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86R-434 RESOLUTION NO. 86R- 4 34 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ANAHEIM AUTHORIZING THE ISSUANCE OF ITS GENERAL OBLIGATION BONDS, SERIES 1986 A RESOLVED, by the City Council of the City of Anaheim, California (the IICity"), as follows: WHEREAS, more than two-thirds of the qual ified voters of the City, voting at a special municipal election held on November 4, 1980, authorized the issuance by the City of general obligation bonds to finance storm drain improvements for the City; and WHEREAS, pursuant to the Charter of the City and Chapter 1.23 of the Anaheim Municipal Code, the City is empowered to issue general obligation bonds which are authorized by two-thirds of the qualified electors of the City; and WHEREAS, the City intends to issue general obligation bonds, in a principal amount not to exceed $10,000,000 pursuant to this Resolution and in conformity with the City Charter and the Anaheim Municipal Code; -1- ARTICLE I DEFINITIONS; AUTHORITY Section 1.01. Definitions. The terms defined in this Section 1.01, as used and capitalized herein, shall, for all purposes of this Resolution, have the meanings ascribed to them below, unless the context clearly requires some other meaning. Articles, Sections. All references herein to IIArticles," IISections" and other subdivisions are to the corresponding Articles, Sections or subdivisions of this Resolution, and the words "herein," IIhereof," IIhereunderll and other words of similar import refer to this Resolution as a whole and not to any particular Article, Section or subdivision hereof. Authorized Investments. The term "Authorized Investments" means any investments permitted by law to be made with moneys belonging to, or in the custody of, the City. Bond Counse 1 . The term II Bond Counse 1" means any attorney or fi rm of attorneys nationally recognized for expertise in rendering opinions as to the legality and tax exempt status of securities issued by public entities. Bonds. The term IIBonds" means the City of Anaheim General Obl igation Bonds, Series 1986 A, at any time Outstanding pursuant to this Resolution. Bond Year. The term "Bond Year" means the twelve month period beginning on October 30 of each year and end i ng on October 29 of the fa 11 owi ng year, commencing with the period beginning on October 30, 1986 and ending on October 29, 1986. Charter. The term IICharter" means the City Charter of the City, as amended. City Representative. The term "City Representative" means the Finance Director of the City or any other person authorized by resolution of the City Council of the City to act on behalf of the City with respect to this Resolution and the Bonds. City Treasurer. The term "City Treasurer" means the treasurer of the City or other duly appointed officer of the City authorized by the City Counci 1 by resolution to perform the functions of the treasurer including, without limitation, the Assistant Treasurer of the City. Code. amended. The term IICodell means the Internal Revenue Code of 1954, as Contractor. The term "Contractor II means the contractor(s) or vendor(s) from whom the City has ordered or caused to be ordered or with whom the City has contracted or caused to be contracted with respect to the construction of the Project. Debt Serv ice. The term II Debt Serv ice II means the schedu 1 ed amount of interest and amortization of principal payable on the Bonds during the period -2- of computation, excluding amounts scheduled during such period which relate to principal which has been retired before the beginning of such period. Debt Service Account. The term "Debt Service Accountll means the Account by that name established by Section 4.03 hereof. Excess Investment Earnings. The term "Excess Investment Earnings" has the meaning ascribed to it in Section 5.09(b) hereof. Excess Investment Earnings Account. The term IIExcess Investment Earnings Account" means the account by that name created by, and held by the City Treasurer pursuant to, Section 5.09(a) hereof. Federal Securities. The term "Federal Securitiesll means United States Treasury notes, bonds, bills or certificates of indebtedness or those for which the faith and credit of the United States are pledged for the payment of principal and interest. Gross Proceeds. following amounts: (i) original proceeds, namely, net amounts (after payment of all expenses of issuing the Bonds) received by or for the City as a result of the sale of the Bonds, excluding original proceeds which become transferred proceeds (determined in accordance with applicable Regulations) of obligations issued to refund in whole or in part the Bonds; The term "Gross Proceeds II means the sum of the (ii) investment proceeds, namely, amounts received at any time by or for the City, such as interest and dividends, resulting from the investment of any original proceeds (as referenced in clause (i) above) or investment proceeds (as referenced in this clause (ii)) in Nonpurpose Obligations, increased by any profits and decreased (if necessary, below zero) by any losses on such investments, excluding investment proceeds which become transferred proceeds (determined in accordance with applicable Regulations) of obligations issued to refund in whole or in part the Bonds; (iii) sinking fund proceeds, namely, amounts, other than original proceeds or investment proceeds (as referenced in clauses (i) and (ii) above) of the Bonds, which are held in the Debt Service Account, the Redempt i on Account and any other fund to the extent that the City reasonably expects to use such other fund to pay Debt Service on the Bonds; (iv) amounts in any fund established as a reasonably required reserve or replacement fund; (v) Investment Property pledged as security for payment of Debt Service on the Bonds by an ultimate obligor or a related person or by the City; (vi) amounts, other than as specified in this definition, used to pay Debt Service on the Bonds; and -3- (vii) amounts received as a result of investing amounts described in this definition. Investment Earni ngs Account. The term II Investment Earni ngs Account II means the account by that name created by, and he 1 d by the City Treasurer pursuant to, Section 5.09(a) hereof. Investment Property. The term II investment property II means any security (as said term is defined in section 165(g)(2)(A) or(B) of the Code), obligation, annuity or investment-type property, excluding, however, obligations the interest on which is exempt from income tax under section 103 of the Code. I ssuance Expenses. The term II I ssuance Expenses II means all items of expense directly or indirectly reimbursable to the City relating to the execution and delivery of the Bonds including, but not limited to, filing and recording costs, settlement costs, printing costs, reproduction and binding costs, legal fees and charges, financial and other professional consultant fees, costs of obtaining credit ratings, fees for execution, transportation and safekeeping of the Bonds and charges and fees in connection with the foregoing. Municipal Code. The term "Municipal Codell means the Anaheim Municipal Code, as amended, including, in particular, Section 1.23 of Title I thereof. Nonpurpose Obligation. The term "Nonpurpose Obligation" means any Investment Property which is acquired with the Gross Proceeds of the Bonds and is not acquired in order to carry out the governmental purpose of the Bonds. Outstanding. The term IIOutstanding," when used as of any particular time with reference to Bonds, means all Bonds except: (i) Bonds theretofore canceled by the Paying Agent or surrendered to the Paying Agent for cancellation; (ii) Bonds paid or deemed to have been paid within the meaning of Section 9.02 hereof; and (iii) Bonds in lieu of or in substitution for which other Bonds shall have been authorized, executed, issued and delivered by the City pursuant to the Resolution. Owner or Bondowner. The terms "Owner" or II Bondownerll mean any person who shall be the registered owner of any Outstanding Bond. Paying Agent. The term "Paying Agent" means the Paying Agent appointed by the City and acting as paying agent, registrar and authenticating agent for the Bonds, its successors and assigns, and any other corporation or association which may at any time be substituted in its place, as provided in Section 7.01 hereof. Proceeds Account. The term "Proceeds Account" means the Account by that name established by Section 4.01 hereof. -4- Project. The term IIProject" means storm drain installation in the central and western areas of the City which will eliminate flooded roadways, extend the useful life of the roadways and reduce maintenance costs on those streets. Project Costs. The term "Project Costsll means (i) all costs of payment of, or reimbursement for, acquisition, construction, installation and equipment of the Project including, but not limited to, architect and engineering fees, Contractor payments, costs of feasibility and other reports, inspection costs, performance bond premiums and permit fees; and (ii) Issuance Expenses. Purchase Pri ce. The term II Purchase Pri ce, II for the purpose of computation of the Yield of the Bonds, has the same meaning as the term lIissue price" in sections 1273(b) and 1274 of the Code, and, in general, means the initial offering price to the public (not including bond houses and brokers, or similar persons or organizations acting in the capacity of underwriters or wholesales) at which price a substantial amount of the Bonds are sold or, if the Bonds are privately placed, the price paid by the first buyer of the Bonds or the acquisition cost of the first buyer. The term IIPurchase Price,1I for the purpose of computation of the Yield of Nonpurpose Obligations, means"the fair market value of the Nonpurpose Obligations on the date of use of Gross Proceeds of the Bonds for acquisition thereof, or if later, on the date that Investment Property constituting a Nonpurpose Obligation becomes a Nonpurpose Obligation of the Bonds. Redempt i on Account. The term 11 Redempt i on Account II means the Account by that name established by Section 4.05 hereof. Regulations. The term "Regulationsll means temporary and permanent regulations promulgated under section 103 of the Code. Resolution. The term "Resolution" means this Resolution No. 86R- , adopted by the City on September 30, 1986, which authorized the issuance-Qf the Bonds. Supplemental Resolution. The term "Supplemental Resolution" means any resolution supplemental to or amendatory of this Resolution, adopted by the City in accordance with Article VII hereof. Written Request of the City. The term "Written Request of the City" means an instrument in writing signed by the Mayor or by any other officer of the City duly authorized by the City for that purpose and by the City Clerk, with the seal of the City affixed. Yield. The term IIYield" means that yield which, when used in computing the present worth of all payments of principal and interest (or other payments in the case of Nonpurpose Obligations which require payments in a form not characterized as principal and interest) on a Nonpurpose Obligation or on the Bonds produces an amount equal to the Purchase Price of such Nonpurpose Obligation or the Bonds, all computed as prescribed in applicable Regulations and, in the case of variable rate obligations, as further prescribed in Section 5.08 hereof. -5- Section 1.02. Authority for this Resolution. This Resolution is entered into pursuant to the provisions of the Charter and the Municipal Code. -6- ARTICLE I I THE BONDS Section 2.01. Authorization. Bonds in the aggregate principal amount of ten million dollars ($10,000,000) are hereby authorized to be issued by the City under and subject to the terms of the Charter, the Municipal Code and this Resolution. This Resolution constitutes a continuing agreement with the Owners of all of the Bonds issued or to be issued hereunder and then Outstanding to secure the full and final payment of principal of and premiums, if any, and the interest on all Bonds which may from time to time be executed and delivered hereunder, subject to the covenants, agreements, provisions and conditions herein contained. The Bonds shall be designated the IICity of Anaheim General Obligation Bonds, Series 1986 All. Section 2.02. Terms of Bonds. (a) Form; Numbering. The Bonds shall be issued as fully registered Bonds, without coupons, in the denomination of $5,000 each or any integral multiple thereof, but in an amount not to exceed the aggregate principal amount of Bonds maturing in the year of maturity of the Bond for which the denomination is specified. Bonds shall be lettered alphabetically by year of maturity (excluding, however, the letters "JII and 11011) and each maturity shall be numbered from (1) consecutively upwards in order of issuance. (b) Date of Bonds. The Bonds shall be dated as of the date of October 1, 1986. (c) CUSIP Identification Numbers: IICUSIP" identification numbers shall be imprinted on the Bonds, but such numbers shall not constitute a part of the contract evidenced by the Bonds and any error or omission with respect thereto shall not constitute cause for refusal of any purchaser to accept delivery of and pay for the Bonds. In addition, failure on the part of the City to use such CUSIP numbers in any notice to Owners of the Bonds shall not constitute an event of default or any violation of the City's contract with such Owners and shall not impair the effectiveness of any such notice. (d) Maturities; Interest. The Bonds shall mature and become payable on October 1 of each year, and shall bear interest at such rate or rates as shall be hereafter determined by the City upon the sale thereof, payable semiannually on each April 1 and October 1, commencing April 1,1987 (the "Interest Payment Datesll), as follows: -7- Maturity Date Principal Maturity Date Principal (October 1) Amount (October 1) Amount 1987 $105,000 2002 $295,000 1988 115,000 2003 315,000 1989 125,000 2004 335,000 1990 130,000 2005 360,000 1991 140,000 2006 385,000 1992 150,000 2007 410,000 1993 160,000 2008 435,000 1994 170,000 2009 470,000 1995 185,000 2010 500,000 1996 195,000 2011 535,000 1997 210 ,000 2012 570,000 1998 225,000 2013 610 ,000 1999 240,000 2014 655,000 2000 255,000 2015 700,000 2001 275,000 2016 745,000 Each Bond shall bear interest from the Interest Payment Date next preceding the date of registration and authentication thereof unless (i) it is registered and authenticated as of an Interest Payment Date, in which event it shall bear interest from such date, or (ii) it is registered and authenticated prior to an Interest Payment Date and after the close of business on the fifteenth day of the month preceding such Interest Payment Date, in which event it shall bear interest from such Interest Payment Date, or (iii) it is registered and authenticated prior to March 16, 1987, in which event it shall bear interest from October 1, 1986; provided, however, that if at the time of authentication of a Bond, interest is in default thereon, such Bond shall bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment thereon. (e) Payment. Interest on the Bonds (including the final interest payment upon maturity or earlier redemption) is payable by check or draft of the Payi ng Agent mailed to the Owner thereof at such Owner I s address as it appears on the registration books maintained by the Paying Agent at the close of business on the fifteenth (15th) day of the month preceding the Interest Payment Date, or at such other address as the Owner may have filed with the Paying Agent for that purpose. Principal of the Bonds is payable in lawful money of the United States of America at the principal corporate trust office of the Paying Agent in Los Angeles, California. Section 2.03. Redemption. (a) Optional Redemption. Bonds maturing on or before October 1, 1996, shall not be subject to optional redemption before their stated maturity. Bonds maturing on or after October 1, 1997, are subject, at the option of the City, to call for redemption prior to their stated maturities in whole at any time and in part on any Interest Payment Date commencing October 1, 1996, in inverse order of maturi ty and by 1 at withi n anyone maturity, equal to the principal amount thereof, at the following prices (expressed as percentages of the principal amount of Bonds called for redemption), for the respective periods set forth below, together with accrued interest to the date fixed for -8- redemption, from any moneys that may be available to the City for such purpose: Redemption Oate (Dates Inclusive) Redemption Price October 1, 1996 to September 30, 1997 ........... 102 % October 1, 1997 to September 30, 1998 ........... 101~ October 1, 1998 to September 30, 1999 ........... 101 October 1, 1999 to September 30, 2000 ........... 100~ October 1, 2000 and thereafter .................. 100 (d) Redemption Procedure. The Paying Agent shall cause notice of any redemption to be mailed, first class mail, postage prepaid, at least thirty (30) days but not more than sixty (60) days prior to the date fixed for redemption, to the respective Owners of any Bonds designated for redemption, at their addresses appearing on the Bond registration books in the principal corporate trust office of the Paying Agent in Los Angeles, California; but such mailing shall not be a condition precedent to such redemption and failure to mail or to receive any such notice shall not affect the validity of the proceedings for the redemption of such Bonds. Such notice shall state the redemption date and the redemption price and, if less than all of the then Outstanding Bonds are to be called for redemption, shall designate the serial numbers of the Bonds to be redeemed by giving the individual number of each Bond or by stating that all Bonds between two stated numbers, both inclusive, or by stating that all of the Bonds of one or more maturities have been called for redemption, and shall require that such Bonds be then surrendered at the principal corporate trust office of the Paying Agent in Los Angeles, California for redemption at the said redemption price, giving notice also that further interest on such Bonds will not accrue from and after the redemption date. Upon surrender of Bonds redeemed in part only, the City shall execute and the Payi ng Agent shall authenticate and deli ver to the Owner. at the expense of the City, a new Bond or Bonds, of the same maturity, of authorized denominations in aggregate principal amount equal to the unredeemed portion of the Bond or Bonds. From and after the date fixed for redemption, if notice of such redemption shall have been duly given and funds available for the payment of the principal of and interest (and premium, if any) on the Bonds so called for redemption shall have been duly provided, such Bonds so called shall cease to be entitled to any benefit under this Resolution other than the right to receive payment of the redemption price, and no interest shall accrue thereon on or after the redemption date specified in such notice. Whenever any Bonds are to be selected for redemption by lot, the Paying Agent shall determine, in any manner deemed by it to be fair, the serial numbers of the Bonds to be redeemed. All Bonds redeemed pursuant to this Section 2.03 shall be canceled and shall be surrendered to the City. -9- Section 2.04. Form of Bonds. The Bonds, the form of the Paying Agent's certificate of authentication and registration and assignment to appear thereon shall be substantially in the forms, respectively, with necessary or appropriate variations, omissions and insertions, as permitted or required by this Resolution, as are set forth in Exhibit A attached hereto. Sect ion 2.05. Execut i on of Bonds. The Bonds shall be executed on behalf of the City by the facsimile signatures of its Mayor and its City Clerk who are in office on the date of adoption of this Resolution or at any time thereafter, and the seal of the City shall be impressed, imprinted or reproduced by facsimile thereon. If any officer whose signature appears on any Bond ceases to be such offi cer before deli very of the Bonds to the purchaser, such signature shall nevertheless be as effective as if the officer had remained in office until the delivery of the Bonds to the purchaser. Any Bond may be signed and attested on behalf of the City by such persons as at the actual date of the execution of such Bond shall be the proper officers of the City although at the nominal date of such Bond any such person shall not have been such officer of the City. Only such Bonds as shall bear thereon a certificate of authentication and registration in the form set forth in Exhibit A attached hereto, executed and dated by the Paying Agent, shall be valid or obligatory for any purpose or entitled to the benefits of this Resolution, and such certificate of the Paying Agent shall be conclusive evidence that the Bonds so registered have been duly authenticated, registered and delivered hereunder and are entitled to the benefits of this Resolution. Section 2.06. Transfer of Bonds. Any Bond may, in accordance with its terms, be transferred, upon the books required to be kept pursuant to the provisions of Section 2.08 hereof, by the person in whose name it is registered, in person or by his duly authorized attorney, upon surrender of such Bond for cancellation, accompanied by delivery of a written instrument of transfer in a form approved by the Paying Agent , duly executed. The City may charge a reasonable sum for each new Bond issued upon any transfer and the Paying Agent shall require the payment by the Owner requesting such transfer of any tax or other governmental charge requ i red to be paid with respect to such transfer. Whenever any Bond or Bonds shall be surrendered for transfer, the City shall execute and the Paying Agent shall authenticate and deliver a new Bond or Bonds, for like aggregate principal amount. No transfers of Bonds shall be requ i red to be made (i) fi fteen days prior to the date established by the Paying Agent for selection of Bonds for redemption or (ii) with respect to a Bond after such Bond has been selected for redemption. Section 2.07. Exchange of Bonds. Bonds may be exchanged at the office of the Paying Agent in Los Angeles, California for a like aggregate principal amount of Bonds of authorized denominations and of the same maturity. The City may charge a reasonable sum for each new Bond issued upon any exchange (except in the case of any exchange of temporary Bonds for definitive Bonds) and the Paying Agent shall require the payment by the Owner requesting such exchange -10- of any tax or other governmental charge required to be paid with respect to such exchange. No exchanges of Bonds shall be required to be made (i) fifteen days prior to the date established by the Paying Agent for selection of Bonds for redemption or (ii) with respect to a Bond after such Bond has been selected for redemption. Section 2.08. Bond Register. The Paying Agent will keep or cause to be kept, at its principal corporate trust office in Los Angeles, California sufficient books for the registration and transfer of the Bonds, which shall at all times be open to inspection by the City upon reasonable notice; and, upon presentation for such purpose, the Paying Agent shall, under such reasonable regulations as it may prescribe, register or transfer or cause to be registered or transferred, on said books, Bonds as hereinbefore provided. Section 2.09. Temporary Bonds. The Bonds may be initially issued 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 City, and may contain such reference to any of the provisions of this Resolution as may be appropriate. Every temporary Bond shall be executed by the City upon the same conditions and in substantially the same manner as the definitive Bonds. If the City issues temporary Bonds it will execute and furnish definitive Bonds without delay, and thereupon the temporary Bonds may be surrendered, for cance 11 at i on, in exchange therefor at the principal corporate trust office of the Paying Agent in Los Angeles, California and the Paying Agent shall deliver in exchange for such temporary Bonds an equal aggregate principal amount of definitive Bonds of authorized denominations. Until so exchanged, the temporary Bonds shall be entitled to the same benefits pursuant to this Resolution as definitive Bonds executed and delivered hereunder. Section 2.10. Bonds Mutilated, Lost, Destroyed or Stolen. If any Bond shall become mutilated the City, at the expense of the Owner of said Bond, shall execute, and the Paying Agent shall thereupon authenticate and deliver, a new Bond of like tenor and number in exchange and substitution for the Bond so mutilated, but only upon surrender to the Paying Agent of the Bond so mut i 1 ated. Every mut il ated Bond so surrendered to the Payi ng Agent sha 11 be cancelled by it and delivered to, or upon the order of, the City. If any Bond shall be lost, destroyed or stolen, evidence of such loss, destruction or theft may be submitted to the City and, if such evidence be satisfactory to the City and indemnity satisfactory to it shall be given, the City, at the expense of the Owner, shall execute, and the Payi ng Agent shall thereupon authenticate and deliver, a new Bond of like tenor and number in lieu of and in substitution for the Bond so lost, destroyed or stolen. The City may require payment of a sum not exceeding the actual cost of preparing each new Bond issued under this Section and of the expenses which may be incurred by the City and the Paying Agent in the premises. Any Bond issued under the provisions of this Section 2.10 in lieu of any Bond alleged to be lost, destroyed or stolen shall constitute an original additional contractual obligation on the part of the City whether or not the Bond so alleged to be lost, destroyed or stolen be at any time enforceable by anyone, and shall be equally and proportionately entitled to the benefits of this Resolution with all other Bonds issued pursuant to this Resolution. -11- ARTICLE I I I ISSUE OF BONDS; SECURITY FOR THE BONDS Section 3.01. Issuance and Delivery of Bonds. At any time after the execution of this Resolution the City may issue and deliver Bonds in the aggregate principal amount of ten million dollars ($10,000,000). The Paying Agent is hereby authorized to deliver the Bonds, upon receipt of the purchase price therefor, to the successful bidder thereof (the "Purchaserll). Section 3.02. Application of Proceeds of Sale of Bonds. Upon the receipt of payment for the Bonds, the proceeds thereof shall be paid to the City Treasurer, who shall forthwi th set as i de, pay over and depos it such proceeds as follows: (a) Deposit in the Proceeds Account, $10,000,000, plus any amount received representing a premium from the Purchaser, to be used to pay Project Costs; and (b) Depos i tin the Debt Serv ice Account, $ accrued interest paid by the Purchaser. . equa 1 i ng the Section 3.03. Validity of Bonds. The validity of the authorization and issuance of the Bonds shall not be dependent upon the comp 1 et i on of the Project or upon the performance by any person of his obligation with respect to the Project. Section 3.04. Security for the Bonds. The Bonds are general ob 1 i gat ions of the City and the City has the power, is ob 1 i gated and hereby covenants to levy ad valorem taxes upon all property within the City subject to taxation by the City, without limitation of rate or amount, for the payment of the Bonds and the interest thereon. -12- ARTICLE IV FUNDS AND ACCOUNTS Section 4.01. Proceeds Account. There is hereby created, as a subaccount within the General Fund of the City, the IIGeneral Obligation Bonds, Series 1986 A, Bond Proceeds Accountll (the "Proceeds Account"), which shall be maintained by the City Treasurer as a separate account, distinct from all other funds of the City, into which shall be paid on receipt thereof, the portion of the Bond proceeds designated in Section 3.02(a) of this Resolution. The Proceeds Account shall be administered and disbursements made in the manner and in the order progressively set forth in Section 4.02 hereof. Section 4.02. Administration and Disbursements From Proceeds Account. (a) Amounts in the Proceeds Account shall be disbursed for Project Costs. Di sbursements from the Proceeds Account shall be made by the City Treasurer upon receipt of a certifi cate requesting di sbursement executed or approved by a City Representative. SUbject to subsections (b) and (c) hereof, each such certificate shall: (i) set forth the amounts to be disbursed for payment or reimbursement of previous payments of Project Costs and the person or persons to whom said amounts are to be disbursed; (ii) state that the amounts to be disbursed constitute Project Costs, that said amounts are required to be disbursed pursuant to a contract entered into therefor by or on behalf of the City, or were necessarily and reasonably incurred and that said amounts are not being paid in advance of the time, if any, fixed for payment; (iii) state that no amount set forth in the certificate was included in any certificate requesting disbursement previously filed with the City Treasurer pursuant to this Section 4.02; and (iv) state that the amount remaining in the Proceeds Account, together with interest earnings thereon or deposited therein, will, after payment of the amount set forth in the certificate requesting disbursement, be sufficient to pay all remaining Project Costs as then estimated. (b) Each certificate requesting disbursement which is submitted pursuant to subsection (a) and which relates to disbursement for a construction portion of the Project shall be accompanied by the certificate of an architect or engineer employed by the City approving the certificate requesting disbursement and certifying that (i) insofar as such certificate relates to payment for work, materials, equipment or supplies, such work was actually performed, or such materials, equipment or supplies were actually installed in furtherance of the construction of the Project or delivered to the appropriate site for such purpose, or delivered or storage or fabrication at a place approved by the City, and (ii) as of the date of said certificate requesting disbursement an identified percentage of the Project has been completed. -13- (c) Each certificate requesting disbursement which is submitted pursuant to subsection (a) and which relates to payment to a Contractor shall be accomplished by a certificate of said Contractor stating that no liens have been imposed on the Project as a result of said construction except liens that have not yet ripened or that would attach by operation of law. Section 4.03. Debt Service Account. There is hereby created, as a subaccount within the General Fund of the City, the "General Obligation Bonds, Series 1986 A, Debt Service Accountll (the IIDebt Service Account"), which shall be maintained by the City Treasurer as a separate account, distinct from all other funds of the City, into which shall be paid on receipt thereof, the portion of the Bond proceeds designated in Section 3.02(b) of this Resolution. The Debt Service Account shall be administered and disbursements made in the manner and in the order progressively set forth in Section 4.04 hereof. Section 4.04. Administration and Disbursements From Debt Service Account. (a) Interest. On or before the day preceding the last day of March and September in each year the Bonds are Outstanding, commencing March 31, 1987, the City Treasurer shall transfer from the General Fund and set aside in the Debt Servi ce Account an amount whi ch, when added to the amount contai ned in the Debt Service Account on that date, if any, will be equal to the aggregate amount of the interest becoming due and payable on the Outstanding Bonds on the next succeeding Interest Payment Date. (b) Pri nci pa 1. On or before the day preced i ng the 1 ast day of September in each year the Bonds are Outstanding, commencing September 30, 1987, the City Treasurer shall transfer from the General Fund and set aside in the Debt Service Account an amount which will be equal to the principal becoming due and payable on the next succeeding October 1. All moneys in the Debt Service Account shall be used and withdrawn by the City Treasurer solely for the purpose of paying the principal of and interest on the Bonds as the same shall become due and payable. On the last day of March and September in each year, the City Treasurer shall transfer to the Paying Agent moneys on deposit in the Debt Service Account for application by the Paying Agent on the next succeeding Interest Payment Date to the payment of principal of and interest on the Bonds. Section 4.05. Redemption Account. There is hereby created, as a subaccount within the General Fund of the City, the "General Obligation Bonds, Series 1986 A, Redemption Account" (the IIRedemption Accountll), which shall be maintained by the City Treasurer as a separate account, distinct from all other funds of the City. The Redemption Account shall be administered and disbursements made in the manner and in the order progressively set forth in Section 4.06 hereof. Section 4.06. Administration and Disbursements From Redemption Account. The Redemption Account shall be maintained by the City Treasurer to pay for the prior redemption of the Bonds. -14- ~""'-'-'''''~-'''''~-''''-~'-'.'''._'-'"._~_'''~"'-- Any funds legally available may, at any time on or after October 1, 1996, at the option of the City, be paid to the City Treasurer for deposit in the Redemption Account and application to the prior redemption of Bonds on October 1, 1996 or any Interest Payment Date thereafter pursuant to Section 2 .03( a) hereof. Section 4.07. Investment of Moneys. Subject to the provisions of Sections 5.07, 5.08 and 5.09 hereof, amounts on deposit in the Proceeds Account, the Debt Service Account and the Redemption Account may be invested in Authorized Investments and earnings on such investments shall be credited to the General Fund of the City. -15- ,....- '_"~-'-'''---<'-_-_'";''.'--'~''''''''''''''''"""''''-~'''~''---'~-'-'*- ARTICLE V OTHER COVENANTS OF THE CITY Section 5.01. Punctual Payment. The City will punctually pay, or cause to be paid, the principal of and interest on the Bonds, in strict conformity with the terms of the Bonds and of this Resolution, and it will faithfully observe and perform all of the conditions, covenants and requirements of this Resolution and of the Bonds. Nothing herein contained shall prevent the City from making advances of its own moneys howsoever derived to any of the uses or purposes permitted by law. Section 5.02. Extension of Time for Payment. In order to prevent any accumulation of claims for interest after maturity, the City will not, directly or indirectly, extend or consent to the extension of the time for the payment of any claim for interest on any of the Bonds and will not, directly or indirectly, approve any such arrangement by purchasing or funding said claims for interest or in any other manner. In case any such claim for interest shall be extended or funded, whether or not with the consent of the City, such claim for interest so extended or funded shall not be entitled, in case of default hereunder, to the benefits of this Resolution, except subject to the prior payment in full of the principal of all of the Bonds then Outstanding and of all claims for interest which shall not have so extended or funded. Section 5.03. Payment of Claims. The City will pay and discharge, or cause to be paid and discharged, any and all lawful claims for labor, materials or supplies which, if unpaid, might become a lien or charge upon the Project and upon other properties owned by the City or upon any funds in the hands of the City, or which might impair the security of the Bonds. Nothing herein contained shall require the City to make any such payment so long as the City in good faith shall contest the validity of said claims. Section 5.04. Books and Accounts; Financial Statement. The City will keep, or cause to be kept, proper books of record and accounts, separate from all other records and accounts of the City in which complete and correct entries shall be made of all transactions relating to the Project. Such books of record and accounts shall at all times during business hours be subject to the inspection of the Paying Agent and the Owners of not less than ten percent (10%) of the principal amount of the Bonds then Outstanding, or their representatives authorized in writing. Section 5.05. Protection of Security and Rights of Bondowners. The City will preserve and protect the security of the Bonds and the rights of the Bondowners, and will warrant and defend their rights against all claims and demands of all persons. From and after the sale and de 1 i very of any of the Bonds by the City, the Bonds shall be incontestable by the City. Sect i on 5.06. Further As surances. The City wi 11 adopt, make, execute and deliver any and all such further resolutions, instruments and assurances as may be reasonab 1 y necessary or proper to carry out the intent i on or to facilitate the performance of this Resolution, and for the better assuring and confirming unto the Owners of the Bonds of the rights and benefits provided in this Resolution. -16- '"......="'~~.._~-_.._,~.-.,""...--., Section 5.07. No Arbitrage. The City shall not take, nor permit nor suffer to be taken by the Paying Agent or otherwise, any action with respect to the Gross Proceeds of the Bonds which if such action had been reasonably expected to have been taken, or had been deliberately and intentionally taken, on the date of the issuance of the Bonds would have caused the Bonds to be "arbitrage bonds" within the meaning of section 103(e) of the Code and Regulations promulgated thereunder. Section 5.08. Investment Limit Above 150 Percent of Annual Debt Service. (a) General Rule. Except as provided in subsection (b) of this Section 5.08, at no time during any Bond Year shall the City permit the aggregate amount of Gross Proceeds of the Bonds invested in Nonpurpose Obligations with a Yield higher than the Yield on the Bonds to exceed 150 percent of the Debt Service on the Bonds for such Bond Year. In addition, the City shall assure that, beginning with the fourth Bond Year, said aggregate amount of Gross Proceeds of the Bonds invested in Nonpurpose Obligations with a Yield higher than the Yield on the Bonds is promptly and appropriately reduced as the principal amount of the Bonds is reduced. In order to comply with the preceding sentence, the City shall assure the reduction of said investment in Nonpurpose Obligations with a Yield higher than the Yield on the Bonds within not to exceed 30 days following the expiration of the third Bond Year and each Bond Year thereafter and within not to exceed 30 days following the payment of any principal on the Bonds (by maturity, redemption, acceleration or otherwise), provided, however, that said reduction may be made by the disposition within the applicable 30-day period of Nonpurpose Obligations with a Yield higher than the Yield on the Bonds which are in excess of 150 percent of Debt Service on the Bonds and that said reduction need not be made if the failure to make said reduction will not violate the 150 percent requirement set forth in the first sentence of this Section 5.08. (b) Exclusions. For the purpose of subsection (a) of this Section 5.08, the aggregate amount of Gross Proceeds invested in Nonpurpose Obligations shall be determined without regard to those Gross Proceeds which are: (i) invested for a period not in excess of three years from the date of issuance of the Bonds, until needed for accrued interest or for the governmental purpose of the Bonds, and which constitute original proceeds or investment proceeds (within the meaning of clauses (i) and (ii) of the definition of Gross Proceeds); (i i) invested for a peri od not in excess of 13 months, from the date of accumulation, in a fund that is used primarily to achieve a proper matching of revenues and Debt Service on the Bonds within each Bond Year and that is depleted at least once a year except for a reasonable carry-over amount not in excess of the greater of one year's earnings on the fund or one-twelfth of annual Debt Service on the Bonds; (iii) invested for a period not in excess of 30 days, from the date of accumulation, in a fund that is reasonably expected to be used to pay Debt Service on the Bonds; -17- '-~""-"'-""-*"'''''~'''''''''''-'''-''"~-~.''''''~-'~'-'' (iv) invested for a period beginning on the date of issue of the Bonds and ending on the first call date (but not more than 10 years after the date of issue) in a fund that is reasonably expected to be used to pay Debt Service on the Bonds and where the City (as certified on the date of issue of the Bonds by an authorized officer of the City) has made a reasonable effort to schedule payment of as much Debt Service on the Bonds as is practicable in each year before the first call date; (v) invested for a period not in excess of one year, from the date of accumulation, in a fund that is reasonably expected to be used to pay Debt Service on the Bonds and which constitute amounts received from investment of amounts deposited in a fund that is reasonably expected to be used to pay Debt Service on the Bonds; (vi) invested for a period not in excess of one year, from the date of accumulation, and constitute amounts received from investment of original proceeds or investment proceeds (within the meaning of clauses (i) and (ii) of the definition of Gross Proceeds); or (vii) invested for a period not in excess of three years, from the date- of receipt, in a revolving fund and constitute receipts from the sa 1 e of real or tang i b 1 e property acqu i red with proceeds of the Bonds and that will be used for the acquisition of additional real or tangible property. (c) Determination of Amount Invested. For the purpose of subsection (a) of this Section 5.08, in determining the aggregate amount of Gross Proceeds of the Bonds invested in Nonpurpose Obligations, each Nonpurpose Obligation in which Gross Proceeds are invested shall be valued as if the Nonpurpose Obligation was acquired for its fair market value on the date of acquisition or, if later, on the date upon which the Investment Property constituting the Nonpurpose Obligation becomes a Nonpurpose Obligation with respect to the Bonds (for example, Investment Property earlier acquired which is later pledged as security for the Bonds). Revaluation following said date is not required unless this Resolution elsewhere requires revaluation in accordance with fair market value on a later date, in which event said revaluation shall apply for the purpose of subsection (a) of this Section 5.08. (d) Determination of Yield of Variable Rate Nonpurpose Obligations. For the purpose of subsection (a) of this Section 5.08, the yield on a Nonpurpose Obligation that consists of variable rate Investment Property shall be determined as of the date the Nonpurpose Obligation is acquired and as of the first day of each Bond Year by assuming that the rate of interest will be the weighted average rate of interest for such Investment Property during the preceding one-year period (or portion thereof in which the Nonpurpose Obligation was outstanding). With respect to a Nonpurpose Obligation purchased on its date of issue, the Yield for the first Bond Year shall be determined by assuming that the rate of interest will be the initial rate of interest for such Nonpurpose Obl igation as determined under the prescribed formula on such date of issue (without regard to any fixed rate initially applicable to such Nonpurpose Obligation). -18- - -""'"._-'-"~-'---"''''-'~''="''--';"''~'''''"'~--_.-'''''-''''.,"- (e) For the purpose of subsection (a) of this Section 5.08, Nonpurpose Obligations subject to such subsection need not be sold or disposed of if such sale or disposition would result in the realization of a loss for federal income tax purpose that exceeds that amount that would be paid to the United States pursuant to Section 5.09 hereof (but for such sale or disposition) at the time of such sale or disposition (not including amounts that have been previously paid to the United States pursuant to Section 5.09) if a payment under Section 5.09 were due at such time; provided, however, that the preceding sentence shall not apply to the extent that other Nonpurpose Obligations acquired with the Gross Proceeds of the Bonds may be sold or disposed of without incurring a loss in excess of the amount that would be paid to the United States pursuant to Section 5.09 (but for such sale or disposition) at the time of such sale or disposition if a payment under Section 5.09 were due at such time; and provided, further, that with respect to any Nonpurpose Obligation that, under the rule described in this subsection need not be sold or disposed of, said rule shall cease to apply thirty (30) days after the last day of the first computation period ending thereafter on which the Nonpurpose Obligation in question can be sold or disposed of without incurring a loss in excess of the amount that would be paid to the United States pursuant to Section 5.09 (but for such sale or disposition) if a payment under Section 5.09 were due at such time. For the purposes of this subsection, Nonpurpose Obligations in which Gross Proceeds of the Bonds are invested which are acquired at different times or with different interest rates or maturi ty peri ods shall be treated as separate issues of Nonpurpose Obligations. Section 5.09. Rebate of Excess Investment Earnings to United States. (a) Creation of Accounts. There is hereby created, to be held by the City Treasurer as separate accounts distinct from all other funds and accounts held by the City Treasurer under this Resolution, the Investment Earnings Account and the Excess Investment Earnings Account. All interest earnings and profits on amounts in all funds and accounts established under this Resolution, other than interest earnings on the Debt Service Fund and any other funds referenced in subsection (c)(5) of this Section 5.09 if such earnings in any Bond Year are less than $100,000, shall, upon receipt by the City Treasurer, be deposited in the Investment Earnings Account. In addition, all interest earnings and profits on Gross Proceeds in funds held by the City shall. upon receipt, be paid to the City Treasurer for deposit in the Investment Earnings Account. Annually, on the last day of each Bond Year or on the preceding business day in the event that such last day is not a business day. the City Treasurer shall transfer from the Investment Earnings Account to the Excess Investment Earnings Account for purposes of ultimate rebate to the United States an amount equal to Excess Investment Earnings, all as more particularly described in this Section 5.09. Following the transfer referenced in the preceding sentence, the City Treasurer shall transfer all amounts remaining in the Excess Investment Earnings Account to the Debt Service Account to be used for the payment of Debt Service on the Bonds on the next interest payment date and for such purpose, Debt Servi ce due from the City on such date shall be credited by an amount equal to the amount so transferred. (b) The City shall calculate Excess Investment Earnings in accordance with this subsection (b) and shall assure payment of an amount equal to Excess -19- - --''''''''"''1-'' _..~..."".. ~,-" '_"""""""""_"",.._..",_"__._",.~_.......",.,_..._-=..". Investment Earnings to the United States in accordance with subsection (c). The term IIExcess Investment Earningsll means an amount equal to the sum of: (i) the excess of (A) the aggregate amount earned from the date of del ivery of the Bonds on all Nonpurpose Obligations in which Gross Proceeds of the Bonds are invested (other than amounts attributable to an excess described in this paragraph (i)), over (8) the amount that would have been earned if the yield on such Nonpurpose Obligations (other than amounts attributable to an excess descri bed in th is paragraph (i)) had been equa 1 to the yield on the Bonds, plus (ii) any income attributable to the excess described in paragraph (i). (c) Prior to the last day of the first Bond Year, the City shall calculate the Excess Investment Earnings referenced in paragraph (i) of -subsection (a). Thereafter, prior to the last day of each Bond Year and on the date of the retirement of the Bonds, the City shall calculate the amount of Excess Investment Earnings referenced in paragraphs (i) and (ii) of subsection (a). Said calculations shall be made or cause to be made by the City in accordance with the following: (i) Except as provided in (2), in determining the amount described in paragraph (i) (A) of subsection (a), the aggregate amount earned on Nonpurpose Obligations shall include (i) all income realized under federal income tax accounting principles (whether or not the person earning such income is sUbject to federal income tax) with respect to such Nonpurpose Obligations and with respect to the reinvestment of investment receipts from such Nonpurpose Obligations (without regard to the transaction costs incurred in acquiring, carrying, selling or redeeming such Nonpurpose Obligations), including, but not limited to, gain or loss realized on the disposition of such Nonpurpose Obligations (without regard to when such gains are taken into account under Section 453 of the Code re 1 at i ng to taxable year of inclusion of gross income), and income under Section 1272 of the Code (relating to original issue discount) and (ii) any unrealized gain or 1 ass as of the date of ret i rement of the Bonds in the event that any Nonpurpose Obligation is retained after such date. (ii) In determining the amount described in paragraph (i) of subsection (a), Investment Property shall be treated as acquired for its fair market value at the time it becomes a Nonpurpose Obligation, so that gain or loss on the disposition of such Investment Property shall be computed with reference to such fair market value as its adjusted basis. (iii) In determining the amount described in paragraph (i)(B) of subsection (b), the yield on the Bonds shall be determined based on the actual yield of the Bonds during the period between the date of the -20- Bonds and the date the computation is made (with adjustments for discount or premium). (iv) In determining the amount described in paragraph (i i) of subsection (b), all income attributable to the excess described in paragraph (i) of subsection (b) must be taken into account, whether or not that income exceeds the yield on the Bonds, and no amount may be treated as "negative arbitragell. (v) In determining the amount described in subsection (b), there shall be excluded any amount earned on any fund or account which is used primarily to achi eve a property matchi ng of revenues and debt servi ce within each Bond Year and which is depleted at least once a year except for a reasonable carry-over amount not in excess of the greater of one year's earnings on such fund or account or one-twelfth of annual Debt Service as well as amounts earned on said earnings if the gross earnings on all such funds and accounts for the Bond Year is less than $100,000. (d) The City shall direct the City Treasurer to pay from the Excess Investment Earnings Account an amount equal to Excess Investment Earnings to the United States in installments with the first payment to be made not later than thirty (30) days after the end of the fifth Bond Year and with subsequent payments to be made not later than five (5) years after the preceding payment was due. The City shall assure than each installment is in an amount equal to at least 90 percent of the Excess Investment Earnings with respect to the Bonds as of the close of the computation period. Not later than thirty (30) days after the retirement of the Bonds, the City shall pay 100 percent of the theretofore unpaid Excess Investment Earnings of the Bonds. The City shall remit such payments to the United States at the address prescribed by the Regulations as the same may be in time to time in effect with such reports and statements as may be prescribed by such Regulations. (e) The City shall assure that Excess Investment Earnings are not paid or disbursed except as required in this Section 5.09. To that end the City shall assure that investment transactions are on an armis length basis. In the event that Nonpurpose Obligations consist of certificates of deposit or investment contracts, investment in such Nonpurpose Obligations shall be made in accordance with the procedures described in applicable Regulations as from time to time in effect. (f) The City shall keep, and retain for a period of six (6) years following the retirement of the Bonds, records of the determinations made pursuant to this Section 5.09. (g) In order to provide for the administration of Section 5.08 hereof and this Section 5.09, the City may provide for the employment of independent attorneys, accountants and consultants compensated on such reasonable basis as the City may deem appropriate. -21- ,,~----.-,-,,~"~-~""-"""'-"----"-~'" ARTICLE VI THE PAYING AGENT Sect ion 6.01. Appo i ntment of Pay i ng Agent. Bank of Ameri ca Na t i ana 1 Trust and Savings Association, at its principal corporate trust office in Los Angeles, California, is hereby appointed Paying Agent for the Bonds. Except during the continuance of an Event of Default, the Paying Agent undertakes to perform such duties, and only such duties, as are specifically set forth in this Resolution, and no implied covenants or obligations shall be read into this Resolution against the Paying Agent. In case an Event of Default has occurred and is continuing, the Paying Agent shall exercise such of the rights and powers vested in it by the Resolution, and use the same degree of care and shall in their exercise, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs. The Paying Agent shall signify its acceptance of the duties and obligations imposed upon it by this Resolution by executing and del ivering to the City a certificate to that effect. The City may remove the Paying Agent initially appointed, and any successor thereto, and may appoint a successor or successors thereto, but any such successor shall be a bank or trust company doing business and having an office in the State of Cal ifornia, having a combined capital (exclusive of borrowed capital) and surplus of at least fifty million dollars ($50,000,000), and sUbject to supervision or examination by federal or state authority. If such bank or trust company publishes a report of condition at least annually, pursuant to law or to the requirements of any supervising or examining authority above referred to, then for the purposes of this Section 6.01 the combined capital and surplus of such bank or trust company shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. The Paying Agent may at any time resign by giving written notice to the City and the Bondowners of such resignation. Upon receiving notice of such resignation, the City shall promptly appoint a successor Paying Agent by an instrument in writing. Any resignation or removal of the Paying Agent and appointment of a successor Paying Agent shall become effective upon acceptance of appointment by the successor Paying Agent. Section 6.02. Paying Agent May Hold Bonds. The Paying Agent may become the owner of any of the Bonds in its own or any other capacity with the same rights it would have if it were not Paying Agent. Section 6.03. Liability of Agents. The recitals of facts, covenants and agreements herein and in the Bonds contained shall be taken as statements, covenants and agreements of the City, and the Paying Agent assumes no responsibility for the correctness of the same, nor makes any representations as to the val idity or sufficiency of this Resolution or of the Bonds, nor shall incur any responsibility in respect thereof, other than as set forth in this Resolution. The Paying Agent shall not be liable in connection with the performance of its duties hereunder, except for its own negligence or willful default. -22- Except during the continuance of an Event of Default, in the absence of bad faith, the Paying Agent may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Paying Agent and conforming to the requirements of this Resolution; but in the case of any such certificates or opinions by which any provision hereof are specifically required to be furnished to the Paying Agent, the Paying Agent shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Resolution. The Paying Agent shall not be liable for any error of judgment made in good faith by a responsible officer unless it shall be proved that the Paying Agent was negligent in ascertaining the pertinent facts. The Paying Agent shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Owners of a majority in principal amount of the Bonds Outstanding relating to the time, method and place of conducting any proceeding for any remedy available to the Paying Agent, or exercising any trust or power conferred Upon the Paying Agent, under this Resolution. No provision of this Resolution shall require the Paying Agent to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. The Paying Agent shall be under no obligation to exercise any of the rights or powers vested in it by this Resolution at the request or direction of any of the Owners pursuant to this Resolution unless such Owners shall have offered to the Paying Agent reasonable security or indemnity against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction. The Paying Agent may execute any of the powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys and the Paying Agent shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder. Section 6.04. Notice to Agents. The Paying Agent may rely and shall be protected in acting or refraining from acting upon any notice, resolution, request, consent, order, certificate, report, warrant, bond or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or proper parties. The Paying Agent may consult with counsel, who may be of counsel to the City, with regard to legal questions, and the opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered by it hereunder in good faith and in accordance therewith. Whenever in the administration of its duties under this Resolution the Paying Agent shall deem it necessary or desirable that a matter be proved or establ ished prior to taking or suffering any action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) -23- :~"""""":""'~~-'~-""~'------'.~---=''-' may, in the absence of bad faith on the part of the Paying Agent, be deemed to be conclusively proved and established by a certificate of the City, and such certificate shall be full warrant to the Paying Agent for any action taken or suffered under the provisions of this Resolution upon the faith thereof, but in its discretion the Paying Agent may, in lieu thereof, accept other evidence of such matter or may require such additional evidence as to it may seem reasonable. Section 6.05. Compensation, Indemnification. The City shall pay to the Paying Agent from time to time reasonable compensation for all services rendered under th is Reso 1 ut i on, and also all reasonab 1 e expenses, charges, counsel fees and other disbursements, including those of their attorneys, agents and employees, incurred in and about the performance of their powers and duties under this Resolution. The City further agrees to indemnify and save the Paying Agent harmless against any liabilities which it may incur in the exercise and performance of its powers and duties hereunder which are not due to its negligence or bad faith. -24- ARTICLE VI I EVENTS OF DEFAULT AND REMEDIES OF BONDOWNERS Section 7.01. Events of Default and Acceleration of Maturities. If one or more of the fall owi ng events (lIevents of defau 1 t ") shall happen, that is to say: (a) if def au 1 t sha 11 be made in the due and punctua 1 payment of the principal of or redemption premium, if any, on any Bond when and as the same sha 11 become due and payable, whether at maturity as therei n expressed, by declaration or otherwise; (b) if default shall be made in the due and punctual payment of any installment of interest on any Bond when and as such interest installment shall become due and payable; (c) if default shall be made by the City in the observance of any of the covenants, agreements or conditions on its part in this Resolution or in the Bonds contained, and such default shall have continued for a period of thirty (30) days after written notice; or (d) if the City shall file a petition seeking reorganization or arrangement under the federal bankruptcy laws or any other applicable law of the United States of Ameri ca, or if a court of competent juri sdi ct ion shall approve a petition, seeking reorganization under the federal bankruptcy laws or any other applicable law of the United States of America, or if, under the provisions of any other law for the relief or aid of debtors, any court of competent jurisdiction shall assume custody or control of the City or of the whole or any substantial part of its property; then, and in each and every event of default and upon written request of the Owners of not less than sixty percent (60%) in aggregate principal amount of the Bonds at the time Outstanding, the principal of all of the Bonds then Outstanding, and the interest accrued thereon, shall be declared to be due and payable immediately, and upon any such declaration the same shall become and shall be immediately due and payable, anything in this Resolution or in the Bonds contained to the contrary notwithstanding. Such declaration may be rescinded by the Owners of not less than 60 percent in aggregate principal amount of the Bonds at the time Outstanding provided the City cures such default or defaults, including the deposit with the Paying Agent of a sum sufficient to pay all principal on the respective Bonds matured prior to such declaration and all matured installments of interest (if any) on the Bonds, with interest at the rate of 12% per annum on such overdue i nsta llments of pri ncipa 1 and, to the extent such payment of interest is lawful at that time, on such overdue installments of interest, so that the City is currently in compliance with all payment, deposit and transfer provisions of this Resolution, and a sum sufficient to pay any expenses incurred by the Paying Agent in connection with such default. Section 7.02. Application of Funds Upon Acceleration. All of the sums in the funds and accounts provided for in Sections 4.02 and 4.04 hereof, upon the date of the declaration of acceleration as provided in Section 7.01 -25- --.-----._.__...._.,_..~"~;_h..,....,.__.". _.____, hereof, and all sums thereafter received by the Paying Agent hereunder, shall be applied by the Paying Agent in the following order upon presentation of the Bonds, and the stamping thereon of the payment if only partially paid, or upon the surrender thereof if fully paid: First, to the payment of the costs and expenses of the Paying Agent and of the Bondowners in declaring such event of default, including reasonable compensation to her or their agents, attorneys and counsel; Second, in case the principal of the Bonds shall not have become due and payable, to the payment of the interest in default in the order of the maturity of the installments of such interest, with interest on the overdue installments at the rate of twelve percent (12%) per annum (to the extent that such interest on overdue installments shall have been collected), such payments to be made ratably to the persons entitled thereto without discrimination or preference; Third, in case the principal of the Bonds shall have become and shall be then due and payable, all such sums shall be app 1 i ed to the payment of the whole amount then owing and unpaid upon the Bonds for principal and interest, with interest on the overdue principal and installments of interest at the rate of twelve percent (12%) per annum (to the extent that such interest on overdue installments of interest shall have been collected), and in case such moneys shall be insufficient to pay in full the whole amount so owing and unpaid upon the Bonds, then 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 7.03. Other Remedies of Bondowners. Any Bondowner shall have the right, for the equal benefit and protection of all Bondowners similarly situated: (a) by mandamus, suit, action or proceeding, to compel the City and its members, officers, agents or employees to perform each and every term, provision and covenant contained in this Resolution and in the Bonds, and to requ i re the carryi ng out of any or all such covenants and agreements of the City and the fulfillment of all duties imposed upon it; (b) by suit, action or proceeding in equity, to enjoin any acts or things which are unlawful, or the violation of any of the Bondowners' fights; or (c) upon the happening of any event of default (as defined in Section 7.01 hereof), by suit, action or proceeding in any court of competent jurisdiction, to require the City and its members and employees to account as if it and they were the trustees of an express trust. Section 7.04. Non-Waiver. Nothing in this Article VI or in any other provision of this Resolution, or in the Bonds, shall affect or impair the obligation of the City, which is absolute and unconditional, to pay the principal of and interest on the Bonds to the respective Owners of the Bonds at the respective dates of maturity, as herein provided, or affect or impair the right of action, which is also absolute and unconditional, of such Owners -26- to institute suit to enforce such payment by virtue of the contract embodied in the Bonds. A waiver of any default by any Bondowner shall not affect any subsequent default or impair any rights or remedies on the subsequent default. No delay or omission of any Owner of any of the Bonds to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver of any such default or an acquiescence therein, and every power and remedy conferred upon the Bondowners by this Article VI may be enforced and exercised from time to time and as often as shall be deemed expedient by the Owners of the Bonds. If a suit, action or proceeding to enforce any right or exercise any remedy be abandoned or determi ned adverse ly to the Bondowners, the City and the Bondowners shall be restored to their former positions, rights and remedies as if such suit, action or proceeding had not been brought or taken. Section 7.05. Actions by Paying Agent as Attorney-in-Fact. Any suit, action or proceeding which any Owner of Bonds shall have the right to bring to enforce any right or remedy hereunder may be brought by the Paying Agent for the equal benefit and protection of all Owners of Bonds similarly situated and the Paying Agent is hereby appointed (and the successive respective Owners and Owners of the Bonds issued hereunder shall be conclusively deemed so to have appointed it) the true and lawful attorney-in-fact of the respective Owners of the Bonds for the purpose of bringing any such suit, action or proceeding and to do and perform any and all acts and thi ngs for and on behalf of the respective Owners of the Bonds as a class or classes, as may be necessary or advisable in the opinion of the Paying Agent as such attorney-in-fact. Section 7.06. Remedies Not Exclusive. No remedy herein conferred upon the Paying Agent or Owners of Bonds shall be exclusive of any other remedy and that each and every remedy shall be cumulative and shall be in addition to every other remedy given hereunder or thereafter conferred on the Paying Agent or Bondowners. -27- ~""""",-","",-~"=-"",, -'~---"'_'_"'-~-,.,...._.~---- ARTICLE VI I I SUPPLEMENTAL RESOLUTIONS Section 8.01. Supplemental Resolutions Effective Without Consent of the Owners. (a) A Supplemental Resolution of the City may be adopted at any time prior to the offer and sale of the Bonds for any purpose set forth therein. (b) For anyone or more of the following purposes and at any time or from time to time, a Supplemental Resolution of the City may be adopted, which, without the requirement of consent of the Owners of the Bonds, shall be fully effective in accordance with its terms: (i) To add to the covenants and agreements of the City in this Resolution, other covenants and agreements to be observed by the City which are not contrary to or inconsistent with this Resolution as theretofore in effect; (ii) To add to the limitations and restrictions in this Resolution, other limitations and restrictions to be observed by the City which are not contrary to or inconsistent with this Resolution as theretofore in effect; (iii) To confirm, as further assurance, any pledge under, and the subjection to any lien or pledge created or to be created by, this Resolution, of any moneys, securities or funds, or to establish any additional funds or accounts to be held under this Resolution; or (iv) To cure any ambiguity, supply and omission, or cure or correct any defect or inconsistent provision in this Resolution. Section 8.02. Supplemental Resolutions Effective With Consent to the Owners. Any modification or amendment of this Resolution and of the rights and obligations of the City and of the Owners of the Bonds, in any particular, may be made by a Supp 1 ementa 1 Reso 1 ut i on, with the written consent of the Owners of at least two-thirds in aggregate principal amount of the Bonds Outstanding at the time such consent is given. No such modification or amendment shall permit a change in the terms of maturity of the principal of any Outstanding Bonds or of any interest payable thereon or a reduction in the principal amount thereof or in the rate of interest thereon, or shall reduce the percentage of Bonds the consent of the Owners of which is required to effect any such modification or amendment, or shall change any of the provisions in Section 7.01 hereof relating to Events of Default, or shall reduce the amount of moneys pledged for the repayment of the Bonds without the consent of all the Owners of such Bonds, or shall change or modify any of the rights or obligations of any paying agent without its written assent thereto. -28- ~<,..."..,..-.,"""" '~~~-"--"'"-' ARTICLE IX MISCELLANEOUS Section 9.01. Benefits of Resolution Limited to Parties. Nothing in this Resolution, expressed or implied, is intended to give to any person other than the City, the Paying Agent and the Owners of the Bonds, any right, remedy, claim under or by reason of this Resolution. Any covenants, stipulations, promises or agreements in this Resolution contained by and on behalf of the City shall be for the sole and exclusive benefit of the Owners of the Bonds. Section 9.02. Defeasance. (a) Discharge of Resolution. Bonds may be paid by the City in any of the following ways, provided that the City also pays or causes to be paid any other sums payable hereunder by the City: (i) by paying or causing to be paid the principal or redemption price of and interest on Bonds Outstanding, as and when the same become due and payable; (ii) by depositing, in trust, at or before maturity, money or securities in the necessary amount (as provided in Section 9.02(c) to payor redeem Bonds Outstanding; or (iii) by delivering to the Paying Agent, for cancellation by it, Bonds Outstanding. If the City shall pay all Bonds Outstanding and shall also payor cause to be paid all other sums payab 1 e hereunder by the City, then and in that case, at the election of the City (evidenced by a certificate of a City Representative, filed with the Paying Agent, signifying the intention of the City to discharge all such indebtedness and this Resolution), and notwithstanding that any Bonds shall not have been surrendered for payment, this Resolution and other assets made under this Resolution and all covenants, agreements and other obligations of the City under this Resolution shall cease, terminate, become void and be completely discharged and satisfied, except only as provided in Section 9.02(b). In such event, upon request of the City, the Paying Agent shall cause an accounting for such period or periods as may be requested by the City to be prepared and filed with the City and shall execute and de 1 i ver to the City all such instruments as may be necessary or desirable to evidence such discharge and satisfaction, and the Payi ng Agent shall pay over, transfer, ass i gn or deli ver to the City all moneys or securities or other property held by it pursuant to this Resolution which are not required for the payment or redemption of Bonds not theretofore surrendered for such payment or redemption. (b) Discharge of Liability on Bonds. Upon the deposit. in trust, at or before maturity, of money or securities in the necessary amount (as provided in Section 9.02(c) to payor redeem any Outstanding Bond (whether upon or prior to its maturity or the redemption date of such Bond), provided that, if such Bond is to be redeemed pri or to maturity, not i ce of such redemption shall have been given as in Section 2.03 provided or provision -29- ~"".'r''','''''''''''''-''''~..",..""",-"~,~._,",""_,_,.",_",,~,,,^_ satisfactory to the Paying Agent shall have been made for the glvlng of such notice, then all liability of the City in respect of such Bond shall cease and be completely discharged, except only that thereafter the Owner thereof shall be entitled only to payment of the principal of and interest on such Bond by the City, and the City shall remain liable for such payment, but only out of such money or securities deposited with the Paying Agent as aforesaid for such payment, provided further, however, that the provisions of Section 9.02(d) shall apply in all events. The City may at any time surrender to the Paying Agent for cancellation by it any Bonds previously issued and delivered, which the City may have acqu ired in any manner whatsoever, and such Bonds, upon such surrender and cancellation, shall be deemed to be paid and retired. (c) Deposit of Money or Securities with Paying Agent. Whenever in this Resolution it is provided or permitted that there be deposited with or held in trust by the Paying Agent money or securities in the necessary amount to pay or redeem any Bonds, the money or securi ties so to be depos i ted or he 1 d may include money or securities held by the Paying Agent in the funds and accounts established pursuant to this Resolution and shall be: (i) lawful money of the United States of America in an amount equal to the principal amount of such Bonds and all unpaid interest thereon to maturity, except that, in the case of Bonds which are to be redeemed prior to maturity and in respect of which notice of such redemption shall have been given as in Section 2.03 provided or provision satisfactory to the Paying Agent shall have been made for the giving of such notice, the amount to be deposited or held shall be the principal amount or redemption price of such Bonds and all unpaid interest thereon to the redemption date; or (ii) Federal Securities (not callable by the issuer thereof prior to maturity) the principal of and interest on which when due will provide money sufficient to pay the principal or redemption price of and all unpaid interest to maturity, or to the redemption date, as the case may be, on the Bonds to be paid or redeemed, as such principal or redemption price and interest become due, provided that, in the case of Bonds which are to be redeemed prior to the maturity thereof, notice of such redemption shall have been given as in Section 2.03 provided or provision satisfactory to the Paying Agent shall have been made for the giving of such notice; provided, in each case, that the Paying Agent shall have been irrevocably instructed (by the terms of this Resolution or by request of the City) to apply such money to the payment of such principal or redemption price and interest with respect to such Bonds. (d) Payment of Bonds After Discharge of Resolution. Notwithstanding any provisions of this Resolution, any moneys held by the Paying Agent in trust for the payment of the principal or redemption price of, or interest on, any Bonds and remaining unclaimed for six years after the principal of all of the Bonds has become due and payable (whether at maturi ty or upon call for redemption or by acceleration as provided in this Resolution), if such moneys were so he 1 d at such date, or six years after the date of depos i t of such -30- .....I.;;'-.,.~..,_.............~.._.,--..............,,,.,._.,"..~-,--,'-,-,~_.~.__._"__,,_ moneys if deposited after said date when all of the Bonds became due and payable, shall, upon request of the City, be repaid to the City free from the trusts created by this Resolution, and all liability of the Paying Agent with respect to such moneys shall thereupon cease; provided, however, that before the repayment of such moneys to the City as aforesaid, the Paying Agent may (at the cost of the City) first mail to the Owners of all Bonds which have not been paid at the addresses shown on the registration books maintained by the Paying Agent a notice in such form as may be deemed appropriate by the Paying Agent , with respect to the Bonds so payable and not presented and with respect to the provisions relating to the repayment to the City of the moneys held for the payment thereof. Section 9.03. Execution of Documents and Proof of Ownershi~ by Bondowners. Any request, declaration or other instrument which this Resolution may require or permit to be executed by Bondowners may be in one or more instruments of similar tenor, and shall be executed by Bondowners in person or by their attorneys appointed in writing. Except as otherwise herein expressly provided, the fact and date of the execution by any Bondowner or his attorney of such request, declaration or other instrument, or of such writing apPointing such attorney, may be proved by the certificate of any notary public or other officer authorized to take acknowledgments of deeds to be recorded in the state in which he purports to act, that the person signing such request, declaration or other instrument or writing acknowledged to him the execution thereof, or by an affidavit of a witness of such execution, duly sworn to before such notary public or other officer. Except as otherwise herein expressly provided, the ownership of registered Bonds and the amount, maturity, number and date of holding the same shall be proved by the registry books. Any request, declaration or other instrument or writing of the Owner of any Bond shall bind all future Owners of such Bond in respect of anything done or suffered to be done by the City, the Paying Agent or the City Treasurer in good faith and in accordance therewith. Section 9.04. Waiver of Personal Liability. No member, officer, agent or employee of the City shall be individually or personally liable for the payment of the principal of or interest on the Bonds; but nothing herein contained shall relieve any such member, officer, agent or employee from the performance of any official duly provided by law. Section 9.05. Destruction of Cancelled Bonds. Whenever in this Resolution provision is made for the surrender to the City of any Bonds which have been paid or canceled pursuant to the provisions of this Resolution, a certificate of destruction duly executed by the Paying Agent shall be deemed to be the equivalent of the surrender of such canceled Bonds and the City shall be entitled to rely upon any statement of fact contained in dny certificate with respect to the destruction of any such Bonds therein referred to. Section 9.06. Partial Invalidity. If any Section, paragraph, sentence, clause or phrase of this Resolution shall for any reason be held illegal or -31- unenforceable, such holding shall not affect the validity of the remaining portions of this Resolution. The City hereby declares that it would have adopted this Resolution and each and every other Section, paragraph, sentence, clause or phrase hereof and authorized the issue of the Bonds pursuant thereto irrespective of the fact that anyone or more Sections, paragraphs, sentences, clauses, or phrases of this Resolution may be held illegal, invalid or unenforceable. If, by reason of the judgment of any court, the City is rendered unable to perform its duties hereunder, all such duties and all of the rights and powers of the City hereunder shall be assumed by and vest in the City Treasurer in trust for the benefit of the Bondowners. Section 9.07. Effective Date of Resolution. This Resolution shall take effect from and after the date of its passage and adoption. * * * * * * * * THE FOREGOING RESOLUTION is approved and adopted by the City Council of the City of Anaheim this 30th day of September, 1986. 4~ M OR OF T E CITY OF ANAHEI ~ ATTESi: /, ~eL 7t 9-Z CITY CLEKK OF THE ClrV OF ANAHEIM -32- -,........"'-".."-,,-,'",._,---_.-......--,,..,-^ 11009-20 JHHW:BDQ:rms 08/18/86 09/02/86 09/18/86 Z2256 EXHIBIT A FORM OF BOND UNITED STATES OF AMERICA STATE OF CALIFORNIA COUNTY OF ORANGE CITY OF ANAHEIM GENERAL OBLIGATION BOND, SERIES 1986 A INTEREST RATE: MATURITY DATE: ISSUE DATE: October 1, 1986 CUSIP: REGISTERED OWNER: PRINCIPAL SUM: The CITY OF ANAHEIM, a municipal corporation and charter city, duly organized and existing under and by virtue of the laws of the State of California (the "City"), for value received hereby promises to pay to the Registered Owner stated above, or registered assigns (the 1I0wner"), on the Maturity Date stated above (subject to any right of prior redemption hereinafter provided for), the Principal Sum stated above, in lawful money of the United States of America, and to pay interest thereon in like lawful money from the interest payment date next preced i ng the date of execution of th i s Bond (unless (i) this Bond is executed on an interest payment date, in which event it shall bear interest from such date of execution, or (ii) this Bond is executed prior to an interest payment date and after the close of business on the fifteenth day of the month preceding such interest payment date, in which event it shall bear interest from such interest payment date, or (iii) this Bond is executed pri or to April 16, 1987, in wh i ch event it shall bear interest from the Issue Date stated above; provided however, that if at the time of execution of this Bond, interest is in default on this Bond, this Bond shall bear interest from the interest payment date to which interest has previously been paid or made available for payment on this Bond) until payment of such Principal Sum in full, at the rate per annum stated above, payable on April 1 and October 1 in each year, commenc i ng April 1, 1987, ca 1 cu 1 ated on the basis of 360-day year composed of twelve 30-day months. Principal hereof and premium, if any, upon early redemption hereof are payable at the principal corporate trust office of Bank of America National Trust and Savings Association (the "Paying Agentll), in Los Angeles, California. Interest hereon Exhibit A Page 1 ~"'-'___'''''-'N._''~"_,,,~ c__,","'"",,____.,.",._,_ (including the final interest payment upon maturity or earlier redemption) is payable by check or draft of the Paying Agent mai led to the Owner at the Owner's address as it appears on the registration books maintained by the Paying Agent at the close of business on the fifteenth day of the month next preceding such interest payment date, or at such other address as the Owner may have filed with the Paying Agent for that purpose. REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS BOND SET FORTH ON THE REVERSE HEREOF WHICH FURTHER PROVISIONS OF THIS BOND SHALL, FOR ALL PURPOSES, HAVE THE SAME EFFECT AS IF SET FORTH IN THIS PLACE. It is hereby certified that all of the things, conditions and acts required to exist, to have happened or to have been performed precedent to and in the issuance of this Bond do exist, have happened or have been performed in due and regular time and manner as required by the Charter, the Municipal Code and the laws of the State of Cal ifornia, and that the amount of this Bond, together with all other indebtedness of the City, does not exceed any limit prescribed by any laws of the State of California, and is not in excess of the amount of Bonds permitted to be issued under the Resolution. This Bond shall not be entitled to any benefit under the Resolution or become valid or obligatory for any purpose until the Certificate of Authentication hereon shall have been signed by the Paying Agent. IN WITNESS WHEREOF, the City of Anaheim has caused this Bond to be executed in its name and on its behalf with the facsimi le signatures of its Mayor and its City Clerk and its seal to be reproduced hereon, all as of the Issue Date stated above. CITY OF ANAHEIM By Mayor (S E A L) ATTEST: City Clerk Exhi bit A Page 2 [FORM OF PAYING AGENT'S CERTIFICATE OF AUTHENTICATION] AUTHENTICATION DATE: CERTIFICATE OF AUTHENTICATION This is one of the Bonds described in the within-mentioned Resolution. BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, as Trustee Authorized Signatory (FORM OF BACK OF BOND) This Bond is one of a duly authorized issue of Bonds of the City designated as "City of Anaheim General Obligation Bonds, Series 1986 A" (the "Bonds"), of an aggregate principal amount of ten million dollars ($10,000,000), all of like tenor and date (except for such variation, if any, as may be required to designate varying numbers, maturities, interest rates, or redemption and other provisions) and all issued pursuant to the provisions of the City Charter of the City (the "Charter"), the Anaheim Municipal Code, in particular, Section 1.23 of Title I thereof (the IIMunicipal Cade") and pursuant to Resolution 86R-_ of the City adopted September 30, 1986 (the "Resolutionll), authorizing the issuance of the Bonds. Reference is hereby made to the Resolution, the Charter and the Municipal Code (copies of which are on file at the office of the City) and to the Charter for a description of the terms on which the Bonds are issued and the rights thereunder of the registered owners of the Bonds and the rights, duties and immunities of the City Treasurer and the rights and obligations of the City thereunder, to all of the provisions of which Resolution the Owner of this Bond, by acceptance hereof, assents and agrees. The Bonds have been issued by the City to finance certain storm drain improvements for the City. The issuance of the Bonds was authorized by a vote of two-thirds of the qualified voters of the City voting at a special municipal election held on November 4, 1980. This Bond and the interest hereon and on all other Bonds and the interest thereon (to the extent set forth ; n the Reso 1 ut; on) are general obligations of the City and the City has the power and is obligated to levy ad valorem taxes for the payment of the Bonds and the interest thereon upon all property within the City subject to taxation by the City. Bonds maturing on or before October 1, 1996, are not sUbject to optional redemption before their stated maturity. Bonds maturing on or after October 1, 1997, are subject, at the option of the City, to call for redemption prior to their stated maturities in whole at any time and in part on any interest payment date commencing October 1, 1996, in inverse order of maturity and by lot within anyone maturity, equal to the principal amount thereof, at the Exhi bit A Page 3 ~"""'''''~''''''''''''-;~"__'''''''_''..;.''''''''O.,"'''_'''''_,__,. following prices (expressed as percentages of the principal amount of Bonds called for redemption), for the respective periods set forth below, together with accrued interest to the date fixed for redemption, from any moneys that may be available to the City for such purpose: Redemption Date Redemption (Dates Inclusive) Price October 1, 1996 to September 30, 1997 ........... 102 % October 1, 1997 to September 30, 1998 ........... 101~ October 1, 1998 to September 30, 1999 ........... 101 October 1, 2000 to September 30, 2000 ........... 100~ October 1, 2000 and thereafter .................. 100 As provided in the Resolution, notice of redemption shall be given by mail no less than thirty (30) nor more than sixty (60) days prior to the redempt i on date to the respect i ve reg i stered owners of any Bonds des i gnated for redemption at their addresses appearing on the Bond registration books maintained by the Paying Agent , but neither failure to receive such notice nor any defect in the notice so mailed shall affect the sUfficiency of the proceedings for redemption. If this Bond is called for redemption and payment is duly provided therefor as specified in the Resolution, interest shall cease to accrue hereon from and after the date fixed for redemption. If an event of default, as defined in the Resolution, shall occur, the principal of all Bonds may be declared due and payable upon the conditions, in the manner and with the effect provided in the Resolution, but such declaration and its consequences may be rescinded and annulled as further provided in the Resolution. The Bonds are issuable as fully registered Bonds without coupons in denominations of $5,000 and any integral multiple thereof. Subject to the limitations and conditions and upon payment of the charges, if any, as provided in the Resolution, Bonds may be exchanged for a like aggregate principal amount of Bonds of other authorized denominations and of the same maturity. This Bond is transferable by the Owner hereof, in person or by his attorney duly authorized in writing, at said office of the Paying Agent , but only in the manner and subject to the limitations provided in the Resolution, and upon surrender and cancellation of this Bond. Upon registration of 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 will be issued to the transferee in exchange herefor. The City and the Paying Agent may treat the Owner hereof as the absolute owner hereof for all purposes, and the City and the Paying Agent shall not be affected by any notice to the contrary. Exhibit A Page 4 ~_..o;_'___' ABBREVIATIONS The following abbreviations, when used in the inscription on the face of this Bond, shall be construed as though they were written out in full according to applicable laws or regulations: TEN COM TEN ENT JT TEN as tenants in common as tenants by the entireties as joint tenants with right of survivorship and not as tenants in common UNIF GIFT MIN ACT Custodian (Cust) (Minor) under Uniform Gifts to Minors Act (State) ADDITIONAL ABBREVIATIONS MAY ALSO BE USED THOUGH NOT IN THE LIST ABOVE Exhibit A Page 5 '-" '~-'-"""-'-"""--'-'-' -",._,-~ -_._"-_."--.,_.__._..._._,.....,...._.~--_.- (FORM OF ASSIGNMENT) For value received the undersigned hereby sells, assigns and transfers unto Name, Address and Tax Identification or Social Security Number of Assignee the within-registered Bond and hereby irrevocably constitute(s) and appoints(s) attorney, to transfer the same on the bond reg i ster of the City Treasurer with fu 11 power of substitution in the premises. Dated: 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. Signature Guaranteed: Note: Signature(s) must be guaranteed member firm of the New York Exchange or a commerci a 1 bank or company. by a Stock trust Exhi bit A Page 6 ~',. ~_. ,-,,--,,~~, ""<"..,..,,~. ~""'-- CLERK STATE OF CALIFORNIA ) COUNTY OF ORANGE ) SSe CITY OF ANAHEIM ) I, LEONORA N. SOHL, City Clerk of the City of Anaheim, do hereby certify that the foregoing Resolution No. 86R-434 was introduced and adopted at a regular meeting provided by law, of the City Council of the City of Anaheim held on the 30th day of September, 1986, by the following vote of the members thereof: AYES: COUNCIL MEMBERS: Kaywood, Overholt, Bay, Pickler and Roth NOES: COUNCIL MEMBERS: None ABSENT: COUNCIL MEMBERS: None AND I FURTHER certify that the Mayor of the City of Anaheim signed said Resolution No. 86R-434 on the 30th day of September, 1986. IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the City of Anaheim this 30th day of September, 1986. ~/(~ CITY CLERK OF THE CITY OF ANAHEIM (SEAL) I LEONORA N. SOHL, City Clerk of the City of Anaheim, do hereby certify that the foregoing is the original of Resolution No. 86R-434 duly passed and adopted by the Anaheim City Council on September 30, 1986. ,/'" ~~ 7r ~ CITY CLE..1U<. ""--, '"...._."........""'~___e....__.""'~"..~_,.___".._