HomeMy WebLinkAboutRDA RES 211RESOLUTION NO. 211
A RESOLUTION OF THE PALM DESERT REDEVELOPMENT
AGENCY AUTHORIZING THE ISSUANCE AND PROVIDING
FOR THE SALE OF ITS PROJECT AREA NO. 1, AS
AMENDED (ADDED TERRITORY ONLY), TAX
ALLOCATION BONDS OF THE AGENCY TO AID IN THE
FINANCING OF A PORTION OF THE COST OF A
REDEVELOPMENT PROJECT
RECITALS:
A. The Palm Desert Redevelopment Agency is a
redevelopment agency, a public body, corporate and politic, duly
created, established and authorized to transact business and
exercise its powers, all under and pursuant to the Redevelopment
Law, and the powers of the Agency include the power to issue
bonds, notes, interim certificates, debentures or other
obligations, for any of its corporate purposes.
B. A Redevelopment Plan for the Project Area has been
duly approved and adopted by the City by Ordinance No. 80.
C. The Amendment to the Redevelopment Plan, adding
territory to the Project Area, was approved and adopted by the
City by Ordinance No. 275, and all requirements of law for and
precedent to the adoption and approval of the Redevelopment Plan
as amended have been duly complied with.
D. Pursuant to Section 33334.2 of the Redevelopment
Law, not less than 20 percent of all taxes which are allocated to
the Agency pursuant to Section 33670 of the Redevelopment Law are
to be used by the Agency for the purposes of increasing and
improving the City's supply of housing available at affordable
housing cost to persons and families of low or moderate income.
Pursuant to Section 33334.3 of the Redevelopment Law, such taxes .
are to be held in the Low and Moderate Income Housing Fund.
Pursuant to Section 33334.2(e)(2) of the Redevelopment Law, such
taxes may be used to improve land or building sites with onsite
or offsite improvements.
E. The staff of the Agency has caused to be prepared
the Palma Village Area Survey which describes the housing located
within such area and its availability at affordable housing cost
to persons and families of low or moderate income. The Agency
deems it necessary and desirable to deposit the net proceeds from
the sale of the Bonds into the Low and Moderate Income Housing
Improvement Account of the Redevelopment Fund of the Agency and
expend such funds for the purposes described in Section 33334.2
of the Redevelopment Law to improve land with certain offsite
improvements within the Palma Village Area, including streets,
curbs, gutters, sidewalks, storm drains and sanitary sewer
improvements.
F. The Agency deems it necessary and desirable to
authorize the issuance of $8,500,000 principal amount of Bonds of
the Agency for its corporate purposes to aid in the financing of
a redevelopment project.
NOW, THEREFORE, THE PALM DESERT REDEVELOPMENT AGENCY
HEREBY FINDS, DETERMINES, RESOLVES AND ORDERS AS FOLLOWS:
Section 1. Definitions. As used in this Resolution
the following terms shall have the following meanings, unless the
context requires otherwise:
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"Added Territory"" means the territory added to the
Project Area pursuant to the Amendment, except that portion of
such territory within the territorial limits of the City of
Indian Wells.
"Agency" means the Palm Desert Redevelopment Agency, a
redevelopment agency, a public body corporate and politic, duly
created, established and authorized to transact business and
exercise its powers all under and pursuant to the Redevelopment
Law, and any successor to its duties and functions.
"Amendment" means the Amendment to the Redevelopment
Plan approved and adopted by the City by its Ordinance No. 275.
"Bond" or "Bonds" means the "Palm Desert Redevelopment
Agency, Project Area No. 1, As Amended (Added Territory Only),
Tax Allocation Bonds, Issue of 1987", in the aggregate principal
amount of $8,500,000 authorized by this Resolution, and includes
any bonds, notes, interim certificates, debentures, or other
obligations issued by the Agency pursuant to this Resolution.
"Bond Insurance" means the policy of municipal bond
insurance, if any, issued with respect to the Bonds by the Bond
Insurer.
"Bond Insurer" means the bond insurer specified in a
Supplemental Resolution.
"Business Day" shall mean any day other than a
Saturday, Sunday or any other day on which banking institutions
in any of the states of New York, Washington or California are
authorized or required not be open by law.
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"City" means the City of Palm Desert, California.
"Code" means the Internal Revenue Code of 1986, as
amended.
"Computation Year" means the twelve (12) month period
commencing on the date of the initial authentication and delivery
of the Bonds and each anniversary date thereafter.
"Costs of Issuance" means the costs and expenses
incurred in connection with the issuance and sale of the Bonds
including the initial fee for the Letter of Credit, the
acceptance and initial annual fees and expenses of the Fiscal
Agent, legal fees and expenses, costs of printing the Bonds and
preliminary and final Official Statement, fees of financial
consultants and other fees and expenses set forth in a
Certificate of the Executive Director.
"Federal Securities" means bills, certificates of
indebtedness, notes, bonds, or similar securities which are
direct obligations of, or the principal and interest of which
securities are secured by, the United States, whether issued in
book entry form or otherwise.
"Fiscal Agent" means the party appointed by the Agency
pursuant to Section 20 hereof, its successors and assigns, and
any other corporation or association which may at any time be
substituted in its place, as provided in this Resolution.
"Fiscal Year" means the fiscal year as established from
time to time by the Agency, being on the date of this Resolution
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the one year period beginning on July 1st and ending on the next
following June 30th.
"Gross Proceeds" means the sum of the following
amounts: (i) original proceeds, being the amounts received by the
Agency, or held by the Fiscal Agent as proceeds of the original
issuance of the Bonds (after payment of all expenses of issuing
the Bonds); (ii) investment proceeds, being amounts received at
any time by the Agency or the Fiscal Agent, such as interest and
dividends, resulting from the investment of proceeds of the
Bonds, including profits and less losses received on such
investment; (iii) amounts, other than original proceeds and
investment proceeds, held in any fund or account and reasonably
expected to be used to pay principal of or interest on the Bonds;
(iv) securities or obligations pledged as security for the
payment of the Bonds by an ultimate obligor (or a related person)
or the Agency; (v) amounts used to pay principal or interest with
respect to the Bonds; and (vi) amounts received as a result of
investing the amounts listed in clauses (i) through (v).
"Independent Financial Consultant" or "Independent
Engineer" means any financial advisor, consultant or engineer or
firm of such consultants or engineers appointed by the Agency,
and who, or each of whom:
1. is in fact independent and not under
domination of the Agency; and
2. does not have any substantial interest,
direct or indirect, with the Agency; and
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3. is not connected with the Agency as an
officer or employee of the Agency, but who may be regularly
retained to make reports to the Agency.
"Low and Moderate Income Housing Fund" means the fund
by that name created pursuant to Section 12 of this Resolution.
"Maximum Annual Debt Service" means the largest of the
sums obtained for any Fiscal Year after totaling the following
for each such Fiscal Year:
1. the principal amount of all Outstanding
serial Bonds and serial Parity Bonds payable in such Fiscal Year;
and
2. the amount of Minimum Sinking Fund Payments
for all Outstanding term Bonds and term Parity Bonds to be made
in such Fiscal Year in accordance with the applicable schedule or
schedules of Minimum Sinking Fund Payments together with the
premium thereon, if any be payable; and
3. the interest which would be due during such
Fiscal Year on the aggregate principal amount of Bonds and Parity
Bonds which would be Outstanding in such Fiscal Year if the Bonds
and Parity Bonds outstanding on the date of such computation were
to mature or be redeemed in accordance with the maturity schedule
or schedules for the serial Bonds and serial Parity Bonds and the
applicable schedule or schedules of Minimum Sinking Fund Payments
for term Bonds and term Parity Bonds. At the time and for the
purpose of making such computation, the amount of Bonds and
Parity Bonds already retired in advance of the above mentioned
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schedule or schedules shall be deducted pro rata from the
remaining amounts thereon.
"Minimum Sinking Fund Payments" means the amount of
money to be deposited into the Term Bond Sinking Fund Account to
be used to redeem term Bonds and term Parity Bonds at the
principal amounts thereof, plus premium, if any, in the amounts
and at the times set forth in the applicable schedule or
schedules of Minimum Sinking Fund Payments contained in this
Resolution or in any Supplemental Resolution or any resolution
providing for the issuance of term Parity Bonds.
"Outstanding," when used with reference to the Bonds,
means, as of any particular date, the aggregate of all the Bonds
authenticated and delivered under this Resolution, except:
1. Bonds canceled by the Agency or delivered to
the Agency for cancellation at or prior to such date;
2. Bonds for the payment or redemption of which
money in the necessary amount has been theretofore deposited with
the Fiscal Agent or any Paying Agent for the holders of such
Bonds, provided that if such Bonds are to be redeemed notice of
such redemption has been duly given pursuant to this Resolution;
3. Bonds paid or deemed to be paid as provided
in Section 3.B hereof; and
4. Bonds in lieu of or in substitution for which
other Bonds shall have been authenticated and delivered pursuant
to this Resolution.
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"Parity Bonds" means any additional tax allocation
bonds, including, without limitation, bonds, notes, interim
certificates, debentures or other obligations, payable out of Tax
Revenues ranking on a parity with the Bonds, issued by the Agency
as permitted by Section 17 of this Resolution.
"Palma Village Area" means the area within the City
commonly known as Palma Village and more particularly described
in that certain Palma Village Area Survey described in Section 13
hereof.
"Paying Agent" means any paying agent provided by the
Agency pursuant to this Resolution.
"Permitted Investments" means:
1. Federal Securities;
2. Bonds, debentures or notes or other evidence
of indebtedness payable in cash issued by any one or a
combination of any of the following federal agencies whose
obligations represent full faith and credit of the United
States of America: Export Import Bank of the United States,
Federal Financing Bank, Farmer's Home Administration,
Federal Housing Administration, Maritime Administration,
Public Housing Authority, Government National Mortgage
Association;
3. Certificates of deposit properly secured at
all times, by collateral security described in (1) and (2)
above. Such agreements are only acceptable with commercial
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banks, savings and loans associations and mutual savings
banks;
4. The following investments fully insured by
the Federal Deposit Insurance Corporation or the Federal
Savings and Loan Insurance Corporation: (i) certificates of
deposit, (ii) savings accounts, (iii) deposit accounts, or
(iv) depository receipts of banks, savings and loan
associations and mutual savings banks;
5. Commercial paper rated in one of the two
highest rating categories by at least two nationally
recognized rating agencies or commercial paper backed by a
letter of credit or line of credit rated in one of the two
highest rating categories;
6. Written repurchase agreements with any bank,
savings institution or trust company (not the Fiscal Agent)
which is insured by the Federal Deposit Insurance
Corporation or the Federal Savings and Loan Insurance
Corporation, or with any broker -dealer with retail customers
which falls under Securities Investors Protection
Corporation protection, provided that such repurchase
agreements are fully secured by (1) above or obligations of
any Corporation of instrumentality of the United States of
America, and provided further that (i) such collateral is
held by the Fiscal Agent or any agent acting solely for the
Fiscal Agent during the term of such repurchase agreement,
(ii) such collateral is not subject to loans or claims of
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third parties, (iii) such collateral has a market value
(determined at least once every 14 days) at least equal to
the amount invested in the repurchase agreement, (iv) the
Fiscal Agent has a perfected first security interest in the
collateral, (v) the agreement shall be for a term not longer
than 270 days and (vi) the failure to maintain such
collateral at the level required in (iii) above will require
the Fiscal Agent to liquidate the collateral;
7. Money market funds rated AAA by Standard &
Poor's, or taxable government money market portfolios,
restricted to obligations with maturities of one year or
less, issued by or guaranteed as to payment of principal and
interest by, the United States of America; and
8. The State of California, Local Agency
Investment Fund but only to the extent that such moneys
remain to the name and credit of the Fiscal Agent.
"Project Area" means only the territory within the
project area described and defined in the Redevelopment Plan
approved and adopted by the City by its Ordinance No. 80.
"Project Area, As Amended" means the Project Area
together with the Added Territory added to the Project Area
pursuant to Ordinance No. 275 of the City, except that portion of
the Added Territory within the territorial limits of the City of
Indian Wells.
"Registered Owner" or any similar term, including,
without limitation, "Bondholder" or "Holder of Bonds," means the
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. registered owner or the duly authorized attorney, trustee,
representative or assigns of any outstanding Bond of such owner.
"Redevelopment Law" means the Community Redevelopment
Law, California Health and Safety Code Section 33000, et seq.,
and all future acts supplemental thereto or amendatory thereof.
"Redevelopment Plan" means the Redevelopment Plan for
Project Area No. 1, approved and adopted by the City by its
Ordinance No. 80 and includes any amendment of the Redevelopment
Plan heretofore or hereafter made pursuant to law, except insofar
as any such amendment pertains only to the Added Territory.
"Series" means all of the Bonds delivered on original
issuance in a simultaneous transaction pursuant to this
Resolution and any Bonds, notes or other obligations thereafter
delivered in lieu of or in substitution therefor pursuant hereto.
"Supplemental Resolution" means a resolution
supplemental to or amendatory of this Resolution.
"Tax Revenues" means 20 percent of that portion of the
taxes levied upon taxable property in the Added Territory and
received by the Agency, which are allocated to and paid into a
special fund of the Agency pursuant to Article 6 of Chapter 6 of
the Redevelopment Law and Section 16 of Article XVI of the
California Constitution, and which are in turn placed into the
Low and Moderate Income Housing fund of the Agency, all as more
particularly set forth in Sections 33334.2 and 33334.3 of the
Redevelopment Law and in this Resolution.
"State" means the State of California.
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"Treasurer" or "Treasurer of the Agency" means the
officer who is then performing the functions of Treasurer of the
Agency.
Section 2. Amount. Issuance and Purpose of Bonds.
Under and pursuant to the Redevelopment Law and under and pur-
suant to this Resolution, Bonds of the Agency in the aggregate
principal amount of $8,500,000 are authorized to be issued by the
Agency for the corporate purposes of the Agency to aid in the
financing of a redevelopment project, and for other purposes
related thereto as hereinafter provided, and such issue of Bonds
is hereby created. It is hereby determined and declared that the
issuance of the Bonds is necessary for the purposes herein
stated. Such redevelopment project includes the installation and
construction of certain offsite improvements in the Palma Village
Area, including streets, curbs, gutters, sidewalks, storm drains,
and sanitary sewer improvements. Whenever the Agency determines
to issue all or part of the Bonds, it shall adopt a Supplemental
Resolution specifying the principal amount of such Bonds to be
issued and providing for: (i) the distinctive designation there-
of; (ii) the date which the Bonds shall bear; (iii) the method of
numbering the Bonds; (iv) the maturity dates of the Bonds; (v)
the date or dates on which all or part of the Bonds may be called
for redemption prior to maturity and the premiums, if any,
applicable thereto; and (vi) any other provision respecting the
Bonds not in conflict with the terms of this Resolution.
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Section 3. Nature of Bonds.
A. Security. The Tax Revenues are hereby allocated
and irrevocably pledged to the payment of the principal of and
interest on the Bonds and all Parity Bonds as in this Resolution
provided, and until all of the Bonds and Parity Bonds, and all
interest thereon, have been paid, or until moneys for that
purpose have been irrevocably set aside as provided in Section
3.B or Section 11.E hereof, the Tax Revenues shall be applied
solely to the payment of the Bonds and the Parity Bonds and the
interest thereon as in this Resolution provided. Such allocation
and pledge are for the exclusive benefit of the Registered Owners
of the Bonds and the Parity Bonds and shall be irrevocable.
The Bonds shall be and are special obligations of the
Agency and are hereby secured by an irrevocable pledge of, and
are payable as to principal, premium, if any, and interest from
Tax Revenues and other funds as hereinafter provided. The Bonds,
premiums, if any, and interest thereon are not a debt of the
City, the State or any of its political subdivisions and neither
the City, the State nor any of its political subdivisions is
liable on the Bonds, nor in any event shall the Bonds, premium,
if any, and interest thereon be payable out of any funds or
properties other than those of the Agency as set forth in this
Resolution. The Bonds do not constitute an indebtedness within
the meaning of any constitutional or statutory debt limitation or
restriction. Neither the members of the Agency nor any persons
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executing the Bonds are liable personally thereon by reason of
their issuance.
The Bonds shall be and are equally secured by an
irrevocable pledge of Tax Revenues and other funds as hereinafter
provided, without priority for number, date of sale, date of
execution, or date of delivery, except as expressly provided
herein.
The validity of the Bonds is not and shall not be
dependent upon the completion of the redevelopment of the Project
Area or upon the performance by any person of an obligation of
that person relative to such redevelopment.
B. Defeasance. Nothing in this Resolution shall
preclude: (i) the payment of the Bonds from the proceeds of
refunding bonds issued pursuant to law, or (ii) the payment of
the Bonds from any legally available funds. Nothing in this
Resolution shall prevent the Agency from making advances of its
own funds howsoever derived to any of the uses and purposes
mentioned in this Resolution. If the Agency shall pay or cause
to be paid, or shall have made provision to pay upon maturity or
upon redemption prior to maturity to the Registered Owners of the
Bonds, or the principal and interest to become due thereon,
together with any applicable premium, through setting aside in
trust funds or setting apart in a reserve fund or special trust
account created pursuant to this Resolution or otherwise, or
through the irrevocable segregation for that purpose in some
sinking fund or other fund or trust account with a responsible
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bank or trust company, moneys sufficient therefor or Federal
Securities, the principal of and interest on which when due will
be sufficient therefor, then, as to the Bonds, the lien of this
Resolution, including, without limitation, the pledge of the Tax
Revenues and the other funds pledged hereunder, and all other
rights granted hereby, shall thereupon cease, terminate and
become void and be discharged and satisfied, and the Bonds and
interest thereon and any applicable premium on such Bonds shall
no longer be deemed to be Outstanding and unpaid; provided,
however, that nothing in this Resolution shall require the
deposit of more than such Federal Securities as may be
sufficient, taking into account both the principal amount of such
Federal Securities and the interest to become due thereon, to
implement any refunding of the Bonds. In such event, the Fiscal
Agent shall cause an accounting for such period or periods as
shall be requested by the Agency to be prepared and filed with
the Agency, and the Fiscal Agent, upon the request of the Agency,
shall release this Resolution as to the Bonds, and execute and
deliver to the Agency all such instruments as may be desirable to
evidence such release, discharge and satisfaction, and the Fiscal
Agent shall pay over or deliver to the Agency all moneys or
securities held by it pursuant to this Resolution as to the
Bonds, which are not required for the payment or redemption
thereof, not theretofore surrendered for such payment or
redemption.
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In case any of the Bonds are to be redeemed on any date
prior to their maturity, the Agency shall give to the Fiscal
Agent, in form satisfactory to it, irrevocable instructions to
provide notice of redemption as provided in Section 11 of this
Resolution. In the event the Bonds are not by their terms
subject to redemption within the next succeeding 60 days the
Agency shall give the Fiscal Agent in form satisfactory to it
irrevocable instructions to provide notice, as soon as
practicable, to the Registered Owners of such Bonds that the
deposit required in this Section 3.B has been made and that the
Bonds are deemed to have been paid in accordance with this
Section and stating the maturity or redemption date upon which
moneys are to be available for the payment of the principal and
interest to become due on the Bonds, together with any applicable
premium thereon. Neither the obligations nor moneys deposited
pursuant to this Section or principal or interest payments on any
such obligations nor moneys deposited pursuant to this Section
nor principal or interest payments on any such obligations shall
be withdrawn or used for any purpose other than, and shall be
held in trust for the payment of the principal and interest to
become due on the Bonds, together with any applicable premium
thereon; provided that any cash received from such principal or
interest payments on such obligations, if not then needed for
such purpose, shall, to the extent practicable, be reinvested in
Federal Securities maturing at times and in amount sufficient to
pay when due the principal and interest to become due on such
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Bonds, together with any applicable premium thereon on and prior
to such redemption date or maturity date thereof, as the case may
be.
Section 4. Description of Bonds; Disposition of
Proceeds. The Bonds shall be designated "Palm Desert
Redevelopment Agency, Project Area No. 1, As Amended (Added
Territory Only), Tax Allocation Bonds," in the aggregate
principal amount of $8,500,000. The Bonds shall be issued in the
form of Fully Registered Bonds, in denominations of $5,000 each
or any integral multiple thereof. The Bonds shall be dated as
set forth in a Supplemental Resolution. The designation of the
Bonds may contain such further descriptive terms as may be
approved by the Executive Director of the Agency and the
signature of the Executive Director appearing on the Bonds shall
be conclusive evidence of such approval.
The Fiscal Agent, on behalf of and as agent for the
Agency, shall receive the proceeds from the sale of the Bonds
upon the delivery of the Bonds to the original purchasers thereof
and shall dispose of such proceeds as follows:
A. Accrued interest and premium, if any, paid by the
original purchasers of the Bonds shall be placed in the Bond
Interest Payment Account.
B. A sum equal to the lesser of (i) ten percent of
the proceeds of the Bonds or (ii) Maximum Annual Debt Service
shall be deposited into the Reserve Account.
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C. After making the above transfers, the balance of
the proceeds from the sale of the Bonds shall be transferred to
the Low and Moderate Income Housing Improvement Account of the
Redevelopment Fund; provided, however, that prior to making such
transfer, the Fiscal Agent shall transfer to the Costs of
Issuance Account of the Redevelopment Fund an amount specified in
a Certificate of the Executive Director and pay the amounts
specified therein to the designated payees.
Section 5. Interest and Maturities. The Bonds shall
bear interest at a rate or rates to be hereafter fixed by a
Supplemental Resolution, but not to exceed the then maximum legal
rate per annum, payable semiannually as provided in a Supple-
mental Resolution. Each Bond shall bear interest until the
principal sum thereof has been paid; provided, however, that if
on any redemption date, funds are available for the payment
thereof in full accordance with the terms of this Resolution,
such Bonds as shall have been called for redemption and for which
notice of such redemption shall have been given shall then cease
to bear interest.
The Bonds shall be numbered by the Fiscal Agent as the
Fiscal Agent shall determine and shall be dated as of the date of
authentication thereof, except that Bonds issued upon exchanges
and transfers of Bonds shall be dated so that no gain or loss of
interest shall result from such exchange or transfer. Each Bond
shall bear interest from the interest payment date next preceding
the authentication date thereof unless (i) such authentication
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date shall be an interest payment date, in which case it shall
bear interest from such interest payment date; (ii) such
authentication date shall be prior to the fifteenth day preceding
the first interest payment date, in which case it shall bear
interest from the date of the Bonds, or (iii) such authentication
date is between the fifteenth day of the month preceding an
interest payment date and such interest payment date, in which
case it shall bear interest from such interest payment date.
Interest on the Bonds shall be paid by the Fiscal Agent, out of
the appropriate funds, by check or draft mailed by first class
mail to the Registered Owner at such Owner's address as it
appears on the register kept by the Fiscal Agent at the close of
business on the fifteenth day of the month preceding the interest
payment date. Interest shall be calculated on the basis of a
360-day year with twelve 30-day months. The principal amount of
Bonds issued from time to time and the schedule of maturity or
maturities thereof shall be specified in a Supplemental
Resolution.
Section 6. Place of Payment. The Bonds, the interest
thereon and any premiums upon the redemption thereof prior to
maturity, shall be payable in lawful money of the United States
of America upon surrender, except for interest which is payable
by check or draft as stated above, and shall be payable at the
corporate trust office of the Fiscal Agent in Los Angeles,
California.
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Section 7. Forms of Bonds. Temnorary Bonds. The Bonds
shall be substantially in the form attached hereto and made a
part hereof, marked "Exhibit A" ("Fully Registered Bond"). Such
form is hereby approved and adopted as the form of the Bonds, and
of the redemption, exchange, registration and assignment
provisions pertaining thereto, with necessary or appropriate
variations, omissions and insertions, as permitted or required by
this Resolution or any Supplemental Resolution.
Any Bonds issued under this Resolution may be initially
issued in temporary form exchangeable for definitive Bonds when
the same are ready for delivery. The temporary Bonds may be
printed, lithographed or typewritten, shall be of such
denominations as may be determined by the Agency 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
Agency and be authenticated and delivered by the Fiscal Agent
upon the same conditions and in substantially the same manner as
the definitive Bonds. If the Agency issues temporary Bonds, it
shall execute and furnish definitive Bonds without delay, and,
thereupon, the temporary Bonds may be surrendered for
cancellation at the Fiscal Agent for the Agency in Los Angeles,
California, and the Fiscal Agent shall deliver in exchange for
such temporary Bond an equal aggregate principal amount of
definitive Bonds of authorized denominations of the same issue.
Until so exchanged, the temporary Bonds shall be entitled to the
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same benefits under this Resolution as definitive Bonds of the
same issue delivered hereunder.
Section 8. Execution of Bonds. The Bonds shall be
signed on behalf of the Agency by facsimile or manual signature
of its Chairman and by facsimile or manual signature of the
Executive Director or one other member or officer of the Agency,
and the seal of the Agency shall be impressed, imprinted or
reproduced thereon. The Chairman, the Executive Director and the
foregoing members and officers are hereby authorized and directed
to sign the Bonds in accordance with this Section. If any Agency
member or officer whose manual or facsimile signature appears on
the Bonds ceases to be such member or officer before delivery of
the Bonds, such signature is as effective as if such member or
officer had remained in office, and the Bonds shall be as binding
upon the Agency as though the person who signed the Bonds had
been such member or officer on the date borne by the Bonds. The
Bonds shall be authenticated by the Fiscal Agent by manual
signature.
Section 9. Form of Bonds, Registration and Exchanae.
The Bonds are issued as Fully Registered Bonds payable to the
Registered Owner, negotiable only by proper transfer of
registration.
A Fully Registered Bond or Fully Registered Bonds may
be exchanged for a Fully Registered Bond or Fully Registered
Bonds. Transfer of ownership of a Fully Registered Bond or Fully
Registered Bonds shall be made by exchanging the same for a new
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Fully Registered Bond or Fully Registered Bonds. All of such
exchanges shall be made in such manner and upon such reasonable
terms and conditions as may from time to time be determined and
prescribed by the Agency; provided, however, no such transfer or
exchange shall be made between 15 days preceding any date
established by the Fiscal Agent for the selection of Bonds for
redemption and the date of such selection. Such exchanges may be
subject to costs or charges to the person, firm or corporation
requesting such exchange, and for any tax or governmental charge
that may be imposed in connection with such exchange. Each Fully
Registered Bond issued pursuant to this Resolution shall be of a
denomination which is $5,000 or a whole multiple thereof.
Section 10. Bond Reaster. The Fiscal Agent shall
keep or cause to be kept at its corporate trust office in Los
Angeles, California, sufficient books for the registration and
transfer of the Bonds, which shall at all reasonable times be
open to inspection by the Agency; and upon presentation for such
purpose, the Fiscal Agent shall, under such reasonable
regulations as it may prescribe, register or transfer, or cause
to be registered or transferred, on such register, the Bonds as
provided above.
Section 11. Redemption of Bonds Prior to Maturity.
A. Call for Redemption. The Agency may provide for
the optional and mandatory call and redemption of Bonds prior to
maturity in a Supplemental Resolution. The Agency may, and, if
required by any provision of this Resolution or Supplemental
-22-
871022 jtw A529.WLS (1)
Resolution, shall, direct the call and redemption prior to
maturity of Bonds, which are by their terms then callable for
redemption, by the Fiscal Agent in such amounts for which funds
are available and shall give notice to the Fiscal Agent of such
redemption at least 60 days prior to the redemption date.
B. Notice of Redemption. Notice of redemption prior
to maturity, except as provided below, shall be given by mailing
such notice by first-class mail not less than 30 nor more than 60
days before such redemption date, to each Registered Owner of
such Bond. The notice of redemption shall (i) state the
redemption date; (ii) state the redemption price; (iii) state the
numbers and dates of maturity of the Bonds to be redeemed;
provided, however, that whenever any call for redemption includes
all of the Outstanding Bonds, the numbers of the Bonds need not
be stated; (iv) state, as to any Fully Registered Bonds redeemed
in part only, the registered Bond numbers and the principal
portion thereof to be redeemed; and (v) state that interest on
the principal portion of the Bonds so designated for redemption
shall cease to accrue from and after such redemption date and
that on such date there will become due and payable on each of
the Bonds the principal amount thereof to be redeemed, interest
accrued thereon to the redemption date and the premium thereon,
if any, such premium to be specified.
The actual receipt by the Registered Owner of notice of
such redemption shall not be a condition precedent to redemption,
and failure to receive such notice shall not affect the validity
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871022 jlw A529.WLS (1)
of the proceedings for the redemption of such Bonds or the
cessation of interest on the redemption date. Notice of
redemption of Bonds shall be given by the Fiscal Agent for and on
behalf of the Agency at the expense of the Agency.
A certificate by the Fiscal Agent that notice of
redemption has been given as herein provided shall be conclusive
as against all parties, and no Registered Owner whose Bond is
called for redemption may object thereto or object to the
cessation of interest on the redemption date fixed by any claim
or showing that such Registered Owner failed actually to receive
such notice of call and redemption.
C. Redemption Fund. Prior to the publication as
above required: (i) the Fiscal Agent shall establish, maintain
and hold in trust a separate fund which is hereby created for the
purpose of this Resolution entitled "Project Area No. 1, As
Amended (Added Territory Only), Tax Allocation Bonds, Redemption
Fund" (the "Redemption Fund"); and (ii) there shall be set aside
in the Redemption Fund, transferred from the appropriate Account
or Accounts in the Special Fund or from other legally available
funds of the Agency, moneys for the purpose and sufficient to
redeem, at the premiums, if any, payable as provided in this
Resolution or a Supplemental Resolution, the Bonds designated in
such notice of redemption. This provision shall not apply,
however, to a redemption made (i) as part of a plan of defeasance
in accordance with Section 3.B hereof; and (ii) pursuant to
mandatory sinking fund account redemption. Such moneys must be
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871022 jlw A529.WLS (1)
set aside in the Redemption Fund solely for that purpose and
shall be applied on or after the redemption date to the payment
of principal and premium, if any, of the Bonds to be redeemed
upon presentation and surrender of such Bonds. Any interest due
on or prior to the redemption date upon the Bonds shall be paid
from the Special Fund upon presentation and surrender thereof.
D. Partial Redemption of Fully Reaistered Bonds.
Upon surrender of any Fully Registered Bond redeemed in part
only, the Agency shall execute and the Fiscal Agent shall
authenticate and deliver to the Registered Owner thereof, at the
expense of the Agency, a new Bond or Bonds of authorized
denominations equal in aggregate principal amount to the
unredeemed portion of the Fully Registered Bond surrendered and
of the same interest rate or rates and same maturity or
maturities.
E. Effect of Redemption. Notice of redemption having
been duly given as aforesaid, and moneys for payment of the
principal of, premiums, if any, and interest payable upon
redemption of the Bonds having been set aside in the Redemption
Fund, the Bonds, or parts thereof, as the case may be, called for
redemption shall, on the redemption date, become due and payable
at the redemption price specified in such notice, interest on the
Bonds, or parts thereof, as the case may be, so called for
redemption shall cease to accrue, and the Bonds, or parts
thereof, as the case may be, shall cease to be entitled to any
lien, benefit or security under this Resolution, and the
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871022 jlw A529.WLS (1)
Registered Owners shall have no rights in respect thereof except
to receive payment of the redemption price thereof, and, in the
case of partial redemption of Fully Registered Bonds, also to
receive a new Bond or Bonds for the unredeemed balance as
aforesaid.
All Bonds, or parts thereof, as the case may be,
redeemed pursuant to the provisions of this Section shall be
canceled upon surrender thereof and destroyed with a certificate
of destruction sent to, or upon the order of, the Agency.
So long as any of the Bonds or Parity Bonds herein
authorized, or any interest thereon, remain unpaid, the moneys in
the Redemption Fund shall be used for no purpose other than those
required or permitted by this Resolution, any Supplemental
Resolution, any resolution providing for the issuance of Parity
Bonds and the Redevelopment Law.
F. Purchase of Bonds. The Fiscal Agent, on behalf of
and at the specific written direction of the Agency, is hereby
authorized to purchase Bonds on the open market at any time at a
price not to exceed the principal amount of the Bonds plus the
applicable premium and accrued interest, if any, to the date of
purchase plus brokerage fees, if any.
Section 12. Funds. There is hereby continued by this
Resolution with the Treasurer a special trust fund called the
"Project Area No. 1, As Amended (Added Territory Only),
Redevelopment Fund" (the "Redevelopment Fund"). There is hereby
created by this Resolution with the Treasurer a special trust
-26-
871022 j l w A529.WLS (1)
account to be held by the Fiscal Agent known as the Costs of
Issuance Account. There is hereby created by this Resolution
with the Treasurer a special trust account in the Redevelopment
Fund known as the "Low and Moderate Income Housing Improvement
Account."
There is hereby created by this Resolution with the
Treasurer a special trust fund to be held by the Fiscal Agent
called the "Redevelopment Project No. 1, Low and Moderate Income
Housing Fund" (the "Low and Moderate Income Housing Fund") and
there is hereby created in the Low and Moderate Income Housing
Fund the following trust accounts: (i) the Bond Interest Payment
Account, (ii) the Serial Bond Payment Account, (iii) the Term
Bond Sinking Fund Account, and (iv) the Reserve Account.
So long as any of the Bonds or Parity Bonds herein
authorized, or any interest thereon, remain unpaid, the moneys in
the foregoing Funds and Accounts shall be used for no purpose
other than those required or permitted by this Resolution, any
Supplemental Resolution, any resolution providing for the
issuance of Parity Bonds and the Redevelopment Law.
Section 13. Sale of Bonds, Disposition of Bond
Proceeds; Redevelopment Fund; Findinas and Determination. The
moneys transferred to and placed in the Low and Moderate Income
Housing Improvement Account of the Redevelopment Fund shall
remain therein until from time to time expended solely for the
purpose of financing a portion of the cost of certain public
-27-
871022 jlw A529.WtS (1)
improvements and other costs related thereto, and also including,
without limitation, in such costs:
A. The cost of any lawful purpose in connection with
such redevelopment, namely, those purposes authorized by Section
33334.2(e) of the Redevelopment Law to pay for certain offsite
improvements in the Palma Village Area of the City; and
B. Any costs and expenses in connection with the
issuance and sale of the Bonds, and fees of the Fiscal Agent and
Paying Agents, if any.
If any sum remains in the Redevelopment Fund after the
full accomplishment of the objects and purposes for which the
Bonds were issued, such sum shall be transferred to the Low and
Moderate Income Housing Fund.
The staff of the Agency has prepared that certain Palma
Village Area Survey, a copy of which has been presented to the
Agency and which is on file in the office of the Executive
Director and the Secretary of the Agency, which describes the
housing in the Palma Village Area and its availability at
affordable housing costs to persons and families of low or
moderate income. Based upon the Palma Village Area Survey and
based upon other information and materials presented to the
Agency, the Agency hereby finds and determines that the
installation and construction of certain offsite improvements in
the Palma Village Area, including streets, curbs, gutters,
sidewalks, storm drains and sanitary sewer improvements, will
benefit the Project Area, As Amended, and will be in furtherance
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871022 jlw A529.48 (1)
of and will carry out the purposes of Sections 33334.2 and
33334.3 of the Redevelopment Law in that such installation and
construction will improve the City's supply of low and moderate
income housing available at affordable housing costs by improving
land and building sites with offsite improvements.
Section 14. Tax Revenues. The Tax Revenues are hereby
allocated and irrevocably pledged to the payment of the principal
of and interest on the Bonds and all Parity Bonds as in this
Resolution provided, and until all of the Bonds and Parity Bonds,
and all interest thereon, have been paid, or until moneys for
that purpose have been irrevocably set aside as provided in
Section 3.B or Section 11.E hereof, the Tax Revenues shall be
applied solely to the payment of the Bonds and the Parity Bonds
and the interest thereon as in this Resolution provided. Such
allocation and pledge is for the exclusive benefit of the
Registered Owners of the Bonds and the Parity Bonds and shall be
irrevocable. Tax Revenues allocated to the Agency shall not be
payable to the Fiscal Agent on account of any Bonds when
sufficient funds have been placed with the Fiscal Agent to redeem
all outstanding Bonds.
Section 15. Low and Moderate Income Housing Fund. All
Tax Revenues shall be deposited in the Low and Moderate Income
Housing Fund. Without limiting the generality of the foregoing
and for the purpose of assuring that the payments referred to
above will be made as scheduled, the Tax Revenues accumulated in
the Low and Moderate Income Housing Fund shall be used in the
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871022 jtw A529.t&S (1)
following priority; provided, however, that to the extent that
deposits have been made in any of the Accounts referred to below
from the proceeds of the sale of the Bonds or otherwise, the
deposits below need not be made:
A. Bond Interest Payment Account. Deposits shall be
made into the Bond Interest Payment Account so that the balance
in such Account 30 days prior to the date of the payment of any
installment of interest on the Bonds and the Parity Bonds shall
be equal to six months interest on the then outstanding Bonds and
Parity Bonds. Moneys in the Bond Interest Payment Account shall
be used for the payment of interest on the Bonds and the Parity
Bonds as the same become due.
B. Serial Bond Payment Account. After the deposits
have been made pursuant to subparagraph A above, deposits shall
next be made into the Serial Bond Payment Account so that the
balance in such Account 30 days prior to the date of payment of
principal is due shall equal the next principal payment, or
payments, as the case may be, on the then outstanding serial Bond
and serial Parity Bonds. Moneys in the Serial Bond Payment
Account shall be used for the payment of the principal of such
serial Bonds and serial Parity Bonds, as the same become due.
C. Term Bond Sinking Fund Account. Commencing on a
date 13 months prior to the first date set forth on the schedule
of Minimum Sinking Fund Payments set forth in a Supplemental
Resolution, after the deposits have been made pursuant to
subparagraphs A and B above, if the Tax Revenues are sufficient
-30-
871022 ill,. A529.WLS (1)
therefor, deposits shall next be made into the Term Bond Sinking
Fund Account so that the balance in such Account 30 days prior to
the date the money in such account is scheduled to be used shall
equal the then current Minimum Sinking Fund Payment on the then
outstanding term Bonds and term Parity Bonds. Moneys in the Term
Bond Sinking Fund Account shall be used and applied by the Fiscal
Agent to call and redeem the amount of Outstanding term Bonds and
term Parity Bonds to be called pursuant to the applicable
schedule, with the moneys available therefor. Any such call and
redemption shall be made in accordance with the provisions of
Section 11 hereof and according to the schedule or schedules
provided in the a resolution relating to the Parity Bonds or in a
Supplemental Resolution. In lieu or partially in lieu of such
call and redemption, moneys in the Term Bond Sinking Fund Account
may be used to purchase Outstanding term Bonds and term Parity
Bonds in the manner hereinafter provided. Purchases of
Outstanding term Bonds and term Parity Bonds shall be made at the
specific written direction of the Agency by the Fiscal Agent at
public or private sale but only at prices, including brokerage, or
other expenses, not more than the principal amount thereof plus
accrued interest plus the premium applicable at the next
following call date according to the schedule or schedules
applicable thereto, and any accrued interest payable upon the
purchase of term Bonds and term Parity Bonds may be paid from the
amount reserved in the Bond Interest Payment Account for the
payment of interest on the next following interest payment date.
-31-
871022 jlw A529.WLS (1)
At the direction of the Agency, the Fiscal Agent shall cancel the
purchased Bonds and apply such cancelled Bonds to the Sinking
Fund Payments.
D. Reserve Account. After the deposits have been
made pursuant to subparagraphs A, B and C above, if the Tax
Revenues are sufficient therefor, deposits shall next be made
into the Reserve Account so that the balance in such Account
shall equal not less than the lesser of ten percent of the
proceeds of the Bonds or Maximum Annual Debt Service on all Bonds
and Parity Bonds, or such other amount as may be specified by a
Supplemental Resolution, and the balance in such Account shall be
so maintained to equal the lesser of ten percent of the proceeds
of the Bonds or Maximum Annual Debt Service on all Bonds and
Parity Bonds, or such other amount. Moneys in the Reserve
Account shall be used solely for the purpose of paying the
interest and principal of the Bonds and Parity Bonds and making
Minimum Sinking Fund Payments on term Bonds or term Parity Bonds
in the event that the moneys in the Bond Interest Payment Account
or Serial Bond Payment Account or Term Bond Sinking Fund Account
are insufficient therefor and for that purpose the Fiscal Agent
shall withdraw and transfer moneys from the Reserve Account to
the appropriate Account. Moneys in the Reserve Account may be
used to pay the interest and principal of the last outstanding
maturity of the Bonds and Parity Bonds so that the issue of Bonds
and Parity Bonds will be retired.
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871022 jlw A529.WLS (1)
E. Jo Default: Surplus. It is the intent of this
Resolution: (i) that the deposits in subparagraphs A and B above
to the Bond Interest Payment Account and the Serial Bond Payment
Account, respectively, shall be made as scheduled, and (ii) that
the deposits in subparagraphs C and D above, to the Term Bond
Sinking Fund Account and the Reserve Account respectively, shall
be made as scheduled, if and only if the Tax Revenues are
sufficient therefor. Failure to make the required deposits into
the Term Bond Sinking Fund Account, as specified in subparagraph
C above, and into the Reserve Account, as specified in
subparagraph D above, shall not be an event of default, if, and
only if, the Tax Revenues are insufficient therefor. Should it
be necessary to defer all or part of any deposit referred to in
subparagraphs C and D above, such deferred deposits shall be
cumulative and shall be made when the Tax Revenues are sufficient
to make the deposits required by subparagraphs A and B and
thereafter make the deposits required by subparagraphs C and D.
If: (i) the above transfers have been made so that the required
amounts as of that time are in all of the above mentioned
Accounts, and (ii) the Tax Revenues to be received for the next
Fiscal Year by the Agency, based upon the most recent assessed
valuation of taxable property in the Project Area, furnished by
the appropriate officer of the County of Riverside, are at least
equal to 110 percent of Maximum Annual Debt Service on all Parity
Bonds and any loans, advances or indebtedness payable from Tax
Revenues or from other sources as provided in Section 3.A hereof
-33-
871022 jlw A529.WLS (1)
on a parity with the Bonds, then the balances in the Special Fund
may be used and applied by the Agency for any lawful purpose,
including without limitation the purchase or call and redemption
of the Bonds and Parity Bonds as set forth in subparagraph C
above. The Fiscal Agent shall pay such balance to the Agency
within five business days of written request for such amount from
an authorized representative of the Agency and a receipt of a
certificate referred to above signed by an Independent Financial
Consultant.
In the event the Agency cannot meet the test above set
forth, any deficiency can be supplied by setting aside in the
Reserve Account amounts being held in the other Accounts of the
Low and Moderate Income Housing Fund and the remaining surplus
balances in the Special Fund may then be used and applied by the
Agency for any lawful purpose as stated above.
Section 16. Deposit and Investment of Moneys in Funds.
Subject to the provisions of Covenant 9 of Section 18 hereof, all
moneys held by the Agency in the Redevelopment Fund and by the
Fiscal Agent in the Special Fund, except such moneys which are at
the time invested, shall be held in time or demand deposits in
any financial institution authorized to accept deposits of public
funds, including the banking department of the Fiscal Agent, and
shall be secured at all times by bonds or other obligations which
are authorized by law as security for public deposits and are of
a market value at least equal to the amount required by law.
-34-
871022 J lw A529.WLS (1)
Moneys in the Low and Moderate Income Housing
Improvement Account of the Redevelopment Fund may be from time to
time invested by the Agency, and moneys in the Low and Moderate
Income Housing Fund may, and, upon written request of the Agency
shall, be invested by the Fiscal Agent as provided by the
Redevelopment Law, subject to the following restrictions:
A. Moneys in the Low and Moderate Income Housing
Improvement Account of the Redevelopment Fund shall be invested
only in Permitted Investments obligations which will by their
terms mature not later than the date the Agency estimates the
moneys represented by the particular investment will be needed
for withdrawal from such Fund.
B. Moneys in the Bond Interest Payment Account, the
Serial Bond Payment Account, and the Term Bond Sinking Fund
Account shall be invested only in Permitted Investments which
will by their terms mature on such dates as to insure that before
each interest payment date there will be in such Accounts, from
matured obligations and other moneys already in such Accounts,
cash equal to the interest and principal payable on such date.
C. Moneys in the Reserve Account shall be invested
only in Permitted Investments which will by their terms mature in
not more than two years, but in no event in obligations which
mature after the final maturity date of the Bonds.
D. Moneys in the Redemption Fund shall be invested
only in Permitted Investments which will by their terms mature
not later than the earlier of (i) two years, or (ii) the date the
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871022 jlw A529.14LS (1)
Agency or Fiscal Agent estimates the moneys represented by the
particular investment will be needed for withdrawal from such
Fund.
E. Moneys in the Rebate Fund shall be invested in
Federal Securities which will by their terms mature not later
than the earlier of (i) two years, or (ii) the date the Fiscal
Agent expects receipt of instructions to pay such amounts to the
United States government.
The moneys held by the Fiscal Agent shall be invested
in Permitted Investments.
The value of Permitted Investments shall be determined
as provided in "Value" below.
"Value", as of any particular time of determination,
means that the value of any investments shall be calculated as
follows:
(1) as to investments the bid and asked prices of
which are published on a regular basis in The Wall Street Journal
or The New York Times: the average bid and asked prices for such
investments so published on or most recently prior to such time
of determination;
(2) as to investments the bid and asked prices of
which are not published on a regular basis in The Wall Street
Journal or The New York Times: the average bid price at such
time of determination for such investments by any two nationally
recognized government securities dealers (selected by the Fiscal
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871022 jlw A529.WLS (1)
Agent in its absolute discretion) at the time making a market in
such investments;
(3) as to certificates of deposit and bankers
acceptances: the face amount thereof, plus accrued interest; and
(4) as to any investment not specified above: the
value thereof established by prior agreement between the Agency
and the Fiscal Agent.
If more than one provision of this definition of
"value" shall apply at any time to any particular investment, the
value thereof at such time shall be determined in accordance with
the provision establishing the lowest value for such investment.
Obligations purchased as an investment of moneys in any
of such Funds or the Accounts therein shall be deemed at all
times to be a part of such Fund or Account and the interest
accruing thereon and any gain realized from such investment shall
be credited to such Fund or Account and any loss resulting from
any such authorized investment shall be charged to such Fund or
Account without liability to the Agency or the members and
officers thereof or to the Fiscal Agent. The Agency or the
Fiscal Agent, as the case may be, shall sell at the best price
obtainable or present for redemption any obligation so purchased
whenever it shall be necessary to do so in order to provide
moneys to meet any payment or transfer from such Fund or Account
as required by this Resolution. For the purpose of determining
at any given time the balance in any such Fund or Account, any
such investment constituting a part of such Fund or Account shall
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871022 jlw A529.45 (1)
be valued at the then estimated or appraised market value or
redemption value of such investment, whichever is less.
Whenever reference is made to sums or moneys in a
particular fund or account, or words of similar import are used,
such reference shall include, without limitation, investments in
such fund or account.
Section 17. Issuance of Parity Bonds. The Agency may
provide for the issuance of, and sell, Parity Bonds in such
additional principal amounts as it estimates will be needed for
the purposes of Section 33334.2 of the Redevelopment Law. The
issuance and sale of any Parity Bonds shall be subject to the
following conditions precedent:
A. The Agency shall be in compliance with all
covenants set forth in this Resolution.
B. Tax Revenues, excluding State subventions,
received or to be received by the Agency, commencing on the date
of issuance of such Parity Bonds, based upon the most recent
equalized roll of taxable property in the Added Territory, shall
be at least equal to 110 percent of the Maximum Annual Debt
Service on the Bonds, Parity Bonds and any loans, advances or
indebtedness payable from Tax Revenues on a parity with the Bonds
pursuant to Section 33670 of the Redevelopment Law, which will be
outstanding following the issuance of such Parity Bonds.
C. The resolution providing for such Parity Bonds
shall require that from the proceeds of the sale thereof or from
other legally available funds there shall be deposited in the
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871022 jlw A529.WLS (1)
Reserve Account in the Special Fund an amount such that the
balance in such Account shall equal the lesser of ten percent of
the proceeds of the Parity Bonds or Maximum Annual Debt Service.
D. The Parity Bonds shall be serial Bonds or term
Bonds, or both, and the interest thereon shall be payable semi-
annually on the same dates as interest on the Bonds is payable.
Section 18. Covenants of the Aaencv. As long as the
Bonds are outstanding and unpaid, the Agency shall, through its
proper members, officers, agents or employees, faithfully perform
and abide by all of the covenants, undertakings and provisions
contained in this Resolution or in any Bond issued hereunder,
including the following Covenants and agreements for the benefit
of the Registered Owners which are necessary, convenient and
desirable to secure the Bonds and will tend to make the Bonds
more marketable; provided, however, that such Covenants do not
require the Agency to expend any funds other than the Tax
Revenues:
Covenant 1. Complete Redevelopment Project;
Amendment to Redevelopment Plan. The Agency covenants and agrees
that it will diligently carry out and continue to completion,
with all practicable dispatch, the redevelopment of the Project
Area, in accordance with its duty to do so under and in
accordance with the Redevelopment Law and the Redevelopment Plan
and in a sound and economical manner. The Redevelopment Plan may
be amended as provided in the Redevelopment Law, but no amendment
shall be made unless accompanied by a certificate or opinion of
-39-
871022 jiw A529.WLS (1)
. an Independent Financial Consultant employed by the Agency to the
effect that such amendment would not so impair the security of
the Bonds or the rights of the Registered Owners.
Covenant 2. Use of Proceeds; Management and
Operation of Properties. The Agency covenants and agrees that
the proceeds of the sale of the Bonds be deposited and used as
provided in this Resolution and that it will cause all properties
owned by it and comprising any part of the Added Territory, to be
managed and operated in a sound and businesslike manner. Not
more than 10 percent, if any, of the proceeds of the Bonds shall
be used for any private business use, within the meaning of that
term under Section 141(b)(1) of the Code, and not more than five
percent, if any, if the private business use is unrelated to the
governmental use of the proceeds. Not more than five percent, if
any, of the proceeds of the issue shall be used (directly or
indirectly) to make or finance loans (other than loans described
in Section 141(c)(2) of the Code) to persons other than
governmental units.
Covenant 3. No Priority. The Agency covenants
and agrees that it will not issue any obligations payable,
principal or interest, from the Tax Revenues which have, or
purport to have, any lien upon the Tax Revenues prior or superior
to the lien of the Bonds herein authorized. Except as permitted
in Section 17 hereof, the Agency will not issue any obligations
payable, principal or interest from the Tax Revenues, which have,
or purport to have, any lien upon the Tax Revenues on a parity
-40-
871022 jlw A529.WLS (1)
with the Bonds herein authorized; provided, however, that nothing
in this Resolution shall prevent the Agency (i) from issuing and
selling pursuant to law refunding bonds or other refunding
obligations payable from and having any lawful lien upon the Tax
Revenues, if such refunding bonds or other refunding obligations
are issued for the purpose of, and are sufficient for the purpose
of, refunding all of the Outstanding Bonds authorized by this
Resolution, or (ii) from issuing and selling or assuming the
liability for
or purport to
junior to the
selling bonds
payment of, bonds or other obligations which have,
have,
Bonds
any lien upon the Tax Revenues which is
herein authorized, or (iii) from
or other obligations which are payable
issuing
and
from sources
other than the Tax Revenues.
Covenant 4. Punctual Payment. The Agency
covenants and agrees that it will duly and punctually pay or
cause to be paid the principal of and interest on each of the
Bonds issued hereunder on the date, in the manner provided in the
Bonds, and all as provided herein.
Covenant 5. Payment of Taxes and Other Charges.
The Agency covenants and agrees that it will from time to time
pay and discharge, or cause to be paid and discharged, all
payments in lieu of taxes, service charges, assessments or other
governmental charges which may lawfully be imposed upon the
Agency or any of the properties then owned by it in the Project
Area, or upon the revenues and income therefrom, and will pay all
lawful claims for labor, material and supplies which if unpaid
-41-
871022 itw A529.WLS (1)
might become a lien or charge upon any of such properties,
revenues or income or which might impair the security of the
Bonds or the use of Tax Revenues or other legally available funds
to pay the principal and interest thereon, all to the end that
the priority and security of the Bonds shall be preserved;
provided that nothing in this Covenant shall require the Agency
to make any such payment so long as the Agency in good faith
shall contest the validity thereof.
Covenant 6. Books and Accounts; Financial
Statements. The Agency covenants and agrees that it shall at all
times keep, or cause to be kept, proper and current books and
accounts, separate from all other records and accounts, in which
complete and accurate entries shall be made of all transactions
relating to the redevelopment of the Project Area, and the Tax
Revenues and other funds relating to such redevelopment, and will
prepare within 180 days after the close of each of its Fiscal
Years a complete financial statement or statements for such year
in reasonable detail covering such redevelopment, the Tax
Revenues and other funds, certified by a certified public
accountant or firm of certified public accountants selected by
the Agency, and will furnish a copy of such statement or
statements to any Registered Owner upon written request.
Covenant 7. Further Redevelopment Covenants. The
proceeds of the Bonds shall be used only for a "redevelopment
activity" or for costs associated with financing a "redevelopment
activity" as that term is defined in Section 33678 of the
-42-
871022 jlw A529.WLS (1)
Redevelopment Law and only for carrying out the purposes
described in Section 33334.2 of the Redevelopment Law.
Covenant 8. Disposition of Property. The Agency
covenants and agrees that it shall not dispose of more than ten
percent of the land area in the Added Territory, except property
shown in the Redevelopment Plan in effect on the date this
Resolution is adopted as planned for public use, or property to
be used for public streets, public off street parking, sewage
facilities, parking easements or rights of way for public
utilities, flood control facilities, storm drainage facilities,
or other similar uses, to public bodies or other persons or
entities whose property is tax exempt, unless accompanied by a
certificate or opinion of an Independent Financial Consultant
employed by the Agency to the effect that such disposition would
not substantially impair the security of the Bonds or the rights
of the Registered Owners.
Covenant 9. Protection of Security and Riahts of
Registered Owners; No Arbitraae; Further Tax Covenants. The
Agency covenants and agrees to preserve and protect the security
of the Bonds and the rights of the Registered Owners and defend
their rights under all claims and demands of all persons. The
Agency covenants and agrees to contest by court action or
otherwise any assertion by the United States of America or any
department or agency thereof that the interest received by the
Registered Owners is taxable under federal income tax laws in
effect on the date of issuance. The Agency covenants and agrees
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871022 j t w A529.WL S (1)
to take no action which, in the opinion of counsel, would result
in the interest received by the Registered Owners becoming
taxable under federal income tax laws. Any opinion of such
counsel may be based upon, insofar as it relates to factual
matters, information which is in the possession of the Agency as
shown by a certificate or opinion of, or representation by, an
officer or officers of the Agency, unless such counsel knows, or
in the exercise of reasonable care should have known, that the
certificate or opinion or representation with respect to the
matters upon which such opinion may be based, as aforesaid, is
erroneous. As used herein, "opinion of counsel" means a written
opinion of an attorney or firm of attorneys of favorable
reputation in the field of municipal bond law. The Agency hereby
further covenants and agrees that it shall take no action and
shall permit no action to be taken which would cause the Bonds to
be federally guaranteed within the meaning of that term under
Section 149(b) of the Code. The Agency hereby further covenants
and agrees that it shall take no action and shall permit no
action to be taken which would cause the Bonds to be arbitrage
bonds within the meaning of that term under Section 148 of the
Code. The Agency hereby further covenants and agrees that it
shall comply with the rebate provisions of Section 148(f) of the
Code, as more particularly described in Section 26 hereof.
Covenant 10. Statement of Indebtedness. The
Agency covenants and agrees to cause to be filed on a timely
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871022 jlw A529.WLS (1)
basis any and all statements of indebtedness pursuant to Section
33675 of the Redevelopment Law.
Covenant 11. Further Tax Covenants. The Agency
covenants and agrees to contest by court action or otherwise any
assertion by the United States of America or any department or
agency thereof that the interest received by the Registered
Owners of the Bonds is includable in gross income of the
recipient under federal income tax laws on the date of issuance
of the Bonds. In order to preserve the exclusion from gross
income of interest on the Bonds, and for no other reason, the
Agency covenants to comply with all applicable requirements of
the Code, together with any amendments thereto or regulations
promulgated thereunder, as well as any applicable existing
regulations, necessary to preserve such exclusion from gross
income and specifically covenants, without limiting the
generality of the foregoing, that:
A. It will make no use of the proceeds of the
Bonds at any time during the term thereof which, if such use had
been reasonably expected at the date the Bonds are issued, would
have caused such Bonds to be "arbitrage bonds" within the meaning
of Section 148 or "private activity bonds" within the meaning of
Section 141 of the Code and the regulations;
B. Not more than ten percent, if any, of the
"proceeds" of the Bonds shall be used for any private business
use, within the meaning of that term under Section 141(b)(1) of
the Code, and not more than five percent, if any, of the private
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871022 jlw A529.WLS (1)
business use, if any, is "unrelated" or "disproportionate" to the
governmental use of the proceeds (for purposes of Section 141 of
the Code). Not more than five percent, if any, of the "proceeds"
of the issue shall be used (directly or indirectly) to make or
finance loans (other than loans described in Section 141(c)(2) of
the Code) to persons other than governmental units.
C. It will ensure that the payment of principal
of and interest on the Bonds shall not be directly or indirectly
guaranteed (in whole or in part) by the United States (or any
agency or instrumentality thereof) and no portion of the moneys
contained in any of the Funds or Accounts created herein shall be
(i) used in making loans guaranteed by the United States (or any
agency or instrumentality thereof); (ii) invested directly or
indirectly in deposits or accounts insured by the Federal Deposit
Insurance Corporation, Federal Savings and Loan Insurance
Corporation, National Credit Union Administration or any other
similar federally chartered corporation; (iii) otherwise invested
directly or indirectly in obligations guaranteed (in whole or in
part) by the United States (or any agency or instrumentality
thereof); except (1) during the initial period following issuance
of the Bonds and ending on the final expenditure of the Bond
proceeds; and (2) for amounts held in the Reserve Account, or
other reserve funds satisfying Section 148(d) of the Code;
(3) for amounts held in the Special Fund and other bona fide debt
service funds; (4) for investments in obligations issued by the
United States Treasury; (5) for investments in obligations guar-
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871022 jlw A529.WLS (1)
anteed by the Federal National Mortgage Association, Government
National Mortgage Association or Federal Home Loan Mortgage
Corporation, or (6) for investments permitted under regulations
issued pursuant to Section 149(b)(3)(B) of the Code;
D. (i) it shall keep a detailed accounting of all
transactions contemplated under this Resolution or in any way
relating to the receipt or disbursement of any of the Gross
Proceeds of the Bonds (whether received, held or paid by the
Agency, the Fiscal Agent or any other person) for a period of six
years after the later of the date of payment of all Excess
Investment Earnings to the United States or the date the Agency
disburses the last of the Gross Proceeds of the Bonds;
(ii) except for the investment of moneys in tax-exempt bonds or
Gross Proceeds invested during an applicable temporary period
permitted under the Treasury Regulations or amounts invested in a
reasonably required reserve or replacement fund (subject to the
limitations of Section 148(d) of the Code), it will not allow
Gross Proceeds of the Bonds to be invested at any time in
Investment Property with a yield in excess of the yield on the
Bonds (determined in accordance with Section 148(h) of the Code)
plus one -eighth of one percent; (iii) it will neither invest
Gross Proceeds nor cause Gross Proceeds to be invested in
Investment Property if the yield on such Investment Property
would be less than the yield that would have resulted in an
arm's-length transaction; and (iv) it will not sell or otherwise
dispose of or cause to be sold or otherwise disposed of
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871022 jlw A529.NLS (1)
Investment Property, if such sale or disposition would result in
a smaller profit or larger loss than would have resulted from a
sale at fair market value arrived at in an arm's-length
transaction;
E. Notwithstanding the foregoing provisions
regarding restrictions on investment of Gross Proceeds, Gross
Proceeds in an amount not exceeding the lesser of five percent of
Bond proceeds or $100,000 may be invested at a yield in excess of
the yield on the Bonds plus one -eighth of one percent; and
F. It is the purpose of this Covenant 11 and
Section 25 hereof to preserve the exclusion of the interest paid
on the Bonds from gross income for the purposes of the Federal
income tax laws and the Agency will not take any action or omit
to take any action which, if taken or omitted, would adversely
affect such exclusion of interest on the Bonds from gross income
for Federal income tax purposes. Anything to the contrary
notwithstanding, if at any time the Agency determines that a
different manner or method of compliance is (i) required to
preserve the exclusion of interest on the Bonds from gross income
for Federal income tax purposes or (ii) permitted, without
impairing the exclusion of interest on the Bonds from gross
income for Federal income tax purposes, the Agency may utilize
such different manner or method at its election; provided,
however, that (i) the Agency has obtained an opinion of
nationally recognized bond counsel, addressed to the Agency, as
to the preservation of the exclusion of interest on the Bonds
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871022 jlu A529.WLS (1)
from gross income for Federal income tax purposes under the
different manner or method and (ii) the Agency has caused this
Resolution to be amended to reflect such different manner or
method in accordance with Section 23 hereof.
Section 19. Taxation of Leased Property. Whenever any
property in the Project Area has been redeveloped and thereafter
is leased by the Agency to any person or persons, other than a
public agency, or whenever the Agency leases real property in the
Project Area to any person or persons, other than a public
agency, for redevelopment, the property shall be assessed and
taxed in the same manner as privately owned property, as required
by Section 33673 of the Redevelopment Law, and the lease or
contract shall provide (i) that the lessee shall pay taxes upon
the assessed value of the entire property and not merely upon the
assessed value of the lessee's leasehold interest, and (ii) that
if for any reason the taxes levied on such property in any year
during the term of the lease or contract are less than the taxes
which would have been levied if the entire property had been
assessed and taxed in the same manner as privately owned
property, the lessee shall pay such difference to the Agency
within thirty days after the taxes for such year become payable
to the taxing agencies and in no event later than the delinquency
date of such taxes established by law. All such payments shall
be treated as Tax Revenues and when received by the Agency shall
be deposited in the Special Fund.
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871022 j l w A529.WLS (1)
Section 20. Fiscal Agent and Paving Aaents. The
Agency hereby appoints Security Pacific National Bank as Fiscal
Agent to act as the agent and depositary of the Agency for the
purpose of receiving Tax Revenues and other funds in trust as
provided in this Resolution, to hold, allocate, use and apply
such Tax Revenues and other funds in trust as provided in this
Resolution, and to perform such other duties and powers of the
Fiscal Agent as are prescribed in this Resolution.
The Agency may remove the Fiscal Agent initially
appointed or any successor thereto, and in such case shall
forthwith appoint a successor thereto; but any successor shall be
a bank or trust company doing business and having an office in
Los Angeles, California, having a combined capital and surplus of
at least $75,000,000. The Fiscal Agent herein appointed or any
substituted Fiscal Agent may at any time resign as such by
writing filed with the Agency, in which event the Agency shall
forthwith appoint a substitute Fiscal Agent and the resignation
shall become effective upon such appointment. In the event that
the Fiscal Agent or any successor becomes incapable of acting as
such, the Agency shall forthwith appoint a substitute Fiscal
Agent. Any bank or trust company into which the Fiscal Agent may
be merged or with which it may be consolidated shall become the
Fiscal Agent without action of the Agency. The Fiscal Agent may
become the owner of any of the Bonds authorized by this
Resolution with the same rights it would have had if it were not
a Fiscal Agent.
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871022 jlw A529.u1S (1)
The Fiscal Agent shall have no duty or obligation
whatsoever to enforce the collection of or to exercise diligence
in the enforcement of the collection of funds assigned to it
hereunder or as to the correctness of any amounts received, but
its liability shall be limited to the proper accounting for such
funds as it shall actually receive.
The recitals of fact and all promises, covenants and
agreements herein and in the Bonds shall be taken as statements,
promises, covenants and agreements of the Agency and the Fiscal
Agent assumes no responsibility for the correctness of the same
and makes no representations as to the validity or sufficiency of
this Resolution or of the Bonds, and shall incur no responsi-
bility in respect thereof, other than in connection with the
duties or obligations herein or the Bonds assigned to or imposed
upon the Fiscal Agent. The Fiscal Agent shall not be liable in
connection with the performance of its duties hereunder except
for its own negligence or default. The Agency may provide for
paying agents.
The Agency agrees to indemnify the Fiscal Agent and
hold it harmless against any loss, liability or expense arising
out of or in connection with the performance of its duties, as
Fiscal Agent, including without limitation legal and other fees
and expenses except that the Fiscal Agent shall not be
indemnified against any such loss, liability or expense arising
out of its gross negligence or willful misconduct. The Fiscal
Agent shall be under no obligation to institute or defend any
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871022 jlw A529.WLS (1)
action, suit or legal proceeding in connection herewith, unless
first indemnified and held harmless to its satisfaction in
accordance with the foregoing.
The Fiscal Agent may consult with counsel, who may be
counsel to the Agency, 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 the
Fiscal Agent in good faith and in accordance therewith.
The Fiscal Agent shall undertake to perform such duties
as are specifically set forth herein and no implied duties or
obligations shall be read into this Resolution against the Fiscal
Agent.
The Agency shall pay to the Fiscal Agent compensation
for all services performed by it hereunder in accordance with a
fiscal agency agreement. The Agency shall also pay to the Fiscal
Agent such reasonable expenses, charges and other disbursements
and those of its attorneys, agents and employees incurred in and
about the administration and the performance of its duties
hereunder, and which are specifically preauthorized in writing by
the Agency.
Section 21. Lost, Stolen, Destroyed or Mutilated Bonds
or Couoons. In the event that any Bond is lost, stolen,
destroyed or mutilated, the Agency shall cause to be issued a new
Bond similar to the original to replace the same in such manner
and upon such reasonable terms and conditions, including the
payment of costs and the posting of a surety bond if the Agency
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871022 jlw A529.WLs (1)
deems such surety bond necessary, as may from time to time be
determined and prescribed by resolution. The Agency may
authorize such new Bond to be signed and authenticated in such
manner as it determines in such resolution.
Section 22. Cancellation of Bonds. All Bonds
surrendered to the Fiscal Agent for the payment shall upon
payment therefor be canceled immediately. Any cancelled Bonds
held by the Fiscal Agent shall be destroyed and certification of
their destruction delivered to the Agency. Any Bonds purchased
by the Fiscal Agent as aforesaid shall be canceled immediately.
Section 23. Amendments. This Resolution, and the
rights and obligations of the Agency and of the holders of the
Bonds issued hereunder, may be modified or amended at any time by
resolution supplementing this Resolution adopted by the Agency:
(i) without the consent of Registered Owners, if such
modification or amendment is for the purpose of curing any
ambiguities, defects or inconsistent provisions in this
Resolution or to insert such provisions clarifying matters or
questions arising under this Resolution as are necessary and
desirable to accomplish the same, provided that such modifica-
tions or amendments do not adversely affect the rights of the
Registered Owners and such modifications or amendments are
accompanied by an opinion to that effect of counsel employed by
the Agency, or (ii) except as provided below, any other
modification or amendment with the consent of Registered Owners
holding at least 60 percent in aggregate principal amount of the
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871022 jlw A529.WLS (1)
outstanding Bonds, exclusive of Bonds, if any, owned by the
Agency or the City, and obtained as hereinafter set forth;
provided, however, that no such modification or amendment shall,
without the express consent of the Registered Owner affected,
reduce the principal amount of any Bond, reduce the interest rate
payable thereon, extend its maturity or the times for paying
interest thereon, or the terms or conditions for the redemption
thereof from the Term Bond Sinking Fund Account, change the
monetary medium in which principal and interest is payable, or
reduced the percentage of consent required for amendment or
modification.
Any act done pursuant to a modification or amendment
pursuant to this Section 23 shall be binding upon the Registered
Owners of all of the Bonds and shall not be deemed an infringe-
ment of any of the provisions of this Resolution or of the
Redevelopment Law, whatever the character of such act may be, and
may be done and performed as fully and freely as if expressly
permitted by the terms of this Resolution; and after such consent
relating to such specified matters has been given, no Registered
Owner shall have any right or interest to object to such action
or in any manner to question the propriety thereof or to enjoin
or restrain the Agency or any officer thereof from taking any
action pursuant thereto.
A. Calling Bondholders' Meeting. If the Agency shall
desire to obtain any such consent it shall duly adopt a
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871022 jlw A529.WLS (1)
resolution calling a meeting of Registered Owners for the purpose
of considering the action, the consent for which is desired.
B. Notice of Meeting. Notice specifying the purpose,
place, date and hour of such meeting shall be mailed by the
Agency, postage prepaid, to the respective Registered Owners of
the Bonds at their addresses appearing on the register in the
hands of the Fiscal Agent. The place, date and hour of holding
such meeting and the date of mailing such notice shall be
determined by the Agency in its discretion.
The actual receipt by any Registered Owner of notice of
any such meeting shall not be a condition precedent to the
holding of such meeting, and failure to receive such notice shall
not affect the validity of the proceedings thereat. A
certificate by the Secretary of the Agency, approved by
resolution of the Agency, that the meeting has been called and
that notice thereof has been given as herein provided shall be
conclusive as against all parties and it shall not be open to any
Registered Owner to show that such Registered Owner failed to
receive actual notice of such meeting.
C. Voting Qualifications. The Registered Owners may,
prior to any such meeting, deliver their Bond or Bonds to the
Fiscal Agent and shall thereupon be entitled to receive an
appropriate receipt for the Bond so deposited, calling for the
redelivery of such Bond at any time after the meeting. The
Fiscal Agent shall prepare and deliver to the chairman of the
meeting a list of the names and addresses of the Registered
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871022 jlw A529.WLS (1)
Owners, with a statement of the maturities and numbers of the
Bonds held and de.posited by each of such Registered Owners, and
no Registered Owners shall be entitled to vote at such meeting
unless their names appear upon such list or unless they shall
present their Bonds at the meeting or a certificate of deposit
thereof, satisfactory to the Agency, executed by a bank or trust
company. No Registered Owners shall be permitted to vote with
respect to a larger aggregate principal amount of Bonds than is
set against their names on such list, unless they shall produce
the Bonds upon which they desire to vote or a certificate of
deposit thereof as above provided.
D. Issuer -Owner Bonds. The Agency covenants that it
shall present at the meeting a certificate, signed and verified
by one member thereof and by the Treasurer of the Agency, stating
the maturities and serial number of all Bonds owned by, or held
for account of, the Agency or the City, directly or indirectly.
No persons shall be permitted at the meeting to vote or consent
with respect to any Bond appearing upon such certificate, or any
Bond which it shall be established at or prior to the meeting is
owned by the Agency or the City, directly or indirectly, and no
such Bond (in this Resolution referred to as "issuer -owned Bond")
shall be counted in determining whether a quorum is present at
the meeting.
E. Ouorum and Procedure. A representation of at
least 60 percent in aggregate principal amount of the Bonds then
outstanding, exclusive of issuer -owned Bonds, if any, shall be
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871022 jlw A529.WLS (1)
necessary to constitute a quorum at any meeting of Registered
Owners, but a majority of those present may adjourn the meeting
from time to time, and the meeting may be held as so adjourned
without further notice, whether such adjournment shall have been
had by a quorum or by less than a quorum. The Agency shall, by
an instrument in writing, appoint a temporary chairman of the
meeting, and the meeting shall be organized by the election of a
permanent chairman and secretary. At any meeting each Registered
Owner shall be entitled to one vote for every $5,000 principal
amount of Bonds with respect to which such Registered Owner shall
be entitled to vote as aforesaid, and such vote may be given in
person or by proxy duly appointed by an instrument in writing
presented at the meeting. The Agency, by its duly authorized
representative, may attend any meeting of the Registered Owners,
but shall not be required to do so.
F. Vote Required. At any such meeting held as
aforesaid there shall be submitted for the consideration and
action of the Registered Owners a statement of the proposed
action, consent to which is desired, and if such action shall be
consented to and approved by Registered Owners holding at least
60 percent in aggregate principal amount of the Bonds then
outstanding, exclusive of issuer -owned Bonds, the chairman and
secretary of the meeting shall so certify in writing to the
Agency, and such certificate shall constitute complete evidence
of consent of Registered Owners under the provisions of this
Resolution. A certificate signed and verified by the chairman
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871022 jlw A529.WLS (1)
and the secretary of any such meeting shall be conclusive
evidence and the only competent evidence of matters stated in
such certificate relating to proceedings taken at such meeting.
Section 24. Proceedings Constitute Contract. The
provisions of this Resolution, of any Supplemental Resolution, of
the resolutions providing for the sale of the Bonds and awarding
the Bonds and fixing the interest rate thereon, and of any other
resolution supplementing or amending this Resolution, shall
constitute a contract between the Agency and the Registered
Owners and the provisions thereof shall be enforceable by any
Registered Owner for the equal benefit and protection of all
Registered Owners similarly situated by mandamus, accounting,
mandatory injunction or any other suit, action or proceeding at
law or in equity that is now or may hereafter be authorized under
the laws of the State in any court of competent jurisdiction.
This contract is made under and is to be construed in accordance
with the laws of the State.
No remedy conferred hereby upon any Registered Owner is
intended to be exclusive of any other remedy, but each remedy is
cumulative and in addition to every other remedy and may be
exercised without exhausting and without regard to any other
remedy conferred by the Redevelopment Law or any other law of the
State. No waiver of any default or breach of duty or contract by
any Registered Owner shall affect any subsequent default or
breach of duty or contract or shall impair any rights or remedies
on such subsequent default or breach. No delay or omission of
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871022 jlw A529.WLS (1)
any Registered Owner to exercise any right or power accruing upon
any default shall impair any such right or power or shall be
construed as a waiver of any such default or acquiescence
therein. Every substantive right and every remedy conferred upon
the Registered Owners may be enforced and exercised as often as
may be deemed expedient. In case any suit, action or proceeding
to enforce any right or exercise any remedy shall be brought or
taken, and should such suit, action or proceeding be abandoned or
be determined adversely to the Registered Owners, then, and in
every such case, the Agency and the Registered Owners shall be
restored to their former positions, rights and remedies as if
such suit, action or proceeding had not been brought or taken,
and should such suit, action or proceeding be abandoned or be
determined adversely to the Registered Owners, then, and in every
such case, the Agency and the Registered Owners shall be restored
to their former positions, rights and remedies as if such suit,
action or proceeding had not been brought or taken.
After the issuance and delivery of the Bonds, this
Resolution, any Supplemental Resolution and any other
supplementary resolutions thereto shall be irrepealable, but
shall be subject to modification or amendment to the extent and
in the manner provided in this Resolution, but to no greater
extent and in no other manner.
CUSIP identification numbers may be imprinted on the
Bonds, but such numbers shall not constitute a part of the
contract evidenced by the Bonds and no liability shall hereafter
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871022 jlw A529.WLS (1)
attach to the Agency or any of the officer or agents thereof
because of or on account of such numbers. Any error or omission
with respect to such numbers shall not constitute cause for
refusal by the successful bidder to accept delivery of and pay
for the Bonds.
Section 25. Rebate Fund.
A. The Agency shall calculate Excess Investment
Earnings in accordance with paragraph B and shall instruct the
Fiscal Agent to pay Excess Investment Earnings to the United
States government in accordance with paragraph C. The term
"Excess Investment Earnings" means an amount equal to the sum of:
1. the excess of
(a) the aggregate amount earned from the
delivery date of the Bonds on all Investment Property
in which Gross Proceeds of the Bonds are invested
(other than amounts attributable to an excess described
in this subparagraph 1), over
(b) the amount that would have been earned
if the yield on such Investment Property (other than
amounts attributable to an excess described in this
subparagraph 1) had been equal to the yield on the
Bonds,
plus
2. any income attributable to the excess
described in paragraph 1.
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871022 jlw A529.WLS (1)
•
B. At or prior to the last day of the first Computa-
tion Year, the Agency shall calculate the Excess Investment
Earnings referenced in subparagraph 1 of paragraph A, above, as
of the last day of such Computation Year and shall deposit the
same from the Redevelopment Fund or any other lawfully available
moneys of the Agency or direct the Fiscal Agent to transfer the
same from the Special Fund into the Rebate Fund. On each June
1st during which the Bonds are outstanding, the Fiscal Agent
shall mail a notice to the Agency setting forth the Agency's
obligation to submit a calculation of Excess Investment Earnings
for the current Computation Year. Thereafter, prior to the last
day of each Computation Year and on the date of the retirement of
the
the
Bonds, the Agency shall cause to be prepared and filed with
Fiscal Agent a calculation of the amount of
Earnings referenced in subparagraphs 1 and 2 of
the
last day of such Computation Year and again
Excess Investment
paragraph A as of
make such deposit
and direct the Fiscal Agent to make corresponding transfers into
the Rebate Fund. The calculations shall be made by a nationally
recognized bond counsel or an Independent Certified Public
Accountant or other expert retained by the Agency in accordance
with the following:
1. Except as provided in subparagraph 2, below,
in determining the amount described in subparagraphs 1(a)
and 2 of paragraph A, above, the aggregate amount earned on
Investment Property shall include (i) all income realized
under federal income tax accounting principles (whether or
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871022 jlw A529.618 (1)
not the person earning such income is subject to federal
income tax) with respect to such Investment Property and
with respect to the reinvestment of investment receipts from
such Investment Property (without regard to the transaction
costs incurred in acquiring, carrying, selling or redeeming
such Investment Property), including, but not limited to,
gain or loss realized on the disposition of such Investment
Property (without regard to when such gains are taken into
account under Section 453 of the Code relating to the
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 loss as of the
date of retirement of the Bonds if any Investment Property
is retained after such date.
2. In determining the amount described in
subparagraph 1 of paragraph A, an obligation or security
shall be treated as acquired for its fair market value at
the time it becomes an Investment Property, so that gain or
loss on the disposition of such an obligation or security
shall be computed with reference to such fair market value
as its adjusted basis.
3. In determining the amount described in
subparagraph 1(b) of paragraph A, above, the yield on the
Bonds shall be determined based on the actual yield of the
Bonds through maturity (with adjustments for discount or
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871022 jlw A529.WLS (1)
premium) calculated in accordance with Section 148(h) of the
Code.
4. In determining the amount described in
subparagraph 2 of paragraph A, all income attributable to
the excess described in subparagraph 1 of paragraph A must
be taken into account, whether or not that income exceeds
the yield with respect to the Bonds, and no amount may be
treated as "negative arbitrage."
C. Upon direction of the Agency, the Fiscal Agent
shall pay Excess Investment Earnings to the United States of
America in installments with the first payment to be made not
later than 30 days after the end of the fifth Computation Year
and with subsequent payments to be made not later than five 5
years after the preceding payment was due. The Agency shall
assure that 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 immediately preceding Computation
Period. Upon the direction of the Agency, which direction shall
be given before 60 days after the retirement of the Bonds, the
Fiscal Agent shall pay from the Rebate Fund, or the Agency shall
pay directly, 100 percent of the theretofore unpaid Excess
Investment Earnings of the Bonds. The Fiscal Agent or the Agency
shall remit such payments to the United States of America at the
address and in the manner directed by the Agency prescribed
pursuant to the Code as the same may be in time to time in
effect, together with such reports and statements prepared by
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871022 jlw A529.WLS (1)
Agency as may be required pursuant to the Code. If the Fiscal
Agent follows the written instructions as supplied by the Agency,
it shall be deemed to have complied with this subsection and
shall have no responsibility to calculate Excess Investment
Earnings or to take action in the absence of instructions from
the Agency. If, however, the Agency shall fail to (i) furnish
any calculation of Excess Investment Earnings, (ii) make deposits
and/or direct transfers, or (iii) give any instructions required
to be given by this Section 25, the Fiscal Agent shall send
written notice of such failure immediately to the Agency.
D. In order to assure that Excess Investment Earnings
are paid to the United States rather than to a third party,
investments by the Agency in certificates of deposit and in
investment agreements shall be made only in accordance with the
applicable requirements of the Code therefor as from time to time
in effect. The Agency shall give the Fiscal Agent instructions
regarding such investments and the Fiscal Agent shall have no
liability if it follows those instructions or if it fails to take
any action in the absence of instructions.
E. The Agency shall keep and retain for a period of
six years following the retirement of the Bonds records of the
determinations made pursuant to this Section 25. The Agency
shall keep a record of all investments made with Gross Proceeds
in the Redevelopment Fund and any other fund or account held by
it and containing Gross Proceeds of the Bonds. The Fiscal Agent
shall keep a record of all investments made with moneys on
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871022 jlw A529.WLS (1)
•
deposit
provide
records
date of
in any Fund or Account held by it hereunder and shall
such records to the Agency at least quarterly. Such
shall contain a reference to the date of purchase, the
sale, the purchase price, the sales price, the principal
amount and coupon rate of each obligation purchased or sold.
F. Payments pursuant to this Section 25 shall be made
to the maximum extent possible from moneys on deposit in the
Rebate Fund and, to the extent of any deficiency therein for such
purpose, shall be made from the
ment Fund. In the event of any
moneys for the purposes of such
Special Fund and the Redevelop -
remaining deficiency in available
transfer, such deficiency shall
be paid by the Agency from any available funds.
G. Notwithstanding any provision in this Section 25 to
the contrary, in the event that the Agency has received an
opinion of counsel that, pursuant to the provisions of Section
148(f)(4)(C) of the Code, the Bonds are to be treated as meeting
the requirements of paragraphs (2) and (3) of Section 148(f) of
the Code, no payments need
government and all amounts
transferred to the Special
The Agency shall
be made to the United States
in the Rebate Fund
Fund.
provide the Fiscal
shall be
Agent with
certificates and other information necessary for the Fiscal Agent
to transmit to the United States Department of the Treasury the
payments, statements and forms described above.
The Agency shall advise the Fiscal Agent of any
investment limitations that may arise requiring restrictions or
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871022 jlw A529.WLS (1)
modifications of any of the investments otherwise permitted under
this Resolution, and shall provide the Fiscal Agent with such
further supplemental instructions as may be appropriate in the
circumstances, and the Fiscal Agent shall follow those
instructions.
Section 26. Terms and Conditions of Sale. The terms
and conditions of the offering and the sale of the Bonds shall be
as specified in a Supplemental Resolution.
Section 27. Preliminary Official Statement. The staff
of the Agency and the Financial Consultant are hereby authorized
and directed to prepare a preliminary Official Statement
regarding the Bonds to be furnished to prospective bidders for
the Bonds.
Section 28. Unclaimed Funds. Notwithstanding any
provisions of this Resolution, any moneys deposited with the
Fiscal Agent for the payment of the principal of, or interest
or
premium on, any Bonds and remaining unclaimed for six years after
the principal of all the Outstanding Bonds has become due and
payable (whether at maturity or upon call for redemption or by
declaration as provided in this Indenture) shall then be repaid
to the Agency upon its written request, and the Owners of such
Bonds shall thereafter be entitled to look only to the Agency for
payment thereof, and all liability of the Fiscal Agent with
respect to such moneys shall thereupon cease.
Section 29. General Authorization. The members of the
Agency, and its officers, deputy officers, employees, consultants
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871022 jlw A529.WLS (1)
and legal counsel are hereby authorized to do all acts and things
which may be required of them by this Resolution, or which may be
necessary or desirable in carrying out the issuance of the Bonds
as provided by this Resolution and all matters incidental
thereto. All such acts and things heretofore done are hereby
approved, ratified and confirmed.
Section 30. Severabilitv. If any covenant, agreement
or provision, or any portion thereof contained in this Resolu-
tion, or the application thereof to any person or circumstance,
is held to be unconstitutional, invalid or unenforceable, the
remainder of this Resolution and the application of any such
covenant, agreement or provision, or portion thereof, to other
persons or circumstances, shall be deemed severable and shall not
be affected, and this Resolution and the Bonds issued pursuant
hereto shall remain valid and the Registered Owners shall retain
all valid rights and benefits accorded to them under this
Resolution and the Constitution and laws of the State of
California. If the provisions relating to the appointment and
duties of a Fiscal Agent are held to be unconstitutional, invalid
or unenforceable, such duties shall be performed by the Treasurer
or other appropriate officer of the Agency.
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871022 jlw A529.WLS (1)
Section 31. Effective Date. This Resolution shall
become effective upon its adoption.
PASSED, APPROVED AND ADOPTED THIS loth day of
December, 1987.
ATTEST:
AYES: CRITES, KELLY, SNYDER, WILSON, BENSON
NOES: NONE
ABSENT: NONE
ABSTAIN: NONE
SHEILA R. G IGAN, SE ETARY
' •l
JEAN M. BENSON, MAYOR
-68-
RESOLUTION NO. 211
EXHIBIT "A"
[FORM OF FULLY REGISTERED Bond]
UNITED STATES OF AMERICA
STATE OF CALIFORNIA
COUNTY OF RIVERSIDE
CITY OF PALM DESERT
PALM DESERT REDEVELOPMENT AGENCY
PROJECT AREA No. 1, AS AMENDED
(ADDED TERRITORY ONLY)
TAX ALLOCATION BOND
The PALM DESERT REDEVELOPMENT AGENCY (the "Agency"), a
public body, corporate and politic, duly organized and existing
under the laws of the State of California, for value received,
hereby promises to pay, but solely from the fund hereinafter
mentioned, to or registered
assigns, herein sometimes referred to as "Registered Owners",
subject to the right of prior redemption hereinafter mentioned,
the principal sum of
Dollars ($ ),
and to pay such Registered Owner by check or draft mailed
thereto, at such Owner's address as it appears on the register
kept by the Fiscal Agent at the close of business on the
fifteenth day preceding the interest payment date, interest on
such principal sum from the interest payment date next preceding
the date hereof, unless the date hereof is prior to
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871022 jlw A529.WLS (1)
RESOLUTION NO. 211
•
in which event from until the principal hereof
shall have been paid or provided for in accordance with the
Resolution hereinafter referred to at the rate above indicated,
payable semiannually on and in each
year. Both principal and interest and any premium upon the
redemption prior to maturity of all or part hereof are payable in
lawful money of the United States of America, and except for
interest which is payable by check or draft as stated above, are
payable at Fiscal Agent for the Agency,
in Los Angeles, California.
This Bond, the interest hereon and any premium due upon
the redemption of this Bond prior to maturity are not a debt of
the City of Palm Desert, the State of California or any of its
political subdivisions and neither such City, such State nor any
of its political subdivisions is liable hereon, nor in any event
shall this Bond, the interest or premium, if any, be payable out
of any funds or properties other than the funds of the Agency as
set forth in the Resolution hereinafter mentioned. This Bond
does not constitute an indebtedness within the meaning of any
constitutional or statutory debt limitation or restriction.
Neither the members of the Agency nor any persons executing this
Bond are liable personally on this Bond by reason of its
issuance.
This Bond is one of a duly authorized issue of Bonds of
the Agency designated "Palm Desert Redevelopment Agency, Project
Area No. 1, As Amended (Added Territory Only), Tax Allocation
871022 jlw A529.11_S (1)
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RESOLUTION NO. 211
s
Bonds (the "Bonds") in aggregate principal amount of $
all of like tenor, except for dates of maturity, bond numbers and
interest rates, and all of which have been issued pursuant to and
in full conformity with the Constitution and laws of the State of
California and particularly the Community Redevelopment Law
(California Health and Safety Code Section 33000, et sea.) for
the corporate purposes of the Agency in aiding in the financing
of the redevelopment of the Project Area above designated, and
are authorized by and issued pursuant to Resolution No.
adopted by the Agency on (such Resolution
No. herein referred to as the "Resolution"), and all
of the Bonds are equally secured in accordance with the terms of
the Resolution, reference to which is hereby made for a specific
description of the security therein provided for the Bonds, for
the nature, extent and manner of enforcement of such security,
for the covenants and agreements made for the benefit of the
Registered Owners, and for a statement of the rights of the
Registered Owners, and by the acceptance of this Bond the
registered owner hereof assents to all of the terms, conditions
and provisions of the Resolution. In the manner provided in the
Resolution, the Resolution and the rights and obligations of the
Agency and of the Registered Owners may, with certain exceptions
as stated in the Resolution, be modified or amended with the
consent of the Registered Owners of 60 percent in aggregate
principal amount of outstanding Bonds, exclusive of issuer owned
Bonds, unless modification or amendment is for the purpose of
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871022 jlw A529.WLS (1)
RESOLUTION NO. 211
curing ambiguities, defects, etc., in which case no Registered
Owner's consent is required.
The principal of this Bond and the interest hereon are
secured by an irrevocable pledge of, and are payable solely from
the Tax Revenues, as such term is defined in the Resolution, and
certain other funds, all as more particularly set forth in the
Resolution. The Resolution is adopted under and this Bond is
issued under and is to be construed in accordance with the laws
of the State of California.
The Outstanding Bonds maturing on or after
, may be called before maturity and redeemed at the option
of the Agency, in whole from the proceeds of refunding bonds, or
in whole or in part from any other source of funds, on
or on any interest payment date thereafter prior to maturity (the
"redemption date"). If less than all of the Bonds outstanding
are to be redeemed at any one time, the Bonds to be redeemed
shall be redeemed in inverse order of maturity and by lot within
a maturity.
Bonds called for redemption shall be redeemed at a
redemption price for each redeemed bond equal to the principal
amount thereof, plus accrued interest to the redemption date.
Notice of call and redemption prior to maturity shall be given as
provided in the Resolution.
The actual receipt by the Registered Owner of any Bond
of notice of such redemption shall not be a condition precedent
to redemption, and failure to receive such notice shall not
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871022 jlw A529.WLS (1)
RESOLUTION NO. 211
•
affect the validity of the proceedings for the redemption of such
Bonds or the cessation of interest on the redemption date.
This Bond is issued in fully registered form, is
sometimes referred to herein as a "Fully Registered Bond" and is
negotiable only by transfer of registration. This Bond may be
exchanged for a like aggregate principal amount of Fully
Registered Bonds of other authorized denominations, all as more
fully set forth in the Resolution. This Bond is transferable by
the registered owner hereof, in person or by the Holder's
attorney duly authorized in writing, at the principal office of
the Fiscal Agent in Los Angeles, California, but only in the
manner, subject to the limitations and upon payment of the
charges provided in the Resolution, upon surrender and
cancellation of this Bond. Upon such transfer a new registered
Bond of authorized denomination or denominations for the same
aggregate principal amount of the same issue will be issued to
the transferee in exchange therefor. No exchange or transfer
shall be made between the fifteenth day of the month preceding
any interest payment date and such interest payment date.
The Agency, the Fiscal Agent and any Paying Agent may
treat the registered owner hereof as the absolute owner hereof
for all purposes, and the Agency, the Fiscal Agent and any Paying
Agent shall not be affected by any notice to the contrary.
This Bond shall not be entitled to any benefit under
the Resolution, or become valid or obligatory for any purpose,
871022 jlw A529.WLS (1)
-5-
RESOLUTION NO. 211
Y
until the certificate of authentication hereon endorsed shall
have been signed by the Fiscal Agent.
It is hereby recited, certified and declared that any
and all acts, conditions and things.required to exist, to happen
and to be performed precedent to and in the issuance of this Bond
exist, have happened and have been performed in due time, form
and manner as required by the Constitution and laws of the State
of California.
IN WITNESS WHEREOF, the Palm Desert Redevelopment
Agency has caused this Bond to be signed on its behalf by the
facsimile signatures of its Chairman and Executive Director and
the seal of the Agency to be imprinted hereon all as of the
day of
(Seal)
Chairman
Executive Director
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871022 jlw A529.WLS (1)
RESOLUTION NO. 211
4-
[FORM OF CERTIFICATE OF AUTHENTICATION
OF FULLY REGISTERED BONDS]
This is one of the Bonds described in the within -mentioned
Resolution.
By
, Fiscal Agent
Authorized Officer
[FORM OF ASSIGNMENT ON FULLY REGISTERED BONDS]
For value received
hereby sells, assigns and transfers unto
the within -mentioned Bond and hereby
irrevocably constitutes and appoints
attorney, to transfer the same
on the books of the Fiscal Agent with full power of substitution
in the premises.
Dated:
Note:
The signature to this Assignment must correspond with
the name as written on the face of the within Bond in
every particular, without alteration or enlargement or
any change whatsoever.
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871022 jlw A529.WLS (1)