96-155 CITY OF ANAHEIM RESOLUTION NO. 96R-155
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
ANAHEIM, CALIFORNIA, AMENDING RESOLUTION NO.
72R-83 OF THIS COUNCIL, AUTHORIZING THE
SOLICITATION OF THE CONSENT OF THE HOLDERS OF
THE OUTSTANDING ELECTRIC REVENUE BONDS OF THE
CITY AND AUTHORIZING CERTAIN OTHER ACTIONS
WHEREAS, concurrently with consideration of this resolution, this City Council has
adopted an authorizing resolution (the "Bond Resolution") to provide for the refunding of the
City's Electric Revenue Bonds, Issue of 1986 and Second Issue of 1986 and for the issuance of
its Electric Revenue Bonds for such purpose, in an amount not to exceed $100,000,000 in
aggregate principal amount (the "Bonds"); and
WHEREAS, the Bonds shall be issued on a parity with all other Electric Revenue Bonds
outstanding, other than the bonds to be refunded with the proceeds of the bonds as provided by
the Bond Resolution (all of such parity bonds being referred to herein as the "Outstanding
Bonds");
WHEREAS, this City Council deems it necessary and proper that certain provisions of
Resolution No. 72R-83 adopted by this City Council on March 14, 1972 be amended to permit
the Reserve Fund established by said Resolution to be funded by one or more reserve fund surety
policies or policies of municipal bond insurance or letters of credit relating thereto under the
terms and conditions provided herein; and
WHEREAS, this City Council also desires to authorize the solicitation of consent of the
holders of the Outstanding Bonds to the amendments hereby proposed;
NOW, THEREFORE, the City Council of the City of Anaheim, Callfomia, DOES
HEREBY RESOLVE, DETERMINE AND ORDER as follows:
Section 1. Recitals Incorporated by Reference. The recitals hereof are true and
correct and are incorporated herein by reference for all purposes of this Resolution.
Section 2. Amendment of Resolution No. 72R-83. Section 16 of Resolution No.
72R-83 is hereby amended to add to the end of said section the following:
The amount on deposit in the Reserve Fund shall be maintained at the Reserve
Requirement at all times. The term "Reserve Requirement" means maximum annual debt service
on all outstanding bonds and parity bonds. IF lieu of the deposit of cash into the Reserve Fund to
satisfy the Reserve Requirement, there may be deposited in said Reserve Fund at any time and
from time to time, in order to satisfy the Reserve Requirement with respect to all or a portion of
the outstanding bonds and parity bonds, one or more Reserve Fund Surety Policies meeting the
requirements of this Resolution. A Reserve Fund Surety Policy may be deposited in substitution
for cash or investments held or to be deposited in the Reserve Fund, in substitution for any
Reserve Fund Surety Policy theretofor deposited in the Reserve Fund or in substitution for any
combination of cash, investments 'and Reserve Fund Surety Policies.
"Reserve Fund Surety Policy" means any of the following:
(a) a surety bond or an insurance policy issued to the City or any paying agent
for the City by a company licensed to issue an insurance policy (a "Municipal Bond
Insurer"), guaranteeing the full and complete payments to be made by the City from the
Reserve Fund that are to be applied to the payment of debt service required to be made by
or on behalf of the City on outstanding bonds and parity bonds, as such payments are due,
provided that the amount available for payment pursuant to any one demand for payment
shall not exceed the limit set forth in the Reserve Fund Surety Policy, if the claims paying
ability of the issuer thereof shall be rated "AAA" by Standard & Poor's and "Aaa" by
Moody's Investors Service, respectively; or
(b) a surety bond or an insurance policy issued to the City or any paying agent
for the City by an entity other than a Municipal Bond Insurer, rated at least "AAA" by
Standard & Poor's and "Aaa" by Moody's Investors Service, respectively if the form and
substance of such instrument and the issuer thereof are such that the instrument has a
revolving feature under which the amount available thereunder will be reinstated to the
extent of any reimbursement of draws or claims paid; or
(c) a Qualified Credit Instrument.
"Qualified Credit Instrument" means an unconditional and irrevocable letter of
credit issued in favor of the City or any paying agent for the City by a financial institution
rated at least "AA" by Standard & Poor's and "Aa" by Moody's Investors Service to
satisfy the Reserve Requirement applicable to an outstanding issue or series of bonds or
parity bonds. A Qualified Credit Instrument that is for a term shorter than the final
maturity of the outstanding bonds and parity bonds shall provide that a draw in the full
stated amount of the Qualified Credit Instrument shall be made not later than 10 days
prior to the expiration of the Qualified Credit Instrument, unless prior to said date, the
City shall have supplied in substitution therefor another Reserve Fund Surety Policy or
shall have deposited cash or investments in the Reserve Fund, or a combination of cash,
investments and one or more Reserve Fund Surety Policies, in an amount sufficient to
cause the amount in the Reserve Fund to be at least equal to the Reserve Requirement.
In the event that the Reserve Fund contains one or more Reserve Fund Surety
Policies, the following additional provisions shall apply with respect to transfers from the
Reserve Fund:
(a) a drawing or claim shall be made under one or more Reserve Fund Surety
Policies to the extent that amounts held in the Bond Service Account for payment of
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principal and interest on any Interest Payment Date on any bonds or parity bonds shall be
insufficient therefor, if and to the extent such Reserve Fund Surety Policy has been
deposited by the City or any paying agent for the City to satisfy the Reserve Requirement
with respect to any bonds or parity bonds.
(b) Each such Reserve Fund Surety Policy shall provide that the City or any
paying agent for the City shall be entitled to draw amounts thereunder when required by
the provisions of the resolutions providing for the issuance of bonds or parity bonds to
make transfers from the Reserve Fund to the Bond Service Account in the event of a
deficiency in the Bond Service Account.
(c) Upon deposit by the City of any Reserve Fund Surety Policy in the
Reserve Fund, the City may withdraw from the Reserve Fund and transfer to the Electric
Revenue Fund an amount equal to the face value of such Reserve Fund Surety Policy, so
long as the balance in the Reserve Fund is not less than the Reserve Requirement.
(d) Demands for payment on any applicable Reserve Fund Surety Policy for
any amounts required to be drawn hereunder shall be made in the manner and as provided
in such Reserve Fund Surety Policy. All amounts received therefrom shall be deposited
into the Reserve Fund and transferred to the Bond Service Account in accordance with
the resolutions providing for the issuance of the outstanding bonds and parity bonds.
Prior to replenishing the Reserve Fund so as to restore the balance therein to the Reserve
Requirement, the City shall reimburse any provider of the Reserve Fund Surety Policy for
amounts owed to such provider relating to a draw under such Reserve Fund Surety
Policy; provided, however, that if at any time them shall be held in the Reserve Fund both
cash and one or more Reserve Fund Surety Policies, any amounts to be used for
restoration of the balance of the Reserve Fund to the Reserve Requirement and for
reimbursement of any providers of Reserve Fund Surety Policies shall be applied by the
City prorata in accordance with the initial transfer of cash and draws on said Reserve
Fund Surety Policies.
(e) The City shall maintain adequate records verified with the provider of any
Reserve Fund Surety Policy as to the amount available to be drawn at any given time
under any Reserve Fund Surety Policy and as to amounts paid and owing to any such
provider under the terms of any financial guaranty agreement relating thereto.
(f) On the date of issuance and delivery of any bonds or parity bonds issued by the
City after October 1, 1996, and concurrently with the delivery of each Reserve Fund
Surety Policy for deposit into the Reserve Fund after October 1, 1996, the City shall
certify in writing to the paying agents for the outstanding bonds and parity bonds that the
balance in the Reserve Fund as of the date of issuance or the date of such deposit, as
applicable, including cash and investments held therein and the face amount of each
Reserve Fund Surety Policy so deposited, together with the face amount of any Reserve
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Fund Surety Policy previously deposited in the Reserve Fund with respect to outstanding
bonds or parity bonds, is at least equal to the Reserve Requirement.
Section 3. Solicitation of Consent of Bondholders. The Authorized
Representatives of the City are hereby authorized to take such actions as may be necessary to
secure the consent of the holders of the outstanding Bonds to the amendments proposed to be
made in Section 2 hereof, including inclusion of a requirement in the notice inviting bids for the
purchase of the Bonds requiring any purchaser to execute a consent to said amendment as a
condition to the purchase and sale of the Bonds to said purchaser. Such consent (whether one or
more) shall be in writing and each consent shall be signed by a duly authorized representative of
the holder or holders of the Outstanding Bonds for which consent is being given. In order to be
effective for the purposes of this resolution, any consent of a holder of Outstanding Bonds must
be given prior to, and must be effective until, November I, 1996. Such consent shall be
irrevocable upon delivery by the City of the written certificate referred to herein. If the consent
of the holders of the Outstanding Bonds is not received on or before November 1, 1996, the
amendment proposed to be made by this resolution shall be null, void and of no effect; provided,
however, that nothing hereinstated shall prevent the City from thereafter requesting any consent
of the Bondholders to the amendments proposed herein or to any other amendment or
proposition, so long as the requirements set forth in the relevant proceedings of this City Council
and the documents and proceedings relating to the Outstanding Bonds are complied with in
connection therewith. An Authorized Representative of the City shall provide a written
certificate to the City Clerk of the receipt of the consent of the holders of the Outstanding Bonds
in the amount required for the amendments proposed by this resolution to be effective and the
City Clerk shall cause such consent to be included in the official proceedings of this Council.
Section 4. Further Authorizations. The Authorized Representatives are further
authorized to take all additional actions necessary to give effect to this resolution, including the
execution of such documents, certificates and agreements as may be necessary or convenient for
such purpose.
Section 5. Effective Date. This Resolution shall take effect from and after its date of
adoption.
ADOPTED, SIGNED AND APPROVED this 10 day of September, 1996.
[SEAL]
CITY CLERK
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STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss.
CITY OF ANAHEIM )
I, LEONORA N. SOHL, City Clerk of the City of Anaheim, do hereby certify that the foregoing
Resolution No. 96R-155 was introduced and adopted at a regular meeting provided by law, of
the Anaheim City Council held on the 10th day of September, 1996, by the following vote of
the members thereof:
AYES: MAYOR/COUNCIL MEMBERS: Tait, Zemel, Feldhaus, Lopez, Daly
NOES: MAYOR/COUNCIL MEMBERS: None
ABSENT: MAYOR/COUNCIL MEMBERS: None
AND I FURTHER CERTIFY that the Mayor of the City of Anaheim signed said Resolution
No. 96R-155 on the 10th day of September, 1996.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City
of Anaheim this 10th day of September, 1996.
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 odginal of Resolution No. 96R-155 was duly passed and adopted by the City Council of
the City of Anaheim on September 10th, 1996.
CITY CLERK OF THE CITY OF ANAHEIM