued, subject to and in accordance with the provisions of the Original Indenture;
WHEREAS, the City desires to finance certa in energy efficiency improvements for City buildings and facilities, includi ng but not limited to, HVAC, lighting, water conservation, solar, and refrigeration improvements (the “2022 Project”); and WHEREAS, the City has requested that th e Authority issue its Lease Revenue Bonds (Energy Efficiency Program) Series 2022A (Gr een Bonds) (the “2022A Bonds”) as Additional Bonds on parity with the 2020 Bonds for the purpos e of financing a portion of the costs of the 2022 Project and to pay for the costs of issuing the 2022A Bonds; WHEREAS, concurrently with the issuance of the 2022A Bonds, the City has requested that the Authority also issue its Lease Revenu e Bonds (Energy Efficiency Program) Series 2022B (Green Bonds) (the “2022B Bonds”) for the purpose of financing a portion of the costs of the 2022 Project, which 2022B Bonds are on parity with the $10,320,000 Lease Revenue Refunding Bonds (Golden Valley Road), Series 2016A (the “2016 Bonds”), secured by lease payments under a separate lease;
WHEREAS, in order to provide for the authentication and delivery of the 2022A Bonds, to establish and declare the te rms and conditions upon which the 2022A Bonds are to be issued and secured and to secure the pa yment of the principal thereof, premium, if any, and interest thereon, the Authority has authorized the exec ution and delivery of this First Supplemental Indenture; and
WHEREAS, the Authority has determined th at all acts and proceedings required by law necessary to make the 2022A Bonds, when ex ecuted by the Authority, authenticated and delivered by the Trustee and duly issued, the va lid, binding and legal speci al obligations of the Authority, and to constitute th is First Supplemental Indenture a valid and bindi ng agreement for the uses and purposes herein set forth in accordance with its terms, have been done and taken, and the execution and delivery of this First Supple mental Indenture has been in all respects duly authorized;
NOW, THEREFORE, that in order to secure th e payment of the principal of, premium, if any, and the interest on all 2022A Bonds at a ny time issued and outsta nding under this First Supplemental Indenture, according to their tenor, and to secure the performance and observance of all the covenants and conditions therein and herein set forth, and to declare the terms and conditions upon and subject to which the 2022A B onds are to be issued and received, and in consideration of the premises and of the mutual covenants herein contained and of the purchase and acceptance of the 2022A Bonds by the holders th ereof, and for other valuable consideration, the receipt of which is hereby acknowledged, the Authority does hereby covenant and agree with the Trustee, for the benefit of the respective holders from time to time of the 2022A Bonds, as follows:
3 PART 1
ADDITION OF ARTICLE X
Part 1.1. ꞏ Addition of Article X . The Original Indenture, as amended, is hereby amended by adding thereto an additional Article X as follows:
ARTICLE X
2022A BONDS
Section 10.01. Definitions. Unless the context otherwise requires, the terms defined and/or modified in this Section shall for all pur poses of this Indenture and of any certificate, opinion or other document herein or therein mentioned, have the meanings herein specified. “Additional Bonds” mean the Bonds of an add itional Series authorized by a Supplemental Indenture that are issued pursuant to this Indenture, including the 2022A Bonds. “Bond Year” means each twelve-month period extending from June 2 in one calendar year to June 1 of the succeeding calendar year, both dates inclusiv e, except that the first Bond Year for the Tax-Exempt Bonds and the Taxable Bonds shall begin on the Closing Date and shall end on June 1, 2021, and for the 2022A Bonds sha ll begin on the 2022A Closing Date and shall end on June 1, 2023.
“Bonds” mean collectively, the Tax-Exempt Bonds and the Taxable Bonds, and, where the context requires, any Additional Bonds, including the 2022A Bonds. “First Lease Amendment” means that certain First Amendment to Lease Agreement, dated as of October 1, 2022, by and between the Authority and the City. “First Supplemental Indenture” means the First Supplemental Indenture, dated as of October 1, 2022, by and between the Authority and the Trustee. “Indenture” means this Indenture, dated as of October 1, 2020, as amended and supplemented by the First Supplemental Indenture, as originally executed or as it may from time to time be amended or supplemented in accordance herewith. “Interest Payment Date” means June 1 and December 1 of each year, commencing December 1, 2020 with respect to the Tax-Ex empt and Taxable Bonds, and commencing December 1, 2022 with respect to the 2022A Bonds.
“Lease” means that certain Lease Agreement, dated as of Octobe r 1, 2020, as amended and supplemented by the First Lease Amendment, each by and between th e Authority as lessor and the City as lessee, as it may be further amended or modified. “Original Purchaser” means, with respect to the Tax-Exempt Bonds and Taxable Bonds, Raymond James & Associates, Inc., the initial purchaser of such Bonds.
4 “Principal Payment Date” means each June 1, commencing June 1, 2021 with respect to the Tax-Exempt Bonds and Taxable Bonds, and commencing June 1, 20___ with respect to the 2022A Bonds.
“Project” means the acquisition of the Recreationa l Facility with respect to the Tax- Exempt Bonds and Taxable Bonds, and the fina ncing of a portion of the 2022 Project with respect to the 2022A Bonds.
“Rebate Fund” means the fund by that name esta blished and held by the Trustee pursuant to Section 4.03, and the accounts therein for each separate Series of Bonds that the Authority intends interest thereon to be excludable from the gross income of the Owners thereof. “Rebate Requirement” means, in respect of the Ta x-Exempt Bonds and the 2022A Bonds, obligations imposed under section 148(f) the Code in respect of such issue. “Tax Certificate” means the Tax Certificate dated the date of the original delivery of the Tax-Exempt Bonds relating to the requirements of certain provisions of the Code, as such certificate may from time to time be modified or supplemented in accordance with the terms thereof, and, where the context requires, the 2022A Tax Certificate. “Trustee” means U.S. Bank Trust Company, Nati onal Association, and its successors and assigns, and any other banking corporation or association that may at any time be substituted in its place as provided in Article VI hereof.
“2022 Project” means the acquisition, installation, modification, improvement and/or construction of energy efficiency improvements for buildings and facilities owned or operated by the City, including but not limited to, HVAC , lighting, water conservation, solar, and refrigeration improvements, as may be designated by the City from time to time. “2022A Bonds” means the Santa Clarita Public Financing Authority, Lease Revenue Bonds (Energy Efficiency Program), Series 20 22A (Green Bonds), au thorized, executed and delivered hereunder.
“2022A Closing Date” means October __, 2022, being the date of delivery of the 2022A Bonds to the 2022A Original Purchaser thereof.
“2022A Original Purchaser” means, with respect to th e 2022A Bonds, Stifel, Nicolaus & Company, Incorporated, the initial purchaser of the 2022A Bonds. “2022A Tax Certificate” means the Tax Certificate dated the date of the original delivery of the 2022A Bonds relating to the requir ements of certain provis ions of the Code, as such certificate may from time to time be modified or suppleme nted in accordance with the terms thereof.
“2022A Term Bonds” mean, collectively, the 2022A Bonds maturing on June 1 in the years ____, ______ and ______.
5 Section 10.02. Terms of the 2022A Bonds . (a) The 2022A Bonds ar e authorized to be issued by the Authority under and subject to the Bond Law and the terms of this Indenture and shall be designated, respectivel y, as the “Santa Clarita Pub lic Financing Authority, Lease Revenue Bonds (Energy Efficiency Program), Se ries 2022A (Green Bonds).” The 2022A Bonds shall be issued in the original aggregate principal amount of $[principal amount]. (b) The 2022A Bonds shall be dated the 2022 Closing Date, shall mature on the dates and in the amounts, and shall bear interest (calcu lated on the basis of a 360-day year of twelve 30- day months) at the rates, set forth in the following table:
2022A Bonds
Maturity Date
(June 1)
Principal
Amount
Interest
Rate
The 2022A Bonds shall be delivered in fully registered form, numbered from one upwards in consecutive numerical order (with such alphabetical prefix as the Trustee shall determine). The 2022A Bonds shal l be executed and delivered in their respective Authorized Denominations.
Each 2022A Bond shall bear interest from the Interest Payment Date next preceding the date of authentication thereof, unless (i) it is executed during the period from the day after the Record Date for an Interest Payment Date to an d including such Interest Payment Date, in which event it shall bear interest from such Interest Pa yment Date, or (ii) it is authenticated on or prior to November 15, 2022, in which event it shall bear interest from the 2022 Closing Date; provided, however, that if, at th e time of authentication of any 2022A Bond interest with respect to such 2022A Bond is in default, such 2022A Bond shall bear interest from the Interest Payment Date to which interest has been paid or made available for pa yment with respect to such 2022A Bond, or if no interest has been paid, from the date of initial delivery of the 2022A Bonds.
Interest with respect to any 2022A Bond shall be payable in lawful money of the United States of America on each Interest Payment Date to the Owner thereof as of the close of business
6 on the Record Date, such interest to be paid by check of the Trustee, mailed by first class mail no later than the Interest Payment Date to the Owner at his address as it a ppears, on such Record Date, on the Registration Books maintained by the Trustee; provided, however, that at the written request of the Owner of at least $1,000,000 in aggr egate principal amount of Outstanding Bonds filed with the Trustee pr ior to any Record Date, interest on such 2022A Bonds shall be paid to such Owner on each succeeding Interest Payment Date (unless such request has been revoked in writing) by wire transfer of immediately avai lable funds to an account in the United States designated in such written reques t. Payments of de faulted interest with respect to the 2022A Bonds shall be paid by check or draft to th e registered Owners of the 2022A Bonds as of a special record date to be fixed by the Trustee, notice of which spec ial record date shall be given to the registered Owners of the 2022A Bonds not less than ten days prior thereto. The principal of and premium, if any, on the 2022A are payabl e by check when due upon surrender thereof at the Trust Office in lawful money of the United States of America. (c) The 2022A Bonds shall initially be i ssued in book-entry form. The 2022A Bonds will be initially registered in the name of Cede & Co., as nomin ee of the Depository. Registered ownership of the 2022A Bonds, or any portion thereo f, may not thereafter be transferred except as provided in this Indenture.
(d) Upon the execution and delivery of the First Supplem ental Indenture, the Authority shall execute and deliver the 2022A Bonds to the Trustee for authen tication, issuance and delivery to the 2022A Original Purchaser thereof upon the Written Request of the Authority.
Section 10.03. Redemption of the 2022A Bonds . (a) Extraordinary Redemption and General Provisions. The 2022A are subject to extrao rdinary redemption provisions of subsection (a) of Section 2.03 of th is Indenture, as well as the general redemption provisions of subsections (d), (e), (f) and (g) of Section 2.03 of this Indenture. (b) Optional Redemption of 2022A Bonds from Prepayments of Base Rental Payments .
The 2022A Bonds maturing on or afte r June 1, 20__ shall be subject to redemption prior to their respective maturity dates, upon written notice from the Authority to the Trustee at least forty-five (45) days (or such lesser number of days acceptable to the Trustee, in the sole discretion of the Trustee) prior to the date fixe d for redemption, as a whole or in part on any da te on or after June 1, 20__, in such maturities as the Authority shall designate (and by lot within any maturity), from prepayments of Base Rental Payments ma de at the option of the City pursuant to Section 11(b) of the Lease, at a redemption pr ice equal to the principal amount of the 2022A Bonds to be redeemed, plus accrued but unpaid interest to the da te fixed for redemption, without premium.
(c) Mandatory Sinking Account Redemption . The 2022A Bonds maturing on June 1, 20___, June 1, 20___ and June 1, 20__ shall be subject to mandatory redemption, in part by lot, from sinking account payments set forth in the following schedule on June 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.
7 2022A Term Bonds Maturing June 1, 20__
Redemption Date
(June 1)
Principal Amount
To be Redeemed
_________________
* Maturity
2022A Term Bonds Maturing June 1, 20__
Redemption Date
(June 1)
Principal Amount
To be Redeemed
_________________
* Maturity
2022A Term Bonds Maturing June 1, 20__
Redemption Date
(June 1)
Principal Amount
To be Redeemed
_________________
* Maturity
If some but not all of a 2022A Term Bond has been rede emed pursuant to extraordinary or optional redemptions, the total amount of sinki ng account payments to be made subsequent to such redemption shall be reduced in an amount equal to the principal amount of such 2022A Term Bond so redeemed by reducing each such future sinking account payment on a pro rata basis (as nearly as practicable) in integral mu ltiples of $5,000, as shall be designated pursuant to written notice filed by Authority w ith the Trustee. In the event of any reductions in the amount of sinking account payments due as a result of some but not all of the 2022A Bonds being redeemed pursuant to extraordinary or optiona l redemptions, the Authority shall provide the Trustee with a revised schedule reflecting such reductions.
Section 10.04. Form of the 2022A Bonds. The 2022A Bonds, the form of Trustee’s certificate of authentication, and the form of assign ment to appear thereon, shall be substantially in the form set forth in Exhibit E attached hereto and by this reference incorporated herein, with necessary or appropriate variati ons, omissions and insertions, as permitted or required by this Indenture.
8 Section 10.05. Execution of the 2022A Bonds. The 2022A Bonds shall be signed in the name and on behalf of the Authority with the manual or facsimile signature of its Chair, and attested with the manual or fa csimile signature of its Secretar y or any Assistant or Deputy Secretary duly appointed by the Authority Board, and shall be delivered to the Trustee for authentication by it. In case any officer of the Authority who shall have signed any of the 2022A Bonds shall cease to be such officer before the 2022A Bonds so signed shall have been authenticated or delivered by the Trustee or issued by the Authority, such 2022A Bonds may nevertheless be authenticated, delivered and is sued and, upon such authentication, delivery and issue, shall be as binding upon the Authority as though the individual who signed the same had continued to be such officer of the Authority. Also, any 2022A Bond may be signed on behalf of the Authority by any individual who on the actual date of the execution of su ch 2022A Bond shall be the proper officer although on the nomin al date of such 2022A Bond such individual shall not have been such officer.
Only such of the 2022A Bonds as shall bear thereon a certificate of authentication in substantially the form set forth in Exhibit E, manually executed on behalf of the Trustee, shall be valid or obligatory for any purpose or entitled to the benefits of this Indenture, and such certificate of the Trustee shall be conclusive evidence that the 2022A Bonds so authenticated have been duly authenticated and delivered here under and are entitled to the benefits of this Indenture.
Section 10.06. Application of Proceeds of Sale of the 2022A Bonds. (a) Upon the receipt of payment for the 2022A Bonds on the 2022A Closing Date, the Trustee shall apply $_______________________ of the ne t proceeds of the 2022A Bonds (which equals the principal am ount of the 2022A Bonds, less an underwriting discount of $___________, and plus/minus a net original issue premium/discount of $____________), as follows:
(1) The Trustee shall deposit in the Costs of Issuance Fund the amount of $______________.
(2) The Trustee shall deposit in the 20 22A Account of the Project Fund the amount of $_________________.
The Trustee may establish such temporary funds, accounts and subaccounts as may be necessary or desirable to accomplish such deposits.
Section 10.07. Reopening of Costs of Issuance Fund. The Trustee shall reopen and reestablish and maintain the Costs of Issuance Fund. On the 2022A Closing Date there shall be deposited in the Costs of Issuance Fund the amounts specified in Section 10.06.
The moneys in the Costs of Issuance Fund shall be used to pay Costs of Issuance related to the 2022A Bonds from time to time and shall be disbursed by the Trustee upon delivery to the Trustee of a requisition, substant ially in the form attached hereto as Exhibit F, executed by an officer of the Authority. Each requisition shall be sufficient evidence to the Trustee of the facts stated therein and the Trustee shall have no duty to confirm the accuracy of such facts. On the date that is 180 days following the 2022A Clos ing Date, or upon the ea rlier receipt by the
9 Trustee of a Written Request of the Authority certifying that all Costs of Issuance related to the 2022A Bonds have been paid or provided for, th e Trustee shall transfer any remaining amounts in the Costs of Issuance Fund to the Lease Re venue Fund and the Truste e shall then close the Costs of Issuance Fund.
Section 10.08. 2022A Account of the Project Fund. There is hereby established within the Project Fund, a separate account to be he ld by the Trustee known as the “2022A Account” into which shall be deposited a portion of the proceeds of the sale of the 2022A Bonds pursuant to Section 10.06. Except as otherwise provided herein, moneys in the 2022A Account of the Project Fund shall be used solely for the payment of Project Costs relating to the 2022 Project.
Before any payment from the 2022 A Account of the Project Fund sh all be made, the City shall file or cause to be filed with the Trustee, a requ isition of the City which shall be substantially in the form attached hereto as Exhibit G. The Trust ee shall be entitled to rely on the representations of the City contained in such requisition and sh all not be required to in dependently verify the contents of such requisition.
Within three (3) Business Days following rece ipt of each such Requisition, the Trustee shall pay the amount set forth in such requisiti on as directed by the te rms thereof out of the 2022A Account of the Project Fund. Upon the Wr itten Request of the City accompanied by a Certificate of the City stating that all Project Costs relating to the 2022 Project have been paid or provision made for their payment, any unexpended moneys in the 2022A Account of the Project Fund may be used to pay the costs associated with any other improvements of the City; provided, that in the opinion of Bond C ounsel such use of the proceeds of the 2022A Bonds shall not adversely affect the exclusion of interest on the Tax-Exempt Bonds and the 2022A Bonds from gross income of the owners thereof.
Any unexpended moneys in the 2022A Account of the Project Fund subsequent to the payment of all Project Costs relating to the 2022 Project which are not used to pay the cost of other improvements of the City shall be transfe rred by the Trustee and deposited in the Lease Revenue Fund upon receipt by the Trustee of a Wr itten Request of the City accompanied by a Certificate of the City stating that all Project Costs relating to the 2022 Project have been paid or provision made for their payment.
The Authority acknowledges that the City sha ll initially designate specific improvements of the 2022 Project to be financed from proceeds within the 2022A Account of the Project Fund.
Nothing herein shall prohibit the City from removing, adding or subs tituting other specific improvements of the 2022 Project, or reallocati ng or reimbursing from other available sources specific improvements from the 2022 Project as determined by the City in its sole discretion upon advice of Bond Counsel.
10 Section 10.09. Tax Covenants Relating to 2022A Bonds. (a) Special Definitions. When used in th is Section, the following terms have the following meanings with respect to any 2022A that the Authority intends in terest thereon to be excludable from the gross income of the Owners thereof:
“Computation Date ” has the meaning set forth in section 1.148-1(b) of the Tax Regulations.
“Computation Period” means, initially, that period co mmencing on the date of issuance of the 2022A Bonds and concluding on the initial Computation Date and, thereafter, each period commencing on the day next following a Computat ion Date and concludi ng on the immediately succeeding Computation Date.
“Gross Proceeds” means any proceeds as defined in section 1.148-1(b) of the Tax Regulations (referring to sales, investment and transferred proceeds), and any replacement proceeds as defined in section 1.148-1(c) of the Tax Regulations, of the 2022A Bonds. “Investment” has the meaning set forth in section 1.148-1(b) of the Tax Regulations. “Nongovernmental Person” refers to any person or entity (including the United States or any agency, department and instrumentality thereof) other than a state or local government, or an agency or instrumentality acting solely on behalf thereof. “Nonpurpose Investment” means any investment property, as defined in section 148(b) of the Code, in which Gross Proceeds of the 20 22A Bonds are invested a nd that is not acquired to carry out the governmental purposes of the 2022A Bonds. “Original Facility” means any property the acquisition, construction or improvement of which was financed directly or indirectly with Gross Proceeds of an Original Issue. “Original Issue” means the 2022A Bonds.
“Proceeds,” with respect to an issue of governme ntal obligations, has the meaning set forth in section 1.148-1(b) of the Tax Regulations (referring to sale s, investment and transferred proceeds).
“Rebate Amount” has the meaning set forth in section 1.148-1(b) of the Tax Regulations. “Tax Regulations” means the United States Treasury Regulations promulgated pursuant to sections 103 and 141 through 150 of the Code , or under the provisions of any predecessor statute corresponding thereto.
“Yield” of
(1) any Investment has the meaning set forth in section 1.148-5 of the Tax Regulations; and
11 (2) the 2022A Bonds has the meaning se t forth in section 1.148-4 of the Tax Regulations.
(b) Exclusion of Interest from Gross Inco me. The Authority will take all actions necessary to establish and main tain the exclusion pursuant to section 103(a) of the Code of interest on the 2022A Bonds from the gross income of the owners thereof for federal income tax purposes, and will not use, permit the use of, or omit to use Gross Proceeds of the 2022A Bonds or any other amounts or any of the Original Faci lities in a manner that if made or omitted, respectively, would cause the interest on any of the 2022A Bonds to fail to be excluded pursuant to section 103(a) of the Code from the gross income of the owners thereof for federal income tax purposes. Without limiting the generality of the foregoing, unless and until the Authority receives a written Opinion of Bo nd Counsel to the effect that failure to comply with such covenant will not adversely affect the exclusion pursuant to section 103(a) of the Code of interest on any 2022A Bond from the gross income of the owner thereof, the Authority shall comply with this covenant and each of the specific covenants in this Section. (c) No Private Use or Private Payments. Except as would not cause any 2022A Bond to become a “private ac tivity bond” within the meaning of section 141 of the Code and the Tax Regulations and rulings thereunder, the Authority covenants that at all times prior to the payment and cancellation of the last 2022A Bond to be paid and canceled:
(1) it will use its best efforts to ensure that the City (or another entity other than a Nongovernmental Entity) exclusively owns, operates and po ssesses all of the Original Facilities that are to be refinanced di rectly or indirectly w ith Gross Proceeds of the 2022A Bonds, and that it will not use or permit the use of such Gross Proceeds (including under any contractua l arrangement with terms diff erent than those applicable to the general public) or any of the Original Facilities in any ac tivity carried on by any Nongovernmental Person, unless such use is so lely as a member of the general public; and
(2) not directly or indirectly impose or accept any charge or other payment by any person or entity in re spect of the use by any Nongove rnmental Person of Gross Proceeds of the 2022A Bonds, other than intere st earned on inves tments acquired with such Gross Proceeds pending application for their intended purposes, or of any Original Facility.
Without limiting the foregoing, except as w ould not cause any 2022A Bond to become a “private activity bond” within the meaning of section 141 of th e Code and the Tax Regulations and rulings thereunder, the Aut hority will not: (i) pe rmit any Nongovernmental Person to hold any ownership, proprietary or possessory interest in any of the Original Facilities; or (ii) contract with any Nongovernmental Person for the provision of operating or other services with respect to any function of an Original Facility (unless e ither (A) such arrangement requires no payment of fees to such Nongovernmental Pers on other than as direct reimburse ment of third party costs or reasonable administrative overhead, or (B) such arrangement conforms to administrative guidance of the Internal Revenue Service in or der to assure that such arrangement does not create a private business use relationship of th e Nongovernmental Person to the Gross Proceeds of the 2022A Bonds or to any Original Facility). For purposes of the preceding sentence, the
12 Authority will treat proceeds of the 2022A Bonds as used ratably for the same purposes as were the proceeds of the Original Issue.
(d) No Private Loan. Except as woul d not cause any 2022A Bond to become a “private activity bond” within the meaning of section 141 of th e Code and the Tax Regulations and rulings thereunder, the Aut hority has not used, and will not use, Gross Proceeds of any 2022A Bond to make or finance loans to any Nongovernmental Person. For purposes of the foregoing covenant, such Gross Proceeds are considered to be “loaned” to a person or entity if:
(1) property acquired, constructed or improved with such Gross Proceeds is sold or leased to such person or entity in a transaction that cr eates a debt for federal income tax purposes; (2) capacity in or service from such pr operty is committed to such pe rson or entity under a take-or- pay, output or similar contract or arrangement; or (3) indirect benefits of such Gross Proceeds, or burdens and benefits of owners hip of any property acquired, cons tructed or improved with such Gross Proceeds, are otherwise transferred in a tr ansaction that is the economic equivalent of a loan.
(e) Not to Invest at Highe r Yield. Except as would not cause any 2022A Bond to become an “arbitrage bond” w ithin the meaning of section 148 of the Code and the Tax Regulations and rulings thereunder, the Authority shall not at any t ime prior to the final maturity of the 2022A Bonds directly or indirectly invest Gross Proceeds in any Investment, if as a result of such investment the Yield of any Investment acquired with Gross Proceeds, whether then held or previously disposed of, would materially ex ceed the Yield of such 2022A Bond within the meaning of such section 148.
(f) Not Federally Guaranteed. The Authorit y covenants that, except to the extent permitted by section 149(b) of th e Code and the Tax Regulations a nd rulings thereunder, it will not take or omit to take any action that would cause a ny 2022A Bond to be “federally guaranteed” within the meaning of section 149(b) of the Code and the Tax Regulations and rulings thereunder.
(g) Information Report. The Aut hority covenants that it will timely file or cause to be filed any information required by section 149(e) of the Code with respect to the 2022A Bonds with the Secretary of the Treasury on Form 8038-G or such other form and in such place as the Secretary of the Treasury may prescribe.
(h) Rebate of Arbitrage Profits. The Aut hority covenants that the requirements of section 148(f) of the Code will be satisfied in order that the 2022A Bonds be not arbitrage bonds, and that, except to the extent otherwise provi ded in section 148(f) of the Code and the Tax Regulations and rulings thereunder:
(1) it will account for all Gross Procee ds of the 2022A Bonds (including all receipts, expenditures and investments ther eof) on its books of account separately and apart from all other fund s (and receipts, expenditures a nd investments thereof) and shall retain all records of accounting for at least six years after the day on which the last 2022A Bond is discharged. However, to the ex tent permitted by law, the Authority may commingle Gross Proceeds of the 2022A Bonds with its ot her money, provided that the
13 Authority separately accounts for each receipt and expenditure of Gross Proceeds and the obligations acquired therewith;
(2) not less frequently than each Computation Date, it will calculate or cause to be calculated the Rebate Amount in accordance with rules set forth in section 148(f) of the Code and the Tax Regulations and rulin gs thereunder. The Trustee may rely conclusively upon the Authority’s determinations, calculations and certifications required by this Section. The Trustee shall have no responsibility to independently make any calculation of determination or to review the Authority’s calcula tions hereunder. The Authority covenants that it will maintain a copy of the calculation with its official transcript of proceedings relating to the i ssuance of the 2022A Bonds until six years after the final Computation Date;
(3) it will deposit in th e Rebate Fund and cause th e Trustee to pay to the United States the amount that when added to the future value of previous rebate payments made for the 2022A Bonds equals (A) in the case of a Final Computation Date as defined in section 1.148-3(e)(2) of the Tax Regul ations, one hundred percent (100%) of the Rebate Amount on such date; and (B) in the case of any other Com putation Date, ninety percent (90%) of the Rebate Am ount on such a date. In all cases such Rebate payments shall be made by the Authority (or by the Trustee at the direction of the Authority) at the times and in the amounts as are or may be required by section 148(f) of the Code and the Tax Regulations and rulings thereunder, and such payments shall be accompanied by Form 8038-T prepared and executed by the Authority or such other forms and information as is or may be required by section 148(f) of the Code and the Tax Regulations and rulings thereunder.
(4) it will exercise reasonable diligence to assure that no errors are made in the calculations and payments required by paragraphs (2) and (3) above, and if an error is made, to discover and promptly correct such error within a reas onable amount of time thereafter (and in all events within one hundr ed eighty (180) days after discovery of the error), including payment to the United States of any addi tional Rebate Amount owed to it, interest thereon, and any penalty imposed under section 1.148-3(h) or other provision of the Tax Regulations.
(i) Not to Divert Arbitrage Profits. The Authority covenants that, except to the extent permitted by section 148 of the Code and the Tax Regulations and rulings thereunder, at no time prior to the final maturity of the 2022A Bonds will it enter into any transaction that reduces the amount required to be paid to the United States pursuant to paragraph (h) of this Section because such transaction results in a smaller profit or a larger loss than would have resulted if the transaction ha d been at arm’s length and had the Yield on the 2022A Bonds not been relevant to each party.
(j) 2022A Bonds Not Hedge Bonds.
(1) The Authority represents that none of the Original Issue was, and covenants that the 2022A Bonds will not be, “hedge bonds” within the meaning of section 149(g) of the Code.
14 (2) Without limitation of paragraph (1 ) above, the Authority warrants as to each of its Original Issue that: (I) on each date of issuance of that issue, the Authority reasonably expected that at least 85% of the spendable proceeds of that Original Issue would be expended within the three-year pe riod commencing on such date of issuance, and (II) no more than 50% of the proceeds of that Original Issue at any time has been invested in Nonpurpose Investments having a s ubstantially guaranteed yield for a period of four years or more.
(k) Elections. The Authorit y hereby directs and authori zes any Responsible Officer to make elections permitted or required pursua nt to the provisions of the Code or the Tax Regulations, as such Responsible Officer (a fter consultation with Bond Counsel) deems necessary or appropriate in conn ection with the 2022A Bonds, in the Tax Certificate relating to the 2022A Bonds or similar or other appropriate certificate, form or document.
Section 10.10. Amendment of Exhibit D. “Exhibit D” is hereby amended as provided in new “Exhibit D – AMENDED FORM OF NET PROCEEDS REQUISITION” attached hereto and incorporated herein by this reference.
PART 2
MISCELLANEOUS
Part 2.1. Effect of First Supplemental Indenture . This First Supplemental Indenture and all of the terms and provisions herein contained shall form part of the Original Indenture, as amended, as fully and with the same effect as if all such terms and provis ions had been set forth in the Original Indenture, as amended. The Orig inal Indenture is hereby ratified and confirmed and shall continue in full force and effect in accordance with the terms and provisions thereof, as heretofore amended and supplemented, and as ame nded and supplemented hereby. If there shall be any conflict between the terms of this Firs t Supplemental Indenture and the terms of the Original Indenture, as amended (a s in effect on the day prior to the effective date of this First Supplemental Indenture), the terms of this First Supplemental Indenture shall prevail.
Part 2.2. Effective Date of First Supplemental Indenture . This First Supplemental Indenture shall take effect upon the 2022A Closing Date.
Part 2.3. Applicable Law . This First Supplemental Indenture shall be governed by and enforced in accordance with the laws of the State of California applicable to contracts made and performed in the State of California.
Part 2.4. Counterparts . This First Supplemental In denture may be executed in counterparts, each of which shall be deemed an original.
15 IN WITNESS WHEREOF, the Authority has cau sed this First Supplemental Indenture to be executed in its name and th e Trustee has caused this Firs t Supplemental Indenture to be executed in its name, all as of October 1, 2022.
ATTEST:
SANTA CLARITA PUBLIC FINANCING
AUTHORITY
By __________________________________
Laurene Weste, Chair
By __________________________________
Mary Cusick, Secretary
U.S. BANK TRUST COMPANY,
NATIONAL ASSOCIATION, as Trustee
By __________________________________
Authorized Office
r
D-1
EXHIBIT D
AMENDED FORM OF NET PROCEEDS REQUISITION
REQUISITION NO. __ (to be numbered sequentially)
with reference to
Santa Clarita Public Financing Authority
(Recreational Facility)
$10,645,000
Lease Revenue Bonds
Series 2020A
$3,625,000
Federally Taxable Lease Revenue Bonds
Series 2020A
and
$[principal amount]
Santa Clarita Public Financing Authority
Lease Revenue Bonds (Energy Efficiency Program)
Series 2022A (Green Bonds)
I. The Santa Clarita Public Financing Au thority (the “Authority”) hereby requests U.S. Bank Trust Company, National Association (fo rmerly U.S. Bank Nati onal Association), as trustee (the “Trustee”), pursuant to that certain Indentur e, dated as of October 1, 2020, as amended and supplemented by the First Supplementa l Indenture, dated as of October 1, 2022 (as amended, the “Indenture”), each by and between the Authority and the Trustee, under the terms of which the Authority has issued the above-referenced Bonds (collectively, the “Bonds”), to pay from the moneys in the Insurance and Condemnation Fund established pursuant to the Indenture, the amounts shown on Schedule I attached hereto to the parties indicated in Schedule I.
II. The payees, the purposes for which the costs have been incurred, and the amount of the disbursements requested are itemized on Schedule I hereto.
III. Each obligation mentioned in Schedule I hereto has been properly incurred and is a proper charge against the Insurance and Conde mnation Fund. None of the items for which payment is requested has been reimbursed pr eviously from the Insu rance and Condemnation Fund.
IV. There has not been filed with or serv ed upon the City or the Authority a stop notice or any other notice of any lien, right to lien or attachme nt upon, or cla im affecting the right to receive payment of, an y of the money payable to th e person[s] named on Schedule I
D-2
hereto which has not been released or will not be released simultaneously with the payment of such obligation, other than liens accruing by mere operation of law.
Dated: ________, 20__
SANTA CLARITA PUBLIC FINANCING
AUTHORITY
By
Title:
E-1
EXHIBIT E
FORM OF 2022A BOND
UNLESS THIS 2022A BOND IS PR ESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY (A S DEFINED IN THE INDENTURE) TO
THE TRUSTEE FOR REGISTRATION OF T RANSFER, EXCHANGE, OR PAYMENT, AND ANY 2022A BOND ISSUED IS REGISTER ED IN THE NAME OF CEDE & CO.
OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY), ANY TRANSFER,
PLEDGE, OR OTHER USE HEREOF FOR VA LUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
No. ___ $_________
SANTA CLARITA PUBLIC FINANCING AUTHORITY
LEASE REVENUE BOND
(ENERGY EFFICIENCY PROGRAM)
SERIES 2022A
(Green Bonds)
RATE OF INTEREST: MATURITY DATE: DATED DATE: CUSIP:
____% JUNE 1, ______ OCTOBER __, 2022 __________
REGISTERED OWNER: CEDE & CO.
PRINCIPAL AMOUNT:
The SANTA CLARITA PUBLIC FINANCING AUTHORITY, a joint powers authority organized and existing under the la ws of the State of California (the “Authority”), for value received, hereby promises to pa y (but only out of the Revenues, as defined in the Indenture hereinafter referred to, and certain other moneys ) to the Registered Owner identified above or registered assigns (the “Registered Owner”), on the Maturity Date identified above or any earlier redemption date, the Principal Amount identified above in lawful money of the United States of America; and to pay interest ther eon at the Rate of Interest id entified above in like money from the Interest Payment Date (as hereinafter defined) next preceding the date of authentication of this 2022A Bond (unless this 2022A Bond is authenticated on or before an Interest Payment Date and after the fifteenth calendar day of the month preceding such Interest Payment Date, in which event it shall bear interest fr om such Interest Payment Date , or unless this 2022A Bond is
E-2
authenticated on or prior to N ovember 15, 2022, in which event it shall bear interest from the Dated Date identified above; provided, however, th at if, at the time of authentication of this 2022A Bond, interest is in default on this 2022A Bond, this 2022A Bond shall bear interest from the Interest Payment Date to which interest here on has previously been paid or made available for payment), payable semiannually on June 1 and December 1 in each year, commencing December 1, 2022 (each an “Interest Payment Date”) until payment of such Principal Amount in full. The Principal Amount hereof is payabl e by check upon presentation hereof upon maturity or earlier redemption at the designa ted corporate trust office (the “Trust Office”) of U.S. Bank, Trust Company, National Association, as trustee (the “Trustee”). Interest hereon is payable by check of the Trustee mailed by first class mail on each Interest Payment Date to the Registered Owner hereof at the address of the Registered Owner as it a ppears on the registration books of the Trustee as of the fifteenth (15 th) calendar day of the month preceding such Interest Payment Date (except that in the case of a Registered Owner of at least $1,000,000 in aggregate principal amount of Outstanding Bonds, such payment may, at such Registered Owner’s option, be made by wire transfer of imme diately available funds to an account located in the United States in accordance with written instructions provided by such Registered Owner prior to the fifteenth calendar day of the month preceding such Interest Payment Date).
This Bond is one of a series of a duly author ized issue of bonds designated “Santa Clarita Public Financing Authority Lease Revenue Bonds (Energy Efficiency Program), Series 2022A (Green Bonds) ” (the “2022A Bonds”) in the aggregate principal amount of $[principal amount].
The 2022A Bonds are issued pursuant to the Inde nture, dated as of October 1, 2020, as amended and supplemented by the First Supplemental Indenture, dated as of October 1, 2022, each by and between the Authority and the Trustee (as so amended and supplemented, the “Indenture”). The Authority has previously issued its $10,645,000 L ease Revenue Bonds (Recr eational Facility), Series 2020A and its $3,625,000 Federally Taxable Lease Revenue Bonds (Recreational Facility) Series 2020A-T (collectively, the “2020 Bonds”), with which the 2022A Bonds are on parity.
Pursuant to and as more particularly provided in the Indenture, additional bonds (“Additional Bonds”) may be issued by the Au thority secured by a lien on a par ity with the lien securing the 2020 Bonds and 2022A Bonds. The 2020 Bonds, the 2022A Bonds and any Additional Bonds are collectively referred to as the “Bonds.” Capitalized undefi ned terms used herein shall have the meanings ascribed thereto in the Indenture.
Reference is hereby made to the Indenture a nd all indentures supplemental thereto for a description of the rights thereunde r of the owners of the Bonds, of the nature and extent of the Revenues (as that term is define d in the Indenture), of the rights, duties and immunities of the Trustee and of the rights and oblig ations of the Authority thereunde r; and all of the terms of the Indenture are hereby incorporated herein and cons titute a contract between the Authority and the Registered Owner hereof, and to all of the prov isions of which Indenture the Registered Owner hereof, by acceptance hereof, assents and agrees.
The Bonds, including the 2022A Bonds, are authorized to be issued pursuant to the provisions of the Marks-Roos Local Bond Pooling Act of 1985, constituting Article 4, Chapter 5, Division 7, Title 1 of the Government Code of the State of California (the “Act”). The Bonds are special obligations of the Authority and, as and to the extent set forth in the Indenture, are
E-3
payable solely from and secured by a first lien on and pledge of th e Revenues as provided in the Indenture. All of the Bonds ar e equally secured by a pledge of, and charge and lien upon, all of the Revenues (other than deposits to the Reba te Funds created by th e Indenture), and the Revenues (other than deposits to the Rebate Funds created by the Indenture) constitute a trust fund for the security and payment of the principal of and interest on the Bonds. The full faith and credit of the Authority are not pledged for th e payment of the principal of or interest or premium (if any) on the Bonds. The Bonds are not secured by a legal or equitable pledge of, or charge, lien or encumbrance upon, a ny of the property of the Author ity or any of its income or receipts, except the Revenues and such other moneys and securities as provided in the Indenture.
The Bonds may be issued for the purpose of financing certain cap ital improvements for the City. Or the purpose of financing a porti on of the costs of certain energy efficiency improvements for City buildings and facilities , including but not limi ted to, HVAC, lighting, water conservation, solar, and refrigeration impr ovements. The Authority and the City have entered into a Lease Agreement, dated as of October 1, 2020, as amended a nd supplemented by the First Amendment to Lease Agreement, dated as of October 1, 2022, each by and between the Authority and the City (as so amended and s upplemented, the “Lease”), under which the City is obligated to pay amounts which are anticipated to be sufficient to enable the Authority to pay the principal of and interest on the Bonds, including the 2020 Bonds and the 2022A Bonds.
The 2022A Bonds are subject to redemption prior to their ma turity as provided in the Indenture.
The 2022A Bonds are subject to redemption prior to their respective maturity dates, upon notice as provided in the Indenture, as a whole or in part on any date, from prepayments of Base Rental Payments made by the City pursuant to the Lease from funds received by the City due to a taking of the Leased Property or any portion thereof under th e power of eminent domain or from insurance proceeds received by the City due to damage to or destruction of the Leased Property or any portion thereof, under the circumstances and upon th e conditions and terms prescribed in the Indenture and in the Lease. Redemption of 2022A Bonds pursuant to this paragraph shall be made at a redemption price equal to the sum of the principal of the 2022A Bonds to be redeemed plus accr ued interest thereon to the da te fixed for redemption, without premium.
The 2022A Bonds may be issued in denomin ations of $5,000 or any integral multiple thereof. Subject to th e limitations and upon payment of the ch arges, if any, provided in the Indenture, this 2022A Bond may be exchanged at the Trust Office of th e Trustee for a like aggregate principal amount, intere st rate and maturity of fully registered 2022A Bonds of other authorized denominations.
This 2022A Bond is transferable by the Regi stered Owner hereof, in person or by his attorney duly authorized in writ ing, at the Trust Office of the Tr ustee, but only in the manner, subject to the limitations and upon payment of the charges pr ovided in the Indenture, and upon surrender and cancellation of this 2022A Bond. Upon such transfer a new fully registered Bond or Bonds, of Authorized Denomination or Deno minations, for the same aggregate principal amount and of the same maturity and the same seri es designation will be issued to the transferee
E-4
in exchange herefor. The Authority and the Trustee may treat the Registered Owner hereof as the absolute owner hereof for all purposes, and the Authority and the Trustee shall not be affected by any notice to the contrary. The Trustee shall not be required to register the transfer or exchange of any 2022A Bond during the period in whic h the Trustee is selecting 2022A Bonds for redemption or any 2022A Bond selected for redemption.
The Indenture and the rights and obligations of the Authority and of the owners of the Bonds and of the Trustee may be modified or amended from time to time and at any time in the manner, to the extent, and upon the terms provid ed in the Indenture; provided that no such modification or amendment shall (a) extend the ma turity of or reduce the interest rate on any Bond or otherwise alter or impair the obligation of the Authority to pay the principal, interest or premiums at the time and place an d at the rate and in the currenc y provided therein of any Bond without the express written cons ent of the owner of such Bond, (b) reduce the percentage of Bonds required for the written consent to any such amendment or modification, or (c) without its written consent thereto, modify any of the rights or obligations of the Trustee, all as more fully set forth in the Indenture.
It is hereby certified that all things, conditio ns and acts required to exist, to have happened and to have been performed precedent to and in the issuance of this 2022A Bond 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 Californ ia and by the Act and the amount of this 2022A Bond, together with all other indebtedness of the Authority, does not exceed any limit prescribed by the Constitution or statutes of the State of California or by the Act.
This 2022A Bond shall not be entitled to any benefit under the Indenture, or become valid or obligatory for any purpose, until the cer tificate of authentication hereon shall have been manually signed by the Trustee.
E-5
IN WITNESS WHEREOF, the Authority has caused this 2022A Bond to be executed in its name and on its behalf by the manual or facsimi le signatures of its Chai r and Secretary as of the Dated Date identified above.
SANTA CLARITA PUBLIC FINANCING
AUTHORITY
By
Chair
ATTEST:
___________________________
Secretary
E-6
TRUSTEE’S CERTIFICATE OF AUTHENTICATION
This is one of the 2022A Bonds describe d in the within-men tioned Indenture and registered on the Registration Books.
Dated: __________, 20__
U.S. BANK TRUST COMPANY, NATIONAL
ASSOCIATION, as Trustee
By
Authorized Officer
E-7
ASSIGNMENT
For value received the undersigned do(es) here by sell, assign and transfer unto ________ ______________________________________________________________________________ _____________________________, whose tax identification number is ________, the within- mentioned registered 2022A Bo nd and hereby irrevocably c onstitute(s) and appoint(s) _____________________________________________________________________ attorney to transfer the same on the books of the Trustee with full power of substitution in the premises.
Dated:
Signature guaranteed: ______________________________________ NOTE: The signature(s) on this Assignment
must correspond with the name(s) as written on
the face of the within Bond in every particular
without alteration or enlargement or any
change whatsoever.
_____________________________________
NOTICE: Signature must be guaranteed by a
member of an institution which is a participant
in the Securities Transfer Agent Medallion
Program (STAMP) or other similar program.
131735222.3 F-1
EXHIBIT F
FORM OF COSTS OF ISSUANCE REQUISITION
COSTS OF ISSUANCE REQUISITION NO. __
with reference to
$[PRINCIPAL AMOUNT]
Santa Clarita Public Financing Authority
Lease Revenue Bonds
(Energy Efficiency Program)
Series 2022A (Green Bonds)
I. The Santa Clarita Public Financing Au thority (the “Authority”) hereby requests U.S. Bank Trust Company, National Association (fo rmerly U.S. Bank Nati onal Association), as trustee (the “Trustee”), pursuant to that certain Indentur e, dated as of October 1, 2020, as amended and supplemented by the First Supplementa l Indenture, dated as of October 1, 2022 (as amended, the “Indenture”), each by and between the Authority and the Trustee, under the terms of which the Authority has issued the above-referenced bonds (the “2022A Bonds”), to pay from the moneys in the Costs of Issuance Fund esta blished pursuant to th e Indenture, the amounts shown on Schedule I attached hereto to the parties indicated in Schedule I.
II. The payees, the purposes for which the costs have been incurred, and the amount of the disbursements requested are itemized on Schedule I hereto.
III. Each obligation mentioned in Schedule I hereto has been properly incurred and is a proper charge against the Costs of Issuance Fund. None of the items for which payment is requested has been reimbursed previously from the Costs of Issuance Fund.
Dated: ________, 20__
SANTA CLARITA PUBLIC FINANCING
AUTHORITY
By
Title:
131735222.3 G-1
EXHIBIT G
FORM OF 2022A ACCOUNT OF THE PROJECT FUND REQUISITION
REQUISITION OF THE CITY
2022A ACCOUNT OF THE PROJECT FUND REQUISITION NO. __
(to be numbered sequentially)
with reference to
$[PRINCIPAL AMOUNT]
Santa Clarita Public Financing Authority
Lease Revenue Bonds
(Energy Efficiency Program)
Series 2022A (Green Bonds)
I. The City of Santa Clarita (the “Cit y”) hereby requests U.S. Bank Trust Company, National Association (formerly U.S. Bank Nationa l Association), as trus tee (the “Trustee”), pursuant to that certain Indenture, dated as of October 1, 2020, as amended and supplemented by the First Supplemental Indentur e, dated as of October 1, 2022 (as amended, the “Indenture”), each by and between the Santa Clarita Public Fi nancing Authority (the “Authority”) and the Trustee, under the terms of wh ich the Authority has issued th e above-referenced bonds (the “2022A Bonds”), to pay from the moneys in the 2022A Account of the Project Fund established pursuant to the Indenture, the amounts shown on Schedule I attached he reto to the parties indicated in Schedule I.
II. The payees, the purposes for which the costs have been incurred, and the amount of the disbursements requested are itemized on Schedule I hereto.
III. Each obligation mentioned in Schedule I hereto is a Project Cost (as defined in the Indenture) and has been properl y incurred and is a proper char ge against the 2022A Account of the Project Fund. None of the items for whic h payment is requested has been reimbursed previously from the 2022A Account of the Project Fund.
IV. There has not been filed with or serv ed upon the City or the Authority a stop notice or any other notice of any lien, right to lien or attachme nt upon, or cla im affecting the right to receive payment of, an y of the money payable to th e person[s] named on Schedule I hereto which has not been released or will not be released simultaneously with the payment of such obligation, other than liens accruing by mere operation of law.
131735222.3 G-2
Dated: ________, 20__
CITY OF SANTA CLARITA
By
Title:
131735222.3 G-3
SCHEDULE I
Project Component
Amount of
This Draw
Aggregate Amount
Draws Including
This Draw
___________ _______________
___________ _______________
___________ _______________
___________ _______________
___________ _______________
___________ _______________
(Continue on Additional Sheet if Necessary)
Name and Address of party to whom payment is to be made:
Purpose for which the obligation was incurred:
INDENTURE
by and between
SANTA CLARITA PUBLIC FINANCING AUTHORITY
and
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
Dated as of October 1, 2020
Relating to
$10,645,000
Santa Clarita Public Financing Authority
Lease Revenue Bonds (Recreational Facility) Series 2020A
and
$3,625,000
Santa Clarita Public Financing Authority
Federally Taxable Lease Revenue Bonds (Recreational Facility) Series 2020A-T
TABLE OF CONTENTS
Page
100802390.7 i
ARTICLE I DEFINITIONS; AUT HORIZATION AND PURPOSE OF
BONDS; EQUAL SECURITY ........................................................................ 2 SECTION 1.01. Definitions...................................... ................................................ 2 SECTION 1.02. Rules of Construction ........................... ....................................... 12 SECTION 1.03. Authorization and Purpose of Bonds .............. ............................. 12 SECTION 1.04. Equal Security .................................. ............................................ 12 ARTICLE II ISSUANCE OF BONDS .................................. ............................................. 13 SECTION 2.01. Designation ..................................... ............................................. 13 SECTION 2.02. Terms of Bonds .................................. .......................................... 13 SECTION 2.03. Redemption of Bonds ............................. ..................................... 15 SECTION 2.04. Form of Bonds ................................... .......................................... 18 SECTION 2.05. Execution of Bonds .............................. ........................................ 18 SECTION 2.06. Transfer of Bonds ............................... ......................................... 18 SECTION 2.07. Exchange of Bonds ............................... ....................................... 19 SECTION 2.08. Temporary Bonds ................................. ........................................ 19 SECTION 2.09. Registration Books .............................. ......................................... 19 SECTION 2.10. Bonds Mutilated, L ost, Destroyed or Stolen ................................ 19 SECTION 2.11. Use of Depository ............................... ......................................... 20 ARTICLE III DEPOSIT AND A PPLICATION OF PROCEEDS ....................................... 21 SECTION 3.01. Issuance of Bonds ............................... ......................................... 21 SECTION 3.02. Application of Proceeds of Sale of Bonds ........ ........................... 21 SECTION 3.03. Costs of Issuance Fund .......................... ...................................... 22 SECTION 3.04. Project Fund .................................... ............................................. 22 SECTION 3.05. Insurance and Condemnation Fund ................. ............................ 23 SECTION 3.06. Validity of Bonds ............................... .......................................... 23 SECTION 3.07. Additional Bonds ................................ ......................................... 23 ARTICLE IV REVENUES; FLOW OF FUNDS ................................................................. 24 SECTION 4.01. Pledge of Revenue s; Assignment of Rights ................................. 24 SECTION 4.02. Lease Revenue Fund; Receipt, Deposit and Applicat ion of Revenues ...................................................................................... 25 SECTION 4.03. Rebate Fund ..................................... ............................................ 26 SECTION 4.04. Investments ..................................... ............................................. 27 SECTION 4.05. Valuation and D isposition of Investments ................................... 28
ARTICLE V COVENANTS OF THE AUTHORITY ........................................................ 28 SECTION 5.01. Punctual Payment................................. ........................................ 28 SECTION 5.02. Extension of Payment of Bonds ................... ................................ 28 SECTION 5.03. Against Encumbrances ............................ ..................................... 28
TABLE OF CONTENTS
(continued)
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SECTION 5.04. Power to Issue B onds and Make Pledge and Assignment ........... 28 SECTION 5.05. Accounting Records and Financial Statements ..... ....................... 29 SECTION 5.06. Additional Obligations .......................... ....................................... 29 SECTION 5.07. Lease ........................................... ................................................. 29 SECTION 5.08. Tax Covenants ................................... .......................................... 29 SECTION 5.09. Further Assurances............................... ........................................ 34 ARTICLE VI THE TRUSTEE ........................................ ..................................................... 34 SECTION 6.01. Appointment of Trustee .......................... ..................................... 34 SECTION 6.02. Acceptance of Trusts............................. ....................................... 34 SECTION 6.03. Fees, Charges and Expenses of Trustee ....................................... 38 SECTION 6.04. Notice to Owners of Default ..................... ................................... 38 SECTION 6.05. Intervention by Trustee ......................... ....................................... 38 SECTION 6.06. Removal of Trustee .............................. ........................................ 38 SECTION 6.07. Resignation by Trustee .......................... ...................................... 38 SECTION 6.08. Appointment of Successor Trustee ................ .............................. 39 SECTION 6.09. Merger or Consolidation ......................... ..................................... 39 SECTION 6.10. Concerning any Successor Trustee ................ .............................. 39 SECTION 6.11. Appointment of Co-Trustee ....................... .................................. 39 SECTION 6.12. Indemnification; L imited Liability of Trustee ............................. 40 ARTICLE VII MODIFICA TION AND AMENDMENT OF THE INDENTURE ............... 40 SECTION 7.01. Amendment ....................................... ........................................... 40 SECTION 7.02. Effect of Su pplemental Indenture ................................................ 41 SECTION 7.03. Endorsement or Repla cement of Bonds After Amendment ........ 42 ARTICLE VIII EVENTS OF DEFAULT AND REMEDIES OF OWNERS ......... ............... 42 SECTION 8.01. Events of Default ............................... .......................................... 42 SECTION 8.02. Remedies; No Acceleration ....................... .................................. 43 SECTION 8.03. Application of Rev enues and Other Funds After Default ............ 43 SECTION 8.04. Power of Trustee to Control Proceedings ......... ........................... 44 SECTION 8.05. Appointment of Receivers ........................ ................................... 44 SECTION 8.06. Non-Waiver ...................................... ............................................ 44 SECTION 8.07. Rights of Owners ................................ ......................................... 45 SECTION 8.08. Termination of Proceedings ...................... ................................... 45 ARTICLE IX MISCELLANEOUS ...................................... ................................................ 45 SECTION 9.01. Limited Liability of Authority .................. ................................... 45 SECTION 9.02. Benefits of Inde nture Limited to Parties ...................................... 46 SECTION 9.03. Defeasance; D ischarge of Indenture ............................................ 46 SECTION 9.04. Successor is Deemed Included in All References to Predecessor .................................................................................. 47 SECTION 9.05. Content of C ertificates and Opinions ........................................... 47
TABLE OF CONTENTS
(continued)
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SECTION 9.06 Execution of Documents by Owners ................. .......................... 47 SECTION 9.07. Disqualified Bonds............................... ........................................ 48 SECTION 9.08. Waiver of Personal Liability .................... .................................... 48 SECTION 9.09. Partial Invalidity............................... ............................................ 48 SECTION 9.10. Destruction of Canceled Bonds ................... ................................ 48 SECTION 9.11. Funds and Accounts .............................. ....................................... 49 SECTION 9.12. Payment on Business Days ........................ .................................. 49 SECTION 9.13. Notices ......................................... ................................................ 49 SECTION 9.14 Unclaimed Moneys ................................. ..................................... 50 SECTION 9.15 Governing Law .................................... ........................................ 50
EXHIBIT A – FORM OF BOND
EXHIBIT B – FORM OF COSTS OF ISSUANCE REQUISITION
EXHIBIT C – FORM OF PROJECT FUND REQUISITION
EXHIBIT D – FORM OF NET PROCEEDS REQUISITION
INDENTURE
This INDENTURE is dated as of October 1, 2020, by and between t he SANTA CLARITA PUBLIC FINANCING AUTHORI TY, a joint powers authority or ganized and existing under the laws of the State of California (the “Author ity”), and U.S. BANK NATIONAL ASSOCIATION, a national banking association duly organ ized and existing under the laws of the United States with a corporate trust office in Los Angeles, California and qualified to accept and administer the trusts hereby created, as trustee (the “Trustee”).
RECITALS:
WHEREAS, the Authority is a join t powers authority duly organiz ed and existing under and pursuant to that certain Joint Exercise of Powers Agreement , dated as of July 9, 1991, as amended on May 10, 2016, by and among the City of Santa Clarita , California (the “City”), the City as successor agency to the Redevelopment Agency of the Cit y of Santa Clarita (no longer a member), and the Santa Clarita Parking Authority, and under the provisions of Articles 1 through 4 (commencing with Section 6500), Chapter 5, Division 7, Title 1 of the Government Code of the State of California (the “Ac t”), and is authorized pursuant to Article 4 of the Act (the “Bond Law”) to borrow money for the purpose of financing and refinanc ing public capital improvements; and
WHEREAS, the City desires to finance the acquisition of a parce l of land and the improvements thereon (the “Project”) to be used for recreational facilities; and WHEREAS, the City has requested that the Authority issue its Le ase Revenue Bonds (Recreational Facility) Series 2020A (the “Tax-Exempt Bonds”) a nd its Federally Taxable Lease Revenue Bonds (Recreational Facility) Series 2020A-T (the “Taxable Bonds,” and together with the Tax-Exempt Bonds, the “Bonds”), for the purpose of financin g the acquisition of an approximately 93,000 square foot recreation facility (the “Facility”) located on an approximately
4.4 acre parcel located at 27745 Smyth Drive within the City (t he “Site” and together with the Facility, the “Recreational Facility”); and
WHEREAS, the Authority intends t o issue the Bonds for such purp ose to assist the City; and
WHEREAS, in connection with the issuance of the Bonds, the City and the Authority have entered into a Site and Facility Lease, dated as of Octobe r 1, 2020 (the “Site Lease”), between the City and the Authorit y, whereby the Authority has a greed to lease the Recreational Facility from the City; and
WHEREAS, the Authority and the City have entered into a Lease A greement, dated as of October 1, 2020 (the “Lease”), between the Authority and the Ci ty, whereby the Authority has agreed to lease the Recreational Facility (the “Leased Property”) to the City; and WHEREAS, under and pursuant to the Lease, the City is obligated to make Base Rental Payments (as defined herein) to the Authority for the sublease of the Leased Property; and
2 WHEREAS, as security for its ob ligations hereunder, the Authori ty has assigned to the Trustee all its rights to receive the Base Rental Payments sche duled to be paid by the City under and pursuant to the Lease and certain other rights to the Trustee pursuant to the Indenture; and WHEREAS, the City has determined that the issuance of the Bonds will result in significant public benefits incl uding demonstrable financing co st savings and more efficient delivery of services to the community; and
WHEREAS, to provide for the authe ntication and delivery of the Bonds, to establish and declare the terms and conditions upon which the Bonds are to be issued and to secure the payment of the principal thereof, premium, if any, and interest thereon, the Authority has authorized the execution and delivery of this Indenture; and WHEREAS, the Authority has determined that all acts and proceed ings required by law necessary to make the Bonds, when executed by the Authority, au thenticated and delivered by the Trustee and duly issued, the valid, binding and legal speci al obligations of the Authority, and to constitute this Indenture a valid and binding agreement for the uses and purposes herein set forth in accordance with its terms, have been done and taken, a nd the execution and delivery of the Indenture have been in all respects duly authorized; NOW, THEREFORE, THIS INDENTURE WITNESSETH , that to secure the payment of the principal of and the interest and premium (if an y) on all Bonds at any time issued and Outstanding under this Indenture, according to their tenor, and to secure the performance and observance of all the covenants and conditions therein and here in set forth, and to declare the terms and conditions upon and subject to which the Bonds are to be issued and received, and in consideration of the premises and of the mutual covenants herei n contained and of the purchase and acceptance of the Bonds by the Owners thereof, and for othe r valuable considerations, the receipt whereof is hereby acknow ledged, the Authority does here by covenant and agree with the Trustee, for the benefit of the respective Owners from time to time of the Bonds, as follows:
ARTICLE I
DEFINITIONS; AUTHORIZATION AND PURPOSE OF BONDS;
EQUAL SECURITY
SECTION 1.01. Definitions. Unless the context otherwise requires, the terms defined in this Section shall for all purposes of this Indenture and of any Supplemental Indenture and of the Bonds and of any certificate, opinion, request or other doc ument herein mentioned have the meanings herein specified.
“Act” means Articles 1 through 4 (co mmencing with Section 6500), Cha pter 5, Division 7, Title 1 of the Government Code of the State, as in existence on the Closing Date or as thereafter amended from time to time.
“Additional Bonds” mean the Bonds of an additional Series authorized by a Supplemental Indenture that are issued pursuant to this Indenture.
3 “Additional Rental Payments” means the additional rental payable by the City under and pursuant to Section 3(b) of the Lease.
“Annual Debt Service” means, for each Bond Year with respect to the Bonds, the sum of (a) the interest payable on the Outstanding Bonds in such Bo nd Year, and (b) the principal amount of the Outstanding Bonds scheduled to mature or required to be redeemed by mandatory sinking account redemption in such Bond Year.
“Assignment Agreement” means that certain Assignment Agreement, dated as of October 1, 2020, by and between the Authority and the Trustee. “Authority” means the Santa Clarita Public Financing Authority, a joint po wers authority duly organized and ex isting under the Joint Exercise of Powers Agreement, as amended, and the laws of the State.
“Authority Board” means the governing body of the Authority. “Authorized Denominations” means $5,000 or any integral multiple thereof. “Base Rental Payments” means all Base Rental Payments under the Lease with respect to the Bonds, as the context requ ires, and any additional base rental payments made under the Lease with respect to any Additional Bonds issued in accordance with this Indenture. “Bond Counsel” means (a) Norton Rose Fulbright US LLP, or (b) any other attor ney or firm of attorneys appointed by or acceptable to the Authority of nationally recognized experience in the area of municipal finance.
“Bond Law” means the Marks-Roos Local Bond Pooling Act of 1985, constitut ing Article 4 of the Act, as in existence on the Closing Date or as thereafter amended from time to time.
“Bond Year” means each twelve-month period extending from June 2 in one ca lendar year to June 1 of the succeeding calendar year, both dates incl usive, except th at the first Bond Year shall begin on the Closing Date and shall end on June 1, 2021. “Bonds” mean collectively, the Tax-Exempt Bonds and the Taxable Bonds, and, where the context requires, any Additional Bonds.
“Business Day” means a day other than (i) a Saturday or Sunday, (ii) a day on which banking institutions in the city in which the Trustee maintains its Trust Office are authorized or required by law or executive order to close or (iii) a day on which the New York Stock Exchange is closed.
“Certificate of the Authority” means a certificate in writing signed by a Responsible Officer of the Authority.
“Certificate of the City” means a certificate in writing signed by a Responsible Officer of the City.
4 “City” means the City of Santa Clarita, California.
“Closing Date” means October 22, 2020, being the date of delivery of the Bond s to the Original Purchaser thereof.
“Code” means the Internal Revenue Code of 1986.
“Costs of Issuance” means all expenses incurred in connection with the authorizati on, issuance, sale and delivery of the Bonds, including but not lim ited to all compensation, fees and expenses (including but not limited to fees and expenses for le gal counsel) of the Authority and the Trustee, compensation to any financial consultants or under writers, legal fees and expenses (including fees and expenses of Bond and Disclosure Counsel), f iling and recording costs, rating agency fees, costs of preparati on and reproduction of documents , costs of printing and fees and costs for any guaranty, surety bond, letter of credit or other credit facility. “Costs of Issuance Fund” means the fund by that name established and held by the Trustee pursuant to Section 3.03.
“Defeasance Securities” means (1) cash, (2) non-callabl e direct obligations of the United States of America (“Treasuries”), (3) evidences of owner ship of proportionate interests in future interest and principal payments on Treasuries held by a bank or trust company as custodian, under which the owner of the investment is the real party in interest and has the right t o p r o c e e d d i r e c t l y a n d i n d i v i d u a l l y a g a i n s t t h e o b l i g o r a n d t he underlying Treasuries are not available to any person claiming through the custodian or to wh om the custodian may be obligated, (4) pre-refunded municipal obligations rated “AAA” and “Aaa” by S&P and Moody’s, respectively.
“Depository” means DTC and its successors and assigns or if (a) the then De pository resigns from its functions as securities depository of the Bond s, or (b) the Authority discontinues use of the Depository pursuant to Section 2.13 hereof, any othe r securities depository which agrees to follow the procedures requested to be followed by a s ecurities depository in connection with the Bonds and which is selected by the Authority.
“Depository Participant” means a member of, or participant in, the Depository. “Designated Investment Banker” means one of the Reference Treasury Dealers appointed by the City.
“DTC” means The Depository Trust Company, New York, New York, and its successors and assigns.
“Event of Default” means any of the events described in Section 8.01. “Facility” means the approximately 93,000 square foot building on the Site as it may be improved, repaired, rehabilitated, and modified for recreational facilities, as more fully described on Exhibit A to the Lease.
5 “Fair Market Value” means the price at which a willing buyer would purchase the investment from a willing seller in a bona fide, arm’s length t ransaction (determined as of the date the contract to purchase or sell the investment becomes bi nding) if the investment is traded on an established securities mar ket (within the meaning of sect ion 1273 of the Code) and, otherwise, the term “fair market value” means the acquisition p rice in a bona fide arm’s length transaction (as referenced above) if (i) the investment is a ce rtificate of deposit the value of which is determined in accordance with applicable regulations u nder the Code, (ii) the investment is an agreement with specifically negotiated withdra wal or reinvestment provisions and a specifically negotiated interest rate (for example, a gua ranteed investment contract, a forward supply contract or other investment agreement) the valu e of which is determined in accordance with applicable regulations under the Code, (iii) th e investment is a United States Treasury Security-State and Local Government Series that is acq uired in accordance with applicable regulations of the United States Bureau of Public De bt, or (iv) the investment is the Local Agency Investment Fund of the State of California, but on ly if at all times during which the investment is held its yield is reasonably expected to be equal to or greater than the yield on a reasonably comparable direct obligation of the United States. “Fiscal Year” means any twelve-month period extending from July 1 in one cal endar year to June 30 of the succeeding calendar year, both dates inc lusive, or any other twelve-month period selected and designated by the Authority as its official fiscal year period. “Indenture” means this Indenture, dated as of October 1, 2020, as original ly executed or as it may from time to time be amended or supplemented in accordance herewith. “Independent Certified Public Accountant” means any certified public accountant or firm of certified public accountants appointed and paid by the Authority, and who, or each of whom:
(a) is in fact independent an d not under domination of the Authority or the City; (b) does not have any substantial interest, direct or indirect, in the Authority or the City; and
(c) is not connected with the Authority or the City as an offic er or employee of the Authority or the City but who may be regularly retained to make annual or other audits of the books of or reports to the Authority or the City.
“Information Services” means the Electronic Municipal Market Access System (referred to as “EMMA”), a facility of the Municipal Securities Rulemaking Board, at http://emma.msrb.org; provided, however, in accordance with then current guidelines o f t h e Securities and Exchange Commission, Information Services shall mean such other organizations providing information with respe ct to called Bonds as the Autho rity may designate in writing to the Trustee.
“Insurance and Condemnation Fund” means the fund by that name established and held by the Trustee pursuant to Section 3.05.
6 “Interest Account” means the account by that name established and held by the Tru stee pursuant to Section 4.02(a).
“Interest Payment Date” means June 1 and December 1 of each year, commencing December 1, 2020.
“Joint Exercise of Powers Agreement” means that certain Joint Exercise of Powers Agreement, dated as of July 9, 1991, as amended on May 10, 2016 , by and among the City, the Successor Agency to the Redevelopment Agency of the City of San ta Clarita, and the Santa Clarita Parking Authority, toge ther with any amendments thereof and supplements thereto.
Currently, the Successor Agency is no longer a member of the Authority. “Lease” means that certain Lease Agreement, dated as of October 1, 202 0, by and between the Authority as lessor and the City as lessee, as it may be further amended or modified. “Lease Revenue Fund” means the fund by that name established and held by the Trustee pursuant to Section 4.02.
“Leased Property” o r “Recreational Facility” means, collectively, the Site and the Facility, leased by the Authority to the City pursuant to the L ease, as more fully described in Exhibit A to the Lease, as such Exhibit A may be revised and am ended from time to time pursuant to the terms hereof and of the Lease.
“Maximum Annual Debt Service” in respect of any Bond Year means the largest of the sums obtained for that or any succeeding Bond Year after totali ng the following for each such Bond Year:
(a) The principal amount of all Outstanding Bonds maturing or r equired to be redeemed by mandatory sinking account redemption in such Bond Year; and (b) The interest that would be due during such Bond Year on the aggregate principal amount of Bonds which would be Outstanding in such Bond Year if the Bonds Outstanding on the date of such computation were to mature or be redeemed in a ccordance with the applicable maturity or mandatory sinking account redemption schedule. At the time and for the purpose of making such computation, the amount of Bonds already retired in advance of the above mentioned schedule or schedules shall be deducted pro rata from the remaining amounts thereon. “Moody’s” means Moody’s Investors Service, Inc., a corporation organized and existing under the laws of the State of Delaware, its successors and the ir assigns, or, if such corporation shall be dissolved or liquidated or shall no longer perform the functions of a securities rating agency, any other nationally recognized securities rating agenc y designated by the Authority with notice to the Trustee.
“Nominee” means the nominee of the Depository, which may be the Deposito ry, as determined from time to time pursuant hereto.
“Original Purchaser” means, with respect to the Bonds, Raymond James & Associates, Inc., the initial purchaser of the Bonds.
7 “Outstanding,” when used as of any particular time with reference to Bonds an d Additional Bonds, means (subject to the provisions of Section 9 .07) all Bonds and Additional Bonds theretofore executed, issued and delivered by the Authority under this Indenture except:
(a) Bonds theretofore canceled by the Trustee or surrendered to t h e T r u s t e e f o r cancellation;
(b) Bonds paid or deemed to have been paid within the meaning o f Section 9.03; and (c) Bonds in lieu of which or in substitution for which other B onds shall have been executed, issued and delivered pursuant to this Indenture or any Supplemental Indenture. “Owner” when used with respect to any Bond, means the person in whose name the ownership of such Bond shall be registered on the Registration Books. “Permitted Investments” means any of the following which at the time of investment are legal investments under the laws of the State for the money s proposed to be invested therein (the Trustee is entitled to conclusively rely on a Written Requ est of the Authority directing investment in such Permitted Investment as a certification by t he Authority to the Trustee that such Permitted Investment is a legal investment under the laws of the State), but only to the extent that the same are acquired at Fair Market Value:
(a) Direct obligations of the United States of America (including o bligations issued or held in book-entry form on the books of the Department of th e Treasury of the United States of America) or obligations the tim ely payment of the principal of and interest on which are fully guaranteed by the United States of America, including instruments evidencing a direct ownership interest in securities described in this clause such as Strippe d Treasury Coupons at the time of purchase rated or assessed in the highest rating category by S& P and Moody’s and held by a custodian for safekeeping on behalf of holders of such securities. (b) Bonds or notes which are exempt from federal income taxes and f or the payment of which cash or obligations described in clause (a) of this de finition in an amount sufficient to pay the principal of, premium, i f any, and interest on when due have been irrevocably deposited w i t h a t r u s t e e o r o t h e r f i s c a l d e p o s i t a r y a n d w h i c h a t t h e t i m e of purchase are rated the same rating as direct obligations of the United States of America by S&P and Moody’s. (c) Obligations, debentures, notes o r other evidence of indebtednes s issued or guaranteed by any of the following: Federal Home Loan Bank Syst em, Government National Mortgage Association, Farmer’s H ome Administration, Federal Hom e Loan Mortgage Corporation or Federal Housing Ad ministration; provided that wi th respect to the funds and accounts established under this I ndenture, such obligations sha ll at no time exceed an amount equal to ten percent (10%) of the aggregate principal amount of the Bonds Outstanding. (d) Deposit accounts certificates of deposit or savings accounts (i ) fully insured by the Federal Deposit Insurance Corporation or (ii) with banks wh ose short term obligations are at the time of purchase rated no lower than A-1 by S&P and P-1 by Moody’s including those of the Trustee and its affiliates.
8 (e) Federal funds or banker’s acceptances with a maximum term of on e year of any bank that at the time of purchase has an unsecured, uninsured a nd unguaranteed obligation rating of “Prime-1” or “A3” by Moody’s and “A-l” or “A” or better by S &P (including the Trustee and its affiliates).
(f) Repurchase or reverse repurchase obligations (including those o f the Trustee or any of its affiliates) with a term not exceeding 30 days pursua nt to a written agreement between the Trustee and either a primary dealer on the Federal Reserve reporting dealer list which falls under the jurisdiction of the SIP C or a federally chartered com mercial bank whose long-term debt obligations at the time of purchase are rated A or better by S&P and Moody’s, with respect to any security described in clau se (1); provided that the secu rities which are the subject of such repurchase obligation (i) must be free and clear of all liens, (ii) in the case of a SIPC dealer, were not acquired pursuant to a repurchase or reverse repurchase agr eement, (iii) must be deposited with the Trustee and maintained through weekly market valuation s in an amount equal to 104% of the invested funds plus accrued interest; and further provid ed that the Trustee must have a valid first perfected security interest in such securities. (g) Taxable government money market portfolios that at the time of purchase have a rating by S&P of Am-G or Am or better and rated in one of the t hree highest rating categories of Moody’s, subject to a maximum permissible limit equal to six mo nths of principal and interest on the Bonds including such portfolios for which the Trustee, i ts affiliates or subsidiaries receive and retains a fee for services provided to the portfolio, wheth er as a custodian, transfer agent, investment advisor or otherwise.
(h) Tax-exempt government money market portfolios that at the time of purchase have a rating by S&P of Am-G or Am or better and rated in one o f the three highest rating categories of Moody’s consisting of securities which are rated in the highest Rating Categories of S&P and Moody’s subject to a maximum permissible limit equal to six months of principal and interest on the Bonds, includ ing such portfolios for which the Trustee, its affiliates or subsidiaries receive and retains a fee for services provided to the portfolio, whether as a custodian, transfer agent, investment advisor or otherwise. (i) Money market funds registered under the Investment Company Act of 1940, the shares in which are registered under the Securities Act of 1933 and that at the time of purchase have a rating by S&P of AAAm-G or AAAm and rated in one of the two highest Rating Categories of Moody’s, including such funds for which the Trust ee, its affiliates or subsidiaries receive and retains a fee for services provided to the fund, whether as a custodian, transfer agent, investment advisor or otherwise.
(j) United States of America dollar denominated commercial paper is sued or guaranteed by a United States or foreign corporation, company, financial institution, trust or other entity, including both unsecured debt and asset-backed programs with a minimum rating of A-1 (or the equivalent) by any one Nationally Recognized Statis tical Rating Organization (NRSRO).
9 (k) The Local Agency Investment Fund of the State, created pursuant t o Section 16429.1 of the California Government Code, to the exten t the Trustee is authorized to register such investment in its name.
(l) Shares of beneficial interest issued by a local agency investment pool joint powers authority organized pursuant to Section 6509.7 of the Californi a Government Code, that invests in the securities and obligations authorized in Section 53601 of the California Government Code, as it may be amended. At the time of purchase, the pool shall h ave a minimum rating of AAAm or the equivalent by any one NRSRO.
(m) Investment agreements, including guaranteed investment contract s (“GICs”) forward purchase agreements and reserve fund put agreements wit h banks or other financial institutions rated, or guaranteed by institutions rated, or wit h senior unsecured debt rated, at the time of entrance into such agre ement by S&P or Moody’s, in one of the three highest rating categories assigned by such agencies.
(n) Any other investments which meet the criteria established by applicable published investment guidelines issued by each rating agency then rating the Bonds. “Principal Account” means the account by that name established and held by the Trustee pursuant to Section 4.02(b).
“Principal Payment Date” means each June 1, commencing June 1, 2021. “Project” means the acquisition of the Recreational Facility. “Project Costs” means all costs which are paid from moneys on deposit in the P roject Fund, including but not limited to:
(a) all costs required to be paid to any person under the terms of any agreement for or relating to the Project;
(b) obligations incurred for labor and materials in connection with the Project; (c) the cost of performance or other bonds and any and all types of insurance that may be necessary or appropriate to have in effect in conne ction with the Project;
(d) all costs of engineering and architectural services, including the actual out- of-pocket costs for test borings, surveys, estimates, plans and specifications and preliminary i nvestigations therefor, develop ment fees, and for supervising construction, as well as for the performanc e of all other duties required by or consequent to the Project;
(e) any sums required to reimburse t he Authority or the City for ad vances made for any of the above items or for any other costs incurred and for work done which are properly chargeable to the Project, includi ng the purchase price for the Site and the improvements thereon; and
10 (f) all financing costs incurred in connection with the Project, in cluding but n o t l i m i t e d t o C o s t s o f I s s u a n c e a n d o t h e r c o s t s i n c u r r e d i n c onnection herewith and the financing of the Project.
“Project Fund” means the fund by that name established and held by the Truste e pursuant to Section 3.04.
“Rebate Fund” means the fund by that name established and held by the Truste e pursuant to Section 4.03.
“Rebate Requirement” means, in respect of an issue of Tax-Exempt Bonds, obligations imposed under section 148(f) the Code in respect of such issue. “Record Date” means, with respect to any Interest Payment Date, the fifteent h (15 th) calendar day of the month immediately preceding such Interest P ayment Date, whether or not such day is a Business Day.
“Reference Treasury Dealer” means each of five firms, specified by the City from time to time, that are primary U.S. Government securities dealers in the City of New York (each, a “Primary Treasury Dealer”); pr ovided, however, that if any of t h e m c e a s e s t o b e a P r i m a r y Treasury Dealer, the City will substitute another Primary Treasury Dealer. “Registration Books” means the records maintained by the Trustee pursuant to Section 2.09 for the registration and transfer of ownership of the Bonds. “Rental Payments” means, collectively, the Base Rental Payments, any additional base rental payments made in connection with Additional Bonds and any Additional Rental Payments. “Responsible Officer” means, with respect to the Authority, any member of the Authority Board, the Executive Director or the Treasurer of the Authority, or any other person authorized by resolution of the Authority Board to act on behal f of the Authority under or with respect to the Lease or this Indenture, and means, with respect to the City, the Mayor, the City Manager, the Assistant City Manager, the Deputy City Manager, t he City Treasurer or any other officer of the City duly authorized for that purpose by the May or, the City Manager or by the City Council, as evidenced in writing to the Trustee.
“Revenues” means (i) all Base Rental Payments payable by the City pursuan t to the Lease (including prepayments), (ii) any proceeds of Bonds depos i t e d w i t h t h e T r u s t e e a n d a l l moneys on deposit in the funds and accounts (other than the Rebate Fund) established hereunder, (iii) investment income with respect to such moneys held by the Trustee and (iv) any insurance proceeds or condemnation awards received by or payable to the T r u s t e e r e l a t i n g t o t h e B a s e Rental Payments.
“S&P” m e a n s S & P G l o b a l R a t i n g s , i t s s u c c e s s o r s a n d a s s i g n s o r , i f s uch corporation shall be dissolved or liquidated or shall no longer perform the functions of a securities rating agency, any other nationally recognized securities rating agenc y designated by the Authority with notice to the Trustee.
11 “Securities Depositories” means The Depository Trust Company, New York, New York and its successors and assigns or if (i) the then Securities Depository resigns from its functions as depository of the Bonds or (ii) the Authority discontinues use of the then Securities Depository pursuant to Section 2.11, any othe r securities depository which agrees to follow the procedures required to be followed by a securities depository in connectio n with the Bonds and which is selected by the Authority.
“Series” whenever used in this Indenture with respect to the Bonds or A dditional Bonds, means all of the Bonds designated as being of the same series, authenticated and delivered in a simultaneous transaction, regardless of variations in maturity, interest rate, redemption and other provisions, and any Bonds thereafter authenticated and delivered upon transfer or exchange of or in lieu of or in substitution for (but not to refund) such Bonds as provided herein. “Site” means the approximately 4.4 acre parcel located at 27745 Smyth Drive, Santa Clarita.
“Site Lease” means that certain Site and Facility Lease, dated as of Octobe r 1, 2020, by and between the City and the Authority, pursuant to which the A uthority leases the Site and improvements thereon from the City.
“State” means the State of California.
“Supplemental Indenture” means any agreement supplemental to or amendatory of this Indenture entered into in accordance with the provisions of Article VII. “Tax Certificate” means the Tax Certificate dated the date of the original deliv ery of the Tax-Exempt Bonds relating to the requirements of certain provis ions of the Code, as such certificate may from time to time be modified or supplemented i n accordance with the terms thereof.
“Tax-Exempt Bonds ” means the Santa Clarita Public Financing Authority, Lease Revenue Bonds (Recreational Facility), Series 2020A, authorized , executed and delivered hereunder.
“Taxable Bonds” means the Santa Clarita Public Financing Authority, Federally Taxable Lease Revenue Bonds (Recreational Facility), Series 2020A-T, authorized, executed and delivered hereunder.
“Term Bonds” mean, collectively, the Tax-Exempt Bonds maturing on June 1 in the years 2041, 2046 and 2050.
“Treasury Rate” means, with respect to any redemption date for a particular Tax able Bond, the yield to maturity as of the redemption date of the Un ited State Treasury securities with a constant maturity (as compiled and published in the most rece n t F e d e r a l R e s e r v e S t a t i s t i c a l Release H.15 (510 that has become publicly available at least t wo (2) Business Days prior to the redemption date (excluding infla tion indexed securities) (or, i f such Statistical Release is no longer published, any publicly a vailable source of similar mark et data)) most nearly equal to the period from the redemption date to the maturity date of the Tax able Bond to be redeemed,
12 provided, however, that if the period from the redemption date to such maturity date is less than one year, the weekly average yield on actually traded United St ates Treasury securities adjusted to a constant maturity of one year will be used.
“Trust Office” means the corporate trust office of the Trustee in Los Angeles , California or such other offices as may be specified to the Authority by t he Trustee in writing or, solely for purposes of the surrender of the Bonds for payment, transfer or exchange, the corporate trust operations or agency office designated by the Trustee.
“Trustee” means U.S. Bank National Association, and its successors and a ssigns, and any other banking corporation or association that may at any ti me be substituted in its place as provided in Article VI hereof.
“Written Request of the Authority” means a request in writing signed by a Responsible Officer of the Authority.
“Written Request of the City” means a request in writing signed by a Responsible Officer of the City.
SECTION 1.02. Rules of Construction. All references in this Indenture to “Articles,” “Sections,” and other subdivisions are to the corresponding Art icles, Sections or subdivisions of this Indenture; and the words “herein,” “hereof,” “hereunder,” and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or subdivision hereof.
SECTION 1.03. Authorization and Purpose of Bonds. The Authority has reviewed all proceedings heretofore take n relative to the authorization of the Bonds and has found, as a result of such review, and hereby finds and determines that all things, conditions, and acts required by law to exist, to happen and to be performed precede nt to and in the issuance of the Bonds do exist, have happened and have been performed in due ti me, form and manner as required by law, and the Authority is now authorized under the Joint Exercise of Powers Agreement and the Bond Law and each and every requirement of la w, to issue the Bonds in the manner and form provided in this Indenture. Accordingly, the A uthority hereby authorizes the issuance of the Bonds pursuant to the Bond Law and this Indentu re for the purpose described in the recitals hereof.
SECTION 1.04. Equal Security. In consideration of the a cceptance of the Bonds by the Owners thereof, this Indenture shall be deemed to be and sh all constitute a contract between the Authority and the Owners from time to time of the Bonds; an d the covenants and agreements herein set forth to be performed on behalf of the Authority sha ll be for the equal and proportionate benefit, security a nd protection of all Owners wi thout preference, priority or distinction as to security or otherwise of any of the Bonds over any of the others by reason of the number or date thereof or the ti me of sale, execution or delive ry thereof, or otherwise for any cause whatsoever, except as expressly provided therein or herein.
13 ARTICLE II
ISSUANCE OF BONDS
SECTION 2.01. Designation. The Tax-Exempt Bonds are authorized to be issued by the Authority under and subject to the Bond Law and the terms o f this Indenture and shall be designated, respectively, as the “Santa Clarita Public Financing Authority, Lease Revenue Bonds (Recreational Facility ), Series 2020A.” The Tax-Exempt Bonds sh all be issued in the original aggregate principal amount of $10,645,000.
The Taxable Bonds are authorized to be issued by the Authority under and subject to the Bond Law and the terms of this Indenture and shall be designate d, respectively, as the “Santa Clarita Public Financing Authority , Federally Taxable Lease Rev enue Bonds (Recreational Facility), Series 2020A-T.” The Taxable Bonds shall be issued in the original aggregate principal amount of $3,625,000.
SECTION 2.02. Terms of the Bonds. The Bonds shall be dated the Closing Date, shall mature on the dates and in the amounts, and shall bear in terest (calculated on the basis of a 360-day year of twelve 30-day months) at the rates, set forth in the following table:
Tax-Exempt Bonds
Maturity Date
(June 1)
Principal
Amount
Interest
Rate
2030 $ 165,000 4.000%
2031 400,000 3.000
2032 415,000 3.000
2033 425,000 2.000
2034 435,000 2.000
2035 445,000 2.125
2036 455,000 2.250
2037 465,000 2.250
2038 475,000 2.375
2039 485,000 2.375
2041 1,005,000 2.500
2046 2,825,000 4.000
2050 2,650,000
2.750
$10,645,000
14 Taxable Bonds
Maturity Date
(June 1)
Principal
Amount
Interest
Rate
2021 $ 485,000 0.447%
2022 350,000 0.597
2023 355,000 0.790
2024 355,000 0.976
2025 360,000 1.176
2026 365,000 1.487
2027 370,000 1.687
2028 375,000 1.967
2029 385,000 2.067
2030 225,000
2.167
$3,625,000
The Bonds shall be delivered in f ully registered form, numbered from one upwards in consecutive numerical order (with such alphabetical prefix as t he Trustee shall determine). The Bonds shall be executed and delivered in their respective Authorized Denominations.
Each Bond shall bear interest from the Interest Payment Date ne xt preceding the date of authentication thereof, unless (i) it is executed during the pe riod from the day after the Record Date for an Interest Payment Date to and including such Interes t Payment Date, in which event it shall bear interest from such Interest Payment Date, or (ii) it is authenticated on or prior to the Record Date for the first Interest Payment Date, in which event it shall bear interest from the Closing Date; provided, however, that if, at the time of authen tication of any Bond interest with respect to such Bond is in default, such Bond shall bear intere st from the Interest Payment Date to which interest has been paid or made available for payment with respect to such Bond, or if no interest has been paid, from the date of initial delivery of the Bonds.
Interest with respect to any Bond shall be payable in lawful money of the United States of America on each Interest Payment Date to the Owner thereof as o f the close of business on the Record Date, such interest to be paid by check of the Trustee, mailed by first class mail no later than the Interest Payment Date to the Owner at his address as it appears, on such Record Date, on the Registration Books maintained by the Trustee; provided, however, that at the written request of the Owner of at least $1,000,000 in aggregate principal amou nt of Outstanding Bonds filed with the Trustee prior to any Record Date, interest on such Bonds shall be paid to such Owner on each succeeding Interest Payment Date (unless such request has been revoked in writing) by wire transfer of immediately availabl e funds to an account in the Un ited States designated in such written request. Payments of defaulted interest with respect t o the Bonds shall be paid by check or draft to the registered Owners of the Bonds as of a special record date to be fixed by the Trustee, notice of which special record date shall be given to the registered Owners of the Bonds not less than ten days prior thereto. The principal of and pre mium, if any, on the Bonds are payable by check when due upon surrender thereof at the Trust O ffice in lawful money of the United States of America.
15 SECTION 2.03. Redemption of Bonds.
(a) Extraordinary Redemption. The Bonds shall be subject to redemp tion prior to their respective maturity dates, upon written notice from the A uthority to the Trustee at least forty-five (45) days (or such lesser number of days acceptable t o t h e T r u s t e e , i n t h e s o l e discretion of the Trustee), from the date fixed for redemption, as a whole or in part on a pro rata basis, on any date from prepayments of the applicable Base Rent al Payments made by the City pursuant to the Lease from funds received by the City due to a taking of the Leased Property or any portion thereof under the power of eminent domain or from i nsurance proceeds received by the City due to damage to or destruction of the Leased Property or any portion thereof, under the circumstances and upon the conditions and terms prescribed herein and in the Lease.
Redemption of Bonds pursuant to this subparagraph (a) shall be made at a redemption price equal to the sum of the principal of the Bonds to be rede emed plus accrued but unpaid interest thereon to the date fixed for redemption, without premium. (b) Bonds Optional Redemption from Prepayments of Base Rental Payments. (1) Optional Redemption of Tax-Exempt Bonds . The Tax-Exempt Bonds maturing on or after June 1, 2030 shall be subject to redemption prior to their respective maturity dates, upon written notice from the Authority to the T rustee at least forty-five (45) days (or such lesser number of days acceptable to the Trus tee, in the sole discretion of the Trustee) prior to the date fixed for redemption, as a whole or in part on any date on or after June 1, 2028, in such maturities as the Au thority shall designate (and by lot within any maturity), from prepayments of Base Rent al Payments made at the option of the City pursuant to Section 11(b) of the Lease, at a redemption price equal to the principal amount of the Tax-Exempt Bonds to be red eemed, plus accrued but unpaid interest to the date fixed for redemption, without premium. (2) Optional Redemption of Taxable Bonds at Make Whole Redemption Price – Make and Hold. The Taxable Bonds may be redeemed, at the written direction of the Authority, in whole or in part in integral multiples of $5,000, on any Business Day prior to June 1, 2030, from prepayments of Base Rental Paym ents made at the option of the City pursuant to Section 11(b) of the Lease, at t he “Make-Whole Redemption Price” for such Taxable Bonds to be redeemed determi ned by the Designated Investment Banker equal to the greater of (i) the issue price as shown on the i n s i d e c o v e r p a g e o f t h e O f f i c i a l S t a t e m e n t ( b u t n o t l e s s t h a n 100% of the principal amount of the Taxable Bonds to be redeemed), or (ii) an amount equal to the sum of the present values of the remaining scheduled payments of principal and interest on the Taxable Bonds to be redeemed, not including any portion of thos e payments of interest accrued and unpaid as of the date on which the Taxable Bonds ar e to be redeemed, discounted to the date on which such Taxable Bonds are to be re deemed on a semi- annual basis, assuming a 360-day year consisting of twelve 30-d ay months, at the “Treasury Rate” plus 20 basis points, plus acc rued and unpaid i nterest on the Taxable Bonds to be redeemed on the redemption date.
16 (c) Mandatory Sinking Account Redemption. The Tax-Exempt Term Bond s maturing on June 1, 2041, June 1, 2046 and June 1, 2050 shall b e subject to mandatory redemption, in part by lot, from sinking account payments set f orth in the following schedule on June 1, in each year shown below until maturity, at a redemptio n price equal to the principal amount thereof to be redeemed (without premium), together with interest accrued thereon to the date fixed for redemption.
Tax-Exempt Term Bonds Maturing June 1, 2041
Redemption Date
(June 1)
Principal Amount
To be Redeemed
2040 $495,000
2041* 510,000
_________________
* Maturity
Tax-Exempt Term Bonds Maturing June 1, 2046
Redemption Date
(June 1)
Principal Amount
To be Redeemed
2042 $520,000
2043 545,000
2044 565,000
2045 585,000
2046* 610,000
_________________
* Maturity
Tax-Exempt Term Bonds Maturing June 1, 2050
Redemption Date
(June 1)
Principal Amount
To be Redeemed
2047 $635,000
2048 655,000
2049 670,000
2050* 690,000
_________________
* Maturity
If some but not all of a Term Bond has been redeemed pursuant t o extraordinary or optional redemptions, the total amount of sinking account payme nts to be made subsequent to such redemption shall be reduced in an amount equal to the principal amount of such Term Bond so redeemed by reducing each such future sinking account paymen t on a pro rata basis (as nearly as practicable) in integral multiples of $5,000, as shall be de signated pursuant to written notice filed by Authority with the Tru stee. In the event of any reduc tions in the amount of sinking account payments due as a result of some but not all of the Bon ds being redeemed pursuant to extraordinary or optional redemptions, the Authority shall prov ide the Trustee with a revised schedule reflecting such reductions.
17 (d) Notice of Redemption. The Trustee on behalf and at the expense of the Authority shall mail (by first class mail or other means acceptable to th e recipient thereof) notice of any redemption to the respective Owners designated for redemption a t their respective addresses appearing on the Registration Books, to the Securities Deposito r i e s a n d t o o n e o r m o r e Information Services, at least twenty (20) but not more than si xty (60) days prior to the date fixed for redemption; provided, however, that neither failure to receive any such notice so mailed nor any defect therein shall aff ect the validity of the proceed ings for the redemption of such Bonds or the cessation of the acc rual of interest thereon. Suc h notice shall state the date of the notice, the redemption date, the redemption place and the redem ption price and shall designate the CUSIP numbers, the Bond numbers and the maturity or maturit ies (in the event of redemption of all of the Bonds of such maturity or maturities i n whole) of the Bonds to be redeemed, and shall require that such Bonds be then surrendered at the Trust Office of the Trustee for redemption at the redemption price, giving notice a lso that further interest on such Bonds will not accrue from and after the redemption date. Such notice shall further state, if so determined by the Authority, that such notice may be rescinded at any time prior to the redemption date.
Neither the Authority nor the Trustee shall have any responsibi lity for any defect in the CUSIP number that appears on any Bond or in any redemption noti ce with respect thereto, and any such redemption notice may contain a statement to the effect that CUSIP numbers have been assigned by an independent servic e for convenience of reference and that neither the Authority nor the Trustee shall be liable for any inaccuracy in such numbers.
Any notice given pursuant to the preceding paragraph may be con ditional and/or rescinded by written notice given to the Trustee by the Authori ty and the Trustee shall provide notice of such rescission as s oon thereafter as practicable in the same manner, and to the same recipients, as notice of such redemption was given pursuant to this Section. The Authority and the Trustee shall have no liability to the Owners or any other party related to or arising from such rescission of redemption.
(e) Selection of Bonds for Redemption. Whenever provision is made in this Indenture for the optional or extraordinary mandatory redemption of less than all of the Bonds of a Series (other than mandatory sinking account redemption), the Trustee shall select the Bonds to be redeemed from all Bonds of such Series not previously called fo r redemption, in such maturities as the Authority shall designate (and by lot within any maturity). For purposes of such selection, all Bonds shall be deemed to be comprised of separate $5,000 portions and such portions shall be treated as separate Bonds, which may be separately redeemed. (f) Partial Redemption of Bonds. In the event only a portion of an y Bond of a Series is called for redemption, then upon surrender of such Bond the Authority shall execute and the Trustee shall authenticate and deliver to the Owner thereof, at the expense of the Authority, a new Bond or Bonds of the same Series, interest rate and maturit y date, in aggregate principal amount equal to the unredeemed portion of the Bond being redeemed. (g) Effect of Redemption. From and after the date fixed for redemp tion, if funds available for the payment of the principal of, premium, if any, and interest on the Bonds of a Series so called for redempti on shall have been duly provided, such Bonds so called shall cease
18 to be entitled to any benefit unde r this Indenture other than t he right to receive payment of the redemption price, and no interest shall accrue thereon from and after the redemption date. All Bonds redeemed pursuant to this Section 2.03 shall be canceled by the Trustee. All moneys held by or on behalf of the Trustee for the payment of principal of or interest or premium on Bonds, whether at redemption or maturity, shall be held in trust for t he account of the Owners thereof and the Trustee shall not be required to pay Owners any interes t on, or be liable to Owners for any interest earned on, moneys so held.
SECTION 2.04. Form of Bonds. The Bonds, the form of Trustee’s certificate of authentication, and the form of assignment to appear thereon, s hall be substantially in the form set forth in Exhibit A-1 and Exhibit A-2 attached hereto and by this reference incorporated herein, with necessary or appropriate variations, omissions and insertions, as permitted or required by this Indenture.
SECTION 2.05. Execution of Bonds. The Bonds shall be signed in the name and on behalf of the Authority with the manual or facsimile signature of its Chair, and attested with the manual or facsimile signature of its Secretary or any Assistant or Deputy Secretary duly appointed by the Authority Board, and shall be delivered to the Trustee for authentication by it.
In case any officer of the Authority who shall have signed any of the Bonds shall cease to be such officer before the Bonds so signed shall have been authenticated or delivered by the Trustee or issued by the Authority, such Bonds may nevertheless be auth enticated, delivered and issued and, upon such authentication, del ivery and issue, shall be as binding upon the Authority as though the individual who signed the same had continued to be s uch officer of the Authority.
Also, any Bond may be signed on behalf of the Authority by any individual who on the actual date of the execution of such Bond shall be the proper officer although on the nominal date of such Bond such individual shall not have been such officer.
Only such of the Bonds as shall bear thereon a certificate of a uthentication in substantially the form set forth in Exhibit A, manually executed on behalf of the Trustee, shall be valid or obligatory for any purpose or entitled to the benefits of this Indenture, and such certificate of the Trustee shall be conclusive evidence that th e Bonds so authenticated have been duly authenticated and delivered hereunder and are entitled to the benefits of this Indenture.
SECTION 2.06. Transfer of Bonds. Any Bond may, in accordance with its terms, be transferred, upon the Registration Books, by the person in whos e name it is registered, in person or by his duly authorized attorn ey, upon presentation and surre nder of such Bond for cancellation, accompanied by delivery of a written instrument o f transfer in a form approved by the Trustee, duly executed. Whenever any Bond shall be surrend ered for transfer, the Authority shall execute and the Trustee shall thereupon authenticate and deliver to the transferee a new Bond or Bonds of like tenor, inte rest rate, series designation, maturity and aggregate principal amount in Authorized Denominations. The cost of printing any Bonds and any services rendered or expenses incurred by the Tru stee in connection with any such transfer shall be paid by the Authority, except that the Trustee shall require the payment by the Owner requesting such transfer of any tax or other governmental charge required to be paid with respect to such transfer.
The Trustee shall not be required to transfer, pursuant to this Section, (a) any Bond during the period established by the Trust ee for the selection of Bonds fo r redemption or (b) any Bond selected for redemption pursuant to Section 2.03(e). Prior to a ny transfer of the Bonds outside
19 the book-entry system (including, but not limited to, the initi al transfer outside the book-entry system) the transferor shall provide or cause to be provided to the Trustee all information necessary to allow the Trustee to comply with any applicable ta x reporting obligations, including without limitation any cost basis reporting obligations under I nternal Revenue Code Section 6045, as amended. The Trustee shall conclusively rely on the i nformation provided to it and shall have no responsibility to verify or ensure the accuracy of such information.
SECTION 2.07. Exchange of Bonds. Bonds may be exchanged at the Trust Office of the Trustee for the same aggregate principal amount of Bonds of the same tenor, interest rate, series designation, and maturity and of other Authorized Denomi nations. The cost of printing any Bonds and any services rendered or expenses incurred by the Trustee in connection with any such exchange shall be paid by the Authority, except that the T rustee shall require the payment by the Owner requesting such exchange of any tax or other gover nmental charge required to be paid with respect to such exchange. The Trustee shall not be r equired to exchange, pursuant to this Section, (a) any Bond during the period established by the Trustee for the selection of Bonds for redemption or (b) any Bond selected for redemption pursuant to Section 2.03(e).
SECTION 2.08. Temporary Bonds. The Bonds may be issued initially in temporary form exchangeable for definitive Bonds when ready for delivery. The temporary Bonds may be printed, lithographed or typewritten, shall be of such denominations as may be determined by the Authority and may contain such reference to any of the provisio ns of this Indenture as may be appropriate. Every temporary Bond shall be executed by the Aut hority and be registered and authenticated by the Trustee upon the same conditions and in su bstantially the same manner as the definitive Bonds. If the Au thority issues temporary Bonds, it will execute and furnish definitive Bonds without delay, and thereupon the temporary Bon ds shall be surrendered, for cancellation, in exchange therefor at the Trust Office of the T rustee, and the Trustee shall authenticate and deliver in exchange for such temporary Bonds d efinitive Bonds of like tenor, series designation, maturity and aggregate principal amount in Authorized Denominations. Until so exchanged, the temporary Bonds shall be entitled to the same benefits under this Indenture as definitive Bonds authenticated and delivered hereunder.
SECTION 2.09. Registration Books. The Trustee will keep or cause to be kept at its Trust Office sufficient records for the registration and transf er of the Bonds, which shall at all times during regular business hours be open to inspection by th e Authority with reasonable prior notice; and, upon presentation for such purpose, the Trustee sh all, under such reasonable regulations as it may prescribe, register or transfer, or cause to be registered or transferred, on such records, Bonds as herein provided.
SECTION 2.10. Bonds Mutilated, Lost, Destroyed or Stolen. If any Bond shall become mutilated, the Authority, at the expense of the Owner of such Bond, shall execute, and the Trustee shall thereupon authenticate and deliver, a new Bond of like tenor, series designation, maturity and aggregate principal amount in an Authorized Denomi nation in exchange and substitution for the Bond so mutilated, but only upon surrender to the Trustee of the Bond so mutilated. Every mutilated Bond so surrendered to the Trustee shall be canceled by it. If any Bond issued hereunder shall be lo st, destroyed or stolen, evide nce of such loss, destruction or theft may be submitted to the Trustee and, if such evidence sha ll be satisfactory to it and indemnity satisfactory to it shall be given, the Authority, at the expense of the Owner, shall
20 execute, and the Trustee shall thereupon authenticate and deliv er, a new Bond of like series and tenor in lieu of and in substitution for the Bond so lost, dest royed or stolen (or if any such Bond shall have matured or shall have been called for redemption, in stead of issuing a substitute Bond the Trustee may pay the same without surrender thereof upon rec eipt of indemnity satisfactory to the Trustee). The Authority may require payment of a reasonabl e fee for each new Bond issued under this Section and of the expe nses that may be incurred by the Authority and the Trustee.
Any Bond issued under the provisions of this Section in lieu of any Bond alleged to be lost, destroyed or stolen shall constitute an original contractual ob ligation on the part of the Authority whether or not the Bond alleged to be lost, destroyed or stolen shall be at any time enforceable by anyone, and shall be equally and proportionately entitled to the benefits of this Indenture with all other Bonds secured by this Indenture.
SECTION 2.11. Use of Depository. Notwithstanding any provision of the Indenture to the contrary:
(a) The Bonds shall be initially issued in book-entry form as provi ded in Section
2.02. The Bonds will be initially registered in the name of Ce de & Co., as nominee of the Depository. Registered ownership of the Bonds, or any portion thereof, may not thereafter be transferred except:
(i) T o a n y s u c c e s s o r o f t h e D e p o s i t o r y o r i t s n o m i n e e , o r t o a n y s ubstitute depository designated pursuant to clause (ii) of this subsectio n (a) (a “substitute depository”); provided that any successor of the Depository or substitute depository shall be qualified under any applicable laws to provide the service p roposed to be provided by it;
(ii) To any substitute depository designated by the Authority and no t objected to by the Trustee, upon (1) the resignation of the Depository o r its successor (or any substitute depository or its successor) from its functions as d epository or (2) a determination by the Authority that the Depository or its succe ssor (or any substitute depository or its successor) is no longer able to carry out its functions as depository; provided that any such substitute depository shall be qualified under any applicable laws to provide the services proposed to be provided by it; or (iii) To any Person as provided below, upon (1) the resignation of th e Depository or its successor (or any substitute depository or it s successor) from its functions as depository; provided that no substitute depository which is not objected to by the Trustee can be obtained or (2) a determination by the Autho rity that it is in the best interests of the Authority to remove the Depository or its succ essor (or any substitute depository or its successor) from its functions as depository. (b) In the case of any transfer pursuant to clause (i) or clause (i i) of subsection (a) hereof, upon receipt of the Outstanding Bonds by the Trustee, t ogether with a Certificate of the Authority to the Trustee, a single new Bond for each maturity o f Bonds then Outstanding shall be executed and delivered in the aggregate principal amount of the Bonds of each such respective maturity then Outstanding, registered in the name of such successor or such substitute depository, or their nominees, as the case may be, all as speci fied in such Certificate of the
21 Authority. In the case of any transfer pursuant to clause (iii ) of subsection (a) hereof, upon receipt of the Outstanding Bonds by the Trustee together with a Certificate of the Authority to the Trustee, new Bonds shall be executed and delivered in such denominations numbered in consecutive order and registered in the names of such persons a s are requested in such a Certificate of the Authority, subject to the limitations of Sec tion 2.02 hereof, provided the Trustee shall not be required t o deliver such new Bonds within a period less than sixty (60) days from the date of receipt of such a Certificate of the Authority. (c) The Authority and the Trustee sh all be entitled to treat the pe rson in whose name any Bond is registered as the Owner thereof for all purposes of the Indenture and any applicable laws, notwithstanding any notice to the contrary received by the Trustee or the Authority; and the Authority and the Trustee shall have no responsibility for tran smitting payments to, communication with, notifying, or otherwise dealing with any Be neficial Owners of the Bonds.
Neither the Authority nor the Trustee will have any responsibil ity or obligations, legal or otherwise, to the Beneficial Own ers or to any other party inclu ding the Depository or its successor (or any substitute depository or its successor), except for the Holder of any Bond. (d) So long as the Outstanding Bonds are registered in the name of Cede & Co. or its registered assigns, the Authority and the Trustee shall coopera te with Cede & Co., as sole registered Owner, and its registe red assigns in effecting payme nt of the principal of and interest on the Bonds by arranging for payment in such manner that funds for such payments are properly identified and are made immediately available on the date they are due.
ARTICLE III
DEPOSIT AND APPLICATION OF PROCEEDS
SECTION 3.01. Issuance of Bonds. Upon the execution and delivery of this Indenture, the Authority shall ex e c u te a n d d e l i v e r th e B o n d s to the Trustee for authentication, issuance and delivery to the Original Purchaser thereof upon th e Written Request of the Authority.
SECTION 3.02. Application of Proceeds of Sale of Bonds. (a) Upon the receipt of payment for the Tax-Exempt Bonds on the Clo sing Date, the Trustee shall apply $10,825,167.75 of the net proceeds of the T ax-Exempt Bonds (which equals the principal amount of the Tax-Exempt Bonds, less an underwriting discount of $45,241.25, and plus a net original issue premium of $225,409.00), as follows:
(1) The Trustee shall deposit in the Costs of Issuance Fund the amo unt of $175,167.75.
(2) The Trustee shall deposit in the Project Fund the amount of $10,650,000.00.
(b) Upon the receipt of payment for the Taxable Bonds on the Closin g Date, the Trustee shall apply $3,609,593.75 of the net proceeds of the Ta xable Bonds (which equals the principal amount of the Taxable Bonds, less an underwriting discount of $15,406.25), as follows:
22 (1) The Trustee shall deposit in the Costs of Issuance Fund the amo unt of $59,593.75, which together with the proceeds from the Tax-Exemp t Bonds, equals $234,761.50.
(2) The Trustee shall deposit in the Project Fund the amount of $3,550,000.00, which together with the proceeds from the Tax-Ex empt Bonds, equals $14,200,000.00.
(c) The Trustee may establish such temporary funds, accounts and su baccounts as may be necessary or desirable to accomplish such deposits.
SECTION 3.03. Costs of Issuance Fund. There is hereby established a fund to be held by the Trustee known as the “Costs of Issuance Fund,” into which shall be deposited a portion of the proceeds of the sale of the Bonds pursuant to Se ction 3.02. The moneys in the Costs of Issuance Fund shall be u sed to pay Costs of Issuance r elated to the Bonds from time to time and shall be disbursed by the Trustee upon delivery to the Trustee of a requisition, substantially in the form attached hereto as Exhibit B, execute d by an officer of the Authority.
Each requisition shall be sufficient evidence to the Trustee of t h e f a c t s s t a t e d t h e r e i n a n d t h e Trustee shall have no duty to confirm the accuracy of such fact s. On the date that is 180 days following the Closing Date, or upon the earlier receipt by the Trustee of a Written Request of the Authority certifying that all Costs of Issuance related to the Bonds have been paid or provided for, the Trustee shall transfer any remaining amounts in the Co sts of Issuance Fund to the Lease Revenue Fund and the Trustee shall then close the Costs of Issuance Fund.
SECTION 3.04. Project Fund. There is hereby established a fund to be held by the Trustee known as the “Project Fund” into which shall be deposit ed a portion of the proceeds of the sale of the Bonds pursuant to Section 3.02. Except as othe rwise provided herein, moneys in the Project Fund shall be used solely for the payment of Project Costs. Before any payment from the Project Fund shall be made, t he City shall file or cause to b e f i l e d w i t h t h e T r u s t e e , a requisition of the City which shall be substantially in the for m attached hereto as Exhibit C. The Trustee shall be entitled to rel y on the representations of the City contained in such requisition and shall not be required to independently verify the contents of such requisition.
Within three (3) Business Days following receipt of each such R equisition, the Trustee shall pay the amount set forth i n such requisition as directed by the terms thereof out of the Project Fund. Upon the Written Request of the City accompanied by a Certificate of the City s t a t i n g t h a t a l l P r o j e c t C o s t s have been paid or provision made f o r t h e i r p a y m e n t , a n y unexpended moneys in the Project Fund may be used to pay the co sts associated with any other improvements of the City; provided, that in the opinion of Bond Counsel such use of the proceeds of the Bonds shall not adversely affect the exclusion of interest on the Bonds from gross income of the owners thereof.
Any unexpended moneys in the Project Fund subsequent to the pay ment of all Project Costs which are not used to pay the cost of other improvements of the City shall be transferred by the Trustee and deposited in the Lease Revenue Fund upon receipt by the Trustee of a Written Request of the City accompanied b y a Certificate of the City st ating that all Project Costs have been paid or provision made for their payment.
23 SECTION 3.05. Insurance and Condemnation Fund. T h e T r u s t e e s h a l l e s t a b l i s h and maintain a separate fund to be known as the “Insurance and Condemnation Fund,” into which shall be deposited Net Pro ceeds required to be deposited therein pursuant to Section 9 of the Lease. The Trustee shall disburse or transfer all amounts i n the Insurance and Condemnation Fund, as stated in a Written Request of the City (as described below) for the payment of the cost of the reconstruction of the Leased Property (including reimbur sement to the City for any such costs paid by it). Before any payment of money is made from th e Insurance and Condemnation Fund, the Authority shall file or shall cause the City to file with the Trustee a requisition in substantially the form set forth as Exhibit D hereto.
SECTION 3.06. Validity of Bonds. The validity of the authorization and issuance of the Bonds shall not be affected in any way by any proceedings t aken with respect to the application of the proceeds of the Bonds, and the recital contained in the Bonds that the same are issued pursuant to the Bond Law shall be conclusive evidence of their validity and of the regularity of their issuance.
SECTION 3.07. Additional Bonds. In addition to the Bonds, the Authority and the Trustee may by execution of a Supplemental Indenture, without t he consent of the Owners, provide for the issuance and delivery of Additional Bonds in on e or more series. Upon the Written Request of the Authority, the Trustee may authenticate and deliver Additional Bonds in an aggregate principal amount authorized by such Supplemental I ndenture. The proceeds of such Additional Bonds may be used for any purpose, including fo r the purpose of refunding Outstanding Bonds. Such Additional Bonds may only be issued upo n compliance by the Authority with the provisions of the Indenture, and subject to the following specific conditions, which are made conditions precedent to the issuance of any such Additional Bonds:
(a) The Authority shall not be in default under the Indenture or an y Supplemental Indenture, as evidenced by a Ce rtificate of the Authority, and the City shall not be in default under the Lease, as evidenced by a Certificate of the City; (b) A Supplemental Indenture may provide for the funding of a debt service reserve for such Additional Bonds;
(c) The Additional Bonds shall be payable as to principal on June 1 of each year in which principal is due and shall be payable as to interest on each Interest Payment Date; (d) The aggregate principal amount of Bonds issued and at any time Outstanding under the Indenture or under any Supplemental Indenture shall n ot exceed any limit imposed by law, by the Indenture or by any Supplemental Indenture, as evid enced by a Certificate of the Authority and the City;
(e) The Lease shall have been amended, if necessary, so as to incre ase the Base Rental Payments payable by the City thereunder by an aggregate amount equal to the principal and interest due and payable on such Additional Bonds, payable at such times and in such manner as may be necessary to provide for the payment of the pr incipal and interest on such Additional Bonds, as evidenced by a Certificate of the City;
24 (f) Such Supplemental Indenture shall provide redemption dates and/ or mandatory redemption of Additional Bonds in amounts sufficient to provide for payment of the Additional Bonds when the applicable Base Rental Payments are due; (g) Any Additional Bonds shall be on a parity with, and each Owner thereof shall have the same rights upon an Event of Default as the Owner of, any other Bonds issued and delivered under the Indenture, except as otherwise provided in the Supplemental Indenture under which Additional Bonds are issued; and
(h) The Supplemental Indenture shall prescribe the form or forms of such Additional Bonds, and subject to the provisi ons hereof, shall provide for the distinctive designation, denominations, dates, principal payment dates, interest payment dates, interest rates, provisions for redemption, and places of payment for principal and interest.
ARTICLE IV
REVENUES; FLOW OF FUNDS
SECTION 4.01. Pledge of Revenues; Assignment of Rights. Subject to the provisions of Sections 3.07 and 6.03, the Bonds shall be secure d by a first lien on and pledge (which shall be effected in the manner and to the extent herein after provided) of all of the Revenues, including all of the moneys in the Lease Revenue Fund , including the Interest Account, the Principal Account, and the Redemption Account ther ein, and the Insurance and Condemnation Fund, and all amounts derived from the investment of such moneys. The Bonds and Additional Bonds shall be equally secured by a pledge, char ge and lien upon the Revenues and such moneys without priority for Series, number, date of th e Bonds, date of execution or date of delivery; and the payment of the interest on and princi pal of the Bonds and Additional Bonds and any premiums upon the redemption of any portion there of shall be and are secured by an exclusive pledge, charge and lien upon the Revenues and such moneys. So long as any of the Bonds or Additional Bonds are Outstanding, the Revenues and such moneys shall not be used for any other purpose; except that out of the Revenues there may be apportioned such sums, for such purposes, as are expressly permitted by Section 4.02.
The Authority hereby transfers in trust and assigns to the Trus tee, for the benefit of the Owners from time to time of the Bonds and Additional Bonds, all of the Revenues, and subject to the Assignment Agreement, all of the right, title and intere st (but none of the obligations) of the Authority in the Lease with respect to the Revenues, includ ing its rights to receive the Base Rental Payments scheduled to be paid by the City under and purs uant to the Lease and any and all of the other rights of the A uthority under the Lease as may be necessary to enforce payment of such Base Rental Payments when due or otherwise to protect t he interest of the Owners of the Bonds and Additional Bonds, including its leasehold title to th e Leased Property leased to the City pursuant to the Lease with respect to the Base Rental Paym ents. The Trustee accepts such assignments. The Trustee shall be entitled to and shall receiv e all of the Revenues, and any Revenues collected or received by the Authority shall be deemed to be held, and to have been collected or received, by the Aut hority as the agent of the Tru stee and shall forthwith be paid by the Authority to the Trustee.
25 Each of the Authority and the City covenant and agree to take s uch action as is necessary from time to time to preserve the priority of the pledge set fo rth in this Section 4.01 under applicable law, and at the expe nse of the Authority or the City and the Trustee shall cooperate with the Authority and/or the City in taking such action.
This Indenture shall be supplemented pursuant to a Supplemental Indenture to pledge revenues from additional base rental payments under the Lease f or any series of Additional Bonds.
SECTION 4.02. Lease Revenue Fund; Receipt, Deposit and Application of Revenues. All Revenues shall be deposited by the Trustee in a special f und designated as the “Lease Revenue Fund,” which the Trustee shall establish, mainta in and hold in trust hereunder.
If the City pays more than 100% of the Base Rental Payments com ing due fifteen (15) days prior to any Interest Payment Date, the Trustee shall deposit into th e Lease Revenue Fund only that portion of the Base Rental Payments which the City is required to make under Section 3(a) of the Lease, and shall remit any excess to the City.
On or before each Interest Payment Date or Principal Payment Da te, as applicable, the Trustee shall transfer from the Lease Revenue Fund and deposit into the following respective accounts (each of which the Trustee shall establish and maintai n within the Lease Revenue Fund), the following amounts in the following order of priority , the requirements of each such account (including the making up of any deficiencies in any suc h account resulting from lack of Revenues sufficient to make any earlier required deposit) at th e time of deposit to be satisfied before any transfer is made to any account subsequent in priority:
(a) Interest Account. The Trustee shall establish and maintain a separate account t o be known as the “Interest Account.” On or before each Interest Payment Date, the Trustee shall deposit in the Interest Account an amount required to cause the aggregate amount on deposit in the Interest Account to equal the amount of interest becoming d ue and payable on such Interest Payment Date on all respective Outstanding Bonds. No deposit s hall be made into the Interest Account if the amount contained therein is at least equal to th e interest becoming due and payable on all respective Outstanding Bonds on each succeeding Interest Payment Date within the then current Bond Year. All moneys in the Interest Account shall be used and withdrawn by the Trustee solely for the purpose of paying interest on the Bo nds as it shall become due and payable (including accrued interest on any Bonds redeemed prior to maturity). (b) Principal Account. The Trustee shall establish and maintain a separate account to be known as the “Principal Account.” On or before each Prin cipal Payment Date, the Trustee shall deposit in the Principal A ccount an amount required to ca use the aggregate amount on deposit in the Principal Account t o equal the principal or mand atory sinking account amount of the Bonds maturing on such Principal Payment Date pursuant to S ection 2.02 or Section 2.03 or pursuant to a Supplemental Indenture, as the case may be. No d eposit shall be made into the Principal Account if the amount contained therein is at least e qual to the principal becoming due and payable on all respective Outstanding Bonds on each succeed ing Interest Payment Date, as applicable, within the then current Bond Year. All moneys in t he Principal Account shall be used and withdrawn by the Trustee solely for the purpose of pay ing the principal of the Bonds, including mandatory sinking account amounts.
26 (c) Redemption Account. On or before the Business Day on which Bonds are subject to redemption (other than mandatory sinking fund redemption of term Bonds), the Authority will transfer or cause there to be transferred to the Trustee for de posit in the Redemption Account an amount required to pay the principal of and premium, if any, on the Bonds to be so redeemed on such date. The Trustee will apply amounts in the Redemption Acc ount solely for the purpose of paying the principal of and premium, if any, on the Bonds upon the redemption thereof, other than mandatory sinking fund redemption of term Bonds which will be made from amounts in the Principal Account, on the date set for such redemption. (d) Surplus. On or before June 1 of each year, commencing June 1, 2021, th e Trustee shall determine the amount, if any, remaining in the Le ase Revenue Fund after making the deposits required by paragraph s (a) through (c) above and t he transfers of investment earnings pursuant to Section 4.03, a nd shall apply such amount as a credit against the next following Base Rental Payment. Notwithstanding the foregoing, if directed in a Written Request of the City, the Trustee shall, with respect to all or any port ion of such amount, pay, or set aside an amount for the payment of, any Rebate Requirement (as define d in the Tax Certificate) in accordance with a computation made by the City.
SECTION 4.03. Rebate Fund.
(a) In addition to the other funds and accounts created pursuant he reto, the Trustee shall establish and maintain a fund separate from any other fun d or account established and maintained hereunder designated the “Rebate Fund” (the “Rebate Fund”) in connection with the Tax-Exempt Bonds. Within the Rebate Fund, the Trustee shall ma intain such accounts or subaccounts as are specified in a Written Request of the Author ity to the Trustee pursuant to the Tax Certificate. The Trustee sh all deposit moneys in the Rebat e Fund pursuant to a Written Request of the Authority. Subject to the transfer provisions p rovided in subparagraph (5) below, all money at any time deposited in the Rebate Fund shall be hel d by the Trustee in trust, to the extent required to satisfy the Rebate Requirement, for payment to the federal government of the United States of America, and none of the Authority, the Truste e or the Owner of any Tax- Exempt Bond shall have any right in or claim to such money. Al l amounts deposited into or on deposit in the Rebate Fund shall be governed by this Section and by the Tax Certificate (which is incorporated herein by reference) . The Trustee shall be deemed conclusively to have complied with the provisions of this Sec tion 4.03 and the Tax Certificat e if it follows the Written Request of the Authority, including supplying all necessary information in the manner requested by the Authority, and except as otherwise expressly provided herein, s hall not be required to take any actions hereunder in the absence of written directions by the A uthority, and shall have no liability or responsibility to e nforce compliance by the Author ity with the terms of the Tax Certificate or this Section. The Trustee agrees to comply with a l l W r i t t e n R e q u e s t s o f t h e Authority given pursuant to the Tax Certificate.
(1) Upon a Written Request of the Authority, an amount shall be dep osited into the Rebate Fund by the Trustee from deposits by the Author ity, if and to the extent required, so that the balance of the amount on deposit thereto shall be equal to the Rebate Requirement. Computations of the Rebate Requirement shall be furnished by or on behalf of the Authority in accordance with the Tax Certifica te. The Authority shall
27 provide the Trustee with a Certif icate of the Authority evidenc ing that the computation of the Rebate Requirement has been made.
(2) The Trustee shall have no obligation to rebate any amounts requ ired to be rebated pursuant to this Section, other than from moneys hel d in the funds and accounts created hereunder or from other moneys provided to it by the Authority. (3) The Trustee shall invest all amounts held in the Rebate Fund in Permitted Investments as directed by a Written Request of the A uthority. Money, including investment earnings, shall not be transferred from th e Rebate Fund except as provided in subparagraph (4) below.
(4) Upon receipt of a Written Request of the Authority, the Trustee shall remit part or all of the amounts in the Rebate Fund to the Unit ed States of America, as so directed. In addition, if the Authority so directs, the Tru stee will deposit moneys into or transfer moneys out of the Rebate Fund from or into suc h accounts or fund as directed by the Written Request of the Authority. Any funds re maining in the Rebate Fund in excess of the Rebate Requirement as of the end of any B ond Year shall be transferred to the Interest Account.
Notwithstanding any other provis ion hereof, including, in parti cular, Section 9.03, the obligation to remit the Rebate Requirement to the United States a n d t o c o m p l y w i t h a l l o t h e r requirements of this Section and the Tax Certificate shall surv ive the defeasance or payment in full of the Tax-Exempt Bonds.
SECTION 4.04. Investments. All moneys in any of the funds or accounts established with the Trustee pursuant to thi s Indenture shall be invested b y the Trustee solely in Permitted Investments pursuant to the written direction of the Authority given to the Trustee not less than two (2) Business Days in advance of the making of such investments. In the absence of any such direction from the Authority, the Trustee shall invest any such moneys in money market funds described in subsection (i) of the definition of Permitted Inve stments; provided, however, that any such investment shall be made by the Trustee only if, prior to the date on which such investment is to be made, the Trustee shall have received a wri tten direction of the Authority specifying a specific money market fund that satisfies the requ irements of such subsection in which such investment is to be made and, if no such written dir ection is so received, the Trustee shall hold such moneys uninvested . Obligations purchased as an investment of moneys in any fund or account shall be deemed to be part of such fund or account.
The Trustee shall transfer all investment earnings on amounts i n a Principal Account and an Interest Account to the Lease Revenue Fund. All investment earnings on amounts in the Insurance and Condemnation Fund shall be retained therein. For purposes of acquiring any investments hereunder, the Trustee may commingle funds held by it hereunder. The Trustee, or any of its affiliates, may act as principal or agent in the acq uisition of any investment and may i m p o s e i t s c u s t o m a r y c h a r g e s t h e r e f o r . T h e T r u s t e e m a y a c t a s manager, sponsor, advisor or depository with respect to any Permitted Investment. The Trust ee shall incur no liability for the selection (other than as provided herein) of investments or los ses arising from any investments made pursuant to this Section. The Authority acknowledges that regulations of the Comptroller
28 of the Currency grant the Authority the right to receive broker age confirmations of security transactions to be effected by th e Trustee hereunder as they oc cur, at no additional cost. The Authority specifically waives the right to receive such confirm ation to the extent permitted by applicable law and agrees that it will instead receive periodic cash transaction statements which shall include detail for the i nvestment transactions effected b y the Trustee hereunder; provided, however, that the Authority retains its right to receive broker age confirmation on any investment transaction requested by the Authority.
SECTION 4.05. Valuation and Disposition of Investments. For the purpose of determining the amount in any fund or account, Permitted Invest ments credited to such fund or account shall be valued at least semiannually on or before each Interest Payment Date at cost (excluding any brokerage commissions and excluding any accrued interest) by the Trustee.
ARTICLE V
COVENANTS OF THE AUTHORITY
SECTION 5.01. Punctual Payment. The Authority shall punctually pay or cause to be paid the principal, interest and premium (if any) to become due in respect of all the Bonds, in strict conformity with the terms of the Bonds and of this Inden ture, according to the true intent and meaning thereof, but only out of applicable Revenues and ot her assets pledged for such payment as provided in this Indenture.
SECTION 5.02. Extension of Payment of Bonds. The Authority shall not directly or indirectly extend or assent to t he extension of the maturity of any of the Bonds or the time of payment of any claims for interest by the purchase of such Bond s or by any other arrangement, and in case the maturity of any of the Bonds or the time of pay ment of any such claims for interest shall be extended, such Bonds or claims for interest s hall not be entitled, in case of any default hereunder, to the benefits of this Indenture, except su bject to the prior payment in full of the principal of all of the Bonds then Outstanding and of all c laims 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 Additional Bonds, or issue Bonds for the pur pose of refunding any Outstanding Bonds, and such issuance shall not be deemed to con stitute an extension of maturity of the Bonds.
SECTION 5.03. Against Encumbrances. The Authority shall not create, or permit the creation of, any pledge, lien, charge or other encumbrance upon the applicable Revenues and other assets pledged or assigned under this Indenture while any of the Bonds and Additional Bonds are Outstanding, except th e pledge and assignment created by this Indenture and Supplemental Indenture. Subject to this limitation, the Authori ty expressly reserves the right to enter into one or more other indentures for any of its corporat e purposes, including other programs under the Bond Law, and reserves the right to issue ot her obligations for such purposes.
SECTION 5.04. Power to Issue Bonds and Make Pledge and Assignment. T h e Authority is duly authorized pur suant to law to issue the Bonds and to enter into this Indenture and to pledge and assign the Revenues, the Lease and other asse ts purported to be pledged and
29 assigned, respectively, under this Indenture in the manner and to the extent provided in this Indenture. The Bonds and the provisions of this Indenture are and will be the legal, valid and binding special obligations of the Authority in accordance with their terms, and the Authority and the Trustee (subject to th e provisions of Section 6.02 here of) shall at all times, to the extent permitted by law, defend, preserve and protect such pledge and assignment of Revenues and other assets and all the rights of the Owners under this Indent ure against all claims and demands of all persons whomsoever.
SECTION 5.05. Accounting Records and Financial Statements. The Trustee shall at all times keep, or cause to be kept, proper books of record and account, prepared in accordance with corporate trust industry standards, in which complete and accurate entries shall be made of all transactions by the Trustee relating to the proceeds of Bon ds, the Revenues, the Lease and all funds and accounts established pursuant to this Indenture. Suc h books of record and account shall be available for inspection by the Authority and the City during regular business hours with reasonable prior notice.
SECTION 5.06. Additional Obligations. The Authority covenants that no additional bonds, notes or indebtedness shall be issued or incurred that a re payable out of the Revenues in whole or in part, other than the Additional Bonds.
SECTION 5.07. Lease. The Trustee, as assignee of the Authority’s rights under the Lease with respect to the Reve nues pursuant to Section 4.01 her eof and the Assignment Agreement(s), shall receive amounts due from the City pursuant to the Lease with respect to the Revenues.
The Authority will faithfully comply with, keep, observe and pe rform all the agreements, conditions, covenants and terms contained in the Lease required to be complied with, kept, observed and performed by it and, together with the Trustee, wi ll enforce the Lease against the City in accordance with its terms.
So long as any Bond remains Outstanding, the Authority will not alter, amend or modify the Lease, except pursuant to Section 21 thereof.
SECTION 5.08. Tax Covenants.
(a) Special Definitions. When used in this Section, the following terms have the following meanings with respect to any Tax-Exempt Bonds or Addi tional Bonds that the Authority intends interest thereon to be excludable from the gross income of the Owners thereof:
“Computation Date ” has the meaning set forth in section 1.148-1(b) of the Tax Regulations.
“Computation Period” means, initially, that period commencing on the date of issua nce of the Tax-Exempt Bonds and conc luding on the initial Computati on Date and, thereafter, each period commencing on the day next following a Computation Date and concluding on the immediately succeeding Computation Date.
30 “Gross Proceeds” means any proceeds as defined in section 1.148-1(b) of the Tax Regulations (referring to sales, investment and transferred pro ceeds), and any replacement proceeds as defined in section 1.148-1(c) of the Tax Regulations, of the Tax-Exempt Bonds. “Investment” has the meaning set forth in section 1.148-1(b) of the Tax Regulations. “Nongovernmental Person” refers to any person or entity (including the United States o r any agency, department and instrumentality thereof) other than a state or local government, or an agency or instrumentality acting solely on behalf thereof. “Nonpurpose Investment” means any investment property, as defined in section 148(b) of the Code, in which Gross Proceeds of the Tax-Exempt Bonds ar e i n v e s t e d a n d t h a t i s n o t acquired to carry out the governmental purposes of the Tax-Exempt Bonds. “Original Facility” means any property the acquisition, construction or improvement of which was financed directly or indirectly with Gross Proceeds of an Original Issue. “Original Issue” means the Tax-Exempt Bonds.
“Proceeds,” with respect to an issue of governmental obligations, has the m eaning set forth in section 1.148-1(b) of the Tax Regulations (referring t o sales, investment and transferred proceeds).
“Rebate Amount” has the meaning set forth in section 1.148-1(b) of the Tax Regulations. “Tax Regulations” means the United States Treasury Regulations promulgated pursu ant to sections 103 and 141 through 150 of the Code, or under the p rovisions of any predecessor statute corresponding thereto.
“Yield” of
(1) any Investment has the meaning set forth in section 1.148-5 o f t h e T a x Regulations; and
(2) the Tax-Exempt Bonds has the meaning set forth in section 1 .148-4 of the Tax Regulations.
(b) Exclusion of Interest from Gross Income. The Authority will ta ke all actions necessary to establish and maintain the exclusion pursuant to s ection 103(a) of the Code of interest on the Tax-Exempt Bonds from the gross income of the o wners thereof for federal income tax purposes, and will not use, permit the use of, or om it to use Gross Proceeds of the Tax-Exempt Bonds or any other amounts or any of the Original Fa cilities in a manner that if made or omitted, respectively, w ould cause the interest on any of the Tax-Exempt Bonds to fail to be excluded pursuant to section 103(a) of the Code from the gross income of the owners thereof for federal income tax purposes. Without limiting the generality of the foregoing, unless and until the Authority receives a written Opinion of Bond Coun sel to the effect that failure to comply with such covenant will not adversely affect the exclusi on pursuant to section 103(a) of
31 the Code of interest on any Tax-Exempt Bond from the gross inco me of the owner thereof, the Authority shall comply with this covenant and each of the specific covenants in this Section. (c) No Private Use or Private Payments. Except as would not cause any Tax-Exempt Bond to become a “private activity bond” within the meaning of section 141 of the Code and the Tax Regulations and rulings thereunder, the Authority covenants that at all times prior to the payment and cancellation of the last Tax-Exempt Bond to be paid and canceled:
(1) it will use its best efforts to ensure that the City (or anothe r entity other than a Nongovernmental Entity) exclusively owns, operates and p ossesses all of the Original Facilities that are to be refinanced directly or indirectly with Gross Proceeds of the Tax-Exempt Bonds, and that it will not use or permit the us e of such Gross Proceeds (including under any contractual arrangement with term s different than those applicable to the general public) or any of the Original Facili ties in any activity carried on by any Nongovernmental Person, unless such use is solely as a member of the general public; and
(2) not directly or indirectly impose or accept any charge or other payment by any person or entity in respect of the use by any Nongovernm ental Person of Gross Proceeds of the Tax-Exempt Bonds, other than interest earned on investments acquired with such Gross Proceeds pending application for their intended purposes, or of any Original Facility.
Without limiting the foregoing, except as would not cause any T ax-Exempt Bond to become a “private activity bond” within the meaning of section 141 of the Code and the Tax Regulations and rulings thereunder , the Authority will not: (i ) permit any Nongovernmental Person to hold any ownership, proprietary or possessory interest in any of the Original Facilities; or (ii) contract with any Nongovernmental Person for the provision of operating or other services with respect to any function of an Original Facility (unless ei ther (A) such arrangement requires no payment of fees to such Nongovernmental Person other than as direct reimbursement of third party costs or reasonable admi nistrative overhead, or (B) such arrangement conforms to administrative guidance of the Internal Revenue Service in orde r to assure that such arrangement does not create a private business use relationship of the Nong overnmental Person to the Gross Proceeds of the Tax-Exempt Bonds or to any Original Facility). For purposes of the preceding sentence, the Authority will treat proceeds of the Tax-Exempt Bonds as used ratably for the same purposes as were the proceeds of the Original Issue.
(d) No Private Loan. Except as would not cause any Tax-Exempt Bond to become a “private activity bond” within the meaning of section 141 of th e Code and the Tax Regulations and rulings thereunder, the Authority has not used, and will no t use, Gross Proceeds of any Tax- Exempt Bond to make or finance loans to any Nongovernmental Per son. For purposes of the foregoing covenant, such Gross Proceeds are considered to be “l oaned” to a person or entity if:
(1) property acquired, constructed or improved with such Gross Proceeds is sold or leased to such person or entity in a transaction that creates a debt for federal income tax purposes; (2) capacity in or service from such property is committed to such person or entity under a take-or- pay, output or similar contract or arrangement; or (3) indirect benefits of such Gross Proceeds, or burdens and benefits of ownership of any property acquired, con structed or improved with such
32 Gross Proceeds, are otherwise transferred in a transaction that is the economic equivalent of a loan.
(e) Not to Invest at Higher Yield. Except as would not cause any T ax-Exempt Bond to become an “arbitrage bond” wit hin the meaning of section 148 of the Code and the Tax Regulations and rulings thereunder, the Authority shall not at any time prior to the final maturity of the Tax-Exempt Bonds directly or indirectly invest Gross Pro ceeds in any Investment, if as a r e s u l t o f s u c h i n v e s t m e n t t h e Y i eld of any Investment acquired with Gross Proceeds, whether then held or previously disposed of, would materially exceed th e Yield of such Tax-Exempt Bond within the meaning of such section 148.
(f) Not Federally Guaranteed. The A uthority covenants that, except to the extent permitted by section 149(b) of the Code and the Tax Regulations and rulings thereunder, it will not take or omit to take any action that would cause any Tax-Ex empt Bond to be “federally guaranteed” within the meaning of section 149(b) of the Code an d the Tax Regulations and rulings thereunder.
(g) Information Report. The Authority covenants that it will timely file or cause to be filed any information required by section 149(e) of the Code wi th respect to the Tax-Exempt Bonds with the Secretary of the Treasury on Form 8038-G or such other form and in such place as the Secretary of the Treasury may prescribe.
(h) Rebate of Arbitrage Profits. The Authority covenants that the requirements of section 148(f) of the Code will be satisfied in order that the Tax-Exempt Bonds be not arbitrage bonds, and that, except to the extent otherwise provided in sec tion 148(f) of the Code and the Tax Regulations and rulings thereunder:
(1) it will account for all Gross Proceeds of the Tax-Exempt Bonds (including all receipts , expenditures and investments thereof) on its books of account separately and apart from all other funds (and receipts, expend itures and investments thereof) and shall retain all records of accounting for at leas t six years after the day on which the last Tax-Exempt Bond is discharged. However, to the extent permitted by law, the Authority may commingle Gross Proceeds of the Tax-Exem pt Bonds with its other money, provided that the Authority separately accounts fo r each receipt and expenditure of Gross Proceeds and the obligations acquired therewith; (2) not less frequently than each Computation Date, it will calcula te or cause to be calculated the Rebate Amount in accordance with rul es set forth in section 148(f) of the Code and the Tax Regulations and rulings thereund er. The Trustee may rely conclusively upon the Authority’s determinations, calculat ions and certifications required by this Section. The Trustee shall have no responsibi lity to independently make any calculation of determina tion or to review the Authorit y’s calculations hereunder. The Authority covenants that it will maintain a cop y of the calculation with its official transcript of proceedings relating to the issuance of the Tax-Exempt Bonds until six years after the final Computation Date;
33 (3) it will deposit in the Rebate Fund and cause the Trustee to pay t o t h e United States the amount that when added to the future value of previous rebate payments made for the Tax-Exempt Bonds equals (A) in the case o f a Final Computation Date as defined in section 1.148-3(e)(2) of the Tax Regulations, one hundred percent (100%) of the Rebate Amount on such date; and ( B) in the case of any other Computation Date, ninety percent (90%) of the Rebate Amount on such a date. In all cases such Rebate payments shall be made by the Authority (or by the Trustee at the direction of the Authority) at the times and in the amounts as are or may be required by section 148(f) of the Code and the Tax Regulations and rulings thereunder, and such payments shall be accompanied by Form 8038-T prepared and execu ted by the Authority or such other forms and information as is or may be r equired by section 148(f) of the Code and the Tax Regulations and rulings thereunder. (4) it will exercise reasonable diligence to assure that no errors are made in the calculations and payments required by paragraphs (2) and (3 ) above, and if an error is made, to discover and promptly correct such error within a r easonable amount of time thereafter (and in all events within one hundred eighty (1 80) days after discovery of the error), including payment to the United States of any ad ditional Rebate Amount owed to it, interest thereon, and any penalty imposed under sec tion 1.148-3(h) or other provision of the Tax Regulations.
(i) Not to Divert Arbitrage Profits. The Authority covenants that, except to the extent permitted by section 148 of the Code and the Tax Regulat ions and rulings thereunder, at no time prior to the final maturity of the Tax-Exempt Bonds will it enter into any transaction that reduces the amount required to be paid to the United States pur suant to paragraph (h) of this Section because such transaction results in a smaller profit or a larger loss than would have resulted if the transaction had been at arm’s length and had th e Yield on the Tax-Exempt Bonds not been relevant to each party.
(j) Tax-Exempt Bonds Not Hedge Bonds.
(1) The Authority represents that none of the Original Issue was, a nd covenants that the Tax-Exempt Bonds will not be, “hedge bonds” within the meaning of section 149(g) of the Code.
(2) Without limitation of paragraph (1) above, the Authority warran ts as to each of its Original Issue that: (I) on each date of issu ance of that issue, the Authority reasonably expected that at least 85% of the spendabl e proceeds of that Original Issue would be expended within the three-year period c ommencing on such date of issuance, and (II) no more than 50% of the proceed s of that Original Issue at any time has been invested in Nonpurpose Investments h aving a substantially guaranteed yield for a period of four years or more. (k) Elections. The Authority hereby directs and authorizes any Res ponsible Officer to make elections permitted or required pursuant to the provisi ons of the Code or the Tax Regulations, as such Responsible Officer (after consultation wi th Bond Counsel) deems
34 necessary or appropriate in conn ection with the Tax-Exempt Bond s, in the Tax Certificate relating to the Tax-Exempt Bonds or similar or other appropriate certificate, form or document.
SECTION 5.09. Further Assurances. The Authority will adopt, make, execute and deliver any and all such further resolutions, instruments and a ssurances as may be reasonably necessary or proper to carry out the intention or to facilitate the performance of this Indenture, and for the better assuring and confirming unto the Owners of t he Bonds the rights and benefits provided in this Indenture.
ARTICLE VI
THE TRUSTEE
SECTION 6.01. Appointment of Trustee. U.S. Bank National Association, a national banking association dul y organized and existing under and by virtue of the laws of the United States of America, is hereby appointed Trustee by the Au thority for the purpose of receiving all moneys required to be deposited with the Trustee hereunder and to allocate, use and apply the same as provided in this Indenture. The Authority agrees that it will maintain a Trustee which has (or which is a wholly-owned subsidiary of a corporati on which has) a combined capital and surplus of at least $75,000,000, and which is subject to supervision or examination by Federal or State authority, so long as any Bonds are Outstandin g. If such bank, national banking association or trust company or s uch parent corporation publish es a report of condition at least annually pursuant to law or to t he requirements of any supervising or examining authority above referred to, then for the purpose of this Section 6.01 the comb ined capital and surplus of such bank, national banking association or trust company or such par ent corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published.
The Trustee is hereby authorized to pay the principal of and in terest and redemption premium (if any) on the Bonds when duly presented for payment a t maturity, or on redemption prior to maturity, and to cancel all Bonds upon payment thereof. The Trustee shall keep accurate records of all funds and accounts administered by it and of all Bonds paid and discharged.
SECTION 6.02. Acceptance of Trusts. T h e T r u s t e e h e r e b y a c c e p t s t h e t r u s t s imposed upon it by this Indenture, and agrees to perform such t rusts, but only upon and subject to the following express terms and conditions:
(a) The Trustee shall not be liable for any error of judgment made in good faith by a responsible officer of the Trust ee, unless it shall be proved t hat the Trustee was negligent in ascertaining the pertinent facts.
(b) Whenever in the administration of this Indenture the Trustee sh all deem it desirable that a matter be proved or established prior to takin g, suffering or omitting any action hereunder, the Trustee (unless other evidence is herein specifi cally prescribed) may, in the absence of bad faith on its part, rely upon a Certificate of the Authority. (c) The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of a ny of the Owners pursuant to this
35 Indenture, unless such Owners shall have offered to the Trustee security or indemnity satisfactory to it against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction.
(d) The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certifi cate, statement, instrument, o pinion, report, notice, request, direction, consent, order, bond or other paper or document. (e) The Trustee, prior to the occurrence of an Event of Default and after the curing or waiving of all Events of Default that may have occurred, undert akes to perform such duties and only such duties as are specifically set forth in this Indentur e and no covenants of or against the Trustee shall be implied in this Indenture. In case an Event o f Default hereunder or under the Lease has occurred (which has not been cured or waived), the Tr ustee may exercise such of the rights and powers vested in it by this Indenture and by the Lea se, and shall use the same degree of care and skill in the exercise of such rights and powers as a prudent person would exercise or use under the circumstances in the conduct of such person’s own affairs. (f) The Trustee may execute any of the trusts or powers hereunder a nd perform the duties required of it hereunder either directly or by or throug h attorneys, receivers or agents, shall not be liable for the acts or omissions of such attorneys , receivers or agents appointed with due care, and shall be entitled to advice of counsel concerning all matters of trust and its duties hereunder. The Trustee may conclusively rely on an opinion of counsel as full and complete authorization and protection for any action taken, suffered or omitted by it hereunder. (g) The Trustee shall not be responsible for any recital herein, in the Lease, or in the Bonds, or for any of the supplements thereto or instruments of further assurance, or for the sufficiency of the security for the Bonds issued hereunder or i ntended to be secured hereby and makes no representation as to the validity or sufficiency of th e Bonds, this Indenture or the Lease. The Trustee shall not be bound to ascertain or inquire as to the observance or performance of any covenants, conditions or agreements on the part of the A uthority hereunder or on the part of the Authority or the City under the Lease. The Trustee shall not be responsible for the application of the proceeds of the Bonds paid over by it to the Authority in accordance with Section 9.03 hereof.
(h) The Trustee may become the Owner or pledgee of Bonds secured he reby with the same rights it would have if not the Trustee; may acquire and d ispose of other bonds or evidences of indebtedness of the Authority with the same rights it would have if it were not the Trustee; and may act as a depos itary for and permit any of its officers or directors to act as a member of, or in any other capacity with respect to, any commit tee formed to protect the rights of Owners of Bonds, whether or not such committee shall represe nt the Owners of the majority in aggregate principal amount of the Bonds then Outstanding. (i) The Trustee may rely and shall be protected in acting or refraining from acting, in good faith and without negligence, upon any notice, resolution, opinion, report, direction, request, requisition, consent, c ertificate, order, affidavit, l etter, telegram or other paper or document believed by it to be genuine and to have been signed o r presented by the proper person or persons. Any action taken or omitted to be taken by the Tru stee in good faith and without
36 negligence pursuant to this Indenture or the Lease upon the request or authority or consent of any person who at the time of making such request or giving such au thority or consent is the Owner of any Bond, shall be conclusive and binding upon all future Ow ners of the same Bond and upon Bonds issued in exchange therefor or in place thereof. The Tru stee shall not be bound to recognize any person as an Owner of any Bond or to take any act ion at his request unless the ownership of such Bond by such person shall be reflected on the Registration Books. (j) The permissive right of the Trustee to do things enumerated in this Indenture or in the Lease shall not be construed as a duty and it shall not be answerable for other than its negligence or willful misconduct. The immunities and exception s from liability of the Trustee shall extend to its officers, directors, employees and agents. (k) The Trustee shall not be required to take notice or be deemed t o have notice of any Event of Default hereunder or under the Lease except failur e by the Authority or the City to make any of the payments to the Trustee required to be made by the Authority pursuant hereto or thereto or failure by the Authority or the City to file with th e Trustee any document required by this Indenture or the Lease to be so filed subsequent to the is suance of the Bonds, unless the Trustee shall be specifically notified in writing of such default by the Authority or by the Owners of at least 50% in aggregate principal amount of the Bonds then Outstanding and all notices or other instruments required by th is Indenture to be delivered to the Trustee must, to be effective, be delivered at the Trust Office of the Trustee, and in the abs ence of such notice so delivered the Trustee may conclusively assume there is no Event of Default hereunder except as aforesaid. (l) At any and all reasonable times the Trustee and its duly author ized agents, attorneys, experts, accountants and representatives, shall have the right but shall not be required to inspect all books, papers and records of the Authority perta ining to the Bonds, and to make copies of any of such books, papers and records which are not privileged by statute or by law. (m) The Trustee shall not be required to give any bond or surety in r e s p e c t o f t h e execution of the trusts and powers or otherwise in respect of the premises hereof. (n) Notwithstanding anything elsewhere in this Indenture with respe ct to the execution of any Bonds, the withdrawal of any cash, the release of any property, or any action whatsoever within the purview of this Indenture, the Trustee sh all have the right, but shall not be required, to demand any showings , certificates, opinions, appra isals or other information, or corporate action or evidence thereof, as may be deemed desirabl e for the purpose of establishing the right of the Authority to the execution of any Bonds, the withdrawal of any cash or the taking of any other action by the Trustee.
(o) All moneys received by the Trustee shall, until used or applied o r i n v e s t e d a s herein provided, be held in trust for the purposes for which th ey were received but need not be segregated from other funds except to the extent required by law. (p) Whether or not expressly provide d therein, every provision of t his Indenture, the Site Lease and the Lease relati ng to the conduct or affecting t he liability of the Trustee shall be subject to the provisions of this Section.
37 (q) The Trustee shall have no responsibility with respect to any in formation, statement, or recital in any official statement, offering memo randum or any other disclosure material prepared or distributed with respect to the Bonds. (r) The Trustee is authorized and di rected to enter into the Assign ment Agreement in its capacity as Trustee.
(s) The Trustee shall have the right to accept and act upon instruc tions, including funds transfer instructions (“Ins tructions”) given pursuant to this Indenture and delivered using Electronic Means (“Electronic Means” shall mean the following c ommunications methods: e- mail, facsimile transmission, secure electronic transmission co ntaining applicable authorization codes, passwords and/or authentic ation keys issued by the Trust ee, or another method or system specified by the Trustee as available for use in connection wit h its services hereunder); provided, however, that the Authority and C ity shall provide to the Trust ee an incumbency certificate listing officers with the authority to provide such Instruction s (“Authorized Officers”) and containing specimen signatures of such Authorized Officers, whi ch incumbency certificate shall be amended by the Authority and City whenever a person is to be added or deleted from the listing. If the Authority and City elect to give the Trustee I nstructions using Electronic Means and the Trustee in its discretion elects to act upon such Instr uctions, the Trustee’s understanding of such Instructions shall be deemed controlling in the absence of manifest error. The Authority and City understand and agrees that the Trustee cannot determin e the identity of the actual sender of such Instructions and that the Trustee shall conclusi vely presume that directions that purport to have been sent by an Authorized Officer listed on th e incumbency certificate provided to the Trustee have been sent by such Authorized Officer. The Authority and City shall be responsible for ensuring that o nly Authorized Officers transmit such Instructions to the Trustee and that the Authority and City and all Authorized Officers are solely responsible to safeguard the use and confidentiality of applicable user and authorizatio n codes, passwords and/or authentication keys upon receipt by the Authority and City. The Trustee shall not be liable for any losses, costs or expenses arising directly or indirectly fr om the Trustee’s reliance upon and compliance with such Instructi ons notwithstanding such directio ns conflict or are inconsistent with a subsequent written instruction. The Authority and City agree: (i) to assume all risks arising out of the use of Electronic Means to submit Instructio ns to the Trustee, including without limitation the risk of th e Trustee acting on unauthoriz ed Instructions, and the risk of interception and misuse by third parties; (ii) that it is fully informed of the protections and risks associated with the various methods of transmitting Instructions to the Trustee and that there may be more secure methods of transmitting Instructions than the method(s) selected by the Authority and City; (iii) that the security procedures (if any) to be fol lowed in connection with its transmission of Instructions provide to it a commercially reaso nable degree of protection in light of its particular needs and circumstances; and (iv) to notify t he Trustee immediately upon learning of any compromise or unauthorized use of the security procedures. (t) The Trustee shall not be liable to the parties hereto or deemed in breach or default hereunder if and to the extent its performance hereunder is prevented by reason of force majeure.
The term “force majeure” means an occurrence that is beyond the control of the Trustee and could not have been avoided by exercising due care. Force maje ure shall include, but not be limited to, acts of God, terrorism, war, riots, strikes, fire, floods, earthquakes, epidemics or other similar occurrences.
38 (u) The Trustee shall not be liable in connection with the performa nce of its duties hereunder, except for its own negligence or willful misconduct.
SECTION 6.03. Fees, Charges and Expenses of Trustee. The Trustee shall be paid and reimbursed by the Authority for reasonable fees for its ser vices rendered hereunder and all advances (with interest on such advances at the maximum rate al lowed by law), counsel fees (including expenses) and other expenses reasonably and necessar ily made or incurred by the Trustee in connection with such services. Upon the occurrence o f an Event of Default hereunder, but only upon an Event of Default, the Trustee shall have a fir st lien with right of payment prior to payment of any Bond upon the amounts held hereunder for the foregoing fees, charges and expenses incurred by it. When the Trustee incurs expenses or r enders services after the occurrence of an Event of Default, such expenses and the compen sation for such services are intended to constitute expenses of administration under any fed eral or state bankruptcy, insolvency, arrangement, moratorium, reorganization or other debtor relief law.
SECTION 6.04. Notice to Owners of Default. If an Event of Default hereunder or under the Lease occurs with respect to any Bonds of which the T rustee has been given or is deemed to have notice, as provided in Section 6.02(k) hereof, t hen the Trustee shall, within 30 days of the receipt of such notice, give written notice thereof by first class mail to the Owner of each such Bond, unless such Event of Default shall have been cu red before the giving of such notice; provided, however, that unless such Event of Default consists of the failure by t he Authority to make any payment when due, the Trustee may elect not to give such notice if and so long as the Trustee in good faith determines that it is in the best interests of the Owners not to give such notice.
SECTION 6.05. Intervention by Trustee. In any judicial proceeding to which the Authority or the City is a party that, in the opinion of the Tr ustee and its counsel, has a substantial bearing on the interests of Owners of any of the Bo nds, the Trustee may intervene on behalf of such Owners, and subject to Section 6.02(c), shall do so if requested in writing by the Owners of at least 25% in aggregate principal amount of such Bonds then Outstanding.
SECTION 6.06. Removal of Trustee. The Trustee may be removed at any time by an instrument or concurrent instruments in writing, filed with the Trustee and signed by the Owners of a majority in aggregate prin cipal amount of the Outstanding Bonds. The Authority may also remove the Trustee at any time upon 30 days’ notice, except dur ing the existence of an Event of Default. The Trustee may be removed at any time for any breach of the Trustee’s duties set forth herein.
SECTION 6.07. Resignation by Trustee. The Trustee and any successor Trustee may at any time give written notice of its intention to resign as T rustee hereunder, such notice to be given to the Authority and the City by registered or certified mail. Upon receiving such notice of resignation, the Authority shall promptly appoint a successor T rustee. Any resignation or removal of the Trustee and appointment of a successor Trustee s hall become effective upon acceptance of appointment by the successor Trustee. Upon such acceptance, the Authority shall cause notice thereof to be given by first class mail, postage p repaid, to the Owners at their respective addresses set forth on the Registration Books.
39 SECTION 6.08. Appointment of Successor Trustee. In the event of the removal or resignation of the Trustee pursuant to Sections 6.06 or 6.07, r espectively, the Authority shall promptly appoint a successor Trustee. In the event the Authority shall for any reason whatsoever fail to appoint a successor Trustee within 60 days following th e delivery to the Trustee of the instrument described in Section 6.06 or within 60 days followin g the receipt of notice by the Authority pursuant to Section 6.07, the Trustee may, at the exp ense of the Authority, apply to a court of competent jurisdicti on for the appointment of a succes sor Trustee meeting the requirements of Section 6.01. Any such successor Trustee appoi nted by such court shall become the successor Trustee hereunder notwithstanding any action by t he Authority purporting to appoint a successor Trustee following the expiration of such 60-day period.
SECTION 6.09. Merger or Consolidation. Any company into which the Trustee may be merged or converted or with which it may be consolidated or any company resulting from any merger, conversion or consolidation to which it shall be a part y or any company to which the Trustee may sell or transfer all or substantially all of its co rporate trust business, provided that such company shall meet the requirements set forth in Section 6 .01, shall be the successor to the Trustee and vested with all of the title to the trust estate an d all of the trusts, powers, discretions, immunities, privileges and all other matters as was its predece ssor, without the execution or filing of any paper or further act, anything herein to the contrary notwithstanding.
SECTION 6.10. Concerning any Successor Trustee. Every successor Trustee appointed hereunder shall execute , acknowledge and deliver to i ts predecessor and also to the Authority an instrument in writing accepting such appointment h ereunder and thereupon such successor, without any further act , deed or conveyance, shall b ecome fully vested with all the estates, properties, rights, pow ers, trusts, duties and obligat ions of its predecessors; but such predecessor shall, nevertheless, on the Written Request of the Authority, or of the Trustee’s successor, execute and deliver an instrument transferring to su ch successor all the estates, properties, rights, powers and trusts of such predecessor hereu nder; and every predecessor Trustee shall deliver all securi ties and moneys held by it as t he Trustee hereunder to its successor. Should any instrument in writing from the Authority be required by any successor Trustee for more fully and certainly vesting in such successor the estate, rights, powers and duties hereby vested or intended to be vested in the predecesso r Trustee, any and all such instruments in writing shall, on request, be executed, acknowle dged and delivered by the Authority.
SECTION 6.11. Appointment of Co-Trustee. It is the purpose of this Indenture that there shall be no violation of any law of any jurisdiction (inc luding particularly the law of the State) denying or restricting the right of banking corporations or associations to transact business as Trustee in such jurisdiction. It is recognized that in the case of litigation under this Indenture, and in particular in case of the enforcement of the rights of t he Trustee on default, or in the case the Trustee deems that by reason of any present or future law o f any jurisdiction it may not exercise any of the powers, rights or remedies herein granted t o the Trustee or hold title to the properties, in trust, as herein granted, or take any other acti on that may be desirable or necessary in connection therewith, it may be necessary that the Trustee o r the Authority appoint an additional individual or institution as a separate trustee or c o-trustee. The following provisions of this Section are adopted to these ends.
40 If the Trustee or the Authority appoints an additional individu al or institution as a separate trustee or co-trustee, each and every remedy, power, r ight, claim, demand, cause of action, immunity, estate, title, interest and lien expressed or intended by this Indenture to be exercised by or vested in or c onveyed to the Trustee with respect thereto shall be exercisable by and vest in such separate trustee or co-trustee but only to the extent necessary to enable such separate trustee or co-trustee to exercise such powers, rights and remedies, and every covenant and obligation necessary to the exercise thereof by such separa te trustee or co-trustee shall run to and be enforceable by either of them.
Should any instrument in writing from the Authority be required by the separate trustee or co-trustee so appointed by the Trustee for more fully and ce rtainly vesting in and confirming to it such properties, rights, powers, trusts, duties and obligations, any and all such instruments in writing shall, on request, be executed, acknowledged and delivered by the Authority. In case any separate trustee or co-trustee, or a successor to either, shall become incapable of acting, shall resign or shall be removed, all the estates, properties, rights , powers, trusts, duties and obligations of such separate trustee or co-trustee, so far as p ermitted by law, shall vest in and be exercised by the Trustee until the appointment of a new trustee or successor to such separate trustee or co-trustee.
SECTION 6.12. Indemnification; Limited Liability of Trustee. The Authority further covenants and agrees, to the extent permitted by law, t o indemnify and save the Trustee and its officers, directors, agents and employees, harmless aga inst any loss, expense, action, suit, claim, judgment and liabilities arising out of or in the exercise and performance of its powers and duties hereunder and under the S ite Lease and the Lease, includ ing the costs and expenses of defending against any claim of liability and fees and expenses of its attorneys, but excluding any and all losses, expenses and liabilities that are due to the ne gligence or willful misconduct of the Trustee, its officers, directors or employees. No provision in this Indenture shall require the Trustee to risk or expend its own funds or otherwise incur any financial liability hereunder. The Trustee shall not be liable for any action taken or omitted to be taken by it in accordance with the direction of the Owners of at l east 25% in aggregate principal amount of Bonds Outstanding relating to the time, method and place of conducting any procee ding or remedy available to the Trustee under this Indenture or exercising any power conferred upon the Trustee under this Indenture. The obligations of the Authority under this Section shall survive the termination of this Indenture and the resignation or removal of the Trustee under this Indenture.
ARTICLE VII
MODIFICATION AND AMENDMENT OF THE INDENTURE
SECTION 7.01. Amendment. This Indenture and the ri ghts and obligations of the Authority, and of the Owners of Bonds of a Series may be modifi ed or amended at any time by a Supplemental Indenture, which shall become binding to the exten t permitted by law upon adoption, without consent of any Owner, but only for any one or more of the following purposes:
(a) to issue Additional Bonds in accordance with Section 3.07 hereof;
41 (b) to add to the covenants and agreements of the Authority in this Indenture contained other covenants and ag reements thereafter to be obser ved, to pledge or assign additional security for the Bonds (or any portion thereof), or to surrender any right or power herein reserved to or conferre d upon the Authority, provided th at no such covenant, agreement, pledge, assignment or surrender shall materially adversely affe ct the interests of the applicable Owners;
(c) to make such provisions for the purpose of curing any ambiguity, inconsistency or omission, or of curing or correc ting any defective provision, c ontained in this Indenture, or in regard to matters or questions arising under this Indenture, as the Authority may deem necessary or desirable and not inconsistent with this Indenture, and whic h shall not materially adversely affect the interests of the applicable Owners in the reasonable judgment of the Authority; (d) to modify, amend or supplement this Indenture in such manner as to permit the qualification hereof under the Trust Indenture Act of 1939, as amended, or any similar federal statute hereafter in effect, and to add such other terms, condi tions and provisions as may be permitted by said act or similar federal statute, and which sha ll not materially adversely affect the interests of the applicable Owners;
(e) to maintain the exclusion of interest on the Tax-Exempt Bonds from gross income for federal income tax purposes under the Code, if applicable; or (f) for any other purpose that does not materially adversely affect the interests of the Owners.
Except as set forth in the preced ing paragraph of this Section, this Indenture and the rights and obligations of the Authority and of the Owners may o nly be modified or amended at any time by a Supplemental Indenture, which shall become bindin g when the written consent of the Owners of a majority in aggregate principal amount of the a ffected Bonds then Outstanding are filed with the Trustee. No such modification or amendment shall (a) extend the maturity of or reduce the interest rate on any Bond or otherwise alter or i mpair the obligation of the Authority to pay the principal, interest or redemption premiums (if any) at the time and place and at the rate and in the currency provided therein of any Bond wi thout the express written consent of the Owner, (b) reduce the percentage of Bonds required for t he written consent to any such amendment or modification, or (c) modify any of the rights or o bligations of the Trustee without its written consent thereto.
SECTION 7.02. Effect of Supplemental Indenture. From and after the time any Supplemental Indenture becomes ef fective pursuant to this Artic le VII, this Indenture shall be deemed to be modified and amended in accordance therewith, the respective rights, duties and obligations of the parties hereto or thereto and all Owners of Outstanding Bonds, as the case may be, shall thereafter be determined, exercised and enforced here under subject in all respects to such modification and amendment, and all the terms and conditio ns of any Supplemental Indenture shall be deemed to be part of the terms and condition s of this Indenture for any and all purposes.
42 Prior to entering into any Supplemental Indenture pursuant to t his Section, the Authority shall deliver to the Trustee an opinion of Bond Counsel to the effect that such Supplemental Indenture has been adopted in accordance with the requirements of this Indenture and does not, in and of itself, cause the interest on the Bonds, as applicabl e, to be included in the gross income of the Owners of such Bonds.
SECTION 7.03. Endorsement or Replacement of Bonds After Amendment. After the effective date of any action taken as hereinabove provided, the Authority may determine that the Bonds shall bear a notation, by endorsement in form approve d by the Authority, as to such action, and in that case upon dema nd of the Owner at such effec tive date and presentation of such Bond for that purpose at the Trust Office of the Trustee, a suitable notation as to such action shall be made on such Bond. If the Authority shall so determin e, new Bonds so modified as, in the opinion of the Authority, shall be necessary to conform to such Owners’ action shall be prepared and executed, and in t hat case upon demand of the Owne r at such effective date such new Bonds shall be exchanged at the Trust Office of the Trustee, without cost to each Owner, for Bonds then Outstanding, upon surrender of such Outstanding Bonds.
ARTICLE VIII
EVENTS OF DEFAULT AND REMEDIES OF OWNERS
SECTION 8.01. Events of Default. The following events shall be Events of Default hereunder:
(a) Default in the due and punctual payment of the principal of or premium on any Bond when and as the same shall become due and payable, whether at maturity as therein expressed, or by proceedings for redemption.
(b) Default in the due and punctual payment of any installment of i nterest on any Bond when and as such interest installment shall become due and payable. (c) Any Event of Default (as defined in the Lease) shall have occur red and be continuing.
(d) Failure by the Authority to observe and perform any of the cove nants, agreements or conditions on its part in this Indenture or in the Bonds con tained, other than as referred to in the preceding clauses (a) and (b ), for a period of thirty (30) days after written notice, specifying such failure and requesting that it be remedied has been given to the Authority by the Trustee, or to the Authority and the Trustee by the Owners of not less than 50% in aggregate principal amount of the Outstanding Bonds; provided, however, that if in the reasonable opinion of the Authority the failure stated in such notice can be corrected, b ut not within such 60-day period, the Trustee and such Owners shall not unreasonably withhold the ir consent to an extension of such time if corrective action is instituted by the Authority w ithin such 60-day period and diligently pursued until such failure is corrected.
(e) The filing by the Authority of a petition or answer seeking reo rganization or arrangement under the Federal bankruptcy laws or any other appl icable law of the United States of America, or if a court of competent jurisdiction shall appro ve a petition, filed with or without
43 the consent of the Authority, seeking reorganization under the Federal bankruptcy laws or any other applicable law of the United States of America, or if, un der the provisions of any other law for the relief or aid of debtors, any court of competent jurisd iction shall assume custody or control of the Authority or of the whole or any substantial part of its property.
SECTION 8.02. Remedies; No Acceleration. Upon the occurrence of an Event of Default the Trustee shall have the right:
(a) by mandamus or other action or proceeding or suit at law or in equity to enforce its rights against the Authorit y or any member, officer or empl oyee thereof, to compel the Authority or any such member, officer or employee to perform an d carry out its or his or her duties under law and the agreements and covenants required to b e performed by it or him contained herein or in the Lease;
(b) by suit in equity to enjoin any acts or things which are unlawf ul or violate the rights of the Trustee; or
(c) by suit in equity upon the happe ning of an Event of Default to require the Authority and its members, officers and employees to account as the trustee of an express trust.
If an Event of Default shall have occurred and be continuing an d if requested so to do by the Owners of a majority in aggregate principal amount of Outst anding Bonds and indemnified as provided in Section 6.02(c), the Trustee shall be obligated to exercise such one or more of the rights and powers conferred by this Article VIII, as the Truste e, being advised by counsel, shall deem most expedient in the interests of the Owners.
No remedy by the terms of this Indenture conferred upon or rese rved to the Trustee (or to the Owners) is intended to be exclusive of any other remedy, bu t each and every such remedy shall be cumulative and shall be in addition to any other remed y given to the Trustee or the Owners hereunder or now or hereafter existing at law or in equity.
No delay or omission to exercise any right or power accruing up on any Event of Default shall impair any such right or power or shall be construed to b e a waiver or any such Event of Default or acquiescence therein; such right or power may be exercised from time to time as often as may be deemed expedient.
The Trustee shall have no right to declare the principal of or interest on the Bonds to be due and payable immediately.
Nothing herein shall be deemed t o authorize the Trustee to auth orize or consent to or accept or adopt on behalf of any Owner any plan of reorganizati on, arrangement, adjustment, or composition affecting the Bonds or the rights of any Owner ther eof, or to authorize the Trustee to vote in respect of the claim of any Owner in any such procee ding without the approval of the Owners so affected.
SECTION 8.03. Application of Revenues and Other Funds After Default. A l l amounts received by the Trustee pursuant to any right given or action taken by the Trustee under the provisions of this Indenture shall be applied by the Trustee in the following order of priority:
44 First, to the payment of the fees, costs and expenses of the Tr ustee, including reasonable compensation to its agents, attorneys and counsel; Second, to the payment of the whole amount of interest on and p rincipal of the Bonds of the applicable Series then due and unpaid; provided, however, that in the event such amounts shall be insufficient to pay in full the full amou nt of such interest and principal, then such amounts shall be applied to the payment of such principal and interest without preference or priority of principal over interest, or interest over principal, or of any installment of interest over any other installment of interest, ratably to the aggregate of such principal and interest.
SECTION 8.04. Power of Trustee to Control Proceedings. If the Trustee, upon the happening of an Event of Default, shall have taken any action, by judicial proceedings or otherwise, pursuant to its duties hereunder, whether upon its o wn discretion or upon the request of the Owners of at least a majority in aggregate principal amo unt of the Bonds then Outstanding, it shall have full power, in the exercise of its d iscretion for the best interests of the Owners of the Bonds, with respect to the continuance, discontin uance, withdrawal, compromise, settlement or other disp osal of such action; provided, however, that the Trustee shall not, unless there no longer continues an Event of Default, discontinue, wit hdraw, compromise or settle, or otherwise dispose of any litig ation pending at law or in equity , if at the time there has been filed with it a written request signed by the Owners of a majority in aggregate principal amount of the Outstanding Bonds opposing such dis continuance, withdrawal, com promise, settlement or other disposal of such litigation and if the Trustee is indemnified a s provided in Section 6.02(c). Any suit, action or proceeding which any Owner shall have the right to bring to enforce any right or remedy hereunder may be brought by the Trustee for the equal be nefit and protection of all Owners similarly situated and th e Trustee is hereby appointed ( and the successive respective Owners issued hereunder by taking and holding the same, shall b e conclusively deemed so to have appointed it) the true and lawful attorney-in-fact of the respective Owners for the purpose of bringing any such suit, action or proceeding and to do and p erform any and all acts and things for and on behalf of the respective Owners as a class or classes, as may be necessary or advisable in the opinion of the Trustee as such attorney-in-fact.
SECTION 8.05. Appointment of Receivers. Upon the occurrence of an Event of Default hereunder, and upon the fi ling of a suit or other comme ncement of judicial proceedings to enforce the rights of the Trustee and of the Owners under th is Indenture, the Trustee shall be entitled, as a matter of right, to the appointment of a receive r or receivers of the Revenues and other amounts pledged hereunder, pending such proceedings, with such powers as the court making such appointment shall confer.
SECTION 8.06. Non-Waiver. A waiver of any default or breach of duty or contract by the Trustee or any Owners sha ll not affect any subsequent de fault or breach of duty or contract, or impair any rights or remedies on any such subsequent default or breach. No delay or omission of the Trustee or any Owner to exercise any right or p ower accruing upon any default shall impair any such right or power or shall be construed to b e a waiver of any such default or an acquiescence therein; and every power and remedy conferred u pon the Trustee or Owners by the Bond Law or by this Article VIII may be enforced and exerci sed from time to time and as often as shall be deemed expedient by the Trustee or the Owners, as the case may be.
45 SECTION 8.07. Rights of Owners. No Owner shall have the right to institute any suit, action or proceeding at law or in equity, for any remedy under or upon this Indenture, unless (a) such Owner shall have previously given to the Trustee writt en notice of the occurrence of an Event of Default; (b) the Owners of a majority in aggregate pri ncipal amount of all the Bonds then Outstanding shall have made written request upon the Trust ee to exercise the powers hereinbefore granted or to insti tute such action, suit or proce eding in its own name; (c) such Owners shall have tendered to t he Trustee indemnity acceptable to the Trustee against the costs, expenses and liabilities to be incurred in compliance with such request; and (d) the Trustee shall have refused or omitted to comply with such request for a perio d of 60 days after such written request shall have been received by, and such tender of indemni ty shall have been made to, the Trustee.
Such notification, request, tender of indemnity and refusal or omission are hereby declared, in every case, to be conditions precedent to the exer cise by any Owner of any remedy hereunder; it being understood and intended that no one or more Owners shall have any right in any manner whatever by his or their action to enforce any right under this Indenture, except in the manner herein provided, and that all proceedings at law or in equity to enforce any provision of this Indenture shall be inst ituted, had and maintained in th e manner herein provided and for the equal benefit of all Owners.
The right of any Owner to receive payment of the principal of a nd interest and premium (if any) on such Bond as herein provided or to institute suit f or the enforcement of any such payment, shall not be impaired or affected without the written consent of such Owner, notwithstanding the foregoing provisions of this Section or any other provision of this Indenture.
SECTION 8.08. Termination of Proceedings. In case the Trustee shall have proceeded to enforce any right under this Indenture by the appo intment of a receiver or otherwise, and such proceedings shall have been discontinued or abandoned for any reason, or shall have been determined adversely, then and in every such case, the Authority, the Trustee and the Owners shall be restored to their former positions and righ ts hereunder, respectively, with regard to the property subject to this Indenture, and all right s, remedies and powers of the Trustee shall continue as if no such proceedings had been taken.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Limited Liability of Authority. Notwithstanding anything in this Indenture contained, the Authorit y shall not be required to adv ance any moneys derived from any source of income other than the Revenues for the payment of the principal of or interest on the Bonds, or any premiums upon the redemption thereof, or for the performance of any covenants herein contained (except to the extent any such coven ants are expressly payable hereunder from the Revenues or o therwise from amounts payable u nder the Lease). The Authority may, however advance funds for any such purpose, prov ided that such funds are derived from a source legally available for such purpose and ma y be used by the Authority for such purpose without incurring indebtedness.
46 The Bonds shall be revenue bonds, payable exclusively from the Revenues and other funds as in this Indenture provided. The general fund of the A uthority is not liable, and the full faith and credit of the Authority is not pledged, for the payme nt of the interest and premiums (if any) on or principal of the Bonds. The Bonds are not secured by a legal or equitable pledge of, or charge, lien or encumbrance upon, any of the property of the Au thority or any of its income or receipts, except the Revenues and such other moneys and securities as provided in this Indenture.
The Owners shall never have the right to compel the forfeiture of any property of the Authority except the Revenues and other funds pledged to the payment of t he Bonds as provided in this Indenture. The principal of and interest on the Bonds, and any premiums upon the redemption of any thereof, shall not be a legal or equitable pledge, charge, lien or encumbrance upon any property of the Authority or upon any of its income, receipts o r revenues except the Revenues and other funds (other than amounts on deposit in the Rebate Fu nd) pledged to the payment thereof as provided in this Indenture.
SECTION 9.02. Benefits of Indenture Limited to Parties. Nothing in this Indenture, expressed or implied, is intended to give to any person other t han the Authority, the Trustee, the City and the Owners, any right, remedy or claim under or by rea son of this Indenture. Any covenants, stipulations, promises or agreements in this Indentu re contained by and on behalf of the Authority shall be for the sole and exclusive benefit of the Trustee, the City and the Owners.
SECTION 9.03. Defeasance; Discharge of Indenture. If the Authority shall pay and discharge any or all of the Outstanding Bonds in any one or more of the following ways:
(a) by well and truly paying or causing to be paid the principal of and interest and premiums (if any) on such Bonds, as and when the same become due and payable; (b) by irrevocably depositing with the Trustee, in trust, at or bef ore maturity, money which, together with the available amounts then on deposit in t he funds and accounts established with the Trustee pursuant to this Indenture, is fully sufficien t to pay such Bonds, including all principal, interest and redemption premiums (if any); or (c) by irrevocably depositing with the Trustee or an escrow agent, in trust pursuant to an escrow deposit agreement, Defeasance Securities in such amou nt as an Independent Certified Public Accountant shall determine in a written report acceptabl e to the Authority in form and substance, and addressed, to the Authority and the Trustee, fil ed with the Trustee (upon which report the Trustee may conclusively rely) will, together with t he interest to accrue thereon and available moneys then on deposit in the funds and accounts established with the Trustee pursuant to this Indenture, be fully sufficient to pay and discharge the indebtedness on such Bonds (including all principal, interest and redemption premiums) at or before their respective maturity dates;
and delivering an opinion of Bond Counsel acceptable to the Aut hority in form and substance, and addressed, to the Authority a nd the Trustee to the effect t hat the Bonds are no longer Outstanding under the Indenture, and if such Bonds are to be re deemed prior to the maturity thereof notice of such redemption shall have been mailed pursua nt to Section 2.03(d) or provision satisfactory to the Trustee shall have been made for the mailing of such notice, then, at the Written Request of the Authority, and notwithstanding that any of such Bonds shall not have
47 been surrendered for payment, the pledge of the Revenues and ot her funds provided for in this Indenture with respect to such Bonds, and all other pecuniary o bligations of the Authority under this Indenture with respect to all such Bonds, shall cease and terminate, except only the obligation of the Authority to pay or cause to be paid to the O wners not so surrendered and paid all sums due thereon from amounts set aside for such purpose as aforesaid, and all amounts due the Trustee. Any funds held by the Trustee following any paymen t or discharge of the Outstanding Bonds pursuant to this Section, which are not requi red for such purposes, shall after payment of amounts due the Trustee hereunder be paid over to th e Authority for use by the Authority for any lawful purpose.
SECTION 9.04. Successor is Deemed Included in All References to Predecessor.
Whenever in this Indenture or any Supplemental Indenture the Au thority is named or referred to, such reference shall be deemed to include the successor to the powers, duties and functions, with respect to the management, admin istration and control of the af fairs of the Authority, that are presently vested in the Authority, and all the covenants, agree ments and provisions contained in this Indenture by or on behalf of the Authority shall bind and inure to the benefit of its successors whether so expressed or not.
SECTION 9.05. Content of Certificates and Opinions. Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture except the certificate of destruction pursuant to Section 9.10 shall inclu de (a) a statement that the person or persons making or giving such certificate or opinion have read such covenant or conditions and the definitions herein relating th e r e t o ; ( b ) a b r i e f s t a t e m e n t as to the nature and scope of the examination or investigation upon which the statements or opini ons contained in such certificate or opinion are based; (c) a statement that, in the opinion of the signers, they have made or caused to be made such examination or investigation as is necessary to enable them to express an informed opinion as to whether or not such covenant or conditio n has been complied with; and (d) a statement as to whether, in the opinion of the signers, s uch condition or covenant has been complied with.
Any such certificate made or given by an officer of the Authori ty may be based, insofar as it relates to legal matters, upon a certificate or opinion o f or representations by counsel, unless such officer knows that the certificate or opinion or represent ations with respect to the matters upon which his certificate may be based, as aforesaid, are erro neous, or in the exercise of reasonable care should have known that the same were erroneous. A n y s u c h c e r t i f i c a t e o r opinion or representation made or given by counsel may be based , insofar as it relates to factual matters, on information with respect to which is in the possess ion of the Authority, or upon the certificate or opinion of or representations by an officer or o fficers of the Authority, unless such counsel knows that the certificat e or opinion or representation s with respect to the matters upon which his certificate, opinion or representation may be based, as aforesaid, are erroneous, or in the exercise of reasonable care should have known that the same were erroneous.
SECTION 9.06. Execution of Documents by Owners. Any request, consent or other instrument required by this Indenture to be signed and executed by Owners may be in any number of concurrent writings of substantially similar tenor an d may be signed or executed by such Owners in person or by their agent or agents duly appointe d in writing. Proof of the execution of any such request, consent or other instrument or o f a writing appointing any such
48 agent, shall be sufficient for any purpose of this Indenture an d shall be conclusive in favor of the Trustee and of the Authority if made in the manner provided in this Section.
The fact and date of the execution by any person of any such re quest, consent or other instrument or writing may be proved by the affidavit of a witne ss of such execution or 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 si gning such request, consent or other instrument or writing acknowledged to him the execution thereof.
The ownership of Bonds shall be p roved by the Registration Book s. Any request, consent or vote of the Owner shall bind every future Owner with respect to the same Bond and the Owner with respect to any Bond issued in exchange therefor or in lieu thereof, in respect of anything done or suffered to be done by the Trustee or the Auth ority in pursuance of such request, consent or vote. In lieu of obtaining any demand, req uest, direction, consent or waiver in writing, the Trustee may call and hold a meeting of the Owne rs upon such notice and in accordance with such rules and obligations as the Trustee consi ders fair and reasonable for the purpose of obtaining any such action.
SECTION 9.07. Disqualified Bonds. In determining whether the Owners of the requisite aggregate principal amount of Bonds have concurred in any demand, request, direction, consent or waiver under this Ind enture, unless all Bonds are th en so owned, Bonds that are owned or held by or for the acc ount of the City or the Authorit y (but excluding Bonds held in any employees’ retirement fund) shall be disregarded and deemed not to be Outstanding for the purpose of any such determination; provided, however, that for the purpose of determining whether the Trustee shall be protected in relying on any such d emand, request, direction, consent or waiver, only Bonds which the Trustee knows to be so owned or held shall be disregarded.
Upon request of the Trustee, the Authority and the City shall s pecify in a certificate to the Trustee those Bonds disqualified pursuant to this Section and t he Trustee may conclusively rely on such certificate.
SECTION 9.08. Waiver of Personal Liability. No official, officer, agent or employee of the Authority shall be individually or personally l iable for the payment of the interest on or principal of the Bonds; but nothing herein contained shall relieve any such official, officer, agent or employee from the performance of any official duty provided by law.
SECTION 9.09. Partial Invalidity. If any one or more of the covenants or agreements, or portions thereof, provided in this Indenture on the part of the Authority (or of the Trustee) to be performed should be contrary to law, then such c ovenant or covenants, such agreement or agreements, or such portions thereof, shall be nul l and void and shall be deemed separable from the remaining covenants and agreements or portio ns thereof and shall in no way affect the validity of this Indenture or of the Bonds; but the Owners shall retain all rights and benefits accorded to them under the Bond Law or any other applicable provisions of law.
SECTION 9.10. Destruction of Canceled Bonds. Whenever in this Indenture provision is made for the surrender of any Bonds which have bee n paid or canceled pursuant to the provisions of this Indenture, the Trustee shall cancel and destroy such Bonds and upon Written Request of the Authority furnish to the Authority a certificate of such destruction.
49 SECTION 9.11. Funds and Accounts. Any fund or account required by this Indenture to be established and maintained by the Authority or the Trustee may be established and maintained in the accounti ng records of the Authority or th e Trustee, as the case may be, either as a fund or an account, and may, for the purpose of suc h records, any audits thereof and any reports or statements with respect thereto, be treated eith er as a fund or as an account. All such records with respect to all such funds and accounts held b y the Authority shall at all times be maintained in accordance with generally accepted accounting principles and all such records with respect to all such funds and accounts held by the Trustee shall be at all times maintained in accordance with corporate trust industry practices; in each case with due regard for the protection of the security of the Bonds and the rights of every Owner thereof.
SECTION 9.12. Payment on Business Days. Whenever in this Indenture any amount is required to be paid on a day that is not a Business Day, suc h payment shall be required to be made, without accruing additiona l interest thereby, on the Busi ness Day immediately following such day.
SECTION 9.13. Notices. All notices, requests and other communications provided for hereunder shall be in electronic, telephonic or written form an d shall be given to the party to whom sent, addressed to it, at its address or other address or telephone, number telecopier as such party may hereafter specify for the purpose by notice to t he other parties set forth below.
Each such notice, request or communication shall be effective ( i) if given by telephone, telecopier or other electronic m eans, when such communication i s transmitted to the address specified below and any appropri ate answerback or confirmation i s r e c e i v e d , ( i i ) i f g i v e n b y certified or registered mail, return receipt requested, on the date of receipt appearing on the return postal receipt for notices given by certified or registe red mail, (iii) if given by hand delivery, when delivered at the address specified below:
If to the Authority: Santa Clarit a Public Financing Authority c/o City of Santa Clarita
23920 Valencia Boulevard
Santa Clarita, California 91355
Attention: Treasurer
661-255-4997
If to the City: Cit y of Santa Clarita
23920 Valencia Boulevard
Santa Clarita, California 91355
Attention: City Treasurer
661-255-4997
If to the Trustee: U.S. B ank National Association
Global Corporate Trust
633 W. Fifth Street, 24th Floor
LM-CA-T24T
Los Angeles, CA 90071
(213) 615-6062
Email: [email protected]
50 The Authority and the Trustee may designate any further or diff erent addresses to which subsequent notices, certificates or other communications shall be sent.
SECTION 9.14. Unclaimed Moneys. Anything in this Indenture to the contrary notwithstanding, any moneys held by the Trustee in trust for the payment and discharge of any of the Bonds that remain unclaimed for two years after the date wh en such Bonds have become due and payable, either at their stated maturity dates or by call f or earlier redemption, if such moneys were held by the Trustee at such date, or for two years after t he date of deposit of such moneys if deposited with the Trustee after such date when such Bonds beco me due and payable, shall be repaid by the Trustee to the Authority, as its absolute propert y and free from trust, and the Trustee shall thereupon be released and discharged with respect thereto and the Owners shall look only to the Authority for the payment of such Bonds; provided, however, that before being required to make any such payment to the Authority, the Trustee shall, at the written request and expense of the Authority, cause to be mailed to the Owners, at their respective addresses appearing on the Registration Books, a notice that such moneys remain unclaimed and that, after a date named in such notice, which date shall not be less than 30 days after the date of mailing of such notice, the balance of such moneys then unclaimed will be returned to the Authority.
SECTION 9.15. Governing Law. This Indenture shall be c onstrued and governed in accordance with the laws of the State of California.
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EXHIBIT A-1
[FORM OF TAX-EXEMPT BOND]
UNLESS THIS TAX-EXEMPT BOND IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY (AS DEFINED IN THE INDENTURE) TO
THE TRUSTEE FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY TAX-EXEMPT BOND ISSUED I S REGISTERED IN THE NAME OF CED E & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITO RY (AND ANY PAYMENT IS MADE TO C E D E & C O . O R T O S U C H O T H E R E N T I T Y A S I S R E Q U E S T E D B Y A N
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY), ANY TRANSFER,
PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
No. ___ $_________
SANTA CLARITA PUBLIC FINANCING AUTHORITY
LEASE REVENUE BOND
(RECREATIONAL FACILITY)
SERIES 2020A
RATE OF INTEREST:
MATURITY DATE: DATED DATE: CUSIP:
____% JUNE 1, ______ ___________ __________
REGISTERED OWNER: CEDE & CO.
PRINCIPAL AMOUNT:
The SANTA CLARITA PUBLIC FINANCING AUTHORITY, a joint powers au thority organized and existing under the laws of the State of Californi a (the “Authority”), for value received, hereby promises to pay (but only out of the Revenues, as defined in the Indenture hereinafter referred to, and cer tain other moneys) to the Regis tered Owner identified above or registered assigns (the “Registered Owner”), on the Maturity Date identified above or any earlier redemption date, the Principal Amount identified above in lawfu l money of the United States of America; and to pay interest thereon at the Rate of Interest id entified above in like money from the Interest Payment Date (as he reinafter defined) next precedi ng the date of authentication of this Tax-Exempt Bond (unless this Tax-Exempt Bond is authentica ted on or before an Interest Payment Date and after the fifteen th calendar day of the month preceding such Interest Payment Date, in which event it shall bear interest from such Interest Payment Date, or unless this Tax- Exempt Bond is authenticated o n or prior to November 15, 2020, in which event it shall bear interest from the Dated Date ide ntified above; provided, howeve r, that if, at the time of authentication of this Tax-Exem pt Bond, interest is in default on this Tax-Exempt Bond, this
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Tax-Exempt Bond shall bear interest from the Interest Payment Date to which interest hereon has previously been paid or made available for payment), payable se miannually on June 1 and December 1 in each year, commencing December 1, 2020 (each an “ Interest Payment Date”) until payment of such Principal Amount in full. The Principal Amount hereof is payable by check upon presentation hereof upon maturity or earlier redempt ion at the designated corporate trust office (the “Trust Office”) of U.S. Bank National Associa tion, as trustee (the “Trustee”).
Interest hereon is payable by check of the Trustee mailed by fi rst class mail on each Interest Payment Date to the Registered Owner hereof at the address of t he Registered Owner as it appears on the registration books of the Trustee as of the fift eenth (15 th) calendar day of the month preceding such Interest Payment Date (except that in the case of a Registered Owner of at least $1,000,000 in aggregate princ ipal amount of Outstanding B onds, such payment may, at such Registered Owner’s option, be made by wire transfer of imm ediately available funds to an account located in the United States in accordance with written instructions provided by such Registered Owner prior to the fifteenth calendar day of the mon th preceding such Interest Payment Date).
This Tax-Exempt Bond is one of a duly authorized issue of bonds of the Authority designated the “Santa Clarita Public Financing Authority, Lease Revenue Bonds (Recreational Facility), Series 2020A” (herein, the “Tax-Exempt Bonds”), in a n aggregate principal amount of $10,645,000 issued under an Indenture, dated as of October 1, 2 020 (the “Indenture”), by and between the Authority and the Trus tee. Concurrently with the i ssuance of the Tax-Exempt Bonds, the Authority is also issuing the $3,625,000 Santa Clari ta Public Financing Authority, Federally Taxable Lease Revenue Bonds (Recreational Facility), Series 2020A-T (the “Taxable Bonds,” and together with the Tax-Exempt Bonds, the “Bonds”), i ssued pursuant to the Indenture. Reference is hereby made to the Indenture and all indentures supplemental thereto for a description of the rights ther eunder of the owners of the Bon ds, of the nature and extent of the Revenues (as that term is defined in the Indenture), of the rig hts, duties and immunities of the Trustee and of the rights and obl igations of the Authority ther eunder; and all of the terms of the Indenture are hereby incorporated herein and constitute a contr act between the Authority and the Registered Owner hereof, and to all of the provisions of which Indenture the Registered Owner hereof, by acceptance hereof, assents and agrees.
The Bonds are authorized to be i ssued pursuant to the provision s of the Marks-Roos Local Bond Pooling Act of 1985, constituting Article 4, Chapter 5, Division 7, Title 1 of the Government Code of the State of California (the “Act”). The Bo nds are special obligations of the Authority and, as and to the extent set forth in the Indent ure, are payable solely from and secured by a first lien on and pledge of the Revenues as provid ed in the Indenture. All of the Bonds are equally secured by a pledge of, and charge and lien u pon, all of the Revenues (other than deposits to the Rebate Fund created by the Indenture), and the Revenues (other than deposits to the Rebate Fund created by the Indenture) constitut e a trust fund for the security and payment of the principal of and interest on the Bonds. The ful l faith and credit of the Authority are not pledged for the payment of the principal of or interest or premium (if any) on the Bonds.
The Bonds are not secured by a legal or equitable pledge of, or charge, lien or encumbrance upon, any of the property of the Authority or any of its income or receipts, except the Revenues and such other moneys and securities as provided in the Indenture.
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The Bonds have been issued for the purpose of financing certain capital improvements for the City. The Authority and the City have entered into a L ease Agreement, dated as of October 1, 2020 (the “Lease”), un der which the City is obligate d to pay amounts which are anticipated to be sufficient to enable the Authority to pay the principal of and interest on the Bonds.
The Bonds are subject to redemption prior to their maturity as provided in the Indenture.
The Bonds are subject to redemption prior to their respective m aturity dates, upon notice as provided in the Indenture, as a whole or in part on any date , from prepayments of Base Rental Payments made by the City pursuant to the Lease from funds received by the City due to a taking of the Leased Property or any portion thereof under the power o f eminent domain or from insurance proceeds received by the City due to damage to or des truction of the Leased Property or any portion thereof, under the circumstances and upon the co nditions and terms prescribed in the Indenture and in the Lease. Redemption of Bonds pursuant to this paragraph shall be made at a redemption price equal to the s um of the principal of the Bon ds to be redeemed plus accrued interest thereon to the date fixed for redemption, without premium.
The Bonds may be issued in denominations of $5,000 or any integ ral multiple thereof.
Subject to the limitations and upon payment of the charges, if any, provided in the Indenture, this Tax-Exempt Bond may be exchanged at the Trust Office of the Tru s t e e f o r a l i k e a g g r e g a t e principal amount, interest rate and maturity of fully registere d Tax-Exempt Bonds of other authorized denominations.
This Tax-Exempt Bond is transferable by the Registered Owner he reof, in person or by his attorney duly authorized in writing, at the Trust Office of the Trustee, but only in the manner, subject to the limitations and upon payment of the charges prov ided in the Indenture, and upon surrender and cancellation of thi s Tax-Exempt Bond. Upon such transfer a new fully registered Bond or Bonds, of Authorized Denomination or Denominations, for the same aggregate principal amount and of the same maturity and the same series designation will be issued to the transferee in exchange herefor. The Authority and the Trustee may treat the Registered Owner hereof as the absolute owner hereof for all purposes, and the Authority and the Trustee shall not be affected by any notice to the contrary. The Trustee shall not be required to register the transfer or exchange of any Tax-Exempt Bond during the period in which the Trustee i s selecting Tax-Exempt Bonds for redemption or any Tax-Exempt Bond selected for redemption.
The Indenture and the rights and obligations of the Authority a nd of the owners of the Bonds and of the Trustee may be modified or amended from time t o time and at any time in the manner, to the extent, and upon the terms provided in the Inden ture; provided that no such modification or amendment shall (a) extend the maturity of or r educe the interest rate on any Bond or otherwise alter or impai r the obligation of the Authori ty to pay the principal, interest or premiums at the time and place and at the rate and in the curre ncy provided therein of any Bond without the express written consent of the owner of such Bond, (b) reduce the percentage of Bonds required for the written consent to any such amendment or modification, or (c) without its written consent thereto, modify a ny of the rights or obligation s of the Trustee, all as more fully set forth in the Indenture.
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It is hereby certified that all things, conditions and acts req uired to exist, to have happened and to have been performed precedent to and in the iss uance of this Tax-Exempt Bond do exist, have happened and have been performed in due time, fo rm and manner as required by the Constitution and statutes of the State of California and by the Act (as such term is defined on the reverse side hereof) and the amount of this Tax-Exempt Bond , together with all other indebtedness of the Authority, does not exceed any limit prescr ibed by the Constitution or statutes of the State of California or by the Act.
This Tax-Exempt Bond shall not be entitled to any benefit under the Indenture, or become valid or obligatory for any purpose, until the certifica te of authentication hereon shall have been manually signed by the Trustee.
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I N W I T N E S S W H E R E O F , t h e A u t h o r i t y h a s c a u s e d t h i s T a x - E x e m p t B ond to be executed in its name and on its behalf by the manual or facsimi le signatures of its Chair and Secretary as of the Dated Date identified above.
SANTA CLARITA PUBLIC FINANCING
AUTHORITY
By
Chair
ATTEST:
___________________________
Secretary
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TRUSTEE’S CERTIFICATE OF AUTHENTICATION
This is one of the Tax-Exempt Bonds described in the within-men tioned Indenture and registered on the Bond Registration Books.
Dated: __________, 20__
U.S. BANK NATIONAL ASSOCIATION, as
Trustee
By
Authorized Officer
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ASSIGNMENT
For value received the undersigned do(es) hereby sell, assign and transfer unto ________ ______________________________________________________________________________ _____________________________, whose tax identification number is ________, the within- mentioned registered Bond and hereby irrevocably constitute(s) and appoint(s) _____________ ______________________________________________________ attorney to transfer the same on the books of the Trustee with full power of substitution in the premises.
Dated:
Signature guaranteed: ______________________________________ NOTE: The signature(s) on this Assignment
must correspond with the name(s) as written on
the face of the within Bond in every particular
without alteration or enlargement or any
change whatsoever.
_____________________________________
NOTICE: Signature must be guaranteed by a
member of an institution which is a participant
in the Securities Transfer Agent Medallion
Program (STAMP) or other similar program.
100802390.7 A-2-1
EXHIBIT A-2
[FORM OF TAX-EXEMPT BOND]
UNLESS THIS TAXABLE BOND IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY (AS DEFINED IN THE INDENTURE) TO
THE TRUSTEE FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY TAXABLE BOND ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITO RY (AND ANY PAYMENT IS MADE TO C E D E & C O . O R T O S U C H O T H E R E N T I T Y A S I S R E Q U E S T E D B Y A N
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY), ANY TRANSFER,
PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
No. ___ $_________
SANTA CLARITA PUBLIC FINANCING AUTHORITY
FEDERALLY TAXABLE LEASE REVENUE BOND
(RECREATIONAL FACILITY)
SERIES 2020A-T
RATE OF INTEREST:
MATURITY DATE: DATED DATE: CUSIP:
____% JUNE 1, ______ ___________ __________
REGISTERED OWNER: CEDE & CO.
PRINCIPAL AMOUNT:
The SANTA CLARITA PUBLIC FINANCING AUTHORITY, a joint powers au thority organized and existing under the laws of the State of Californi a (the “Authority”), for value received, hereby promises to pay (but only out of the Revenues, as defined in the Indenture hereinafter referred to, and cer tain other moneys) to the Regis tered Owner identified above or registered assigns (the “Registered Owner”), on the Maturity Date identified above or any earlier redemption date, the Principal Amount identified above in lawfu l money of the United States of America; and to pay interest thereon at the Rate of Interest id entified above in like money from the Interest Payment Date (as he reinafter defined) next precedi ng the date of authentication of this Taxable Bond (unless this Taxable Bond is authenticated on or before an Interest Payment Date and after the fifteenth calendar day of the month precedin g such Interest Payment Date, in which event it shall bear interest from such Interest Payment Date, or unless this Taxable Bond is authenticated on or prior to November 15, 2020, in which event it shall bear interest from the Dated Date identified above; provided, however, that if, at the time of authentication of this Taxable Bond, interest is in default on this Taxable Bond, this Taxable Bond shall bear interest
100802390.7 A-2-2
from the Interest Payment Date to which interest hereon has pre viously been paid or made available for payment), payable semiannually on June 1 and Dece mber 1 in each year, commencing December 1, 2020 (each an “Interest Payment Date”) u ntil payment of such Principal Amount in full. The Principal Amount hereof is payab le by check upon presentation hereof upon maturity or earlier redemption at the designated co rporate trust office (the “Trust Office”) of U.S. Bank National Association, as trustee (the “Trustee”). Interest hereon is payable by check of the Trustee mailed by first class mail on each Inte rest Payment Date to the Registered Owner hereof at the address of the Registered Owner as it appears on the registration books of the Trustee as of the fifteenth (15 th) calendar day of the month preceding such Interest Payment Date (except that in the case of a Registered Owner of at least $1,000,000 in aggregate principal amount of Outstanding Bonds, such payment may, at suc h Registered Owner’s option, be made by wire transfer of immediately available funds to an a ccount located in the United States in accordance with writt en instructions provided by such Registered Owner prior to the fifteenth calendar day of the month preceding such Interest Payment Date).
This Taxable Bond is one of a duly authorized issue of bonds of the Authority designated the “Santa Clarita Public Financing Authority Lease Revenue Bon ds (Recreational Facility), Series 2020A-T” (herein, the “T axable Bonds”), in an aggregate principal amount of $3,625,000 issued under an Indenture, dated as of October 1, 2020 (the “In denture”), by and between the Authority and the Trustee. Concurrently with the issuance of t he Taxable Bonds, the Authority is also issuing the $10,645,000 Sa nta Clarita Public Financing Authority, Lease Revenue Bonds (Recreational Facility), Series 2020A (the “Tax-Exempt Bonds,” and together with the Taxable Bonds, the “Bonds”), issued pursu ant to the Indenture. Referen ce is hereby made to the Indenture and all indentures supplemental thereto for a description of the rights thereunder of the owners of the Bonds, of the nature and extent of the Revenues ( as that term is defined in the Indenture), of the rights, duties and immunities of the Trustee and of the rights and obligations of the Authority thereunder; and all of the terms of the Indenture are hereby incorporated herein and constitute a contract between the Authority and the Registered Owner hereof, and to all of the provisions of which Indenture the Registered Owner hereof, by a cceptance hereof, assents and agrees.
The Bonds are authorized to be i ssued pursuant to the provision s of the Marks-Roos Local Bond Pooling Act of 1985, constituting Article 4, Chapter 5, Division 7, Title 1 of the Government Code of the State of California (the “Act”). The Bo nds are special obligations of the Authority and, as and to the extent set forth in the Indent ure, are payable solely from and secured by a first lien on and pledge of the Revenues as provid ed in the Indenture. All of the Bonds are equally secured by a pledge of, and charge and lien u pon, all of the Revenues (other than deposits to the Rebate Fund created by the Indenture), and the Revenues (other than deposits to the Rebate Fund created by the Indenture) constitut e a trust fund for the security and payment of the principal of and interest on the Bonds. The ful l faith and credit of the Authority are not pledged for the payment of the principal of or interest or premium (if any) on the Bonds.
The Bonds are not secured by a legal or equitable pledge of, or charge, lien or encumbrance upon, any of the property of the Authority or any of its income or receipts, except the Revenues and such other moneys and securities as provided in the Indenture.
The Bonds have been issued for the purpose of financing certain capital improvements for the City. The Authority and the City have entered into a L ease Agreement, dated as of
100802390.7 A-2-3
October 1, 2020 (the “Lease”), un der which the City is obligate d to pay amounts which are anticipated to be sufficient to enable the Authority to pay the principal of and interest on the Bonds.
The Bonds are subject to redemption prior to their maturity as provided in the Indenture.
The Bonds are subject to redemption prior to their respective m aturity dates, upon notice as provided in the Indenture, as a whole or in part on any date , from prepayments of Base Rental Payments made by the City pursuant to the Lease from funds received by the City due to a taking of the Leased Property or any portion thereof under the power o f eminent domain or from insurance proceeds received by the City due to damage to or des truction of the Leased Property or any portion thereof, under the circumstances and upon the co nditions and terms prescribed in the Indenture and in the Lease. Redemption of Bonds pursuant to this paragraph shall be made at a redemption price equal to the s um of the principal of the Bon ds to be redeemed plus accrued interest thereon to the date fixed for redemption, without premium.
The Bonds may be issued in denominations of $5,000 or any integ ral multiple thereof.
Subject to the limitations and upon payment of the charges, if any, provided in the Indenture, this Taxable Bond may be exchanged at the Trust Office of the Truste e for a like aggregate principal amount, interest rate and maturity of fully registered Taxable Bonds of other authorized denominations.
This Taxable Bond is transferable by the Registered Owner hereo f, in person or by his attorney duly authorized in writ ing, at the Trust Office of the Trustee, but only in the manner, subject to the limitations and upon payment of the charges prov ided in the Indenture, and upon surrender and cancellation of this Taxable Bond. Upon such transfer a new fully registered Bond or Bonds, of Authorized Denomination or Denominations, for the same aggregate principal amount and of the same maturity and the same series designation will be issued to the transferee in exchange herefor. The Authority and the Trustee may treat the Registered Owner hereof as the absolute owner hereof for all purposes, and the Authority and the Trustee shall not be affected by any notice to the contrary. The Trustee shall not be required to register the transfer or exchange of any Taxable Bond during the period in which the Trustee is s electing Taxable Bonds for redemption or any Taxable Bond selected for redemption.
The Indenture and the rights and obligations of the Authority a nd of the owners of the Bonds and of the Trustee may be modified or amended from time t o time and at any time in the manner, to the extent, and upon the terms provided in the Inden ture; provided that no such modification or amendment shall (a) extend the maturity of or r educe the interest rate on any Bond or otherwise alter or impai r the obligation of the Authori ty to pay the principal, interest or premiums at the time and place and at the rate and in the curre ncy provided therein of any Bond without the express written consent of the owner of such Bond, (b) reduce the percentage of Bonds required for the written consent to any such amendment or modification, or (c) without its written consent thereto, modify a ny of the rights or obligation s of the Trustee, all as more fully set forth in the Indenture.
It is hereby certified that all things, conditions and acts req uired to exist, to have happened and to have been performed precedent to and in the iss uance of this Taxable Bond do
100802390.7 A-2-4
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 by the Act (as such term is defined on the reverse side hereof) and the amount of this Taxable Bond, together with all other indebtedness of the Authority, does not exceed any limit prescribed by the Cons titution or statutes of the State of California or by the Act.
This Taxable Bond shall not be entitled to any benefit under th e Indenture, or become valid or obligatory for any purpos e, until the certificate of a uthentication hereon shall have been manually signed by the Trustee.
100802390.7 A-2-5
IN WITNESS WHEREOF, the Authority has caused this Taxable Bond to be executed in its name and on its behalf by the manual or facsimile signature s of its Chair and Secretary as of the Dated Date identified above.
SANTA CLARITA PUBLIC FINANCING
AUTHORITY
By
Chair
ATTEST:
___________________________
Secretary
100802390.7 A-2-6
TRUSTEE’S CERTIFICATE OF AUTHENTICATION
This is one of the Taxable Bonds described in the within-mentio ned Indenture and registered on the Bond Registration Books.
Dated: __________, 20__
U.S. BANK NATIONAL ASSOCIATION, as
Trustee
By
Authorized Officer
A-2-7
ASSIGNMENT
For value received the undersigned do(es) hereby sell, assign and transfer unto ________ ______________________________________________________________________________ _____________________________, whose tax identification number is ________, the within- mentioned registered Bond and hereby irrevocably constitute(s) and appoint(s) _____________ ______________________________________________________ attorney to transfer the same on the books of the Trustee with full power of substitution in the premises.
Dated:
Signature guaranteed: ______________________________________ NOTE: The signature(s) on this Assignment
must correspond with the name(s) as written on
the face of the within Bond in every particular
without alteration or enlargement or any
change whatsoever.
_____________________________________
NOTICE: Signature must be guaranteed by a
member of an institution which is a participant
in the Securities Transfer Agent Medallion
Program (STAMP) or other similar program.
100802390.7 B-1
EXHIBIT B
FORM OF COSTS OF ISSUANCE REQUISITION
COSTS OF ISSUANCE REQUISITION NO. __
with reference to
Santa Clarita Public Financing Authority
(Recreational Facility)
$10,645,000
Lease Revenue Bonds
Series 2020A
$3,625,000
Federally Taxable Lease Revenue Bonds
Series 2020A
I. The Santa Clarita Public Financing Authority (the “Authority ”) hereby requests U.S. Bank National Association, as trustee (the “Trustee”), pur suant to that certain Indenture, dated as of October 1, 2020 (the “Indenture”), by and between t he Authority and the Trustee, under the terms of which the Authority has issued its Lease Rev enue Bonds (Recreational Facility), Series 2020A and its Federally Taxable Lease Revenue Bonds (Recreational Facility), Series 2020A-T, to pay from the m oneys in the Costs of Issuance Fund established pursuant to the Indenture, the amounts shown on Schedule I attached hereto to the parties indicated in Schedule I.
II. The payees, the purposes for which the costs have been incu rred, and the amount of the disbursements requested are itemized on Schedule I hereto.
III. Each obligation mentioned in Schedule I hereto has been pr operly incurred and is a proper charge against the Costs of Issuance Fund. None of th e items for which payment is requested has been reimbursed previously from the Costs of Issuance Fund.
Dated: ________, 20__
SANTA CLARITA PUBLIC FINANCING
AUTHORITY
By
Title:
C-1
EXHIBIT C
FORM OF PROJECT FUND REQUISITION
REQUISITION OF THE CITY
PROJECT FUND REQUISITION NO. __ (to be numbered sequentially)
with reference to
Santa Clarita Public Financing Authority
(Recreational Facility)
$10,645,000
Lease Revenue Bonds
Series 2020A
$3,625,000
Federally Taxable Lease Revenue Bonds
Series 2020A
I. The City of Santa Clarita (the “City”) hereby requests U.S. Bank National Association, as trustee (the “Tr ustee”), pursuant to that certa in Indenture, dated as of October 1, 2020 (the “Indenture”), by and between the Santa Clarita Public Financing Authority (the “Authority”) and the Trustee, under the terms of which the Auth ority has issued its Lease Revenue Bonds (Recreational Facility), Series 2020A and its Fed erally Taxable Lease Revenue Bonds (Recreational Facility), Series 2020A-T, to pay from the moneys in the Project Fund established pursuant to the Indenture, the amounts shown on Sch edule I attached hereto to the parties indicated in Schedule I.
II. The payees, the purposes for which the costs have been incu rred, and the amount of the disbursements requested are itemized on Schedule I hereto.
III. Each obligation mentioned in Schedule I hereto is a Projec t Cost (as defined in the Indenture) and has been properly incurred and is a proper charg e against the Project Fund. None of the items for which payment is requested has been reimbursed previously from the Project Fund.
IV. There has not been filed with or served upon the City or th e Authority a stop notice or any other notice of any lien, right to lien or attach ment upon, or claim affecting the right to receive payment of, any of the money payable to the pe rson[s] named on Schedule I hereto which has not been released or will not be released simu ltaneously with the payment of such obligation, other than liens accruing by mere operation of law.
Dated: ________, 20__
CITY OF SANTA CLARITA
By
Title:
C-2
SCHEDULE I
Project Component
Amount of
This Draw
Aggregate Amount
Draws Including
This Draw
___________ _______________
___________ _______________
___________ _______________
___________ _______________
___________ _______________
___________ _______________
(Continue on Additional Sheet if Necessary)
Name and Address of party to whom payment is to be made:
Purpose for which the obligation was incurred:
D-1
EXHIBIT D
FORM OF NET PROCEEDS REQUISITION
REQUISITION NO. __ (to be numbered sequentially)
with reference to
Santa Clarita Public Financing Authority
(Recreational Facility)
$10,645,000
Lease Revenue Bonds
Series 2020A
$3,625,000
Federally Taxable Lease Revenue Bonds
Series 2020A
I. The Santa Clarita Public Financing Authority (the “Authority ”) hereby requests U.S. Bank National Association, as trustee (the “Trustee”), pur suant to that certain Indenture, dated as of October 1, 2020 (the “Indenture”), by and between t he Authority and the Trustee, under the terms of which the Authority has issued its Lease Rev enue Bonds (Recreational Facility), Series 2020A and its Federally Taxable Lease Revenue Bonds (Recreational Facility), Series 2020A-T, to pay from the moneys in the Insurance and Con demnation Fund established pursuant to the Indenture, the amounts shown on Schedule I atta ched hereto to the parties indicated in Schedule I.
II. The payees, the purposes for which the costs have been incu rred, and the amount of the disbursements requested are itemized on Schedule I hereto.
III. Each obligation mentioned in Schedule I hereto has been pr operly incurred and is a proper charge against the Ins urance and Condemnation Fund. N one of the items for which payment is requested has been re imbursed previously from the In surance and Condemnation Fund.
IV. There has not been filed with or served upon the City or th e Authority a stop notice or any other notice of any lien, right to lien or attach ment upon, or claim affecting the right to receive payment of, any of the money payable to the pe rson[s] named on Schedule I hereto which has not been released or will not be released simu ltaneously with the payment of such obligation, other than liens accruing by mere operation of law.
Dated: ________, 20__
SANTA CLARITA PUBLIC FINANCING
AUTHORITY
By
Title: