Loading...
HomeMy WebLinkAboutResolution 9518 N.C.S. 08/02/1982.-' i'~ _" ~~_~._ "' w 1• t ~y _ ,~~',f .`S %--~.-~~.~~'. . . . .`~ ! . ~~ RESOLUTION 9 5 .1 ~ NCS RESOLUTION AUTHORIZING THE ISSUANCE OF GRANT ANTICIPATION NOTES OF THE CITY OF PETALUMA, GALIFORNIA Adopted August 2, 1982 ~ 12-1-84 ~ ~Ss, lt~ ~ . . ~ _,;. . ,y~, ,: , .,.~'. . q ~ ~ ;' _. ;, ;~ , ~ ~ ,. . . _; RESOLUTION TABLE OF CON'TEN'TS (This Table of Gontents is for convenience of reference onTy and is not a part of the Resolution.) Page ARTICLE I Definiti'ons and Interpretation Section 101. Definitions . . . . . . . . . . . . . . 1 Section 102. InterPretation. . . . . . . . . . . . . 6 Section 103. Suc:cessors and Assigns. . . . . . . . . . 6 Secti on 104. Reci tal s. . . . . . • • • • • • • • • • ~ Section 105. Resolution to Constitute C.ontract .... 7 Section 106. Part'ies Interested Herein .. ..... 8 Section 107. Sevewability of Invalid Provisions. ... 8 Sect i on 108. Short Ti tl e . . . . . . . • • • • • • • • • $ ARTICLE II Authorization and General Terms of Notes Section 201. Authori'zation .of Notes. . . . Section 202. Particular Terms of the Notes Section 203. Security for the Notes. . . . . . . . . . Section 204. Limited Liability of City . . . . . . . . Section 205. General Terms of Notes. . . . . . . . . . Section 206. Execution of Notes. . . . . . . . . . . . Section 207. Auth,entication of Notes . . . . ~. . . . Section 208. Conditions Pr.ecedent to Authentication of the Notes . . . .. . . . . . . . . . Section 209. Negotiability and Transfer of Notes ... Section 210. Reissuance of Mutilated, Destroyed, Stol e.n or Lost Notes . . . . . . . . . . Sec.tion 211. Prohibition of Other D:ebt in Antic~pation of, Grant R:eceipts. . . . . . . . . . . Section 212. Covenants with Noteholders. . . . . . . . Section 213. Required Notices to Fiscal Agent. .... Section 214. Notice of Certain Other Actions ..... ~ ~ ) . :;.g,~l~~ ~~1~ ~.. . ~, T ~ ^I '1" I Page ARTICLE III Establishment and Application of Accounts Section 301. Security for Notes and Sources of Payme n t . . . . . . . . . . . . . . . . . Section 302. Establishment of Ac.coant:s . . . . . . . . Section 303. Debt Service Account. . . . . . . . . . . Section 304. Construction Account. . . . . . . . . . . Section 305. Grant Receipts Account. . . . . . . . . . Section 306. Investments . . . . . . . . . . . . . . . ARTICLE IV Events of .Default and Remedies of Holders Section 401. Eve'nts of Default . ., . . . . . . . Section 402. Enforcement by Fiseal Agent ....... Section 403. Enforcement by Noteholders. . . . . . . . Section 404. Right to Enforce Payment of Notes ~ Unimpai red . . . . . . . . . . . . . . . ARTICLE V The Fiduciaries Section 501. Fiscal Agent . . . . . . . . . . . . . . . Section 502. Pay?ng Agents . . . . . . . . . • • • • • Section 503. ResPonsibilities of Fiduciaries ..... Section 504. Evidence on Which Fiduciaries May Act .. Section 505. Compensation and Expenses . . . . . . . . Section 506. Certain Permitted Acts. . . . . . . . . . Section 507. Resignation of Fiduciary. . . . . . . . . Section 508. Removal . . . . . . . . . . . . . . . . ~ Section 509. Successor. . . . . . . . . Appointment of Section 510. Transfer of Rights~and Property to . Successor. . . . . . . . . . . . . Section 511. Merger or Consolidation . . . . . . . . . ARTICLE VI SuppTemental Resolutions and Amendments Section 601.' Supplemental Resolutions Effective Upon Adoption . . . . . . . . . . . . . . Section 60:2~. Supplemental Resolutions~Effective Upon Filing . . . . . . '. . . . . . . Section 603. Supplemental Resolutions~Effective Upon Consent of Fiscal Agent. . . . . . . . . Section 604. Amendment by Consent of Holders ..... (ii) ~-~9.~5~1 ~ .~ . , ;> Page ARTICCE VII Misc.ellaneous Section 701. Defe;asance. . . . . . . . . . . . Section 702. Evide:nce of Signatures of Noteholders and Ownership af Notes . . . . . . . . . . . Section 703. Preservation and Inspection of Documents. Section 704. form of Notes, Coupons an.d Fiscal Agent's Certi f i cate. . . . . . . . . . . . . Section 705. Waiver of Personal Liability. .... ... Section 706. Canaellation of Notes a.nd Coupons .... Section 707. E;ffecti~ve Date. . . . . . . . . . . . . . (iii) :9~5iG~ ~ , ~- 3' _ .. ~ RESOLUTION AUTHORIZING THE ISSUANCE OF GRANT ANTICIPATI'ON NOTES OF THE CITY DF PETALUMA, CALIFORNIA BE IT RESOLVED BY THE COUNCIL O~F THE CITY OF PETALUMA, CALIFORNIA, AS FOLLOWS: ARTICtE I De.finitions and Interpr'eta~tion Section 101. Definitions. As.used or referred to in this resolution, unless a different meaning,clearly appears from the context: "Act" means Section 53859 et seq• of the Government Code of the State o~f California; "Agency Sec'urity" ;means any bond, debenture, note or other evidenee of indebte~dness issued by any of the following agencies: Banks for Cooperatives; Federal Farm Credit Banks; Federal Intermediate Credit BankS; Federal Nome Loan Bank System; Export=Import Bank of the United States; Federal Land Banks; Government National Mortgage Association; "Anticipated Gr`ant Receipts" mearr~s at any time the amount of Gra~nt Receipts stated in a certificate. of an Authorize,d Officer as expected to be received after the date of such certif- i'cate and prior to SePtember 1, 1984; "Authorized. Newspaper" means a newspaper or journal of general circulation in the City of San Francisco, California, printed in the English language and devoted in part to the publi- cation of financial news; ,, ~~~~;1 ~ ' ~~ • - "Authorized Officer" means the City Manager, Director of Finance or Direct.or of Public Works; "City" means the City of Petaluma, a municipal corpora- tion and a charter city of the State of California; "Construction.Account" means the accoun~t so designated established by Section 302; °Consulting Engi_neer" means such independent engineer or engineering firm or corporation of reputatiorr for skill and experience with respect to the design and construction of sewerage systems or facilities as may from time to time be retained by the City in connection with the Project; - "Costs" or "Costs of the Project" means E1igible Costs and costs of issuance of the Notes; ~ "Council" me~ans the City Council of the City; "Debt Service Account means the ac.count so designated established by Section 302; "Eligible Gosts" means Project costs entitled to reim- bursement under any Grarrt A.greement; "EPA" means the United States~EnVironmental Protection Agen.cy; "Federal Security" means any direc~t obligation of or obligation guaranteed by the United States of Ameri'ca; "Fiduciary" means the Fiscal Agent or a Paying Agent; "Fisc:al Agent" means the Fiduciary appointed pursuant to Section 501, and its successor or successors, and any other corporation or association which may at any time be substituted in its place pursuant to the Resolution; -2- 95;~~ I t "Grant" me:ans an amount expected to be received.by the City from the EP'A or~the State Board in aid of financing Eligible Costs of the Project; "Grant Agreement" means a written commitment fo.r the payment of a Grant, specifying the amount of 'Such Grant, the terms and conditions. upon which suc.h G~rant is made and the date or dates or event or events upon whi~ch such Grant is to be paid to the City; ' . "Grant~Receipts" means all moneys received by the City on account of..any Grant; "Grant Receipts Account" means th~e~account so desig- . nated established by Section 302; "Investmerr't Secur'ity" means any of the following secur- ities legal for the i,nvestment of City funds at the time of purchase thereof: ~ (a) Any Federal Security; (b) Any Agency Security; (c) Interest-bearing time or dema.nd deposits or negotiable or non-negotiable certificates of deposit issued by any bank, trust company or national ba.nking association which is a member of the Federal Reserve System, which certifieates of deposit shall be purchased directly from such a bank, trust company or national banking asso,eiation, provided that all amounts in such accour~ts or- certificates of any ba.nk, trust company or national ~anking associataon not having a reported capital and surplus of at least $50,000,000 shall be continuously secured by other -3- 9`51~ r Inve.stment Securities referred to in clause (a) or clause (b) above which have a market value (exclusive of accrued interest) at all times at least equal to the principal amount of such certificates of deposit and which are lodged with the Fiscal Agent, as custodian; (d) Unsecured promissory notes of any bank, trust . company, national banking association or bank holding company equal in dignity to such institution's outstanding unsecured long-term debt which is rated in either of the two highest rating categories by Standard & Poor's Corporation or Moody's Investors Service, Inc. ~ , "Note" means any of the notes authorized by, and au- thenticated and delivered pursuant to, the Resolution; "Noteholder" or the term "holder" or any similar term, when used with reference to a Note or Notes, means any person who shall be the bearer of any Outstanding Note or Notes; "Outstandang" when used with reference to Notes and as of any particular date, describes all Notes theretofore and thereupon being authenticated and delivered except (a) any Note cancelled by the Fiscal Agent at or prior to said date, (b) any Note ~for the payment of which moneys, equal to its principal amount, with interest to the date of maturity, shall be held in trust under the Resolution and set aside for such payment, (c) any Note deemed to have been paid, as provided in subsection (2) of Section 701, and (d) any Note in lieu of or in substitution for which another Note shall have been authenticated and delivered pursuant to the provisions of the Resolution; -4- a~ ~.~'~ - `~ "Paying Agent" means any paying agent for Notes ap- pointed pur'suant to Section 502, and its successor or successors and .any other corporation or associatio,n which may at any time be substituted in its place pursuant to the R,esolution; "Project".means the improvement of the sanitary sewerage system of the City 6y t''he construction of new wastewater treatment facilities and acquisition of land in connection therewith, together with incidental equipment; "Resolution" means this resol,ution as amended from time to time; ~ "Revenues" means all gross income and revenue received or receivable by the City from the ownership and operation of the System, calculated in accordance with generally accepted account- ing principles, including all rates, fees and charges received by the City for the conveyance, storage, treatment or disposal of sewage, and all other income and revenue howsoever derived by the City from or arising from the System, but excluding refundable deposits made to establish credit and advances or contributions in aid of construction and connection fee`'s` and annexatio~n. charges and other payments~of a similar nature; "'Security I.nstrument" means any trust indenture, trust agreement or contract, and any bond ordinance, resolutio'n or other legislative enactment of the Council under o~r pursuant to which bonds, notes or other evidences of indebtedness are or may be issued or secured; "State Board" means the State Water Resources Control Board of the State of California; -5- ... .95~:~. "S~uppl em.ental Resol uti on° means any r'esol uti on of th:e Council amendi'ng or su,pplementirng the .Resolution adopted and becoming effective~in accordance with the terms of `Article VI; "Surplus Revenues" means a-ny Revenues not required by a Security Instwument to be set aside and ~hel.d for the payment or security of bon~ds, notes or other obligations of the City; °System" means the entire sewerage facilities now or hereafter owned or- operated by the City for the eollection, treatment or disposal of sewa~ge, including all components of the Project. Section 102. Interpretation. (1) Words importing the masculine gender include every other gender. Words importing persons includ.e firms, partnerships, associations and corporations. Words importing the.sin,gular number include the plural, and vice versa. (2) The terms "herein," "hereunder," °hereby," "here- to," "hereof" and any similar terms, refer to the R'esolution; and the term "hereafter" means after the date of adoption of the Resolution; and (3) Articles and Sections mentioned by number only are. the respective Artic'1es and Section<s of the Resolution so num- be red . Sec;tio:n 103. Successors and Assigns. Whenever in the Resolution the City is named or referred to, it shall be deemed to include its successors and assigns whether so expressed or not. All of the covenants, stipulations, obligatiorrs, and agree- ments by or on behalf of, and other provisions for the benefit -6- 9~.51~ of, the City contained in the Resolution sh.all bind and inure to the benefit of such successors and assigns and shall bind and inure to the benefit of any officer, board, commission, author- ity, agent or instrumentality to whom or to which there shall be transferred by or in accordance with law a-ny right, pawer ar duty of the City, or of its successors or assigns, the possession of which is necessary or appropriate in order to comply with any such~ covenants, stipulations, obligations, agreements or other provisions of the Resolution. Section -104. Recitals. The Resolution is adopted by virtue of the Act and pursuant to its provisions, and the Council has ascertained and hereby determines that each and ever.y act, matter, thing or course of conduct as to which provision is made in the Resolution is necessary in order to carry out and effec- tuate the purposes of the City an,d to further secure the payment of the principal of and interest on the Notes. It is hereby found and determined that the City has entered into and executed a Grant Agreement or Agreements for Grants in the stated aggre- gate amount of $7,047,687 and will be entitled to, and will receive, within 29 months from the date of the Notes, at least $5,6~74;2.80;:00in Grant Receipts. Section 105. Resolution to Constitute Contract. In consideration of the purchase and acceptance of the Notes by those who shall hold the same from time to time, the provisions of the Resolution shall be deemed to be and shall constitute cont~acts between the City, the Fiscal Agent and the holders from - 7 - +,9;~~1~~ . t~:~. . . time to time of the Notes and coupons; th,e pledge made in the R_esolution and the covenants and agreements herein set forth to be perfor:med on behalf of the Gity shall be for the equal benefit, prote.c.tion and security of the holders of any and all of the Notes and coupons, all of which shall be of equal rank without preference, priority or distinction of any of the Notes or cou- pons over any other th:ereof. Section 106. Parties Interested Herein. Nothing in the Resolution expressed or implied is intended or shall be con- strued to confer up.on, or give_ to, any Person or corporation, other than the City, the Fiscal Agent and t~he holders of the Notes and appurtenant coupons, any right, remedy or claim under or by reason of th,e Resolution. All the covenants, stiQulations, promises and agreements contained in the~'R,esolution by and on behalf of the City shall be for the sole a,nd exclusive benefit of the City, the Fiseal Agent and the hold,ers of the Notes and coupons. Section 107. Severability of-Invalid Provisions. If any one or more of the covenants or agre~ements provided in the Resolution on the part of the City or the Fiscal Agent to be perfo:rmed should be contrary to Taw, then such covenant or cove- nants, agreement or agreemen'ts, shall be deemed severable from the remaining covenants and agreements, an-d shall in rro way affect the validity of the other provisions of the Resolution or of the Notes. Section 108. Short T~itle. This resolution may be cited as the "1982 Note Resolution." -8- ~ x~: ~9~:1~ ARTICLE II - ' Authorization and G;eneral Terms of Notes Section 201. Authorization of Notes. For the purpose of rai.sing funds to pay costs of the Project pending receipt of the Grant Receipts, $2,600,000 principal am-ount of notes of the City are hereby aut~h°orized to be issued in anticipation of the . Grant Receipts. Each of the Notes shall be.designated °'Grant Anticipation Note°o AlT or part of the authar~zed principal amount of the Notes may be issued by the City, upon authen'tication by the Fiscal Agent in accordance with Section 208. The City Manager is hereby authorized, within the limitations of this Section, to determine the principal amount of the Notes .to be issued, and with respect to such determination his execution of the written order ref~erred to in Section 208 shall be conclusive. Section 202. Particular T'erms of the Notes. The Notes ~ shall be dated August l, 1982 and sba71 matu're on January 1, 1985. None of the Notes shall be subject to redemption prior to maturity. The Notes shall bear interest, payable on January 1 _ and July 1 in each year, commencing January l, 1983, at such rate as shall be determined by a Supplemental Resol.ution adopted prior to their issuance or be determined by an Authorized Officer subject to ratification by a Supplemental Resolution. The Notes shall be issued in the denomination of $5,000 each and shall. be numbered from.l upwards. A Paying Agent or Agents for the Notes shall be selected by such Supplemental Resolution. Section 203. Security for the Notes. The Notes and appurtenant coupons shall be payable in the first instance from -g- 9~`~~ the Grant ReceiPts and the income derived from the investment of moneys held in the Accounts established by Sectio~n 302, and shall also be pa,yable f'rom Surplus Revenues and from the proceeds of additional notes issued pursuant to the A.ct or other ob1igations of the City. All mon~eys held in the Debt Service Account and, subject to the provisions of Section 304 and,Section 305, the Construction Account.a.nd the Grant Receipts Account, are hereby pledged for the paym,ent of the Notes. Section 204. Limited Liability of City. Notwith- standing anythirrg in the Resolution, the City shall not be re- quired to advance any money derived from any source of income ~ other than the Grant Receipt5, Surplus Revenues and other funds pledged by the Resolution for the payment of the princip.al of or interest on the Notes or for the performance of any of its duties under the Resolution. The City may, however, advance funds for any such purpose, provided that such funds are derived from a ~ source legally availa`ble for such purpose and may be used by the City for such purpose without incurring indebtedness. ~ The Notes and appurtenant coupons shall be limited obligations of the City, payable exclusively from the so,urces and fun:ds. provided in the 'Resolution. The ~eneral Fund of the City is not liable, and the full faith and credit or taxing .power of the City is not pledged, for the payment of the Notes. The holders of the Notes and appurtenant coupons shall never have the right to compel the forfeiture of any property of the City. The Notes shall n.ot be a debt of the City, nor a legal or equitable pledge, charge, lien or encumbrance upon any property of the City -10- 9~5~1u~ or upon any of its income, receipts or revenues except the Grant Receipts, Surplus Revenues and other funds pledged by the Resolu- tion. Section 205. General Terms of Notes. The Notes shall be payable in legal tender of the United States of America, shall be issued in form payable to bearer with coapons attached for the several in.stallments of interest thereon due at or prior to maturity. Each Note shall bear interest from~its date until the City`s obligation with res~ect to the Payment of the principal sum shall be discharged, payable in the case of installments due at or prior to its maturity in accordance with the tenor and upon surrender of the appurtenant coupons as they severally become due. Section 206v Execution of Note.s. Each Note shall be executed in the name of the City by its Mayor and City C1erk, using their manual.or facs'imile signatures, and the corporate seal of the City sh.al'1 be affixed, imprinted or reproduced thereon. In case any officer who shall have signed or attested any of the Notes shall leave office before the Notes so signed and attested shall have been aut''henticated and del~ivered by the Fiscal Agent, such Notes may nevertheless be authenticated and delivered. Any Note may be signed, sealed or attested on behalf of the City by any person who, on the date of such act, shall hold the proper office, notwithstanding that on the date of such Note su.ch person may not have held such office. The coupons appurtenant and to be attached to any Note shall~ bear and be authenticated by the facsimile signature of the Mayor, and the City may use f`or that -1~- . 9~:1~ purpose th<e facsimile.~signature of any person who shall have been Mayor at or subsequent to-the date of this Resolution, notwith- standing that at the time when such Note sha11 be authenticated and delivered or su"ch coupons attach,ed such person may have left office. Sec.tion 207. Authentication of Notes. The Notes shall bear a cert.ificate of authentication, substarrti:ally in the form set forth in the `Resolution, duly exe:cuted by the Fiscal Agent. Only such Notes as shall bear such certificate af authentication, duly executed, s.hall be entitled to any right or benefit under the Resolution. No Note and no apPurtenant coupon shall be valid or abligatory for any purpose unless such certificate of.authen- tication upon such Note shall have been duly executed by the Fiscal Agent, and sueh certificate of authentication by the Fiscal Agent upon any Note executed on behalf of the City shall be conclusive and the only evidence that the N;ote so authenti- cated has been duly authenticated and delivered under the Resolution and that.the holder thereof and of any appurtenant coupons is entitled to the benefit of the Resolution. Except in cases provided for in Section 210, the Fisca~l Agent, before authe;:nti~cati~ng and delivering any Note, shall detach and cancel all matured coupons thereto attached. Section 208. Conditiorrs Prec.edent to Authentication of the Not~es. The executed Notes shall be delivered to the Fiscal Agent for aut:h,entication and delivery to or on the order of the purchasers, but shall be so authenticated only upon prior or simultaneous receipt by the Fiscal Agent of: -~z- 9~:5:1~ (1) A copy of the Resolution, certified by the City Clerk; (2) A co:py of each Supplemental Resolution then in effect, certified by the City Clerk; (3) Copies of the Grant Agreements, as amended or modified to the date of delivery of the Notes, certified by an Authorized Officer as then in effe:ct; (4) An opinion of the City Attorney to the effect that such Agreements have been validly executed and accepted on behalf of the City, that each Grant Agreement constitutes a binding agreement by and between the City and the EPA or between the Ci"ty and th"e State Board relating to the construc- tion of the Project and reimbusements by the EPA or the State Board for Eligible Costs incurred or to be incurred by the City; (5) A certificate of an Authorized Officer stating (a) with respect to the Grants (i} the aggregate amount thereof committed or awarded, (ii) the aggregate amount thereof previously received by the City and (iii) the aggregate amount thereof expected to be received and (b) the principal amount of Notes then outstanding; and (6) A written order as to the delivery and application of the praceeds of the Notes, siqned by an Authorized Officer, Section 209. Neqotiability and Transfer of Notes. 7he Notes shall be negotiable instruments and title ta any Note shall pass by delivery as a negotiable instrument payable to bearer. -13 - ~: D.,~. +~ The City and any Fiduciary may treat and .conside,r t"he bearer of any Note as .its holder and absolute o-wner, whether or not such Note shall b'e overdue, for the purpose of rece.iving payment of princi.pal and for all other purposes whatsoever except for the purpose of receiving payment of coupons. The C'ity and any Fiduciary may treat and consider the bearer of any coupon as its holder and absalute owner, whether such coupon or such Note shall be overdue, for the p`urpose of receiving. payment and for all other purposes. A11 payments made as in this Section provided sfiall be valid a-nd effectual to satisfy and discharge t;he liability upon the several Notes to the extent o.f the sum or sums so paid. Secti.on 210. Reissuance of Mutilated, Destro_y~ed, Stolen or Lost Notes. In case any Outstanding Note shall become mutilated or be destroyed, stolen or lost, the Fiscal Agent shall authenticate and deliver a new Note (with apPropriate coupons attached~ of like tenor, number and amount as the Note and appur- tenant coupons, if any, so mutilated, destroyed, stolen or 1ost, in exchange and substitution for such mutilated Note and upon surrender of such mutilated Note and appurtenant coupons, if any, or in lieu of and substitution for the Note and appurtenant coupons, if any, destroyed, stolen or lost, upon filing with the~ Fiscal Agent evidence satisfactory to the City and the Fiscal Agent that' such Note and appurt~enant coupons, if any, have been destroyed, stolen or lost and proof of ownership, and upon fur- nishing the City and the Fiscal Agent with indemnity satisfactory to them, and complying with such other reasonable regulations as the City and the Fiscal Agent may prescribe and paying such - ~ 4 - 9,~5~-1-~ expe.nses as the City and Fiscal Agent may incur in connection therewith. All Notes or coupons surrendered to the Fiscal Agent under the provisions of Section 210 shall be cancelled by the Fiscal Agent. In all cases in which Notes registered as to both principal and interest are to be converted into coupon Notes payable to bearer, the~ City sha11 execute coupons as required by the transaction. In all cases in which new N.otes are to be deli~vered under the provisions of Section 210, the Fiscal Agent shall deliver to the City a certificate specifying the Notes mutilated, destro~yed,.stolen or lost, and the City shall execute coupons or Notes an:d the Fiscal Agent shall `authenticate Notes, as required by the transaction. Section 211. Prohi6ition of~Other Debt in A,ntici_pation of Grant Receipts. E,xcept for the Notes, no bonds, notes or other evidences of inde'btedness shall 6e issued by the City in anticipation of any G:rant Receipts or for t,he payment of which any Grant Receipts are pledged or otherwise made available. Section 212. Covenants wit,h Not.eholders. In order to secure the payment of the Notes, the City hereby particularly covenants and agrees with the holders of the Notes, and makes provisions which s~ha1T be a p~art of the contract with such ho1- ders, that the Gity,.if and so long~as any of the Notes are out- standi'ng and unpaid: (a) Wi'll proceed to complete with all practicable dispatch the construction and acquisition of the Project; {b) Will not make or cause or permit to be made any appli°cation of the proceeds of the Notes or of any moneys - ~ 5 - ~ 9;5~1:~ held in the De'bt Service Account, the Construction Account ~ or the Grant Receipts Account except in accordance with the provisions of Article III; , (c)_ Will comply in all respects w.ith the terms and provisions of all Grant Agreements a.nd with all applicable State and Federal laws and regulations governing the imple- mentation of any G'rant Agreement; (d) Will impose and collect user charges for the use and services .of the System i,n accordance with the require- ments of any Grant Agreement and any Security Instrument; (e) Will~take all actions necessary to preserve its right to receive reimbursements under the Grant Agreements; (f) Will a;pply or continue to apPly Revenues and any other available funds to pay that portion of Eligible Costs not expected to be reimbursed from Grants until all such Costs have be`en p:aid; (g) Will n,ot apply the proceeds of any Note or other moneys of the City in any manner which would cause any of the Notes to be an "arbitrage bond" ,within the meaning of Section 103(c) of the Internal Revenue Code of 1954, as amended; (h) Will promptly request each reimbursement to which it has be~come entitled under any Grant A;greement; (i) Will promptly pay over to the Fiscal Agent all Grant Receipts, for deposit in the Grant Receip:ts Account; (~j) Wi11 not unilaterally terminate, or enter into any ~ agreement t.o terminate, any Grant Agreement; - ~ 6 - ~ ;9:5;1 ~ (k) Except for the benefit or security of the Bonds or the Notes or any other bonds or other obligations heretofore or hereafter issued by the City, will not create, assume or suffer to be created any judgment, mortgage, pledge, or other lien, enc.umbrance or charge on the Revenues, or on any property or assets, real or personal, of the System, and will not permit any attachment of the Revenues or of such property or assets to remain unreleased for a period exc,eed- ing thirty days; (1) Will not adopt or enter into any Security Instru- ment which does not provide for the periodic release from the lien of such~Seeurity Instrument, not less often than annually, of Surplus Revenues, or which does not permit the application of Surp1us Revenues 'to the payment of the Notes or other evidences of indebtedness:which the City may issue to refund or r'etire the Notes; and (m) Will, if three months prio.r to the maturi.ty of the Notes there shall not be on deposit in the Debt Service Account and the G'rant Receipts Account a sum sufficient and available to pay the principal o-f and interest on the No.tes, as soon as possible authorize and affer for sale ad-ditional grant ant'icipation notes pursua.nt to the Act, or issue other obTigat'ions in a principal amount sufficient, with other available moneys, to make full payment of the principal of and interest on the Notes, such additional notes or other obligations to be offered for sale upon reasonable and customary terms and conditions, will commence and carry out - lJ - ~9'!5.1 ~ , such offering in time to receiVe.offers or bids for the purchase of such obligations no later than two months prior to the,maturity of the Notes, a°nd will promptly deliver such obligations to the purchaser thereof and deposit the proceeds . of sale in the De.bt Service Account for .application to the retirement of the Notes. For the purpose of determining sufficiency and avail- ability within the meanin-g: of paragraph (m') of this Section, Investment Securities maturing on or before t'he maturity of the Notes shall be v`alued at their face value plu~s the amount of interest payable at or prior to such maturity date; Investment Securities which are subject to an agreement for their repurchase on or before the maturity of the Notes shall be valued at the agreed on repurchase price plus the aggr,egate amount of interest payable to the Fiscal Agent under the terms of the applicable repurchase agreement at or prior to the date of such maturity. Section 2~13. Required Notices to Fiscal Agent. The City will gi;ve to the Fiscal Agent prom;pt written notice, appro- pria:te'ly documented, of any change in the status of the Grants and of any auth,orization of addition~al ind'ebtedness of the City payable fwom Revenues, and particularly of any o°f -the following events : (i) any modification of a Grant; (ii) the susp.ension of any Grant or the issuance of any stop-work order; (iii) the termination of any Grant; -~s- ~ , 95:i~ (iv) the annulment of any Grant; (v) the ado.ption or auth'orization by the City of any Security Instrument. Section 214. Notice of Certain Other Actions. When- ever the suspension of any Grant or the issuanc,e of any stop-work order has been lifted or cancelled, the C:ity will give to the Fiscal Agent prompt written notice, appropriately documented, of such lifting or cancellation. -~9- . .-9~~1~ ARTICLE III E-stablishment and. A lication of Accoun:ts Section 301. Security for Not'es a.nd Sources of Payment. The Notes sha11. be lim~ited obligations of t6e City, payable, as to both prineipal and interest, in the first instance from the Grant Receipts and other moneys, includi,ng i~nvestment income, held in the Account:s u'rrder the Re,solution,. and, to the extent not so paid, shall also be payable from Surp`lus Rev~enues and from the proceeds of additional notes issued pursuant to the Act or other obligations of the Ci'ty. A11 moneys hel~d~i:n the Debt Service Account and, subje.ct to the provisions of the Resolution permit- , ting or reqwirin,g,.:application to costs of the Project, all moneys held in the Constr'uction Account and the Gran't Receipts Account are hereby pledged for the payment of the Notes. Se:ction 302. Establishment of Aecounts. The City hereby creates and est'ablishes the foTlowi`ng special funds or accounts, each of.whic'h shall be held by the ,Fiscal Agent: (~1 ) De:,b~t. Servi ce Account (2) C'onstruction Account ~ (3) Gran:tt Receipts Account S_ection 303. Qebt Service Account. Of tiie proceeds of saTe of the ~Note's., such amount as shall.be stated in the written order referred to in Section 208 shall be paid to the Fiscal Agent for d'eposit in the Debt Service Account for apPlication to the payment of instaTlments of interest on the Notes as the same become due. On September 1; 1984, or on the next succee.ding business day, the Fiscal Agent shall withdraw from the Gra~nt :9:5~1 ~ -20- ' . Receipts Account and' deposit in the Debt Serviee Account an amount equal to the p.rincipal of the Notes, or such lesser amount as shall then b'e on deposit in the' Grant Receipts Account. On and after September l, 1984, all Grant Rece'ipts shall be paid into the Debt Service Account until its balance shall equal the principal of and int'erest payable on the Notes a't maturity. Amounts held in the Debt Service Account shall be applied to the payment of principal of and interest on th.e Notes and used for no other purpose. Pending such application, moneys in the Debt Service Acco~unt shall be invested in Investment Securities pursuant to Section 306. ~ Section 304. G:onstruction Account,. The remaining proceeds of sale of the Notes, after making the deposit required by Section 303, shal,l be paid to the Fiscal Agent for deposit in the Construetion Account and application to payment of Costs of the Project. Pending such application, moneys in the Construction Account shall be invested in Investment Securities. No moneys shall be disbursed from the Construction Account except to pay such Costs or to pay the principal of or interest on the Notes when due. Disbursemen.ts for the payment of E~igible Casts shall be made by~t.he Fiscal Agent upon receipt of vo,uchers signed by an Ruthorized Officer stating that such Costs h:ave been properly incurred, are Eligib.le Costs, and payment is then due and owing. Disbursements for Costs of Issuance of the. Notes shall be made upon requisition by .an Authorized Officer. Whenever the Fiscal Agent shall have received notice pursuant to Section 213 that any Grant Agreement has been sus- -2~- ~ :9°5~F pended or a stop-work order has been issued, no further dis- bursements shall be made from the Construction Account until the Fiscal Agent sha]1 have received notice of the lifting of such susPension or stop-worK order in accordance with Section 214. If the Fiscal Agent shall have received notic.e pursuant to Section 2I3 that any Grant Agreement has been terminated or annulled, no further disbursements~shall be made from the.Construction Account, and all moneys remaining in said Account shall immediately be transferred to the Debt Service Account. On Sep'tember l, 1984, or on the next succeeding business day, to the extent that sufficient moneys are not available in , the Debt Service Account and the Grant Receipts Account to pay the principal of and interest on the Notes at maturity, moneys in the Construction Account shall be transferred to the Debt Service Account and applied to such payment. After completion of the Project, a:ny moneys remaining in the Construction Account shall be transferred to the Debt Service Account and~held for the retirement of the Notes. If no Notes are then Outstanding, moneys rem_aining in the Construction Account may be withdrawn by the City and used .for any lawful purpose: S.ection 305. Grant Receipts Account. All Grant Re- ceipts rec,eived by the City prior to September l, 1984 shall be pro.mptly paid to the Fiscal Agent for deposit in the Grant Re- ceipts Account and ap~plication to the payment of the principal of and interest on the N,otes or to payment of Eligible Costs of the Project, as provided in this Section. Pending such application, -22- _ 95~1~ moneys in the Grant Receipts Account shall be invested in Tnvestment Securities, Prior ta September 1, 1984 moneys may be withdrawn by the City from the Gra.nt Rece_ipts Account for applica- tion to Costs of the Project, but only if, after any such withdrawal there remain in the G;:rant Receipts Account moneys or Investment Securities in an amount sufficient, together with ninety percent (90%) of the Anticipa,ted Grant Receipts (as stated in a certificate of an Authorized Officer da'ted and delivered to the Fiscal Agent no more than ten days prior to such withdrawal) to pay the principal of.all Outstanding:No.tes at their maturity. Any moneys remaining in the Grant Receip°ts Account after the payment of the Notes in , full shall be applied to costs of completion of the Project, or if the Project is then complete, may be withdrawn by the City and used for any lawf-ul purpose. Section 306. Investments. Moneys in the Debt Service Account, the Construction Account and the Grant Receipts Account shall at all times be invested, to the ex.tent practicable, in Investment Securitie;s maturing (or salable t'hrough repurchase agreement at a stated price} at such tim:es and in such amounts as wi,ll make cash avail,able for the purposes of such Accounts as need=ed,. S,uch; Investment Securi ti es shal 1 be acqu i red as di rected by an Aut"'horized Of'ficer, or, in the absence of such direction, as determined b.y the Fiscal Agent in its sole discretion. Invest- men;t Securitie;s may be purchased for the Grant Receipts Accaunt either in th,e open market or from the Construction Account. If purchased from t,h;e Construction Account, such Investme_nt Securities shall be purchas.ed at a price equal to their original. purchase - z 3 - ~ :9:~5~1 ~ price plus accrued interest. To the extent permitted by law, the ., City may al~so engage i•n financial transactions whereby Investment Securities are purchased under an agreeme'nt providing for resale to the original sel'ler at a stated price. -24- :y5~;~ ARTICLE IV Events of Default and Remedies of Holders Section 401. Events of Default. Each of the following events shall constitate an "event of default": (a) if default shall occur in the due and punctual payment of t'he principal of or interest on any N.ote; (b}- if default shall be made by the City in the obser- vance of any of the covenants, agreements or conditions on its part in th,e~Resolution or in any Supplemental Resolution or in the Notes contained, and such~default shall have continued for a period of 30 days after the City shall have . been given writt,en notice of such default by the Fiscal Agent; or (c) if the City shall file a petition or answer seek- ing reorganazation or arrangement under the federal bank- ruptcy la-ws or a,ny other applicable law of the United States of America, or if a court of comPetent jurisdiction shall approve a petition, filed with ar withou't the consent of the City, seeking reorganization of the City under the federal bankru;ptcy laws or any other applicable law of the lJnited St~ates of America, or. if a court of competent jurisdiction shall assume custody or control of.the City or of the whole or an'y substantial part of its property. ' Secti on 402. Enforce,ment ~ Fi s.cal ~A.gent. Upon the happening and continuance of any event of defau]t, the Fiscal Agent may, and upon the written request of~the holders of not less than twenty-five per cent (25%) in aggregate principal 9 5:~ ~ -25- amount of the Notes at the time Outstandin'g, shall exercise in i ts own 'na,me a~ny or al l of the powers of the Notehol ders under Section 403 and in.particular (i) b`ring su'it for any unpaid principal or int°erest then due, (ii) by mandamus or other appro- priate proceeding enforce all rights of th;e N~oteholders, including the right to require the City to Perform its duties under the Act , and the Resolut.ion, (iii) bring suit upon the Notes, (iv) by action at law or bill in eq.uity require the .Gity to account as if it were the trustee of an express trust for the Noteholders and (v) by action or bil'1 ~in equity enjoin a,ny acts in violation of the Resolution or the rights of the Noteholders. , - Section 4:03. Enforcement ~ Noteholders. Any holder of an 0utstanding Note or coupon may exercise any available remedy and bring any appropriate action, suit or proceeding to enf.orce his rights, including those specified in Section 402, provided that prior to resorting to any court of law or chancery or to any other legal process, either (i')' such holder shall have given written notice to the City and the Fiscal Agent specifying the event of default to be complained of and requesting the , Fiscal Agent to tak°e appropriate action, and t.he Fiscal Agent shall have f`ai`1'ed to act within a reasonable time, or (ii) such holder shall have obtained the written consent of the Fiscal Agent to the institution of the action, suit or proceeding pro- posed; and such action, suit or proceeding is brought for the ratable benefit of all Noteholders. • Section 404. Right to Enforce Payment of Notes Unim- ap ired. Nothing in t.his Article shall affect or impair the right _.2 6 - .~9 s: ~ ~~3 of any Noteholder to enforce the payment of the principal of or ' interest on his Note or the obligation of the City to pay the principal of and interest on each Note to its holder when due. -27- :9:~1:~ . Y.~ 1 ' t;,, - ARTICLE V The Fiduciaries Section 501. Fiscal A~ent. The City shall, by Supple- mental Resolution adopted prior to the authentication and deli- very of any Note-s, appoint as Fiscal Agent a bank, trust company or national banking association having tr°ust powers, able to ac- cept the office on reasonable and customary terms and authorized by law to perform the duties imposed upon it by the Resolution. The Fiscal Agent shall signify its acceptance of the duties and obligations imposed upon it by the Resolution by executing the . certificate of authentication on the Notes, and, by executing such certificate upon any Note, the Fi,scal Agent shall be deemed to have certified to the City that it has all requisite power to accept, and has accepted such duties and obligations not only with respect to the Note so authenticated, b.ut with respect to all the Notes. Section 502. Pa in A~ents. The City shall appoint one or more Paying Agents for the Notes 6y Supplement.al Resolution adopted prior to their authentication and delivery, and may at any time :or from time to time by Supplemental Resolution appoint one or more other .Paying Agents. Each Paying Agent shall be a bank, trust~comPany or national banking association having trast powers, able to accept the office on reasonable and customary terms and authorized by law to.perform the duties imposed upon it by the Resolution. Each Paying Agent shall deliver to the City and the Fiscal Agent a written acceptance of its duties and - 2 $ - ~ ~ 9~~~~ ~ obligations under the Resolution. The Fiscal Agent may be appointed and may act as a Paying Agent. ~ Sectio'n 503. Responsibilities of Fiduciaries. The recitals of fact in the Resolution and the No.tes shall be taken as statements.of the City, and no Fiduciary sha11 be responsible for their accuracy. No Fiduciary shall be deemed to make any representatio,n as to, or shall incur any liability on account of, the validity~,of the Resolution or of any Notes or coupons. The Fiscal Agent shall, however, be respansible for any representation in its certificate of authentication on the Notes. No Fiduciary shall be under any responsibility or duty with respect to the ap- • plication of any moneys paid to the City or to any other Fiduci- ary. No Fiduciary shall be under any obligation or duty to perform any act which would involve it in expense or liability or to institute or defen~d any action or suit in respect of the Resolution or Notes, or to advance any of its own moneys, unless properly indemnified. The Fiscal Agent, prior to the occurrence of an event of default and after the remedy of all events of default which may h,ave occurred, undertakes to perform such duties and only such duties as are sp.ecifically set forth in the Resolution. In case an event of default has occurred and has not been remedied, the Fiscal A•gent shall exercise such of the. rights and powers vested in it 'by the Resolution, and sh:all u=se the same degree of care and skill in their exercise, as a prudent m,an would exercise or use unde_r the circumstances in the conduct of his own affairs. Any provision of the R.esolution relating to action taken or to be -29- ~ 95:1~ taken by the Fisc~al Agent or ta evidence upon which the Fiscal Agen.t may rely shall be subject to the provisi.ons of this Section. No Paying Agent shall be liable in connectiorr with the performance of its duties as sach Paying Agent except for its own negligence or default. Section 504. Evidence on Which Fiduciaries ~ Act. Each Fiduciary shall be pr.otected in acting upon any notice, resolution, request, consent, order, certificate, opinion, or other document believed by it to be genuine, and to have been signed or presented by the proper party or parties. Whenever any Fiduciary shall deem it necessary or desirable that a fact or , matter be proved or established prior to taking or suffering any action, such fact or matter, unless other evidence is specifi- cally prescribed, may be deemed to be conclusively proved and established by .a certificate of an Authorized Officer, but in its discretion the Fiduciary may instead accept: other evidence of such fact or matter. Section 505. Compensation and Expenses. Unless other- wise provided by contract with the Fiduciary, the City shall pay to each Fiduciary from time to time reasona.ble.compensation for aTl services, and also reimburse its reasonable expenses, charges, legal fees and other disbursements and those of its attorneys, agents and e.mployees, incurred in the performance of its duties. The City shall indemnify an,d save each Fiduciary harmless against any liabilities 'which it may incur in the exercise and perfor- mance of its powers and duties and which are not due to its negligence or default. ,9,5~:1 ~ -30- " Section 506. Certain Permitted Acts. Any Fiduciary may become the owner of or may deal in Notes as fully and with the same rights it would have if it were not a Fiduciary. To the extent permitted by law, any Fiduciary may act as depositary for, ~ and permit any of its officers or directors to act as a member of, or in any other capacity with respect to, any committee formed to protect the wights of Noteholders or effect or aid in any reorganization growing out of the enforcement of the Notes or the Resolution, whether or not any such committee shall represent the holders of a majority in pri'ncipal amount of the Notes Out- standing.. , Section 507, Resignation of Fiduciary. A Fiduciary may at any time resign and be discharged of its duties and obli- gations under the Resolution by giving not less than sixty days' writt.en notice to the City and publishing notice, specifying the date when such resignation shall take effect, in an Authorized Newspaper within twenty days after the giving of such written notice. Such resignation shall take effect upon the day speci- fied in such notice unless a successor shall have been previously appointed by the City or Noteholders, in which e,vent such resig- nation shall take effect immediately. Section 508. Removal. A Fiduciary may be removed at any time by t:he holders of a majority in principal amount of the Notes then 0atstanding, excluding any Notes held by or for the account of the City, by an instrument or concurrent instruments in writing signed and duly acknowledged by such Noteholders or by their attorneys duly authorized in wri~ting and delivered by the City. Copies of each such instrument shall be delivered by the City to each Fiduciary. _,9~~~~:~ ~ -31- • , .~ S.ection 509. Appointment of S"ucce:ssor. In case at any , time a Fidu,ciary sha1T resign or shall be removed or shall become incapable of acting, or shall be adjudged a bankrupt or insolvent, or if.a receiver, liguidator or conservator of such Fiduciary or of its property shall be appointed, or if any public officer or court shall take charge or control of such Fiduciary or of its property or affairs, a successor may be appointed by the holders of a majority in principal amoun~ of the Notes then Outstanding, excluding any Notes held by or for the aecount of the City, by an instrument or concurrent instruments in writing signed by such Noteholders or thei"r at`-torneys duly authorized in writing and delivered to such successor Fiduciary, notification thereof being given to the City, the pr.edecessor Fiduciary and any other Fidu- ciaries. Pending such appointment, the City shall forthwith appoint a Fiduciary to fill such vacancy until a su.ccessor Fidu- ciary shall be apP;oirrted by Noteholders., but no succ.essor Payin~g Agent shall be reqaired to be appointed if another Paying Agent is still acting. The City shall publish notice of any such appointment in a`n Authdriz.ed Newspaper within twenty days after such• appointment. Any successor Fiduciary appointed by the City shall, imme:diately a,nd without further act, be su,Perseded by a Fiduciary appointed by Noteholders. .If in a proper case no ap- pointment of a suc.cessor Fiduciary shall be made within forty-five days af:ter .tfie Fiduciary :shall have given to the City .written notice of resignation or after the occurrence of any other event requiring suc~h appointment, the Fiduciary or any other Fiduciary or any Noteholder may apply to any court of competent jurisdic- 951~ -32- . tion to appoint a su~ccessor. Any Fiduciary a,ppointed under the provisions of this Section shall be a bank or trust company or a national banking asso~ciation, doing business and having its principal office in the State of California and authorized to perform the duties im°posed upon it by the Resolution. Section 5SQ. Transfer of Ri9hts.and Property to Suc- cessor. Any predecessor Fiduciary shall pay over, assign and deliver any money~s held by it to its succes.sor, or if there is no successor, to the Fiscal Agent. Section 511. Mer er or Consolid:ation. Any company into whic'h any Fid~u'ciary may be merged or converted or with which , it may be consolid,ated or any company res`ulting from any merger, conversion or consoli'dation to which it shall be a party, or any company to which suc.h Fiduciary or any public officer or court may sell or transfer all or substantially all of its corporate trust business,~sh~all be the successor to such Fiduciary without the execution or filing of any paper or the perform'ance of any further act; provide:d, however, that such co.mpany shall be a bank or trust company 'or national banking ass.oc~iation and shall be autharized by law to perform a1T the duties imposed upon it by the Resolution. -33- ~ ;9`~;~~ aRTICLE• VI - Supplemental Resolutions and Amendments Section 601: Supplemental Resolutions Effective Upon Adoption. A Supplemental, Resolution for any one or more of the following purposes shall be fully effective in accordance with its terms upon adoPtion: (1) To specify, determine or authorize any matters and things conc~erning the Notes or the proceeds thereof which are not contrary to or inconsistent with the Resolution; (2) 'To modify or amend any of the terms or provisions of the Resolutian prior to the acceptance by the Fiscal , Agent of its appointment under the R~.esolution. Section 602. Supplemental Resol.utions Effective Upon Fi11ng. A Supplem,ental Resolution for any one or more of the following purposes shall be fully effective in accordance with its terms upon the filing. with the Fiscal Agent of a copy certi- fied by the City Clerk; (1) To impose additional covenants or agreements to be observed by the City which are not contrary to or inconsistent with the Resolution; (2) To impose other limitations or restrictions upon the City; (3) To surrender any right, power or privilege reserved to or conferred upon the City by the Resolution; and (4) To confirm, as further assurance., any pledge of or lien upon the Grant Receipts or any other moneys, securities or fuhds. -3~- - ~9;51~ Section.603. Supp:lemental Resolutions Effective Upon Consent of Fisc.al Age.nt. A Supplemental Resolution for the purpose of curing any ambiguity, omission or defect in the Resolution shall be fully effective in accordance with its terms upon the written consent of the Fiscal Agent. Sec•tion 604. Amendment ~ Consent of Nolders. The Resolution or any Supplemental Resolution and the rights and obligations of the City and of.the Notehold.ers may be modified or amended at any time by a Supplemental Resolution which shall become binding when the written consents of the holders of sixty per cent (60%) in aggregat.e principal amount of the Notes then • Outstanding are filed with the Fiscal Agent. No such modifica- tion or amendment shall extend the maturity of or reduce the interest rate on, or otherwise alter the terms of payment of the principal of or interest on any Note without the express written consent of the holder of suc.h Note, nor reduce the percentage of Notes required for consent to any such amendment or modification, nor modify any of the rights or obligations of the Fiscal Agent without its prior written consent. -35- 951~ , ,~; - ' ARTICLE VII ~ Miscellaneous Section 701. Defeasance. (1) If tFie City shall pay or cause to be paid to the holders of the Notes and coupons, the ~principal and interest due and to become due thereon, at the times and in the manner stipulated therein and in the Resolution, then, at the option of the City express:ed in a certificate of an Authorized Officer delivered to the Fisca1 Agent, the pledge of the Grant Receipts and other moneys, securities and funds hereby pledged and the cov:enants, agreements and other obligations of the City to the Noteholders hereunder shall be-discharged and • satisfied. Ln such event, the Fiscal Agent sha11, upon the request of the City exp'ressed in a certificate-of an Authorized Officer delivered' to th.e Fiscal Agent, execute and deliver to the City all such instruments as may be desirable to evidence such discharge and satisfaction, and the Fiduciaries shall pay over or deliver to the City a11 mon~eys or securities held by them pursuant to the Resolution which are not required~for th.e payment of Notes or coupons. (2) Any Notes and their appurtenant coupons, whether at or prior to the maturity of such Notes or coupons, shall be deemed to have been paid within the me,a;ning of this Section if there shall ha.ve been deposited with t:he` Fisca~l Agent by or on behalf of the City either (i) moneys in an amount which shall be sufficient, or (ii) Federal Securities not subject.to redemption prior t~o maturity the~principal of and the interest on which when due will provide moneys which, together with the moneys, if any, ,9.51 ~ -3 6 - • ;a; 4 on deposit wi'th the Fiscal Agent at the same time, sha11 be sufficient to pay when due the principal of and interest due and to become due on said Notes at and prior to their maturity. Any moneys so deposited may be invested by the Fiscal Agent only in such Federal Securities. The Federal Securi.ties and moneys deposited with the Fiscal Agent pursuant to this Section shall be held in trust for the payment of the princ:ipal of and interest on said Notes. No payments of principal of or interest on any such Federal Securities shall be withdrawn or used for any purpose other than the payment of such principal or interest. Section 7"02. Evidence of Siqnat.ures of Noteholders and Ownership of Notes. Any request, consent, revocation of consent or other instrumernt which the Resolution may require or permit to be signed and executed by Noteholders may be in one or more instruments of similar tenor, and shall b.e signed or executed by such Noteholders in person or by their att.orneys duly authorized in writing. Proof of, (1) the execution of any such instrument, or of an instrument ap~p.ointing or authorizing any sach attorney, or (2) the holding by any person of an.y Notes or coupons apper- taining thereto, shall be sufficient for any purpose of the Re- solution if made in the fo.llowing manner, or in any other manner satisfactory to the Fiscal Agent which may nevertheless in its discretion re;quire further or other proof in cases where it deems the same de`sirable: (A) .The fact and dat_e of the execution by any Note- holder or his attorney of any such instrument may be proved (1) by the certificate of a notary public or other officer -3~- 95~1~ A '" Y . ' _.. " . authorized to take acknowledgments of dee;ds to be recorded in the jurisdiction in which he.purports to act that the person sign'in~g such instrument ack°nowledged to him the execution thereof, or by the affidavit of a witness of such execution, duly sworn to before such a.notary public or other officer o.r (2) by the certificate, wfiich need not be acknowledged or verified, of an officer of a bank, trust company or financial firm or corporation Satisfactory to the Fiscal Agent t'ha't the person signing such instrument acknow- ledged to such bank, trust company, firm or corporation the execution ther;eof. (B) The au,th.ority of a person or persons to execute any such instru;ment on behalf of a corporate Noteholder may be established without further proof if such instru,ment is signed by a person purporting to be the president or trea- surer or a vice=president or an assistant treasurer of such corporation. with a corporate seal affixed, and is attested by a person pur'pbrting to be its se:cretary or assistant secretary. (C) The amount of Notes tra'nsferable by delivery held by any person executing any such instrument as a Noteholder, and the nu~m:bers and other identification thereof, and the date of his holding such Notes, may be proved by a certifi- cate, which ne:ed n~t be acknowledg.ed or verified, of an officer of'~a .bank, trust company, financial firm or corpora- tion or other depositary satisfactory to~t.he Fiscal Agent, showing that at a date therein mentioned such person exhibited -38- ~ 9~~~~ .. a .. - . to or.had on deposit with such bank, trust company, firm, corporation or depositary Notes described or referred to in such certificate; and such a certificate may be made and given by an officer or member of any bank, trust company, insurance company or financial firm or corporation with respect to Notes held by it, if acceptable to the Fiscal Agent. Any request, consent or other instrument executed by the holder ~ of any Note shall_ bind all future holders of such Note in respect of anything don,e or suffered to be done hereunder by the City or any Fiduciary in accord-ance therewit'h. . Section 703. Preservation and Inspection of Documents. All reports, certificates, statements, and other documents re- ceived by any Fiduciary under the provisions of the Resolution shaTl be retained in its possession an~d shall be available at all reasonable times for the inspection of the City, any other Fidu- ciary or any Notehold,er, and thei.r agents and their representa- tives, any of whom may make copies thereof, but any such reports, certificates, stateme4nts.or.other documents may, at th~ election of such Fiduciary, be destroyed or otherwise disposed of at any time after such date as the pledge created by the Resalution shaTl be discharged.as provided in Section 701. Section 704. Form of Notes, Coupons and Fiscal Agent's Certificate. Subject to the provisions of the Resolution, each Note, the coupo:ns to be attached thereto and the certificate of authentication by the Fiscal Agent shall be, respectively, in substantially the following form: - 3 9 - 9~5F1 ~ [Form of Note] UNITED STATES OF AMERICA STATE OF CALIFORNIA ~ CITY OF PETALUMA GRANT ANTICIPATION NOTE No. The CITY OF PETALUMA (the "City"), a municipal corpora- tion and a charter city of the State of California, acknowledges itself indebted and for value received hereby`promises to pay to , the bearer, upon pres.entation and surrender, the principal sum of Five Thousand Dollars ($5,000) on the First day of January, 1985, and to pay interest on such principal sum from the date hereof at the rate of per centum ( ~) per annum, ,payable on the first days of January and July in each year, commencing January l, 1983, until the City's obligation with respect to the payment af such principal sum shall be dis:charged, but only, in the~case of interest d~ue at or before maturity of this note, according to the tenor of the attached coupons.and upon presenta- tion and surrender of said.coupons as they severally become due. This note, as to both principal and interest when due, will be payable at the principal corporate trust office of , in the City of San Francisco, California, as Fiscal Agent under the ResoTution hereinafter referred to (the "Fiscal Agent"), or of its successor as such Fiscal Agent, or, at the option of the holder of the note or -4 0- ~9:51~fi . . ~u~c. . ' ,- '~ ~~ coupon entitled thereto, in the City of New York, New York, at the principal corporate trust offi.ce of , a paying agent of.the City, or of its successor as such paying agent, in any coin or currency of the United State`s of America which at the time of payment is legal tender for the payment of public and pwivate debts. This note is one of an issue of notes (the "Notes") issued in the aggregate principal amount of $ , which are all dated August l, 1982, and are all of like tenor and which are authorized and issued under and pursuant to Sections 53859 et seq. of the Government Code of the State of California (herein called the "Act"), and wnder and in accordance with a resolution adopted by the Council of the City on _, 1982, and entitled "Resolution Authorizing the Issuance of Grant Anticipa- tion Notes of the City of Petaluma, Galifornia", as supplemented (the,"Resolution") for the purpose of financing improvements to the sanitary sewerage system of the City (the "System"). A copy of the Resolution is on file at the principal office of the Fiscal Agent. The Notes are limited obligations of the City issued in anticipation of th.e receipt of certain grants expected to be received from the United States of Amer'ica and the State of California (herein called the "Grant Receipts") and are payable solely from moneys, including Grant Receipts, held in the accounts maintained und•er th.e Resolution,, the proceeds of sale of additional notes issued pursuant to the Act and any available surplus revenues of the System. The general fund of the City is not liable, and - 4 ~ - ~s ~:i: ~ . . ,,. ' ;. . . ! ~. ~. . the full faith or credit or taxing power of the City is not pledged, for the payment of the principal of or interest on the Notes. All of the Notes are equally secured by the pledge of funds and revenues provided in the Resolution. Reference to the Resolution and any and all modifications and amendments thereof and to the Act is made for a description of the nature and exterrt of the security for the ~lotes, the funds , or revenues pledged, the nature and extent and manner of enforcement of the pledge, the rights and remedies of the holders of the Notes with respect thereto and the terms and conditions upon , which the Notes are issued, and a statement of rights, duties, immunities and obligations of the City and of the Fiscal Agent. To the extent and in the respe_cts permitted by the Re- ~~ solution, the provisions of the Resolution or.any resolution amendatory thereof or supplemental thereto may be modified or amended by action on behalf of the City taken in the manner and subject to the cond'itions and exceptions prescribed in the Reso- lution. The pledge of revenues and other obligations of the City under the Resolution ma~y be discharged' at or Prior to the matur- ity of the Notes up.on the making of provisions for the payment thereof on the terms and conditions set forth in the Resolution. It is hereby certified and recited.that all conditions, acts and things required by the Constitution or statutes of the State of California or the Resolution to exist, to have happened or to have been performed precedent to or i'n the issuance of this note exist, have happened and have been perfarmed and that the -42- . , 951fi . . : 1•e i ssu,e of notes of wh i ch thi s i s one,_ tog-ether ~wi th al l other indebted!ness~ of the City, is within every debt and oth~er limit prescribed by said Const:itution or statutes. Neither this note nor any coupo'ns for interest thereon shall be entitled to any security and bene.fit under the Resolu- tion or be valid a:nd become obligatory for~any purpose unless the ce.rtificate of aut-hentication hereon has been duly executed by the Fi5ca1 Agent. ' IN WI_TNE'SS WHEREOF, the CITY OF PETALUMA has caused this note to be ex.ecuted by its Mayor and City Clerk, using their facsimile signatures, and its corpor.at'e seal to be affixed, imprinted,or reproduced hereon and coupo-n,s for interest, bearing and authenticated by the facsimile signature of said Mayor, to be hereto attache.d, all as of the first day of A st, 1982. 4 CITY 0 ° MA B y . _../ % , ~ ~ ~Ma o r [SEAL] Attest: City C1e,rk -43- qg;~.~; ~ CERTIFICATE OF AUTWE'NTICATION This not:e is one of the issue of Nates described in the within-mentioned Resolution and dated August 1, 1982. Fiscal Age:nt By Authorized Officer [FORP1 OF COUPONS] , Coupon No. ~On the first~day of , 19 , the CITY OF PETALUMA, a munici;pal corporation and a charter city of the State of California, will pay to bearer at the principal corporate trust office of , in the City of San Francisco, California, or, at the option of the holder, at the prihcipal corpo , in the surrender of this coupon, ($ ~ },, but.solely from Note hereinafter~mentioned, in States of America which at the rate trust office of City of New York, New York, upon Dollars the sources referred.to in the arry coin or currency of the United time of payment is legal tender 951~ -44- ~ , .,.. , , i; ~ ' `~' issue of notes of which this is one, together with all other indebtedness of the City, is within every debt and other limit prescribed by said Constitution or statutes. Neither this note nor any coupons for interest thereon shall be entitled to any security and benefit under the Resolu- tion or be valid~and become obligatory for any purpose unless the certificate of authentication hereon has been duly executed by the Fiscal Agent. _ IN WITNESS WHEREOF, the CITY OF PETALUMA has caused t~his note to be executed by its Mayor and City Clerk, using their facsimile signatures, and its corporate seal to be.affixed, imprinted or reproduced hereon and coupons for interest, bearing and authenticated by the facsimile signature of said Mayor, to be hereto attached, all as of the first day of A g t, 1982. CITY E UMA B y ~ ,~ Ma or {SEAL] Attest: ~ City Clerk -43- 9;5~~~ ~ .~ ~ f ~ +: . . - ' .~' ~ ..~ .. . . . .' `~~~.~ - ~ ~ ~"_M '- ~ l.f . ' ~_~ ~ for the~payment o-f public and private debts, being the interest .then due on itS Grant Anticipation Note, dated _, 1982, and bearing No. . ~ ~_ ~ ' 1 Mayor Section 705'. Waiver of Personal Liability. No member of the Council or~officer or employee of the City shall be indivi- dually or personall,y liable for the payment of the principal of or the interest on an_y Note, but nothing herein contained shall re1 i eve any sucli .mem:be:r, offi ci al or empl oyee from the performance , of any official duty ~provided by law or the Resolution. Section 70;6. Cancellation of Notes and Coupons. All . Notes and coupons purchased, redeemed or paid shall, if sur- rendered to the City or a.ny Paying Agent, be cancelled and deliv- ered to the Fiscal Agent, or if surrendered to the Fiscal Agent, be cancelled by it. No such Notes shall be deemed Outstanding under the Resolu.tion and no Notes or coupo:ns shall be issued in lieu thereof. All such Notes and coupons and all coupons de- tached from Notes prior to authentication sha~_1 be cancelled and upon order of the City shall be destroyed and a certificate evidencing such d-estruction s:hall be delivered to t,he City. Section 707. Effective Date. Th.is resolution shall take effect from and after its passage and approval. -45- 9'i~`1~ i ~ a~~. , °.~ '~, . r:: ~ - 'i,;, ~: , , . PASSED AND ADOPTED ON Augvst. 2, 1982, by the following vote: Ye S: Councilmen Balshaw, Batta.~lia, Bond, Cavanagh, Harberson, Vice Ma.yor Perry; Ma.yor Ma.ttei N o : None Absent: None Approved:, ~ Mavor -t~. 951~ ~ -46-