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EXHIBIT 10.25
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INDENTURE OF TRUST
By and Between
CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY
and
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Trustee
Dated as of May 15, 1998
Securing
$334,190,000
CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY
APARTMENT DEVELOPMENT REVENUE REFUNDING BONDS, SERIES 1998A
(IRVINE APARTMENT COMMUNITIES, L.P.)
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ARTICLE I
DEFINITIONS AND INTERPRETATION
Section 1.1. Definitions...................................................................3
Section 1.2. Article and Section Headings.................................................11
Section 1.3. Interpretation...............................................................11
ARTICLE II
AUTHORIZATION AND ISSUANCE OF THE BONDS
Section 2.1. Authorization of Bonds.......................................................12
Section 2.2. Issuance of Bonds; Terms of Bonds............................................12
Section 2.3. Form of Bond.................................................................18
Section 2.4. Execution; Limited Obligations...............................................31
Section 2.5. Conditions Precedent to Delivery of Bonds; Authentication....................31
Section 2.6. Redemption of Bonds..........................................................32
Section 2.7. Selection of Bonds for Redemption............................................35
Section 2.8. Notice of Redemption.........................................................36
Section 2.9. Effect of Redemption.........................................................37
Section 2.10. Optional Redemption only at Direction of Borrower............................37
Section 2.11. Book-Entry Bonds............................................................37
Section 2.12. Extension of Letter of Credit in Anticipation of Expiration.................38
Section 2.13. Delivery of Initial Letter of Credit; Replacement of Letter of
Credit.......................................................................39
Section 2.14. Notice to Owners.............................................................39
Section 2.15. Reduction....................................................................39
Section 2.16. Other Credit Enhancement; No Credit Enhancement..............................40
ARTICLE III
PURCHASE AND REMARKETING OF THE BONDS
Section 3.1. Optional Tenders for Purchase................................................40
Section 3.2. Mandatory Tenders for Purchase...............................................41
Section 3.3. Remarketing and Purchase.....................................................42
Section 3.4. Inadequate Funds for Tenders.................................................45
Section 3.5. [Reserved]...................................................................45
Section 3.6. Bond Purchase Fund...........................................................45
ARTICLE IV
GENERAL PROVISIONS
Section 4.1. Authorization for Indenture; Indenture to Constitute Contract................46
Section 4.2. Payment of Principal, Premium, if any, and Interest..........................46
Section 4.3. Performance of Covenants; Issuer Warranties..................................47
Section 4.4. Instruments of Further Assurance.............................................47
Section 4.5. Limitation on Issuer's Actions...............................................47
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Section 4.6. Registration of Bonds; Trustee Appointed Bond Registrar;
Persons Treated as Owners....................................................47
Section 4.7. Cancellation.................................................................49
Section 4.8. Non-presentment of Bonds.....................................................49
Section 4.9. Rights Under Loan Agreement..................................................49
Section 4.10. Legal Existence of Issuer....................................................49
Section 4.11. Tax-Exempt Status of Bonds...................................................50
Section 4.12. Diminution of, or Encumbrance on, Trust Estate...............................50
Section 4.13. Books, Records and Accounts..................................................50
Section 4.14. Temporary Bonds..............................................................50
Section 4.15. Mutilated, Lost, Stolen or Destroyed Bonds...................................50
Section 4.16. Notice to Remarketing Agent and Rating Agencies..............................51
ARTICLE V
REVENUES AND FUNDS
Section 5.1. Creation of Refunding Fund; Application of Original Proceeds of
Bonds; Source of Payment of Bonds............................................51
Section 5.2. Creation of Revenue Fund.....................................................52
Section 5.3. Payments into Revenue Fund...................................................52
Section 5.4. Use of Moneys in Revenue Fund................................................52
Section 5.5. Investment of Moneys.........................................................52
Section 5.6. Moneys Held in Trust.........................................................53
Section 5.7. Repayment to Borrower from Indenture Funds...................................54
Section 5.8. Tax Covenants................................................................54
Section 5.9. Rebate Fund..................................................................54
ARTICLE VI
DISCHARGE OF INDENTURE
Section 6.1. Discharge....................................................................56
ARTICLE VII
EVENTS OF DEFAULT AND REMEDIES
Section 7.1. Events of Default............................................................57
Section 7.2. Acceleration.................................................................57
Section 7.3. Other Remedies; Rights of Bond Owners........................................57
Section 7.4. Right of Bond Owners to Direct Proceedings...................................59
Section 7.5. Appointment of Receiver......................................................59
Section 7.6. Waiver of Certain Laws.......................................................59
Section 7.7. Application of Moneys........................................................59
Section 7.8. Remedies Vested in Trustee...................................................60
Section 7.9. Rights and Remedies of Bond Owners...........................................61
Section 7.10. Termination of Proceedings...................................................61
Section 7.11. Waivers of Events of Default.................................................62
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Section 7.12. Notice of Default; Opportunity to Cure Defaults..............................62
ARTICLE VIII
THE TRUSTEE, TENDER AGENT AND REMARKETING AGENT
Section 8.1. Acceptance of Trusts.........................................................62
Section 8.2. Annual Fees, Charges and Expenses of Trustee and Tender Agent................66
Section 8.3. Notice to Bond Owners of Default.............................................66
Section 8.4. Intervention by Trustee......................................................67
Section 8.5. Successor Trustee by Merger or Otherwise.....................................67
Section 8.6. Resignation by Trustee.......................................................67
Section 8.7. Removal of Trustee...........................................................67
Section 8.8. Appointment of Successor Trustee.............................................67
Section 8.9. Successor Trustee............................................................67
Section 8.10. Appointment of Tender Agent..................................................68
Section 8.11. Remarketing Agent............................................................69
Section 8.12. Qualifications of Successor Remarketing Agents; Resignation or
Removal of Remarketing Agents................................................69
Section 8.13. Appointment of Separate or Co-Trustee........................................69
Section 8.14. Qualifications...............................................................70
ARTICLE IX
SUPPLEMENTAL INDENTURES
Section 9.1. Supplemental Indentures Not Requiring Consent of Bond Owners.................71
Section 9.2. Supplemental Indentures Requiring Consent of Bond Owners.....................71
Section 9.3. Limitation Upon Amendments and Supplements...................................72
Section 9.4. Consent of Trustee, Letter of Credit Issuer, Borrower,
Remarketing Agent and Tender Agent Required..................................72
ARTICLE X
AMENDMENT OF CERTAIN LOAN DOCUMENTS
Section 10.1. Amendments of Loan Agreement and Tax Certificate Not Requiring
Consent of Bond Owners.......................................................72
Section 10.2. Amendments of Loan Agreement and Tax Certificate Requiring
Consent of Bond Owners.......................................................73
Section 10.3. Limitation Upon Amendment of Loan Agreement..................................73
Section 10.4. Letter of Credit Issuer's Consent...........................................74
ARTICLE XI
MISCELLANEOUS
Section 11.1. Consents of Bond Owners......................................................74
Section 11.2. Limitation of Rights.........................................................74
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Section 11.3. Severability.................................................................74
Section 11.4. Notices......................................................................74
Section 11.5. Payments or Performance Due on Other Than Business Days......................75
Section 11.6. Execution of Counterparts....................................................75
Section 11.7. Applicable Law...............................................................75
Section 11.8. Disqualified Bonds...........................................................75
Section 11.9. References to Letter of Credit Issuer........................................76
EXHIBIT A ALLOCATION OF PROJECTS......................................................A-1
EXHIBIT B INVESTOR LETTER.............................................................B-1
EXHIBIT C LEGEND FOR BONDS PRIOR TO JUNE 17, 2000.....................................C-1
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INDENTURE OF TRUST
THIS INDENTURE OF TRUST dated as of May 15, 1998 (the "INDENTURE"), is
made and entered into by and between the CALIFORNIA STATEWIDE COMMUNITIES
DEVELOPMENT AUTHORITY, a joint powers agency of the State of California (the
"ISSUER"), and U.S. BANK TRUST NATIONAL ASSOCIATION, a national banking
association, duly authorized to exercise trust powers hereunder, as Trustee (the
"TRUSTEE").
W I T N E S S E T H:
WHEREAS, the Issuer is a joint powers agency duly organized and existing
pursuant to the provisions relating to the joint exercise of powers found in
Chapter 5 of Division 7 of Title 1 (commencing with Section 6500) of the
Government Code of the State of California (herein the "Act");
WHEREAS, the Issuer is empowered under the provisions of the Act to
issue its bonds and to enter into financing agreements for the purpose of
facilitating the development of multifamily rental housing;
WHEREAS, the Issuer, acting pursuant to Article 11 of Chapter 3 of Part
1 of Division 2 of Title 5 of the Government Code is empowered to issue bonds to
refund the Prior Bonds (the "REFUNDING LAW"); and
WHEREAS, the Issuer has complied with the applicable notice provisions
of Section 8855 of the Government Code of the State of California (the
"GOVERNMENT CODE") and has received the certification required from the State
Treasurer pursuant to Section 8855.7(b) of the Government Code; and
WHEREAS, Irvine Apartment Communities, L.P., a Delaware limited
partnership (the "Borrower"), has applied to the Issuer for financial assistance
in the aggregate principal amount of $334,190,000, the proceeds of which will be
used as further described herein; and
WHEREAS, the Issuer has determined to issue its $334,190,000 Apartment
Development Revenue Refunding Bonds, Series 1998A (Irvine Apartment Communities,
L.P.) (the "Series 1998A Bonds") and to loan the proceeds thereof to the
Borrower pursuant to a Loan Agreement dated as of June 1, 1998 (the "Loan
Agreement") by and between the Issuer and the Borrower which requires the
Borrower to make or cause to be made, payments sufficient to pay principal and
purchase price of, and redemption premium, if any, and interest on, the Series
1998A Bonds as the same become due and payable and to pay certain administrative
expenses in connection with the Series 1998A Bonds; and
WHEREAS, all of the proceeds of the Series 1998A Bonds, together with
such other funds as are required, shall be applied as required hereunder to the
current refunding of the Issuer's $334,190,000 Apartment Development Revenue
Refunding Bonds, Series 1995A (the "Prior Bonds");
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WHEREAS, the Issuer has, by a resolution duly adopted in accordance with
the Act and the Refunding Law on May 12, 1998, duly authorized the execution and
delivery of this Indenture and the issuance of the Series 1998A Bonds, upon and
subject to the terms and conditions hereinafter set forth; and
WHEREAS, all acts and things have been done and performed which are
necessary to make the Series 1998A Bonds, when executed and issued by the
Issuer, authenticated by the Trustee and delivered, the valid and binding legal
obligations of the Issuer in accordance with their terms and to make this
Indenture a valid and binding agreement for the security of the Series 1998A
Bonds authenticated and delivered under this Indenture;
NOW, THEREFORE, THIS INDENTURE WITNESSETH: That, to provide for the
payment of principal or redemption price (as the case may be), purchase price
and interest in respect of all Series 1998A Bonds issued and outstanding under
this Indenture, the rights of the Bond Owners (as hereinafter defined) and the
performance of the covenants contained in the Series 1998A Bonds and herein, and
the payment of all other amounts due under this Indenture, the Issuer does
hereby sell, assign, transfer, set over and pledge unto the Trustee, its
successors in trust and its assigns forever, all right, title and interest of
the Issuer in and to, and remedies under, the Loan Agreement (except for the
Reserved Rights (as defined in the Loan Agreement), which rights may be enforced
jointly or severally by the Issuer and the Trustee) as the same relate to the
Series 1998A Bonds issued under this Indenture, and all right, title and
interest of the Issuer in and to the Revenues, the Refunding Fund and the
Revenue Fund (as such terms are hereinafter defined) but excluding amounts held
pursuant to Section 4.8 hereof or in the Rebate Fund (as hereinafter defined);
TO HAVE AND TO HOLD all and singular said right, title and interest of
the Issuer; granted, bargained, sold, assigned, transferred, enfeoffed,
conveyed, mortgaged, pledged, aliened, remised, released, confirmed and set over
by the Issuer as aforesaid or intended so to be, unto the said Trustee, its
successors and assigns, forever.
IN TRUST, NEVERTHELESS, under and subject to the terms and conditions
hereinafter set forth, for the equal benefit, protection and security of the
Owners of any and all of the Series 1998A Bonds, all of which, regardless of the
time or times of their issuance or maturity, shall be of equal rank, without
preference, priority or distinction of any of the Series 1998A Bonds over any
other thereof, except as otherwise provided in or pursuant to this Indenture
and/or any Letter of Credit (as hereinafter defined), and for securing the
observance and performance of all the conditions, covenants, promises,
stipulations, agreements and terms and provisions of this Indenture and the uses
and purposes herein expressed and declared. It is hereby expressly declared that
any Letter of Credit Issuer (as hereinafter defined) shall be deemed to be a
third-party beneficiary of this Indenture, so long as the Letter of Credit
Issuer is not in default of its obligations under the Letter of Credit.
PROVIDED, HOWEVER, that if the Issuer, its successors or assigns, shall
well and truly pay, or cause to be paid, the principal and purchase price of the
Series 1998 Bonds and any Additional Bonds (as hereinafter defined) and the
interest and premium, if any, due or to become due thereon at the times and in
the manner mentioned in the Series 1998A Bonds and any Additional Bonds
according to the true intent and meaning thereof, and shall cause the payments
to be made
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into the Revenue Fund, as required under Article V hereof, or shall provide, as
permitted by Article VI hereof, for the payment thereof, and for the payment of
certain excess investment earnings to the United States of America, as required
under Article V hereof, and shall well and truly keep, perform and observe all
of the covenants and conditions pursuant to the terms of this Indenture to be
kept, performed and observed by it, and shall pay or cause to be paid to the
Trustee all sums of money due or to become due in accordance with the terms and
provisions hereof, then this Indenture and the rights hereby granted shall cease
and terminate; otherwise this Indenture is to be and remain in full force and
effect.
THIS INDENTURE FURTHER WITNESSETH, and it is expressly declared, that
all Series 1998A Bonds and any Additional Bonds issued and secured hereunder are
to be issued, authenticated and delivered, and all said property, rights and
interests, including, without limitation, the amounts hereby assigned, are to be
dealt with and disposed of under, upon and subject to the terms, conditions,
stipulations, covenants, agreements, trusts, uses and purposes hereinafter
expressed, and that the Issuer has agreed and covenanted, and hereby does agree
and covenant, with the Trustee and with the Owners, from time to time, of the
Series 1998A Bonds and any Additional Bonds, or any part thereof, as follows:
ARTICLE I
DEFINITIONS AND INTERPRETATION
Section 1.1. Definitions. In addition to the terms defined elsewhere
herein, each of the following terms shall have the meaning assigned to it in
this Section 1.1 whenever it is used in this Indenture, unless the context in
which it is used clearly requires otherwise (certain terms used herein and not
otherwise defined are defined in the Loan Agreement):
"Act of Bankruptcy" shall mean the filing of a petition in bankruptcy
(or other commencement of a bankruptcy or similar proceeding) by or against the
Borrower under any applicable bankruptcy, insolvency, reorganization or similar
law affecting creditors' rights generally, now or hereafter in effect.
"Alternate Letter of Credit" shall mean any guaranty, standby purchase
agreement or letter of credit substituted for an Initial Letter of Credit (or
for any Alternate Letter of Credit) a written commitment for which is issued by
a Qualified Issuer at least forty-five (45) days prior to the Interest Payment
Date of the applicable Subseries immediately preceding the Termination Date,
specifying that the Alternate Letter of Credit will be effective on or prior to
the Termination Date (unless the Interest Payment Date and the Termination Date
are the same date, in which case such commitment shall be issued by a Qualified
Issuer at least forty-five (45) days prior to such date), and which Alternate
Letter of Credit (i) has provisions in all material respects the same as the
Initial Letter of Credit (other than the Termination Date therefor), (ii)
provides liquidity for payment of the purchase price of such Subseries when due,
and (iii) is accompanied by (a) written evidence from the Rating Agencies then
rating such Subseries, if any, that the substitution of such Alternate Letter of
Credit in and of itself does not cause a downgrading of the rating then in
existence, if any, of such Subseries by such Rating Agencies and (b) a Favorable
Opinion of Bond Counsel. Notice of the delivery to the Trustee of an Alternate
Letter of Credit shall be given by first class mail to the Bondholders of
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the applicable Subseries by the Trustee. Any extension of a Letter of Credit (or
any substitute Letter of Credit contemplated by Section 2.15 hereof) shall not
constitute an Alternate Letter of Credit.
"Authorized Denominations" shall mean the following: (i) for all Bonds
of a Subseries bearing interest at a Daily Rate or a Weekly Rate, $100,000 or
any integral multiple thereof (except that one Bond of such Subseries may be in
a denomination that is an integral multiple of $5,000 in excess of $100,000),
(ii) for all Bonds of a Subseries bearing interest at a Flexible Rate, $100,000
or any integral multiple of $1,000 in excess thereof, and (iii) for all Bonds of
a Subseries bearing interest at a Term Rate, $5,000 or any integral multiple
thereof.
"Beneficial Owner" or "beneficial owner" is defined in Section 2.11
hereof.
"Bond" or "Bonds" shall mean the $334,190,000 aggregate principal amount
of the Issuer's Apartment Development Revenue Refunding Bonds, Series 1998A
(Irvine Apartment Communities, L.P.) authenticated and delivered by the Trustee
under and pursuant to Article II hereof.
"Bond Counsel" shall mean ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇, or a firm of
attorneys of nationally recognized expertise with respect to the tax-exempt
obligations of political subdivisions, acceptable to the Issuer.
"Bond Owner," "Bondowner," "Owner," "owner," "Bondholder," "bondholder,"
"holder" or "owner of the Bonds," when used with respect to a Bond, shall mean
the person or entity in whose name such Bond shall be registered.
"Bond Purchase Fund" shall mean the fund so designated and established
pursuant to Section 3.6 hereof.
"Borrower Purchase Account" shall mean the account so designated and
established pursuant to Section 3.6 hereof.
"Borrower Revenue Account" shall mean the account so designated and
established pursuant to Section 5.2 hereof.
"Business Day" or "business day" shall mean any day other than a
Saturday, Sunday or other day on which the New York Stock Exchange is closed or
banks are authorized or obligated by law or executive order to close in New
York, New York, or in any city in which is located the Principal Office of the
Trustee or the Tender Agent or the Principal Office of the Remarketing Agent,
or, if so specified in the Letter of Credit in any definition of "business day"
referred to therein, the office of the Letter of Credit Issuer at which demands
for a draw on or payment under the Letter of Credit will be made.
"Closing Date" shall mean the date on which the Bonds are issued and
delivered to the Underwriters.
"Code" shall mean the 1954 Code and the 1986 Code, in each case to the
extent made applicable to matters relating to the Bonds and the Projects by
Section 1313(a) of the Tax Reform Act of 1986, and with respect to a specific
section thereof such reference shall be deemed to include (a) the applicable
regulations promulgated or proposed under such section or any previous
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corresponding section, (b) any successor provision of similar import hereafter
enacted, (c) any corresponding provision of any subsequent Internal Revenue Code
and (d) the applicable regulations promulgated or proposed under the provisions
described in (b) and (c). "1954 CODE" means the Internal Revenue Code of 1954,
as amended prior to the enactment of the Tax Reform Act of 1986. "1986 CODE"
means the Internal Revenue Code of 1986, as amended.
"Conversion Date" shall mean the Business Day on which a particular type
of Interest Rate becomes effective for any Subseries which is not immediately
preceded by a day on which such Subseries accrued interest at the same type of
Interest Rate and when used with respect to a Term Rate Period, the Interest
Payment Date on which such Subseries begins to bear interest at a new Term Rate.
"Daily Rate" shall mean, with respect to any Subseries, the interest
rate to be determined for such Subseries on each Business Day pursuant to
Section 2.2(B)(c) hereof.
"Daily Rate Conversion Date" shall mean, with respect to any Subseries,
each day on which such Subseries accrues interest at a Daily Rate which is
immediately preceded by a day on which such Subseries did not accrue interest at
a Daily Rate.
"Daily Rate Period" shall mean, with respect to any Subseries, each
period during which such Subseries accrues interest at a particular Daily Rate.
"Dated Date" shall mean May 15, 1998.
"Determination of Taxability" shall mean (a) there shall have been
delivered to the Trustee an opinion of Bond Counsel to the effect that any
payment of interest on the Bonds or any amount in respect of interest on the
Bonds made on or after a date specified in said opinion is includable for
federal income tax purposes in the gross income of any holder of the Bonds under
the Code (other than a holder who is a "substantial user" of a Project or a
"related person" as provided for in Section 147(a) of the Code), or (b) a final
determination by the Internal Revenue Service or a final judgment is rendered by
a court of competent jurisdiction in a proceeding, which determination or
judgment is not being contested in an appropriate proceeding brought directly by
the Borrower or by a holder of a Bond (provided that the Borrower may not
contest any such determination or judgment unless the Borrower provides the
holder of the Bond involved in such proceeding with an opinion of Bond Counsel
that such contest has a reasonable likelihood of success), to the effect that
the interest payable on the Bonds is includable for federal income tax purposes
in the gross income of any holder of the Bonds under Section 103 of the Code
(other than a holder who is a "substantial user" of a Project or a "related
person" within the meaning of Section 147(a) of the Code). A Determination of
Taxability under (a) or (b) above will result only from the inclusion of the
interest paid or to be paid on any Bond (except to a holder who is a
"substantial user" of a Project or a "related person") in the gross income of
the holder for federal income tax purposes and not from any other federal tax
consequences arising with respect to the Bonds.
"DTC" shall mean The Depository Trust Company.
"Event of Default," when used with respect to this Indenture, shall mean
any event specified in Section 7.1 hereof.
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"Favorable Opinion of Bond Counsel" shall mean an opinion of Bond
Counsel addressed to the Issuer, the Borrower and the Trustee to the effect that
the action proposed to be taken is authorized or permitted by this Indenture and
will not adversely affect the exclusion of interest on the Bonds from gross
income of the owners thereof for federal income tax purposes.
"Flexible Rate" shall mean, when used with respect to any particular
Bond of a Subseries, the interest rate determined for each Flexible Rate Period
applicable thereto pursuant to Section 2.2(B)(b) hereof.
"Flexible Rate Conversion Date" shall mean, each day on which the
particular Bonds of a Subseries accrue interest at Flexible Rates which is
immediately preceded by a day on which such Bonds of such Subseries did not
accrue interest at Flexible Rates.
"Flexible Rate Period" shall mean, with respect to a particular Bond of
a Subseries, each period during which such Bond of such Subseries accrues
interest at a particular Flexible Rate.
"Government Obligations" shall mean direct obligations of, or
obligations the timely payment of the principal of and interest on which are
fully and unconditionally guaranteed by, the United States of America, which, at
the time of investment, are legal investments under the laws of the State for
the moneys proposed to be invested therein.
"Indenture" shall mean this Indenture of Trust, including all amendments
hereof and supplements hereto.
"Initial Letter of Credit" shall mean, with respect to any Subseries,
the initial direct pay or standby letter of credit, guaranty or standby purchase
agreement issued by the Letter of Credit Issuer for the benefit of the Trustee,
as amended, extended or substituted by the Letter of Credit Issuer, providing
credit and/or liquidity support for the payment of principal, purchase price,
premium, if any, and interest on the Bonds.
"Interest Payment Date" shall mean (a) when used with respect to any
particular Bond accruing interest at a Flexible Rate, the day after the last day
of each Flexible Rate Period applicable thereto; (b) when used with respect to
Bonds accruing interest at Daily or Weekly Rates, the first Business Day of each
calendar month following a month in which interest at such rate has accrued; (c)
when used with respect to Bonds accruing interest at a Term Rate, the fifteenth
day of the May or November following the Closing Date and the month in which a
Term Rate Conversion Date occurs and the fifteenth day of each May and November
thereafter to which interest at such rate has accrued, except that the last
Interest Payment Date for any Term Rate Period shall be the first Business Day
that falls on or after the fifteenth day of the May or November in which the
Term Rate Period ends; and (d) each Conversion Date.
"Interest Period" shall mean the period from and including any Interest
Payment Date to and including the day immediately preceding the next Interest
Payment Date.
"Interest Rate" shall mean a Flexible, Daily, Weekly or Term Rate.
"Letter of Credit" shall mean, at any time, the Initial Letter of Credit
or any Alternate Letter of Credit then in effect. As of the Closing Date, no
Letter of Credit shall be in effect for the Bonds.
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"Letter of Credit Issuer" shall mean (i) when the Initial Letter of
Credit is in effect, the issuer of the Initial Letter of Credit, and (ii) when
an Alternate Letter of Credit is in effect, the Qualified Issuer of such
Alternate Letter of Credit.
"Letter of Credit Purchase Account" shall mean the account so designated
and established pursuant to Section 3.6 hereof.
"Letter of Credit Revenue Account" shall mean the account so designated
and established pursuant to Section 5.2 hereof.
"Letter of Credit Tender Date" shall mean the last Interest Payment Date
prior to the Termination Date of the Letter of Credit.
"Loan" shall mean the loan made by the Issuer to the Borrower from the
proceeds of the Bonds pursuant to the Loan Agreement.
"Mandatory Redemption Event" shall mean the occurrence of the event
described in Section 2.6(d) hereof.
"Moody's" shall mean ▇▇▇▇▇'▇ Investors Service, Inc., a Delaware
corporation, and, if such corporation is dissolved or liquidated or no longer
performs the functions of a securities rating agency, "Moody's" will be deemed
to refer to any other nationally recognized securities rating agency designated
by the Borrower with the consent of the Remarketing Agent and the Letter of
Credit Issuer, if any.
"Outstanding" or "Bonds outstanding" or "Bonds then outstanding," at the
time in question, shall mean all Bonds which have been executed and delivered by
the Issuer and authenticated by the Trustee or the Tender Agent under this
Indenture, except:
(i) Bonds theretofore cancelled by the Trustee or surrendered to
the Trustee for cancellation;
(ii) Bonds paid or deemed to be paid pursuant to Article VI
hereof;
(iii) Bonds in lieu of or in exchange for which other Bonds shall
have been executed and delivered by the Issuer and authenticated by the
Trustee or the Tender Agent pursuant to Section 4.6(b), 4.14 or 4.15
hereof; and
(iv) Undelivered Bonds.
"Permitted Investments" shall mean, to the extent permitted by State law
(the Trustee shall be entitled to rely upon any investment direction as a
certification to it that such investment is permitted by State law) (i)
Government Obligations or obligations of the Federal National Mortgage
Association, Government National Mortgage Association, Federal Intermediate
Credit Banks, Federal Banks for Cooperatives and Federal Home Loan Mortgage
Corporation, (ii) obligations issued by a state or political subdivision of a
state, (iii) money market funds investing exclusively in the obligations
described in clause (i) or (ii) hereof, (iv) shares of an Investment Company
organized under the Investment Company Act of 1940, as amended, including an
Investment Company for
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which the Trustee, or any of its affiliates, is investment advisor, which
invests its assets substantially in obligations described in clause (i) or (ii)
hereof, (v) banker's acceptances drawn on and accepted by commercial banks
(including the Trustee or its affiliates) having combined capital and surplus of
not less than $50,000,000; (vi) certificates of deposit and time deposits of any
bank organized under the laws of the United States or any state thereof which
has a combined capital, surplus and undivided profits not less than $50,000,000,
including the Trustee and, to the extent then permitted by law for the Trustee,
any other investments of its trust funds provided that any such certificates and
investments are fully collateralized by obligations described in clause (i) or
(ii) hereof, or (vii) any investment acceptable to any Rating Agency then rating
the Bonds.
"Pledge Agreement" shall mean any pledge and security agreement, or
similar agreement relating to Pledged Bonds, by and among any Letter of Credit
Issuer, the Tender Agent and the Borrower, as any such agreement may be amended,
modified, supplemented or vested from time to time in accordance with its terms.
"Pledged Bonds" shall mean those Bonds described in Section 3.3(b)(v)
hereof.
"Premium" or "premium," when used with respect to a Bond, shall mean any
amount in addition to the principal of, and interest on, such Bond that is
required to be paid in the event of the exercise of an option or obligation to
pay the principal of such Bond prior to maturity as permitted or required by
this Indenture, and, when used with respect to the Loan, shall mean any amount
in addition to the principal of, and interest on, the Loan that is required to
be paid in the event of the exercise of an option or obligation to pay the
principal of the Loan prior to maturity as permitted by the Loan Agreement.
"Prepayment" or "prepayment," when used with respect to the Loan, shall
mean the payment of all or a portion of the principal of the Loan prior to
maturity, except for a payment made in advance of the scheduled due date thereof
that is not to be applied against the outstanding principal balance of the Loan
until such due date.
"Project" shall have the meaning given thereto in the Loan Agreement.
"Qualified Issuer" shall mean a bank, financial institution or other
entity which has the power and authority to issue an Alternate Letter of Credit.
"Rate Period" shall mean the period during which a particular Interest
Rate is to remain in effect pursuant to the terms of this Indenture.
"Rating Agencies" shall mean Standard & Poor's, Moody's and any other
nationally recognized rating agency which then maintains a rating on the Bonds.
"Rebate Analyst" shall mean (a) Bond Counsel, (b) any nationally
recognized firm of certified public accountants, (c) any reputable firm which
offers to the tax-exempt bond industry rebate calculation services and holds
itself out as having expertise in that area, or (d) such other Person as is
approved by the Issuer.
"Rebate Regulations" shall mean the Treasury Regulations issued under
Section 148(f) of the Code.
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"Rebate Fund" shall mean the fund so designated and established pursuant
to Section 5.9 hereof.
"Record Date" shall mean (a) with respect to each Interest Payment Date
when Bonds bear interest at a Daily Rate, a Weekly Rate or a Flexible Rate, the
Business Day next preceding such Interest Payment Date, and (b) with respect to
each Interest Payment Date when Bonds bear interest at a Term Rate, the first
day of the calendar month containing such Interest Payment Date.
"Redemption Agreement" shall mean the Agreement Regarding Redemption and
Payment of Prior Bonds dated the Closing Date among the Issuer, the Trustee, the
Borrower, the trustee for the Prior Bonds, the Federal National Mortgage
Association and Bankers Mutual.
"Refunding Fund" shall mean the fund so designated and established
pursuant to Section 5.1 hereof.
"Registration Books" shall mean the registration records, maintained by
the Trustee, as registrar for the Bonds.
"Regulatory Agreements" shall mean the Amended and Restated Regulatory
Agreements and Declarations of Restrictive Covenants dated as of the date hereof
among the Issuer, the Borrower and the Trustee, including all amendments thereof
and supplements thereto.
"Reimbursement Agreement" shall mean the agreement between the Letter of
Credit Issuer and the Borrower relating to the Borrower's reimbursement
obligations with respect to the Initial Letter of Credit, and any similar
agreement between a Qualified Issuer of an Alternate Letter of Credit and the
Borrower providing that it shall be deemed to be a reimbursement agreement for
the purpose of this Indenture, as any such agreement may be amended, modified,
supplemented or restated from time to time in accordance with its terms.
"Remarketing Account" shall mean the account so designated and
established pursuant to Section 3.6 hereof.
"Remarketing Agent" shall mean the Remarketing Agent appointed by the
Borrower in accordance with the Remarketing Agreement; "Principal Office" of the
Remarketing Agent shall mean the office thereof designated by the Remarketing
Agent in writing to the Issuer, the Trustee, the Tender Agent, the Letter of
Credit Issuer and the Borrower.
"Remarketing Agreement" shall mean the Remarketing Agreement, by and
between the Borrower and the Remarketing Agent, and any similar agreement
between the Borrower and a successor Remarketing Agent, as any such agreement
may be amended, modified, supplemented or restated from time to time.
"Representation Letter" shall mean the Blanket Letter of
Representations, dated May 18, 1995, between the Issuer and The Depository Trust
Company, for the Bonds, including all amendments thereof and supplements
thereto.
"Revenue Fund" shall mean the fund so designated and established by
Section 5.2 hereof.
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"Revenues" shall mean (i) all amounts payable in respect of, or proceeds
from, the Loan, (ii) investment income in respect of any money held by the
Trustee, and (iii) any other amounts paid by the Borrower to the Trustee
pursuant to the Loan Agreement (except for amounts payable under Sections 2.7,
7.5, 7.11, 8.5 and 9.3 of the Loan Agreement).
"Standard & Poor's" shall mean Standard & Poor's Ratings Services, a
division of the ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., a corporation organized and
existing under the laws of the State of New York, and, if such corporation is
dissolved or liquidated or no longer performs the functions of a securities
rating agency, "Standard & Poor's" will be deemed to refer to any other
nationally recognized securities rating agency designated by the Borrower with
the consent of the Remarketing Agent and the Letter of Credit Issuer, if any.
"Subseries" shall mean all Bonds designated as being of the same
Subseries.
"Tax Certificate" shall mean the Tax Certificate of the Issuer dated the
Closing Date.
"TBMA Municipal Swap Index" shall mean The Bond Market Association
Municipal Swap Index as of the most recent date for which such index was
published or such other weekly, high-grade index comprised of seven-day,
tax-exempt variable rate demand notes produced by Municipal Market Data, Inc. or
its successor, or as otherwise designated by The Bond Market Association;
provided, however, that, if such index is no longer produced by Municipal Market
Data, Inc., or its successor, then "TBMA Municipal Swap Index" shall mean such
other reasonably comparable index selected by the Borrower with the consent of
the Remarketing Agent.
"Tender Agent" shall mean U.S. Bank Trust National Association, or any
successor to its interests, appointed in accordance with Section 8.10 hereof;
"Principal Office" of the Tender Agent shall mean the office thereof designated
by the Tender Agent in writing to the Issuer, the Trustee, the Remarketing
Agent, the Letter of Credit Issuer and the Borrower.
"Term Rate" shall mean, with respect to any Subseries, the interest rate
per annum on such Subseries established in accordance with Section 2.2(B)(e)
hereof.
"Term Rate Conversion Date" shall mean, with respect to any Subseries,
the Interest Payment Date on which such Subseries begins to bear interest at a
new Term Rate in accordance with the terms hereof.
"Term Rate Period" shall mean, with respect to any Subseries, the period
from (a) the Closing Date and a Term Rate Conversion Date, to (b) the final
maturity of the Bonds of such Subseries, or a subsequent Term Rate Conversion
Date or Conversion Date but, in any event, a period of not less than one year in
duration which ends on a Term Rate Interest Payment Date.
"Termination Date" shall mean the termination or expiration date of any
Letter of Credit, as such date may be extended from time to time pursuant to the
terms thereof.
"Treasury Regulations" shall mean the temporary and permanent Income Tax
Regulations promulgated or proposed by the Department of the Treasury pursuant
to the Code, as applicable to the Bonds.
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"Trustee" shall mean U.S. Bank Trust National Association, a national
banking association organized and existing under the laws of the United States,
not in its individual capacity but solely as Trustee under this Indenture, or
any successor trustee serving as such under this Indenture; "Principal Office"
of the Trustee shall mean the office thereof at which at any particular time its
corporate trust business shall be principally administered, which office at the
date hereof is located at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or any other such office as shall be designated by the Trustee
in writing to the Issuer, the Tender Agent, the Remarketing Agent, the Letter of
Credit Issuer and the Borrower.
"Trust Estate" shall mean the property conveyed to the Trustee pursuant
to the Granting Clauses of this Indenture.
"Undelivered Bonds" shall have the meaning ascribed to such term in the
form of Bond set forth in Section 2.3 hereof.
"Underwriters" shall mean ▇.▇. ▇▇▇▇▇▇ Securities Inc., ▇▇▇▇▇▇▇, ▇▇▇▇▇ &
Co. and Artemis Capital Group, Inc.
"Weekly Rate" shall mean, with respect to any Subseries, the interest
rate per annum on such Subseries established in accordance with Section
2.2(B)(d) hereof.
"Weekly Rate Conversion Date" shall mean, with respect to any Subseries,
the Business Day on which such Subseries begins to bear interest at a Weekly
Rate in accordance with the terms hereof.
"Weekly Rate Period" shall mean, with respect to any Subseries, the
period in which such Subseries accrues interest at a particular Weekly Rate.
The following terms are defined in the recitals hereto: "Act",
"Borrower", "Issuer", "Loan Agreement", "Prior Bonds," "Refunding Law" and
"State".
Section 1.2. Article and Section Headings. The headings or titles of the
several Articles and Sections of this Indenture, and the Table of Contents
appended hereto, are solely for convenience of reference and shall not affect
the meaning or construction of the provisions hereof.
Section 1.3. Interpretation. The singular form of any word used herein
shall include the plural, and vice versa, if applicable. The use of a word of
any gender shall include all genders, if applicable. This Indenture and all of
the terms and provisions hereof shall be construed so as to effectuate the
purposes contemplated hereby and to sustain the validity hereof. All references
to any person or entity defined in Section 1.1 shall be deemed to include any
person or entity succeeding to the rights, duties and obligations of such person
or entity.
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ARTICLE II
AUTHORIZATION AND ISSUANCE OF THE BONDS
Section 2.1. Authorization of Bonds. No Bonds may be issued under the
provisions of this Indenture except in accordance with this Article. The Bonds
are hereby authorized to be issued in a single Series with four Subseries,
designated "California Statewide Communities Development Authority Apartment
Development Revenue Refunding Bonds, Series 1998A (Irvine Apartment Communities,
L.P.)" in the aggregate principal amount of $334,190,000. The Bonds shall
contain substantially the terms recited in the form of the Bonds set forth in
this Indenture. The Bonds shall be issued for the purpose of providing funds to
enable the Issuer to make the Loan to the Borrower, as provided in the Loan
Agreement, to refund in their entirety the Prior Bonds.
Section 2.2. Issuance of Bonds; Terms of Bonds.
(A) General Provisions. The Bonds (i) shall be dated as provided in
paragraph (H) of this Section, (ii) shall be issued in the aggregate principal
amount of $334,190,000, (iii) shall bear interest as set forth in paragraphs (B)
and (C) of this Section, until paid, at the rates therein provided (computed,
while any Bonds bear interest at a Daily Rate, Flexible Rate or Weekly Rate, on
the basis of a 365- or 366-day year, for the actual number of days elapsed and,
while any Bonds bear interest at a Term Rate, on the basis of a 360-day year,
composed of twelve 30-day months), payable on each Interest Payment Date, (iv)
shall mature on May 15, 2025, (v) shall be issued in the following Subseries and
in the following aggregate principal amounts and (vi) shall initially bear
interest at the following Term Rates for the following Term Periods:
End of Term Term
Subseries Principal Amount Rate Period Rate
--------- ---------------- ----------- ----
Series 1998A-1 $ 24,800,000 May 15, 2008 5.05%
Series 1998A-2 109,390,000 May 15, 2008 4.90
Series 1998A-3 100,000,000 May 17, 2010 5.10
Series 1998A-4 100,000,000 May 15, 2013 5.25
Subject to the terms of this Indenture, different types of Interest
Rates may be in effect as to different Subseries.
(B) Determination of Interest Rates.
(a) Determination by Remarketing Agent.
(i) The Interest Rate shall be determined by the Remarketing
Agent as the rate of interest which, in the judgment of the Remarketing Agent,
would cause the Bonds of a Subseries to have a market value as of the date of
determination equal to the principal amount thereof, taking into account
prevailing market conditions; provided that if a Letter of Credit is then in
effect for any Subseries, the Interest Rate borne by such Subseries shall not
exceed the maximum interest rate with respect to such Subseries specified in the
Letter of Credit.
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(ii) In the event the Remarketing Agent fails for any reason to
determine or notify the Trustee of the Interest Rate for any Rate Period:
(A) The Interest Rate then in effect for Bonds of a
Subseries that accrue interest at a Daily Rate will remain a Daily Rate, and
until a new Daily Rate is determined, and furnished to the Trustee in writing,
by the Remarketing Agent, such Subseries shall accrue interest at a rate equal
to the rate derived from the TBMA Municipal Swap Index furnished to the Trustee
in writing by the Remarketing Agent;
(B) The Interest Rate then in effect for Bonds of a
Subseries that accrue interest at a Weekly Rate will remain a Weekly Rate, and
until a new Weekly Rate is determined, and furnished to the Trustee in writing,
by the Remarketing Agent, such Subseries shall accrue interest at a rate equal
to the rate derived from the TBMA Municipal Swap Index furnished to the Trustee
in writing by the Remarketing Agent;
(C) The Interest Rate for any Bond of a Subseries that
accrues interest at a Flexible Rate and for which a Flexible Rate and Flexible
Rate Period is not determined shall be equal to the rate derived from the TBMA
Municipal Swap Index and furnished to the Trustee in writing by the Remarketing
Agent, and the Flexible Rate Period for such Bond of a Subseries shall begin on
each Business Day and extend through the day preceding the next Business Day
until a new Flexible Rate and Flexible Rate Period is determined for such Bond
of such Subseries, and furnished to the Trustee in writing, by the Remarketing
Agent; and
(D) The Interest Rate then in effect for Bonds of a
Subseries that accrue interest at a Term Rate shall be converted automatically
to Flexible Rates determined in accordance with clause (C) above with Flexible
Rate Periods beginning on each Business Day and extending through the day
preceding the next Business Day until the Trustee is notified in writing of a
new Flexible Rate and Flexible Rate Period determined for such Bonds by the
Remarketing Agent; provided, that, the Trustee shall have received a Favorable
Opinion of Bond Counsel prior to the commencement of any such Flexible Rate
Period, and, in the event that the Trustee does not receive a Favorable Opinion
of Bond Counsel prior to the commencement of such Flexible Rate Period, the Term
Rate then in effect shall continue for another Term Rate Period of the same
duration or, if shorter, until the maturity date of such Subseries.
(iii) All determinations of Interest Rates pursuant to this
Section shall be conclusive and binding upon the Issuer, the Borrower, the
Trustee, the Tender Agent and the Owners of the Bonds to which such rates are
applicable.
(iv) The Interest Rate in effect for a Subseries of Bonds during
any Rate Period shall be available to Bond Owners between 1:00 p.m. and 5:00
p.m., New York City time, from the Remarketing Agent or the Trustee (subject to
prior receipt of notice thereof from the Remarketing Agent) at their Principal
Offices.
(b) Flexible Rates.
(i) The Flexible Rate Period for each Bond of a Subseries shall
be of such duration, not exceeding 270 days, as may be offered by the
Remarketing Agent and specified by the purchaser; provided that if a Letter of
Credit is then in effect for such Subseries and such
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Letter of Credit provides less than 284 days' interest coverage, such Flexible
Rate Period shall not be longer than a period equal to the maximum number of
days' interest coverage provided by such Letter of Credit minus 14 days. Any
Bond of a Subseries may accrue interest at a Flexible Rate for a Flexible Rate
Period different from any other Bond of such Subseries. Each Flexible Rate
Period shall commence on a Business Day and end on a day immediately preceding a
Business Day. The Remarketing Agent shall offer and accept purchase commitments
for the Bonds of a Subseries for such Flexible Rate Periods and at such Flexible
Rates as it deems advisable in order to minimize the net interest cost on such
Bonds of such Subseries, taking into account prevailing market conditions;
provided, however, that the foregoing shall not prohibit the Remarketing Agent
from accepting purchase commitments for longer Flexible Rate Periods (and at
higher Flexible Rates) than are otherwise available at the time of any
remarketing if the Remarketing Agent determines that, taking into account
prevailing market conditions, a lower net interest cost on such Bonds can be
achieved over the longer Flexible Rate Period.
(ii) Each Flexible Rate and Flexible Rate Period shall be
determined not later than 1:00 p.m., New York City time, on the first Business
Day of the Flexible Rate Period to which it relates with notice thereof provided
to the Trustee by the Remarketing Agent by written, telephonic (promptly
confirmed in writing or electronically) or electronic notice by 1:00 p.m., New
York City time, on that same day.
(c) Daily Rates. A Daily Rate shall be determined for each Daily
Rate Period as follows:
(i) Daily Rate Periods shall commence on a Daily Rate Conversion
Date, which shall be a Business Day, and on each Business Day thereafter until
the Daily Rate Period is converted to another type of Interest Rate and shall
extend to, but not include, the next succeeding Business Day.
(ii) The Daily Rate for each Daily Rate Period shall be
effective from and including the commencement date of such Daily Rate Period and
shall remain in effect to, but not including, the next succeeding Business Day.
Each such Daily Rate shall be determined not later than 10:30 a.m., New York
City time, on the first Business Day of the Daily Rate Period to which it
relates with notice thereof provided to the Trustee by the Remarketing Agent by
written, telephonic (promptly confirmed in writing or electronically) or
electronic notice by 1:00 p.m., New York City time, on that same day; provided
that no notice need be given if the Daily Rate then in effect is to be the Daily
Rate for the next Daily Rate Period.
(d) Weekly Rates. A Weekly Rate shall be determined for each Weekly
Rate Period as follows:
(i) Weekly Rate Periods shall commence on a Wednesday (or, if
such Wednesday is not a Business Day, the next succeeding Business Day) and end
on the day prior to the commencement of the next succeeding Weekly Rate Period,
and each Weekly Rate Period shall be followed by another Weekly Rate Period
until the Weekly Rate Period is converted to another type of Interest Rate;
provided that (A) in the case of a conversion to a Weekly Rate Period from
another type of Interest Rate, the Weekly Rate Period shall commence on the
Weekly Rate Conversion Date and shall end on the day prior to the commencement
of the next succeeding Weekly Rate Period; and
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(B) in the case of a conversion from a Weekly Rate Period to another type of
Interest Rate, the last Weekly Rate Period prior to conversion shall end on the
last day immediately preceding the Conversion Date to the new type of Interest
Rate.
(ii) The Weekly Rate for each Weekly Rate Period shall be
effective from and including the commencement date of such Weekly Rate Period
and shall remain in effect through and including the last day thereof. Each such
Weekly Rate shall be determined not later than 10:00 a.m., New York City time,
on the first day of the Weekly Rate Period to which it relates with notice
thereof provided to the Trustee by the Remarketing Agent by written, telephonic
(promptly confirmed in writing or electronically) or electronic notice by 12:00
Noon, New York City time, on such first day.
(e) Term Rates. A Term Rate shall be determined for each Term Rate
Period, after the initial Term Rate Periods, as follows:
(i) Term Rate Periods shall (A) commence on a Term Rate
Conversion Date and (B) end on the commencement date of the following Term Rate
Period or the Conversion Date on which a different type of Interest Rate shall
become effective or the maturity date of the Bonds of the applicable Subseries;
provided that if a Letter of Credit is then in effect for a Subseries bearing
interest at a Term Rate, no Term Rate Period shall extend beyond the remaining
term of such Letter of Credit minus 14 days. Each Subseries of Bonds that bears
interest at the Term Rate may have a Term Rate Period different from a Term Rate
Period for any other Subseries.
(ii) The Term Rate for each Term Rate Period shall be effective
from and including the commencement date of such Term Rate Period and remain in
effect to but not including the last day thereof. Each such Term Rate shall be
determined not later than 12:00 noon, New York City time, on the Business Day
immediately preceding the commencement date of the Term Rate Period to which it
relates with notice thereof provided to the Trustee by the Remarketing Agent by
written, telephonic (promptly confirmed in writing or electronically) or
electronic notice by the close of business on such Business Day.
(C) Conversions Between Interest Rates . The Borrower may elect to
convert a Subseries from one type of Interest Rate to another (including from
one Term Rate Period to a Term Rate Period of a different duration) as follows:
(a) Conversion Dates.
(i) If the conversion is from a Flexible Rate, the Conversion
Date shall be a Business Day on which interest is payable on all Bonds of a
Subseries accruing interest at Flexible Rates.
(ii) If the conversion is from a Daily or Weekly Rate, the
Conversion Date shall be a Business Day.
(iii) If the conversion is from a Term Rate, the Conversion Date
shall be a date on which the Bonds of the applicable Subseries are subject to
optional redemption pursuant to Section 2.6(a)(ii) hereof.
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(b) Notices by Borrower. The Borrower shall give notice of any
proposed conversion to the Trustee, any Letter of Credit Issuer and the
Remarketing Agent not less than twenty-five (25) days before the proposed
conversion from a Flexible, Daily or Weekly Rate and not less than forty-five
(45) days before the proposed conversion from a Term Rate.
(c) Notices by Trustee. The Trustee shall give notice by first class
mail of the proposed conversion to the Owners of Bonds of the Subseries subject
to the proposed conversion accruing interest at Flexible, Daily or Weekly Rates
not less than fifteen (15) days before the proposed Conversion Date and to the
Owners of Bonds of the Subseries subject to the proposed conversion accruing
interest at a Term Rate not less than thirty (30) days before the proposed
Conversion Date. Such notice shall state:
(i) the proposed Conversion Date;
(ii) that the Bonds of the Subseries subject to the proposed
conversion will be subject to mandatory tender for purchase on the Conversion
Date (except in the case of conversions from a Daily Rate to a Weekly Rate or
from a Weekly Rate to a Daily Rate);
(iii) the conditions, if any, to the conversion pursuant to
subsection (d) below;
(iv) any changes in the redemption dates or redemption prices
following the Conversion Date, if any, applicable to the Bonds of the Subseries
subject to the proposed conversion which have been approved by a supplemental
indenture adopted in accordance with the terms of this Indenture; and
(v) if the Bonds of the Subseries subject to the proposed
conversion are in certificated form, information with respect to required
delivery of Bond certificates and payment of the purchase price.
(d) Conditions to Conversion. No conversion of Interest Rates will
become effective unless:
(i) if the conversion is from a Flexible Rate, the Trustee has
received, prior to the date on which notice of conversion is required to be
given to Bond Owners, written confirmation from the Remarketing Agent that it
has not established and will not establish any Flexible Rate Periods extending
beyond the day before the Conversion Date;
(ii) if the conversion is from a Flexible, Daily or Weekly Rate
to a Term Rate, or from a Term Rate to a Flexible Rate, Daily Rate, Weekly Rate
or a new Term Rate or Term Rate Period, the Trustee has been provided, no later
than one day before the Conversion Date, with a Favorable Opinion of Bond
Counsel with respect to the conversion;
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(iii) if a Letter of Credit for the Subseries subject to the
proposed conversion will be held by the Trustee after the Conversion Date, such
Letter of Credit (A) will cover the principal of and interest (computed on the
basis of a 365-day year, in the case of conversion to a Flexible Rate, Daily
Rate or Weekly Rate, and on the basis of a 360-day year consisting of twelve
30-day months, in the case of conversion to a Term Rate) which will accrue on
the Outstanding Bonds of such Subseries for the maximum permitted Interest
Period for the proposed Rate Period plus 14 days, and (B) in the case of
conversion to a Term Rate, (i) extends for a period which shall not end on a
date that is earlier than five days after the first date on which such Subseries
can be called for optional redemption, and (ii) covers the premium, if any,
which would be included in the purchase price upon mandatory purchase of the
Bonds of such Subseries pursuant to Section 3.2(c) hereof if such Letter of
Credit were not extended beyond the Termination Date set forth therein.
(D) Redemption Provisions. The Bonds are subject to redemption prior to
maturity as set forth in Section 2.6 hereof.
(E) Tender Rights/Obligations. While in a Daily Rate or a Weekly Rate,
Bonds may be tendered for purchase as set forth in the form of Bond contained in
Section 2.3 hereof and in Section 3.1 hereof. In addition, the Bonds are subject
to mandatory tender for purchase on the day after the last day of each Flexible
Rate Period, on the last day of a Term Rate Period, on the day on which a Letter
of Credit is replaced pursuant to Section 2.13 hereof, on each Letter of Credit
Tender Date and on each Conversion Date (except in the case of conversions from
a Daily Rate to a Weekly Rate or from a Weekly Rate to a Daily Rate) by the Bond
Owners as set forth in Section 3.2 hereof.
(F) Form; Numbering. The Bonds are issuable in the form of registered
Bonds without coupons in any Authorized Denomination. The Bonds shall be
numbered consecutively within each Subseries from 1 upwards, bearing numbers not
then contemporaneously outstanding according to the Registration Books.
(G) Payment Terms. Principal of, and premium, if any, on the Bonds (and
interest on Bonds accruing at a Flexible Rate) shall be payable by the Trustee
to the Bond Owners upon presentation and surrender of the Bonds as the same
become due at the Principal Office of the Trustee. Interest on the Bonds shall
be paid by the Trustee by check drawn upon the Trustee and mailed by first class
mail on the respective Interest Payment Dates to the Bond Owners at their
addresses shown on the Registration Books as of the close of business on the
Record Date with respect to such Interest Payment Date; provided that payment of
interest may be made by the Trustee by wire transfer to an account with a
financial institution in the continental United States of an Owner of $1,000,000
or more in aggregate principal amount of Bonds upon such Owner providing the
Trustee with written wire transfer instructions before the applicable Record
Date. Such interest shall be paid notwithstanding the cancellation of any Bonds
upon any exchange or registration of transfer thereof subsequent to the Record
Date and prior to such Interest Payment Date, except that, if and to the extent
there shall be a default in the payment of the interest due on such Interest
Payment Date, such defaulted interest shall be paid to the Bond Owners in whose
names such Bonds (or any Bond or Bonds issued upon registration of transfer or
exchange thereof) are registered at the close of business on the Business Day
next preceding the date of payment of such defaulted interest. Payment of
principal or purchase price of, premium, if any, and interest on, the Bonds
shall be made in such lawful money of the United States of America as, at the
respective times of payment, shall be
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legal tender for the payment of public and private debts. If a Letter of Credit
is in effect for a Subseries, and the Letter of Credit so provides, the Trustee
shall draw under the Letter of Credit in accordance with its terms to the extent
necessary to pay the principal of, premium, if any, purchase price and interest
on, such Subseries, as and when due.
(H) Dating. The Bonds shall be dated and initially bear interest from
the Dated Date, and thereafter shall bear interest from the Interest Payment
Date next preceding the date of authentication, unless (i) authenticated prior
to the first Interest Payment Date, in which event such Bonds shall bear
interest from the Dated Date, (ii) authenticated on an Interest Payment Date, in
which event such Bonds shall bear interest from the date of authentication, or
(iii) authenticated after a Record Date and before the following Interest
Payment Date, in which event such Bonds shall bear interest from the following
Interest Payment Date. If, as shown by the records of the Trustee, interest on
the Bonds is in default, Bonds issued in exchange for Bonds surrendered for
registration of transfer or exchange shall bear interest from the date to which
interest has been paid in full on the Bonds, or, if no interest has been paid on
the Bonds, from the Dated Date. The Bonds shall also bear a date of
authentication.
Section 2.3. Form of Bond. Subject to the provisions hereof with respect
to special endorsement of Bonds in connection with a conversion, the Bonds, the
certificate of authentication, the registration information form and the form of
assignment shall be in substantially the form hereinafter set forth, with such
appropriate variations, omissions, substitutions and insertions as are permitted
or required hereby, and may have such letters, numbers or other marks of
identification and such legends and endorsements placed thereon as may be
required to comply with any applicable laws or rules or regulations, or as may,
consistently herewith, be determined by the officers executing such Bonds, as
evidenced by their execution of the Bonds. In the preparation of definitive
forms of Bonds relative to the periods before and after a Conversion Date,
pertinent provisions of the form of Bond may be omitted, as appropriate.
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FORM OF BOND
THE BONDS SHALL NOT CONSTITUTE A DEBT OF THE STATE OR ANY POLITICAL SUBDIVISION
THEREOF; AND NEITHER THE STATE OF CALIFORNIA NOR ANY POLITICAL SUBDIVISION
THEREOF SHALL BE LIABLE THEREFOR. NEITHER THE FAITH, REVENUES, CREDIT NOR TAXING
POWER OF THE STATE OF CALIFORNIA OR ANY POLITICAL SUBDIVISION THEREOF SHALL BE
PLEDGED TO THE PAYMENT OF THE PRINCIPAL OF OR INTEREST ON THE BONDS. THE BONDS
ARE NOT A DEBT OF THE UNITED STATES OF AMERICA OR OF ANY AGENCY THEREOF AND ARE
NOT GUARANTEED BY THE FULL FAITH AND CREDIT OF THE UNITED STATES OF AMERICA. THE
BONDS ARE A SPECIAL LIMITED OBLIGATION OF THE ISSUER, PAYABLE, AS TO PRINCIPAL,
PREMIUM, IF ANY, AND INTEREST, SOLELY OUT OF THE TRUST ESTATE, WHICH IS THE SOLE
ASSET OF THE ISSUER PLEDGED THEREFOR. THE ISSUER HAS NO TAXING POWER.
No. RB-________ $____________
CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY
APARTMENT DEVELOPMENT REVENUE REFUNDING BONDS, SERIES 1998A-__
INTEREST RATE MATURITY DATE DATED DATE CUSIP
------------- ------------- ---------- -----
May 15, 2025 ________ __, 1998
REGISTERED OWNER:
PRINCIPAL AMOUNT:
Last Day of Term Rate [Flexible Rate] Period ________
[Number of Days in Period ________] [________ Interest Due at End of Period
THIS BOND IS SUBJECT TO MANDATORY TENDER FOR PURCHASE AT THE TIMES AND
IN THE MANNER HEREINAFTER DESCRIBED, AND MUST BE SO TENDERED OR WILL BE DEEMED
TO HAVE BEEN SO TENDERED UNDER CERTAIN CIRCUMSTANCES AS DESCRIBED HEREIN.
WHILE IN A DAILY RATE PERIOD OR A WEEKLY RATE PERIOD, THIS BOND SHALL BE
PURCHASED ON THE DEMAND OF THE OWNER AT THE TIMES AND IN THE MANNER HEREINAFTER
DESCRIBED.
The CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY (the
"Issuer"), a joint powers agency of the State of California (the "State"),
hereby promises to pay to the Registered Owner specified above, or registered
assigns, the Principal Amount specified above on the Maturity Date specified
above (or earlier as hereinafter provided), and to pay interest on the Principal
Amount hereof from the Dated Date specified above at the rates per annum and on
the
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dates set forth herein; provided, however, that such principal and interest are
payable solely from the sources and in the manner hereinafter described.
The Bonds are issued pursuant to and in compliance with the laws of the
State, particularly Article 11 of Chapter 3 of Part 1 of Division 2 of Title 5
of the Government Code of the State (the "Refunding Law"). The Bonds are limited
obligations of the Issuer payable solely from revenues and funds pledged
therefor under the Indenture. No holder of this Bond shall ever have the right
to compel the exercise of the taxing power of the State or any political
subdivision thereof to pay the principal of this Bond or the interest hereon or
any other cost incident hereto, or to enforce payment hereof against any
property of said State or any political subdivision thereof.
The principal of, premium, if any, and interest on, this Bond are
payable in lawful money of the United States of America. The principal and
premium, if any, payable upon maturity or earlier redemption of this Bond (and
interest on this Bond if it is accruing interest at a Flexible Rate) is payable
when due upon the presentation and surrender hereof at the principal corporate
trust office of U.S. Bank Trust National Association, as trustee (the
"Trustee"), or any successor. Each payment of interest on this Bond shall be
payable to the holder hereof as shown on the Registration Books at the close of
business on the Business Day next preceding the date on which (but, during a
Term Rate Period, the first day of the calendar month in which) such interest
becomes due and payable (herein, a "Record Date"). Interest on this Bond shall
be payable to the holder hereof by check mailed by first class mail on the
respective Interest Payment Dates (as hereinafter defined) to the address of
such holder as shown on the Registration Books at the close of business on the
relevant Record Date, or to such other address as is furnished to the Trustee
(in form satisfactory to the Trustee) by such holder prior to such Record Date.
Holders of $1,000,000 in aggregate principal amount of Bonds shall be entitled
to receive interest payments by wire transfer to an account with a financial
institution in the continental United States by providing written wire
instructions to the Trustee before the Record Date.
This Bond is one of a duly authorized series (the "Bonds"), limited in
aggregate principal amount to $334,190,000, issued under and pursuant to
authority conferred by the Refunding Law, a Resolution of the Issuer adopted on
May 12, 1998 and the Indenture of Trust, dated as of May 15, 1998 (the
"Indenture") by and between the Issuer and the Trustee, to accomplish the public
purposes of the Refunding Law by providing financing to Irvine Apartment
Communities, L.P., a Delaware limited partnership (the "Borrower"), to refinance
existing loans with respect to certain multifamily housing projects owned by the
Borrower (the "Projects").
The Bonds are special, limited obligations of the Issuer, payable solely
from payments made by the Borrower pursuant to the Loan Agreement dated as of
May 15, 1998 (the "Loan Agreement") by and between the Issuer and the Borrower,
from payments made pursuant to a Letter of Credit ((as hereinafter defined), if
any, and from any other moneys held by the Trustee under the Indenture for such
purpose, and other than as provided in the Loan Agreement and the Indenture,
there shall be no other recourse against the Issuer. Except as otherwise
specified in the Indenture, this Bond is entitled to the benefits of the
Indenture equally and ratably both as to principal, premium, if any, and
interest with all other Bonds issued under the Indenture, to which reference is
made for a description of the rights of the holders of the Bonds, the rights and
obligations of the Issuer, the rights, duties and obligations of the Trustee,
and the provisions relating to amendments to and modifications of the Indenture.
The holder of this Bond may not enforce the provisions of the Loan Agreement
except in
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accordance with the provisions of the Indenture. Copies of the Indenture and the
Loan Agreement are on file at the principal corporate trust office of the
Trustee.
This Bond has been issued in global form, registered in the name of Cede
& Co., nominee of The Depository Trust Company ("DTC"). Beneficial owners hereof
will hold their interests herein through the facilities and subject to the
procedures of DTC. By acceptance of a confirmation of purchase, delivery or
transfer, the beneficial owners of this Bond shall be deemed to have agreed to
this arrangement. Cede & Co., as registered owner of this Bond, shall be treated
as the owner hereof for all purposes.
Reference is made to: (a) the Indenture and the Loan Agreement for
provisions concerning, as applicable, the rights of the holders and the rights
and obligations of the Issuer, the Borrower and the Trustee; and (b) the
Remarketing Agreement pursuant to which _______________________, New York, New
York, shall serve as remarketing agent for the purposes set forth in the
Indenture (such agent or its successors being herein referred to as the
"Remarketing Agent"). The acceptance of the terms and conditions of the
foregoing documents (including amplifications and qualifications of the
provisions of this Bond), each of which is on file at the principal corporate
trust office of the Trustee, is an explicit and material part of the
consideration of the Issuer's issuance of this Bond, and each holder hereof by
acceptance of this Bond accepts and assents to all such terms and conditions as
if fully set forth herein.
Capitalized terms used in this Bond which are not defined herein but
which are defined in the Indenture shall have the respective meanings set forth
in the Indenture.
INTEREST ON BONDS
The Bonds shall accrue interest at the Term Rate until changed by the
Borrower on any date on which the Bonds are subject to optional redemption in
accordance with the provisions of the Indenture or at the end of the Term Rate
Period, and will be subject to conversion as herein provided. All computations
of interest shall be computed on the basis of 360-day years of twelve 30-day
months; except for interest at Daily, Weekly or Flexible Rates, which shall be
based on 365- or 366- day years for the actual number of days elapsed.
Notwithstanding any provision of this Bond or the Indenture to the contrary, in
no event shall the cumulative amount of interest paid or payable on this Bond
(including interest calculated as provided herein, together with all other
amounts that constitute interest on this Bond under the laws of the State which
are contracted for, charged, reserved, taken or received pursuant to the Loan
Agreement or the Indenture) through any date of payment of interest or through
the date of payment of this Bond (whether at maturity, by acceleration or upon
earlier redemption) exceed the maximum rate permitted by State law.
The Bonds may accrue interest at various types of Interest Rates
effective for Rate Periods determined as described in the Indenture. Each
Subseries of Bonds may accrue interest at a type of Interest Rate that is
different from any other Subseries. The Interest Rates for the Bonds, which will
be determined by the Remarketing Agent, are as follows:
Flexible Rate.
While the Bonds accrue interest at Flexible Rates, the rate of interest
for each particular Bond will be determined by the Remarketing Agent and will
remain in effect from and including the
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commencement date of the Flexible Rate Period selected for that Bond by the
Remarketing Agent to, but not including, the last date thereof. While the Bonds
accrue interest at Flexible Rates, Bonds may have successive Flexible Rate
Periods of any duration up to 270 days each (or such lower maximum number as is
then permitted under the Indenture) and any Bond may accrue interest at a rate
and for a period different from any other Bond.
Daily Rate.
While the Bonds accrue interest at a Daily Rate, the interest rate
established for the Bonds will be effective from day to day until changed by the
Remarketing Agent.
Weekly Rate.
While the Bonds accrue interest at a Weekly Rate, the rate of interest
on the Bonds will be determined weekly by the Remarketing Agent to be effective
for a period commencing on Wednesday (or, if such Wednesday is not a Business
Day, the next succeeding Business Day) of the week of such determination and
ending on the day prior to the commencement of the next succeeding period. (The
length of the period, the day of commencement and the last day of the period may
vary in the event of a conversion to or from a Weekly Rate.)
Term Rate.
While the Bonds accrue interest at a Term Rate, the interest rate will
be determined by the Remarketing Agent to remain in effect for a term of at
least one year selected by the Borrower.
The Interest Rate established will remain in effect until changed by the
Borrower, in accordance with the Indenture. During each period that a particular
type of Interest Rate is in effect, the rate of interest on the Bonds shall be
that rate which, in the judgment of the Remarketing Agent, would cause the Bonds
to have a market value as of the date of determination equal to the principal
amount thereof, taking into account prevailing market conditions, and with
respect to Flexible Rates, the Remarketing Agent shall determine the Flexible
Rate and the Flexible Rate Period for each Bond at such rate and for such period
as it deems advisable in order to minimize the net interest cost on the Bonds,
taking into account prevailing market conditions.
Bonds which accrue interest at Flexible Rates will be issued in
denominations of $100,000 or any integral multiple of $1,000 in excess thereof.
Bonds which accrue interest at Daily Rates or Weekly Rates will be issued in
denominations of $100,000 or any integral multiple thereof (except that one Bond
may be in a denomination that is an integral multiple of $5,000 in excess of
$100,000). Bonds which accrue interest at Term Rates will be issued in
denominations of $5,000 or any integral multiple thereof.
OPTIONAL TENDERS
While this Bond accrues interest at a Daily Rate or a Weekly Rate, the
Registered Owner of this Bond has the right to tender this Bond for purchase at
the principal amount hereof plus accrued interest as follows: (i) during a Daily
Rate Period, on any Business Day upon written, electronic or telephone notice to
the Tender Agent prior to 11:00 a.m., New York City time, on such Business Day
or (ii) during a Weekly Rate Period, on any Business Day upon written or
electronic notice to
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the Tender Agent prior to 5:00 p.m., New York City time, on any Business Day at
least seven days prior to such Business Day of tender.
MANDATORY TENDER OR CONVERSION
While this Bond accrues interest at a Flexible Rate, this Bond is
subject to mandatory tender on the day after the last day of each Flexible Rate
Period applicable to this Bond. While this Bond accrues interest at a Daily Rate
or a Weekly Rate, this Bond is subject to mandatory tender on the effective date
of a change from one type of Interest Rate to a different type of Interest Rate
(except for changes from a Daily Rate to a Weekly Rate or from a Weekly Rate to
a Daily Rate) or of a change from a Term Rate Period to a Term Rate Period of a
different duration. While this Bond accrues interest at a Term Rate, this Bond
is subject to mandatory tender on the last day of the Term Rate Period at a
price equal to 100% of the principal amount thereof plus accrued interest to the
mandatory tender date. While this Bond accrues interest at a Term Rate, at the
option of the Borrower, the interest rate on this Bond may be converted to a
different interest rate on any date that this Bond is also subject to optional
redemption at a purchase price equal to the principal amount hereof plus accrued
interest to the Conversion Date and plus any premium that would be payable if
such Bonds were redeemed on such date.
Interest on any Bond which is not tendered on the mandatory tender date
or Conversion Date, but for which there has been irrevocably deposited with the
Trustee an amount sufficient to pay the purchase price thereof (an "Undelivered
Bond"), shall cease to accrue on the mandatory tender date or Conversion Date,
and the holder of such Undelivered Bond shall not be entitled to any payment
other than the purchase price for such Undelivered Bond, and such Undelivered
Bond shall no longer be outstanding and entitled to the benefits of the
Indenture, except for the payment of the purchase price of such Undelivered Bond
from monies held by the Trustee for such payment.
WRITTEN NOTICE OF MANDATORY TENDER OR CONVERSION
The Trustee shall give notice, by first class mail, to the holders of
all Bonds subject to mandatory tender or Conversion at least fifteen (15) days
before the mandatory tender date while the Bonds accrue interest at Flexible,
Daily or Weekly Rates, and at least thirty (30) days before the mandatory tender
date or Conversion Date while the Bonds accrue interest at a Term Rate.
INTEREST PAYMENT DATES
While this Bond accrues interest at a Flexible Rate, interest is payable
on the day after the last day of each Flexible Rate Period. While this Bond
accrues interest at a Daily Rate or a Weekly Rate, interest is payable on the
first Business Day of each month. During any Term Rate Period, interest is
payable semiannually on the fifteenth day of the May or November after the
commencement of such Term Rate Period and the fifteenth day of each May or
November thereafter; provided that the last Interest Payment Date for any Term
Rate Period shall be the first Business Day that falls on or after the fifteenth
day of the May or November in which the Term Rate Period ends.
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OPTIONAL REDEMPTION
While this Bond accrues interest at a Daily Rate or a Weekly Rate, this
Bond is subject to optional redemption on any date, and while this Bond accrues
interest at a Flexible Rate, this Bond is subject to optional redemption on any
Interest Payment Date, in each case, at a redemption price equal to 100% of the
principal amount hereof, plus accrued interest to the redemption date. Interest
due on any redemption date which is also an Interest Payment Date shall be paid
in accordance with the procedures set forth in the Indenture for payment of
interest.
[For Subseries 1998A-1 and Subseries 1998A-2] While this Bond accrues
interest at a Term Rate for an initial Term Rate Period of ten (10) years, this
Bond is subject to optional redemption on the last day of each Term Rate Period
at a redemption price equal to 100% of the principal amount of this Bond,
together with accrued interest, if any, to the redemption date.
[For Subseries 1998A-3 and Subseries 1998A-4 Bonds] While this Bond
accrues interest at a Term Rate, this Bond is subject to optional redemption at
a redemption price equal to 100% of the principal amount thereof, plus accrued
interest hereon to the redemption date and plus premium, in whole or in part, on
any date on and after July 1, 2008, as follows:
Redemption Period Redemption Price
----------------- ----------------
July 1, 2008 through June 30, 2009 101.0%
July 1, 2009 through June 30, 2010 100.5
July 1, 2010 and thereafter 100.0
MANDATORY REDEMPTION
[Delete if no Letter of Credit effective]
This Bond is subject to mandatory redemption prior to maturity upon the
occurrence of a Mandatory Redemption Event at a redemption price equal to 100%
of the principal amount of this Bond, plus accrued interest to the redemption
date. The manner of redeeming Bonds is described in detail in the Indenture.
SPECIAL MANDATORY REDEMPTION
This Bond is subject to special mandatory redemption prior to maturity
not later than 180 days after the occurrence of a Determination of Taxability at
a redemption price equal to 100% of the principal amount hereof, plus accrued
interest to the redemption date. The manner of redeeming Bonds is described in
detail in the Indenture.
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EXTRAORDINARY OPTIONAL REDEMPTION
This Bond is subject to extraordinary optional redemption by the Issuer,
at the direction of the Borrower, in whole or in part, on any Interest Payment
Date during any Term Rate Period, at a redemption price equal to 100% of the
principal amount of this Bond, plus accrued interest, if any to the redemption
date, if one or more of the following events shall have occurred within the
preceding year:
(a) Any Project shall have been damaged or destroyed to such
extent that, in the opinion of the Borrower, (i) normal operations at the
Project are prevented or are likely to be prevented for a period of four
consecutive months, or (ii) the restoration of such Project is not economically
feasible.
(b) Title to, or the temporary use of, all or substantially all
of a Project shall have been taken under the exercise of the power of eminent
domain by any governmental authority, or person, firm or corporation acting
under governmental authority which, in the opinion of the Borrower, is likely to
result in normal operations at such Project being prevented for a period of four
consecutive months.
(c) Changes, which the Borrower cannot reasonably control or
overcome, in the economic availability of materials, supplies, labor, equipment
and other properties and things necessary for the efficient operation of a
Project shall have occurred, or technological or other changes shall have
occurred which, in the opinion of the Borrower, render uneconomic the continued
operation of a Project.
(d) Any court or administrative body shall enter a judgment,
order or decree requiring cessation of all or any substantial part of operations
at a Project, to such an extent that, in the opinion of the Borrower, normal
operations at such Project are likely to be prevented for a period of four
consecutive months.
(e) As a result of any changes in the State Constitution or the
Constitution of the United States of America or as a result of legislation or
administrative action (whether state or federal) or by final decree, judgment or
order of any court or administrative body (whether state or federal) entered
after the contest thereof by the Borrower in good faith, the Loan Agreement
shall have become void or unenforceable or impossible of performance in
accordance with the intent and purposes of the parties, or shall have been
declared to be unlawful, or unreasonable burdens or excessive liabilities shall
have been imposed on the Issuer or the Borrower, including, without limitation,
federal, State or other ad valorem, property, income or other taxes not being
imposed on the date of the Loan Agreement.
DEFAULT ACCELERATION
In case an Event of Default shall have occurred, the principal of all
Bonds then outstanding under the Indenture may become due and payable prior to
their scheduled maturity date.
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GENERAL PROVISIONS
The provisions of this Section shall apply at all times from and after
the date of issuance of this Bond.
Except during such period of time as the Bonds are held under DTC's
"Book-Entry Only System," the ownership of this Bond may be transferred (in an
amount which is an Authorized Denomination; provided that the portion thereof
retained is itself an Authorized Denomination) only upon presentation and
surrender of this Bond at the Principal Office of the Trustee together with an
assignment duly executed by the Registered Owner hereof or its duly authorized
attorney-in-fact in such form as shall be satisfactory to the Trustee, and
subject to the provisions made therefor in the Indenture; provided that the
Trustee shall not be required to make any such transfer of any Bond during the
ten (10) Business Days immediately preceding the selection of Bonds for
redemption or, with respect to a Bond, after such Bond or any portion thereof
has been selected for redemption.
The Trustee shall cause notice of any redemption of Bonds to be mailed
by first class mail, postage prepaid, to the Registered Owners of all Bonds to
be redeemed at the registered addresses appearing in the Registration Books kept
for such purpose pursuant to the Indenture. Each such notice shall (i) be mailed
at least fifteen (15) days prior to the redemption date for Bonds which accrue
interest at a Daily, Weekly or Flexible Rate and at least thirty (30) days prior
to the redemption date for Bonds which accrue interest at a Term Rate, (ii)
identify the Bonds to be redeemed, if less than all Bonds are to be redeemed
(specifying the CUSIP numbers, if any, assigned to the Bonds), (iii) specify the
redemption date and the redemption price and (iv) state that on the redemption
date the Bonds called for redemption will be payable at the Principal Office of
the Trustee, that from the redemption date interest will cease to accrue and
that no representation is made as to the accuracy or correctness of the CUSIP
numbers printed therein or on the Bonds; provided, however, that so long as DTC
or its nominee is the sole Registered Owner of the Bonds under DTC's "Book-Entry
Only System," redemption notices will be sent to Cede & Co. Any failure on the
part of DTC or a Direct Participant to give such notice to the Beneficial Owner
or any defect therein shall not affect the sufficiency or validity of any
proceedings for the redemption of the Bonds.
If at the time of mailing of any notice of an optional redemption there
shall not have been deposited with the Trustee moneys sufficient to redeem all
the Bonds called for redemption, such notice may state that it is conditioned
upon the deposit with the Trustee on or prior to the redemption date of moneys
sufficient to pay the redemption price of the Bonds to be redeemed plus
interest, if any, accrued thereon to the date of redemption, and such notice
shall be of no effect unless such moneys are so deposited.
Failure on the part of the Trustee to give such notice or any defect
therein shall not affect the validity of any proceedings for the redemption of
the Bonds. By the date fixed for any such redemption, due provision shall be
made with the Trustee for the payment of the principal of, premium, if any, and
interest on the Bonds to be redeemed on the date of redemption. If notice of
redemption is given and if due provision for payment of the redemption price is
made, all as provided in the Indenture, the Bonds or portions thereof which are
to be redeemed shall not bear interest after the date fixed for redemption, and
shall not be entitled to any benefit or security under
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the Indenture, except for the right of the Registered Owner to receive the
redemption price out of the funds provided for such payment.
Provisions may be made for the payment of amounts represented by the
Bonds as provided in the Indenture, in which event all liability of the Issuer
to the owners of the applicable Bonds for the payment of such Bonds shall
forthwith cease, terminate and be completely discharged, and thereupon it shall
be the duty of the Trustee to hold such funds (but only for the period specified
and as provided in the Indenture), without liability for interest thereon, for
the benefit of the owners of such Bonds, who shall thereafter be restricted
exclusively to such funds for any claims of whatever nature under the Indenture
or on, or with respect to, said Bonds.
It is hereby certified and covenanted that this Bond has been duly and
validly authorized, issued and delivered; that all acts, conditions and things
required to exist, happen and be performed precedent to or in the authorization,
issuance and delivery of this Bond do exist, have happened and have been
performed in accordance with law; that the Bonds are limited obligations of the
Issuer; and that the principal of, premium, if any, and interest on the Bonds
are payable from and secured by the properties, revenues and receipts that
constitute a part of the Trust Estate.
The Bonds are secured by the Indenture, whereunder the Trustee
undertakes to enforce the rights of the owners of the Bonds and to perform other
duties to the extent and under the conditions stated in the Indenture. In case
an Event of Default shall occur, the principal of and interest on the Bonds then
outstanding may, and, under certain circumstances, shall, be declared to be due
and payable immediately upon the conditions and in the manner provided in the
Indenture; and no interest shall accrue on this Bond from and after the date of
such acceleration. Under the circumstances provided in the Indenture, the
Trustee may, in its discretion, and upon the written request of the Registered
Owners of a majority in aggregate principal amount of the Bonds then outstanding
shall, waive any Event of Default and its consequences; provided, however, that
an Event of Default arising from a default in the payment of the principal of,
premium, if any, or interest on the Bonds may not be waived by the Trustee
without the consent of the Registered Owners of all of the Bonds. The Registered
Owners of the Bonds shall have no right to institute any action, suit or
proceeding at law or in equity to enforce the Indenture, except as provided in
the Indenture; provided, however, that nothing in the Indenture shall affect or
impair the right of the Registered Owner of any Bond to enforce the payment of
the principal of, premium, if any, and interest on such Bond from the source and
in the manner herein expressed.
The Issuer has reserved the right to amend the Indenture with the
consent of the Borrower as provided therein. Under some (but not all)
circumstances, amendments to the Indenture must be approved by the owners of
greater than fifty percent (50%) or one hundred percent (100%) in aggregate
principal amount of the outstanding Bonds.
This Bond shall not be valid or become obligatory for any purpose or be
entitled to any security or benefit under the Indenture until the Certificate of
Authentication hereon shall have been signed by the Trustee, or the Tender Agent
as Co-Authenticating Agent, or any successor.
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IN WITNESS WHEREOF, the CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT
AUTHORITY has caused this Bond to be signed in its name and on its behalf by the
manual or facsimile signature of its Chairman and attested by the manual or
facsimile signature of its Secretary.
CALIFORNIA STATEWIDE COMMUNITIES
DEVELOPMENT AUTHORITY
ATTEST:
__________________________ By: ________________________________
Secretary Chairman
[FORM OF CERTIFICATE OF AUTHENTICATION]
This Bond is hereby authenticated as required by Section 2.5 of the
within-referenced Indenture of Trust.
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Trustee and Tender Agent
By: ________________________________
Authorized Signatory
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[FORM OF REGISTRATION INFORMATION]
REGISTRATION INFORMATION
Under the terms of the Indenture, the Trustee will register a Bond in
the name of a transferee only if the owner of such Bond (or its duly authorized
representative) provides as much of the information requested below as is
applicable to such owner prior to submitting this Bond for transfer.
Name:___________________________________________________________________________
Address:________________________________________________________________________
________________________________________________________________________________
Social Security or
Employer Identification Number:_________________________________________________
If a Trust, Name and Address of Trustee(s) and
Date of Trust:________________________________
________________________________________________________________________________
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[FORM OF ASSIGNMENT]
ASSIGNMENT
For value received, the undersigned hereby sells, assigns and transfers
unto _______________________________________________________________________ the
within Bond, and does hereby irrevocably constitute and appoint ________________
attorney to transfer such Bond on the books kept for registration and transfer
of the within Bond, with full power of substitution in the premises.
Dated:_______________________________
_______________________________
Signature Guaranteed By: NOTE: The signature to this
Assignment must correspond with
the name as it appears upon the
face of the within Bond in
every particular, without
enlargement or alteration or
any change whatsoever.
_____________________________________
NOTE: The signature to this Assignment must
be guaranteed by an eligible guarantor
institution.
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Section 2.4. Execution; Limited Obligations. The Bonds shall be executed
on behalf of the Issuer with the manual or facsimile signature of the Chairman
of the Commission of the Issuer and attested with the manual or facsimile
signature of the Secretary of the Commission. All authorized facsimile
signatures shall have the same force and effect as manual signatures. In case
any officer of the Issuer whose signature or a facsimile thereof appears on a
Bond shall cease to be such officer before the delivery of such Bond, such
signature or such facsimile shall nevertheless be valid and sufficient for all
purposes, the same as if such officer had remained in the office until delivery.
THE STATE IS NOT OBLIGATED TO PAY, AND NEITHER THE FAITH AND CREDIT NOR
TAXING POWER OF THE STATE IS PLEDGED TO THE PAYMENT OF, THE PRINCIPAL OR
REDEMPTION PRICE, IF ANY, OF, OR INTEREST ON, THE BONDS. THE BONDS ARE SPECIAL,
LIMITED OBLIGATIONS OF THE ISSUER, PAYABLE SOLELY OUT OF THE REVENUES OR OTHER
RECEIPTS, FUNDS OR MONEYS OF THE ISSUER PLEDGED UNDER THE INDENTURE AND FROM ANY
AMOUNTS OTHERWISE AVAILABLE UNDER THE INDENTURE FOR THE PAYMENT OF THE BONDS.
THE BONDS DO NOT NOW AND SHALL NEVER CONSTITUTE A CHARGE AGAINST THE GENERAL
CREDIT OF THE ISSUER. THE ISSUER HAS NO TAXING POWER.
No member of the Issuer nor any person executing Bonds for the Issuer
shall be liable personally on the Bonds by reason of the issuance thereof. No
covenant or agreement contained in the Bonds or in this Indenture shall be
deemed to be the covenant or agreement of any member, agent, officer, or
employee of the Issuer in his or her individual capacity, and neither the
members of the Issuer nor any official executing the Bonds shall be liable
personally on the Bonds or be subject to any personal liability or
accountability by reason of the issuance thereof.
Section 2.5. Conditions Precedent to Delivery of Bonds; Authentication.
The Issuer shall execute and deliver the Bonds to the Trustee, and the Trustee
shall, upon receipt by the Trustee of the purchase price for the Bonds,
authenticate the Bonds and deliver them to the initial purchasers thereof. Prior
to and as a condition precedent to the authentication and delivery of the Bonds
there shall be filed with and delivered to the Trustee in addition to the items
required by Section 6.3 of the Loan Agreement:
(a) a copy, duly certified by an authorized representative of the
Issuer, of the resolution adopted by the Issuer authorizing the
execution and delivery of this Indenture and the issuance of the Bonds;
(b) original executed counterparts of this Indenture, the Loan
Agreement and the Tax Certificate;
(c) a written order of the Issuer, directed to the Trustee,
instructing the Trustee to authenticate the Bonds and to make them
available for delivery to the initial purchasers thereof upon payment to
the Trustee for the account of the Issuer of the sum specified in such
written order;
(d) an opinion of Bond Counsel substantially to the effect that
(A) the Bonds constitute legal, valid and binding special, limited
obligations of the Issuer, enforceable in
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accordance with their terms, subject to bankruptcy, insolvency,
moratorium, reorganization and other similar laws affecting the rights
of creditors and to the exercise of judicial discretion in accordance
with general principles of equity, and (B)(i) the interest on the Bonds
is not includable for federal income tax purposes in gross income under
existing statutes, regulations, rulings and court decisions, except for
interest on any Bond for any period during which such Bond is held by a
"substantial user" of the Project or a "related person," as such terms
are used in Section 147(a) of the Code and (ii) under existing law,
interest on the Bonds is exempt from State personal income taxes.
No Bond shall be valid or obligatory for any purpose or entitled to any
security or benefit under this Indenture unless and until a certificate of
authentication on such Bond shall have been duly executed by the Trustee or the
Tender Agent. Such executed certificate of the Trustee or the Tender Agent upon
any such Bond shall be conclusive evidence that such Bond has been authenticated
and delivered under this Indenture. The certificate of authentication on any
Bond shall be deemed to have been executed by the Trustee or the Tender Agent if
signed by an authorized officer of the Trustee or the Tender Agent, but it shall
not be necessary that the same officer sign the certificates of authentication
on all Bonds issued hereunder.
Section 2.6. Redemption of Bonds. The Bonds shall be subject to
redemption prior to maturity as set forth below:
(a) Optional Redemption. The Bonds shall be subject to
redemption at the option of the Issuer, in whole or in part, and if in part in
Authorized Denominations, at the direction of the Borrower, from funds available
for such purpose in the Revenue Fund, as follows:
(i) if any Subseries accrues interest at a Daily Rate
or a Weekly Rate, each Bond of such Subseries is subject to optional redemption
on any date, and if any Subseries accrues interest at a Flexible Rate, each Bond
of such Subseries is subject to optional redemption on any Interest Payment
Date, in all cases at a redemption price equal to 100% of the principal amount
thereof plus accrued interest to the redemption date. Interest due on any
redemption date which is also an Interest Payment Date shall be paid in
accordance with the procedures set forth in Section 2.2 (G) hereof; and
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(ii) (x) the Subseries 1998A-1 Bonds and Subseries
1998A-2 Bonds (during the initial Term Rate Periods) shall be subject to
optional redemption by the Issuer, at the direction of the Borrower, in whole or
in part on the last day of the respective Term Rate Periods at a redemption
price equal to 100% of the principal amount thereof plus accrued interest, if
any, to the redemption date.
(y) the Subseries 1998A-3 Bonds and Subseries
1998A-4 Bonds (during the initial Term Rate Periods) shall be subject to
optional redemption by the Issuer, at the direction of the Borrower, on and
after July 1, 2008, in whole or in part on any date at the redemption prices set
forth below (expressed as percentages of principal amount), plus accrued
interest, if any, to the redemption date:
Redemption Period Redemption Price
----------------- ----------------
July 1, 2008 through June 30, 2009 101.0%
July 1, 2009 through June 30, 2010 100.5
July 1, 2010 and thereafter 100.0
(iii) during any subsequent Term Rate Periods, any
Subseries of Bonds shall be subject to optional redemption by the Issuer, at the
direction of the Borrower, on any date ten years after the Conversion Date at a
redemption price of 101.5% (expressed as a percentage of principal amount) for
the first year, such redemption price declining .5% each year thereafter until
such redemption price equals 100% of the principal amount of Bonds to be
redeemed, plus accrued interest, if any, to the redemption date; provided that
such optional redemption dates and redemption prices may be changed by a
supplemental indenture approved by the Borrower and filed with the Trustee,
accompanied by a Favorable Opinion of Bond Counsel, and, provided, further, that
any change in such redemption dates and redemption prices shall be effective
only if such supplemental indenture is approved prior to the applicable
Conversion Date or beginning of the Term Rate Period.
If a Letter of Credit is then in effect for a Subseries and the
redemption price includes any premium, and the Letter of Credit so provides the
right of the Borrower to direct an optional redemption is subject to the
condition that the Trustee has received, prior to the date on which notice of
redemption is required to be given to the Owners, written confirmation from the
Letter of Credit Issuer that it can draw under the Letter of Credit on the
proposed redemption date in an aggregate amount sufficient to cover the
principal of and premium and interest due on the redemption date.
(b) Special Mandatory Redemption. The Bonds shall be
subject to special mandatory redemption prior to maturity on a date selected by
the Borrower not later than 180 days after the occurrence of a Determination of
Taxability at a redemption price equal to 100% of the principal amount thereof,
plus accrued interest to the redemption date. Any such special mandatory
redemption shall be in whole unless it is finally determined as evidenced by a
Favorable Opinion of Bond Counsel delivered and addressed to the Trustee that
less than all of the Bonds may be redeemed without adversely affecting the
exclusion from gross income for federal income tax purposes of interest on the
remaining Bonds, in which case only the principal amount of Bonds indicated in
such Opinion need be redeemed.
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If the Trustee receives written notice from any Owner
stating that (i) the Owner has been notified in writing by the Internal Revenue
Service that it proposes to include the interest on any Bond in the gross income
of such Owner for the reasons stated in the definition of "Determination of
Taxability" or any other proceeding has been instituted against such Owner which
may lead to a "final determination" or "final judgment" as described in the
aforesaid definition, and (ii) such Owner will afford the Borrower the
opportunity to contest the same, either directly or in the name of such Owner,
until a conclusion of any appellate review, if sought, the Trustee shall
promptly give notice of the receipt of any written notice described above to the
Borrower, the Issuer and the Owners of Bonds then Outstanding. If a "final
determination" or "final judgment" thereafter occurs and written notice thereof
is given to the Trustee by such Owner, the Trustee shall make demand for
prepayment of the unpaid Loan payments (or necessary portions thereof as
specified in the foregoing Opinion) from the Borrower and give notice of the
special mandatory redemption of the appropriate amount of Bonds on the date
selected by the Borrower within the required period of 180 days. In taking any
action or making any determination under this Section 2.6(b), the Trustee may
rely on an opinion of counsel.
(c) Extraordinary Optional Redemption. The Bonds shall be
subject to extraordinary optional redemption by the Issuer, at the direction of
the Borrower, in whole or in part, on any date during any Term Rate Period, at a
redemption price equal to 100% of the principal amount thereof, plus accrued
interest, if any, to the redemption date, if one or more of the following events
shall have occurred within the preceding year:
(i) Any Project shall have been damaged or destroyed
to such extent that, in the opinion of the Borrower, (A) normal
operations at the Project are prevented or are likely to be prevented
for a period of four consecutive months, or (B) the restoration of the
Project, is not economically feasible.
(ii) Title to, or the temporary use of, all or
substantially all of a Project shall have been taken under the exercise
of the power of eminent domain by any governmental authority, or person,
firm or corporation acting under governmental authority which, in the
opinion of the Borrower, is likely to result in normal operations at the
Project being prevented for a period of four consecutive months.
(iii) Changes, which the Borrower cannot reasonably
control or overcome, in the economic availability of materials,
supplies, labor, equipment and other properties and things necessary for
the efficient operation of a Project shall have occurred, or
technological or other changes shall have occurred which, in the opinion
of the Borrower, render uneconomic the continued operation of a Project.
(iv) Any court or administrative body shall enter a
judgment, order or decree requiring cessation of all or any substantial
part of operations at a Project, to such an extent that, in the opinion
of the Borrower, is likely to result in normal operations at such
Project being prevented for a period of four consecutive months.
(v) As a result of any changes in the State
Constitution or the Constitution of the United States of America or as a
result of legislation or administrative action (whether state or
federal) or by final decree, judgment or order of any court or
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administrative body (whether state or federal) entered after the contest
thereof by the Borrower in good faith, the Loan Agreement shall have
become void or unenforceable or impossible of performance in accordance
with the intent and purposes of the parties, or shall have been declared
to be unlawful, or unreasonable burdens or excessive liabilities shall
have been imposed on the Issuer or the Borrower, including, without
limitation, federal, state or other ad valorem, property, income or
other taxes not being imposed on the date of the Loan Agreement.
(d) Mandatory Redemption. If a Letter of Credit is in
effect for any Subseries, and if the Letter of Credit so provides, the Bonds of
such Subseries shall be subject to mandatory redemption prior to maturity by the
Issuer in whole at a redemption price equal to 100% of the principal amount
thereof, plus accrued interest to the redemption date, upon receipt by the
Trustee of a written notice from the Letter of Credit Issuer directing the
Trustee to draw under the Letter of Credit in an amount necessary to redeem the
Bonds of such Subseries as a result of the occurrence of an event of default
under the Reimbursement Agreement (a "Mandatory Redemption Event").
Section 2.7. Selection of Bonds for Redemption. In the event that fewer
than all Bonds subject to redemption are to be redeemed, Bonds shall be selected
for redemption in the following manner; provided that the Bonds that remain
Outstanding shall be in Authorized Denominations:
(a) If Bonds are subject to special mandatory redemption
pursuant to Section 2.6(b) or extraordinary optional redemption pursuant to
Section 2.6(c), or if the Bonds are subject to optional redemption pursuant to
Section 2.6(a) and the Borrower notifies the Trustee that such redemption
relates to a specific Project (as described in Exhibit A hereto), Bonds shall be
selected for redemption, by lot, from one or more Subseries that relates to such
Project. If more than one Subseries relates to such Project, the Bonds to be
redeemed shall be selected on a pro rata basis among each such Subseries and by
lot within a Subseries.
(b) If the Bonds are subject to optional redemption
pursuant to Section 2.6(a) and the Borrower does not notify the Trustee that
such redemption relates to a specific Project. Bonds shall be selected for
redemption by the Trustee, on a pro rata basis among all Subseries, and by lot
within a Subseries, first, from Bonds subject to such redemption (other than
Bonds owned of record by the Borrower), and, second, from Bonds owned of record
by the Borrower subject to such redemption; provided that, upon any optional or
extraordinary optional redemption, at the Borrower's direction (and for so long
as no Event of Default then exists), Pledged Bonds, if any, shall be redeemed
first.
(c) In the case of Bonds of varying denominations, the
Trustee shall, to the extent practicable, treat each Bond as representing that
number of units of Bonds which is obtained by dividing the face amount thereof
by the smallest Authorized Denomination. If it is determined that one or more,
but not all, of the units of principal amount represented by any such Bond is to
be called for redemption, then upon notice of intention to redeem such unit or
units of principal, the Bondholder of such Bond shall forthwith surrender such
Bond to the Trustee for (i) payment to such Bondholder of the redemption price
of the unit or units of its Bond called for redemption and (ii) delivery to such
Bondholder of a new Bond or Bonds in an aggregate principal amount equal to the
unredeemed balance of such Bond. New Bonds representing the unredeemed balance
of the
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principal amount of such Bond shall be issued to the Bondholder thereof without
charge therefor. If the Bondholder of any such Bond of a denomination greater
than the principal amount thereof called for redemption shall fail to present
such Bond to the Trustee for payment and exchange as aforesaid, such Bond shall,
nevertheless, become due and payable on the date fixed for redemption to the
extent of the principal amount called for redemption (and to that extent only).
Section 2.8. Notice of Redemption. (a) The Borrower shall deliver notice
to the Trustee of its intention to prepay the Loan and cause the Bonds to be
called for optional redemption or extraordinary optional redemption (as
described in Section 2.6 hereof) at least thirty (30) days prior to the proposed
redemption date of Flexible Rate, Daily Rate and Weekly Rate Bonds, and at least
forty-five (45) days prior to the proposed redemption date of Term Rate Bonds.
Any notice from the Borrower or the Issuer to the Trustee pursuant to either of
the preceding two sentences shall state that all conditions precedent contained
herein to the applicable redemption have been complied with. The Trustee shall
cause notice of any redemption of Bonds hereunder to be mailed by first class
mail, postage prepaid, to the Owners of all Bonds to be redeemed at the
registered addresses appearing in the Registration Books. Each such notice shall
(i) be mailed at least fifteen (15) days prior to the redemption date for Daily,
Weekly and Flexible Rate Bonds and at least thirty (30) days prior to the
redemption date for Term Rate Bonds, (ii) identify the Bonds to be redeemed if
less than all Bonds are to be redeemed (specifying the CUSIP numbers, if any,
assigned to the Bonds), (iii) specify the redemption date and the redemption
price, and (iv) state that on the redemption date the Bonds called for
redemption will be payable at the Principal Office of the Trustee, that from
that date interest will cease to accrue and that no representation is made as to
the accuracy or correctness of the CUSIP numbers printed therein or on the
Bonds; provided, however, that so long as DTC or its nominee is the sole Owner
of the Bonds under DTC's "Book-Entry Only System," redemption notices will be
sent to Cede & Co. Any failure on the part of DTC or a Direct Participant (as
hereinafter defined) to give such notice to the Beneficial Owner or any defect
therein shall not affect the sufficiency or validity of any proceedings for the
redemption of the Bonds. No defect affecting any Bond, whether in the notice of
redemption or mailing thereof (including any failure to mail such notice), shall
affect the validity of the redemption proceedings for any other Bonds.
(b) Conditional Notice. If at the time of mailing of notice
of an optional redemption there shall not have been deposited with the Trustee
moneys sufficient to redeem all the Bonds called for redemption, such notice may
state that it is conditioned upon the deposit with the Trustee on or prior to
the redemption date of moneys sufficient to pay the redemption price of the
Bonds to be redeemed plus interest, if any, accrued thereon to the date of
redemption, and such notice shall be of no effect (and the redemption shall not
occur) unless such moneys are so deposited.
(c) Additional Notice of Redemption. In addition to the
redemption notice required above, if there is more than one Owner of the Bonds,
further notice (the "Additional Notice") shall be given by the Trustee as set
forth below. No defect in the Additional Notice nor any failure to give all or
any portion of the Additional Notice shall in any manner defeat the
effectiveness of a call for redemption if notice is given as prescribed in
paragraph (a) above.
(1) Each Additional Notice shall contain the
information required in paragraph (a) above for an official notice of redemption
plus (i) the date of the Bonds as originally issued; (ii) the interest rate
determination method for, or the rate of interest borne by, each Bond
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being redeemed; (iii) the maturity date of each Bond being redeemed; and (iv)
any other descriptive information needed to identify accurately the Bonds being
redeemed.
(2) Each Additional Notice shall be sent at least
thirty (30) days (fifteen (15) days in the case of Bonds accruing interest at
Daily, Weekly or Flexible Rates) before the redemption date by registered or
certified mail or overnight delivery service to the following registered
securities depositories: The Depository Trust Company of New York, New York,
Midwest Securities Trust Company of Chicago, Illinois, and Philadelphia
Depository Trust Company of Philadelphia, Pennsylvania, and to such other
registered securities depositories as may be specified by the Borrower to the
Trustee in writing and to one or more national information services that
disseminate notices of redemption of obligations such as the Bonds as shall be
specified by the Borrower to the Trustee in writing.
(3) The Trustee's agreement to give any Additional
Notice is made as a matter of courtesy and accommodation only and the Trustee
shall incur no liability to any Person for its failure to give such Additional
Notices.
Section 2.9. Effect of Redemption. If payment of the redemption price of
the Bonds has been duly provided for on the redemption date, then interest on
the Bonds called for redemption will cease to accrue on such date, and the
Owners will have no rights with respect to such Bonds nor will they be entitled
to the benefits of the Indenture except to receive payment of the redemption
price thereof and unpaid interest accrued to the date fixed for redemption.
Section 2.10. Optional Redemption only at Direction of Borrower.
Optional redemption of the Bonds by the Issuer pursuant to Sections 2.6(a) and
(c) shall only be made at the direction and in the sole discretion of the
Borrower, and the Issuer shall take no action with respect to Sections 2.6(a) or
(c) without the prior written direction of the Borrower.
Section 2.11. Book-Entry Bonds. (i) Except as provided in subsection
(iii) of this Section, the Bonds shall all be registered as to both principal
and interest in the name of and held by Cede & Co., as nominee of DTC. Payment
of both principal and interest for any Bond registered as of the applicable
Record Date in the name of Cede & Co., as nominee of DTC, shall be made by the
Trustee with immediately available funds to the account of Cede & Co., as
nominee of DTC, on the interest or principal payment date for the Bonds, as the
case may be, at the address indicated on the Registration Books.
(ii) The Bonds shall be initially issued in the form of
one authenticated fully registered Bond for each Subseries. Upon initial
issuance, the ownership of such Bond shall be registered in the Registration
Books in the name of Cede & Co., as nominee of DTC. The Trustee and the Issuer
may treat DTC (or its nominee) as the sole and exclusive owner of the Bonds
registered in its name for the purposes of payment of the principal or
redemption price of or interest on the Bonds, selecting the Bonds or portions
thereof to be redeemed, giving any notice permitted or required to be given to
Bondholders under this Indenture, registering the transfer of the Bonds,
obtaining any consent or other action to be taken by Bondholders and for all
other purposes whatsoever; and neither the Trustee nor the Issuer shall be
affected by any notice to the contrary. Neither the Trustee nor the Issuer shall
have any responsibility or obligation to any DTC participant (herein a "Direct
Participant"), any person claiming a beneficial ownership interest in the Bonds
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under or through DTC or any Direct Participant (herein, a "Beneficial Owner"),
or any other person which is not shown on the Registration Books as being a
Bondholder. The Issuer and the Trustee shall have no responsibility with respect
to the accuracy of any records maintained by DTC, Cede & Co., or any Direct
Participant with respect to any ownership interest in the Bonds, the payment by
DTC or any Direct Participant to any Beneficial Owner of any amount in respect
of the principal or redemption price of or interest on the Bonds, the delivery
to any Direct Participant or any Beneficial Owner of any notice which is
permitted or required to be given to Bondholders under this Indenture, the
selection by DTC or any Direct Participant of any Person to receive payment in
the event of a partial redemption of the Bonds, or any consent given or other
action taken by DTC as Bondholder. The Trustee shall pay all principal of and
premium, if any, and interest on the Bonds only to or upon the order of Cede &
Co., as nominee of DTC, and all such payments shall be valid and effective to
fully satisfy and discharge the Issuer's obligations with respect to the
principal of, premium, if any, and interest on the Bonds to the extent of the
sum or sums so paid without the requirement that DTC surrender the Bond so
redeemed (except upon final payment). Upon delivery by DTC to the Trustee of
written notice to the effect that DTC has determined to substitute a new nominee
in place of Cede & Co., and subject to the provisions herein with respect to
Record Dates, the words "Cede & Co.", in this Indenture shall refer to such
successor nominee.
(iii) In the event that the Issuer, at the direction of
the Borrower, determines to make available to the Beneficial Owners of the Bonds
definitive Bonds, the Issuer will notify DTC and the Trustee, in writing,
whereupon DTC will notify Direct Participants, of the availability through DTC
of definitive Bonds. In such event, the Issuer shall issue definitive Bonds
registered in such names and in such amounts as shall be designated in writing
by DTC. DTC may determine to discontinue providing its services with respect to
the Bonds at any time by giving reasonable notice to the Issuer and the Trustee
and discharging its responsibilities with respect thereto under applicable law.
Under such circumstances, the Issuer and the Trustee shall be obligated to
deliver definitive Bonds as described in this Indenture registered in such names
and in such amounts as shall be designated by DTC. In the event definitive Bonds
are issued, the provisions of this Indenture shall apply to, among other things,
the transfer and exchange of such definitive Bonds and the method of payment of
principal of, redemption price and interest on such definitive Bonds. Whenever
DTC requests the Issuer to do so, the Issuer will cooperate with DTC in taking
appropriate action (a) to make available one or more separate definitive Bonds
evidencing the Bonds to any Direct Participant having Bonds credited to its DTC
account or (b) to arrange for another securities depository to maintain custody
of definitive Bonds.
(iv) In connection with any notice or other communication
to be provided to Bondholders pursuant to this Indenture with respect to any
consent or other action to be taken by Bondholders, the Issuer or the Trustee,
as the case may be, the Trustee shall establish a record date for such consent
or other action and give DTC notice of such record date not less than fifteen
(15) calendar days in advance of such record date to the extent practicable.
(v) The expense of providing definitive Bonds shall be
borne by the Borrower.
Section 2.12. Extension of Letter of Credit in Anticipation of
Expiration. At least forty-five (45) days (or such shorter period as shall be
acceptable to the Trustee in its sole discretion) prior to the Interest Payment
Date next preceding the Termination Date of any existing Letter of Credit,
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the Borrower may provide for the delivery to the Trustee of an amendment to the
Letter of Credit which extends the Termination Date to a date that is not
earlier than one year from its then current Termination Date or the maturity of
the Bonds if shorter. If the Letter of Credit is so extended, the mandatory
tender for purchase pursuant to clause (c) of Section 3.2 shall not occur;
otherwise, the Trustee shall take all action necessary to call the Bonds for
mandatory tender for purchase pursuant to clause (c) of Section 3.2 on the
Interest Payment Date next preceding such Termination Date; provided that if the
Borrower shall have notified the Trustee in writing that it expects to meet all
the conditions for the delivery of an amendment extending the existing Letter of
Credit on or before the Interest Payment Date next preceding the Termination
Date of the existing Letter of Credit, then the notice of mandatory tender for
purchase pursuant to clause (c) of Section 3.2 shall state that it is subject to
rescission, and the Trustee shall rescind such notice, if such conditions are so
met (in which case such mandatory purchase shall not occur).
Section 2.13. Delivery of Initial Letter of Credit; Replacement of
Letter of Credit. On any date on which the Bonds are subject to mandatory tender
or optional redemption, the Borrower may cause to be delivered to the Trustee an
Initial Letter of Credit for one or more Subseries. On any date on which the
Bonds are subject to optional redemption, the Borrower may provide for the
delivery to the Trustee of (1) an Alternate Letter of Credit which shall have
terms which are the same in all material respects (except as to the Termination
Date and except any changes pursuant to this Indenture with respect to interest
or premium coverage in connection with a concurrent Rate Period conversion) as
the existing Letter of Credit, which shall have a Termination Date that is not
less than one year from the date of its delivery and not sooner than the
Termination Date of the existing Letter of Credit, or the maturity of the Bonds,
if shorter, and which shall be issued by a Qualified Issuer; (2) an opinion of
counsel to the Qualified Issuer in form satisfactory to the Trustee with respect
to the validity, binding effect and enforceability of such Alternate Letter of
Credit; and (3) an opinion of Bond Counsel to the effect that such action will
not adversely affect the exclusion from gross income of interest on the Bonds
for Federal income tax purposes, and if the requirements set forth in this
Section are met, then the Trustee shall accept such Alternate Letter of Credit
and promptly surrender for cancellation the previously held Letter of Credit to
the issuer thereof in accordance with the terms of such Letter of Credit. The
Borrower shall give the Trustee at least forty-five (45) days (or such shorter
period as shall be acceptable to the Trustee in its sole discretion) notice of
the proposed replacement of the Letter of Credit, which notice shall include the
expected ratings, if any, applicable to the Bonds after the proposed replacement
of the Letter of Credit. Upon receipt of such notice, the Trustee shall take all
action necessary to call the Bonds for mandatory tender for purchase pursuant to
clause (c) of Section 3.2 on the date on which the Letter of Credit is to be
replaced. Any Alternate Letter of Credit shall, upon its acceptance by the
Trustee, be deemed to be a Letter of Credit for all purposes of this Indenture.
Section 2.14. Notice to Owners. The Trustee shall give notice to the
Owners and the Remarketing Agent, in the name of the Issuer, of the proposed
replacement of the existing Letter of Credit, of the ratings expected to be
applicable to the Bonds after the proposed replacement and of the mandatory
tender date as required under clause (c) of Section 3.2 by first class mail,
postage prepaid, not less than fifteen (15) days prior to the proposed
replacement date.
Section 2.15. Reduction. In each case that Bonds are redeemed or deemed
to have been paid pursuant to this Indenture, the Trustee shall take such action
as may be permitted under the Letter of Credit to reduce the amount available
thereunder to an amount equal to the principal
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amount of the outstanding Bonds for which the Letter of Credit is effective,
plus interest at the maximum rate required under the Letter of Credit for the
maximum period between Interest Payment Dates plus 14 days; provided that such
action by the Trustee shall not be required if the Letter of Credit so reduces
automatically pursuant to its terms.
Section 2.16. Other Credit Enhancement; No Credit Enhancement. After a
mandatory purchase of the Bonds pursuant to clause (c) of Section 3.2 or after a
conversion to a Term Rate Period, nothing in this Article II shall limit the
Borrower's right to provide other credit enhancement (such as an Alternate
Letter of Credit or bond insurance) or no credit enhancement as security for the
Bonds; provided that any such credit enhancement shall have administrative
provisions reasonably satisfactory to the Trustee, and the Borrower shall have
furnished to the Trustee a Favorable Opinion of Bond Counsel. During the initial
Term Rate Periods for the Bonds, no credit enhancement shall be required as
security for the Bonds.
ARTICLE III
PURCHASE AND REMARKETING OF THE BONDS
Section 3.1. Optional Tenders for Purchase.
(a) Purchase Dates. The Owners of Bonds accruing interest
at Daily Rates or Weekly Rates may elect to have their Bonds (or portions
thereof in amounts equal to any Authorized Denomination) purchased at a purchase
price equal to 100% of the principal amount, plus accrued interest to the
purchase date on the following purchase dates:
(i) Bonds accruing interest at Daily Rates may be
tendered for purchase at a purchase price payable in immediately available funds
on any Business Day prior to conversion from a Daily Rate to a different
Interest Rate, upon written, electronic or telephonic notice of tender given to
the Tender Agent, directly or through the Beneficial Owner's Direct Participant,
not later than 11:00 a.m., New York City time, on the purchase date;
(ii) Bonds accruing interest at Weekly Rates may be
tendered for purchase at a purchase price payable in immediately available funds
on any Business Day prior to conversion from a Weekly Rate to a different
Interest Rate, upon written or electronic notice of tender given to the Tender
Agent, directly or through the Beneficial Owner's Direct Participant, not later
than 5:00 p.m., New York City time, on a Business Day not less than seven (7)
days prior to the purchase date.
(b) Notice of Tender. Each notice of tender:
(i) shall, in the case of a written notice, be
delivered to the Tender Agent at its Principal Office and be in form
satisfactory to the Tender Agent;
(ii) shall state, whether delivered in writing,
electronically or by telephone, (A) the principal amount of the Bond to which
the notice relates, (B) that the Owner irrevocably demands purchase of such Bond
or a specified portion thereof in an amount equal to any Authorized
Denomination, (C) the date on which such Bond or portion is to be purchased, and
(D) payment instructions with respect to the purchase price; and
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(iii) shall automatically constitute, whether delivered
in writing, electronically or by telephone (A) an irrevocable offer to sell the
Bond (or portion thereof) to which the notice relates on the purchase date at a
purchase price equal to the principal amount of such Bond (or portion thereof)
plus, with respect to Bonds accruing interest at a Daily Rate or a Weekly Rate,
any interest thereon accrued and unpaid as of the purchase date, (B) an
irrevocable authorization and instruction to the Tender Agent to effect transfer
of such Bond (or portion thereof) upon payment of the purchase price to the
Tender Agent on the purchase date, (C) an irrevocable authorization and
instruction to the Tender Agent to effect the exchange of the Bond to be
purchased in whole or in part for other Bonds in an equal aggregate principal
amount so as to facilitate the sale of such Bond (or portion thereof to be
purchased), and (D) an acknowledgment that such Owner will have no further
rights with respect to such Bond (or portion thereof) upon payment of the
purchase price thereof to the Tender Agent on the purchase date, except for the
right of such Owner to receive such purchase price upon delivery of such Bond to
the Tender Agent and that after the purchase date such Owner will hold any
undelivered certificate as agent for the Tender Agent. The determination of the
Tender Agent as to whether a notice of tender has been properly delivered
pursuant to the foregoing shall be conclusive and binding upon the Owner.
(c) Bonds to be Remarketed. Not later than 11:00 a.m., New
York City time, on the Business Day immediately following the date of receipt of
any notice of tender (or immediately upon such receipt, in the case of Bonds
accruing interest at Daily Rates), the Tender Agent shall notify, by telephone,
promptly confirmed in writing, the Borrower, the Trustee and the Remarketing
Agent of the principal amount of Bonds (or portions thereof) to be purchased and
the date of purchase.
Section 3.2. Mandatory Tenders for Purchase.
(a) Flexible Rate and Term Rate Bonds. Each Bond accruing
interest at a Flexible Rate shall be subject to mandatory tender for purchase on
the day after the last day of each Flexible Rate Period applicable to such Bond,
at a purchase price equal to 100% of the principal amount thereof, plus interest
accrued during such Flexible Rate Period. Each Bond accruing interest at a Term
Rate shall be subject to mandatory tender for purchase on the last day of the
Term Rate Period applicable to such Bond, at a purchase price equal to 100% of
the principal amount thereof, plus interest accrued to the purchase date. The
Owner of any Bond tendered for purchase as provided in this Section 3.2(a) shall
provide the Tender Agent with written payment instructions for the purchase
price of its Bond on or before tender thereof to the Tender Agent.
(b) Conversions between Interest Rates. Bonds to be
converted from one type of Interest Rate to a different type of Interest Rate
(except conversions from a Daily Rate to a Weekly Rate or from a Weekly Rate to
a Daily Rate) are subject to mandatory tender for purchase on the Conversion
Date at a purchase price equal to the principal amount thereof plus accrued
interest, if any; provided that the purchase price for Bonds converted from a
Term Rate on a date when such Bonds are also subject to optional redemption at a
premium shall include an amount equal to the premium that would be payable if
such Bonds were redeemed on such date.
(c) Prior to Expiration or upon Replacement of Letter of
Credit. The Bonds are subject to mandatory tender for purchase (i) on the Letter
of Credit Tender Date, unless at least forty-five (45) days (or such shorter
period as shall be acceptable to the Trustee in its sole discretion)
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prior to such Letter of Credit Tender Date the Trustee has received written
notice from the Letter of Credit Issuer that the Letter of Credit has been or
will be extended and (ii) on the date the Letter of Credit is replaced pursuant
to Section 2.13, in each case at a purchase price equal to the principal amount
thereof plus accrued interest to the mandatory tender date; provided that, if a
Letter of Credit is delivered on a date on which the Bonds are also subject to
optional redemption at a premium, the purchase price shall include an amount
equal to the premium that would be payable if such Bonds were redeemed on that
date.
(d) Notice of Mandatory Tender. The Trustee shall give
notice of mandatory tender for purchase to the Owners of Bonds subject to
mandatory tender pursuant to this Section 3.2 by first class mail, not less than
fifteen (15) days prior to the mandatory tender date, except that not less than
thirty (30) days notice shall be given to the Owners of Bonds accruing interest
at a Term Rate. If the Bonds are in certificated form, such notice shall include
information with respect to required delivery of Bond certificates and payment
of the purchase price.
Section 3.3. Remarketing and Purchase.
(a) Remarketing of Tendered Bonds. Unless otherwise
instructed by the Borrower, the Remarketing Agent shall offer for sale, and use
its best efforts to find purchasers for, all Bonds (or portions thereof) for
which notice of tender has been received pursuant to Section 3.1(b) or 3.2(d).
While the Bonds are in book-entry only form, the Remarketing Agent will make
payment of the purchase price for tendered Bonds in accordance with the
procedures established by DTC. If the book-entry only system is not in effect,
the terms of any sale by the Remarketing Agent shall provide for the payment of
the purchase price for tendered Bonds by the Remarketing Agent to the Trustee
(i) in immediately available funds not later than 3:00 p.m., New York City time,
on the purchase date, in the case of Bonds accruing interest at Flexible Rates,
(ii) in immediately available funds not later than 4:00 p.m., New York City
time, on the purchase date, in the case of Bonds accruing interest at Daily
Rates or Weekly Rates, and (iii) in immediately available funds not later than
12:00 noon, New York City time, on the purchase date, in the case of Bonds
accruing interest at Term Rates. The Remarketing Agent shall not sell any Bond
as to which a notice of conversion from one type of Interest Rate to another has
been given by the Trustee unless the Remarketing Agent has advised the Person to
whom the sale is made of the conversion. The Remarketing Agent shall not, while
any Letter of Credit is in effect, remarket the Bonds to the Issuer, the
Borrower, or any general partner of the Borrower, any affiliate of the Borrower
or any guarantor of the Borrower's obligations, other than Bonds which would
thereupon constitute Pledged Bonds.
(b) Purchase of Tendered Bonds.
(i) Notice. Not later than 3:00 p.m., New York City
time, on the Business Day immediately preceding the date fixed for purchase of
tendered Bonds (or 12:45 p.m., New York City time, on the purchase date, in the
case of Bonds accruing interest at Daily or Flexible Rates), the Remarketing
Agent shall give notice by telephone, telecopy, electronically or by other
similar communication to the Borrower, the Tender Agent and the Trustee of the
principal amount of tendered Bonds which were remarketed and the amount of
remarketing proceeds received which will be transferred pursuant to Section
3.3(a). Not later than 4:00 p.m. (or 1:00 p.m., in the case of Bonds accruing
interest at Daily, Weekly or Flexible Rates), New York City time, on the date of
receipt of
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such notice the Tender Agent shall give notice by telephone, telecopy,
electronically or by other similar communication to any Letter of Credit Issuer
and the Borrower, specifying the principal amount of tendered Bonds as to which
the Remarketing Agent has notified the Tender Agent that it has not found a
purchaser at that time. Not later than 3:00 p.m., New York City time, on the
Business Day prior to the purchase date to the extent known to the Remarketing
Agent, but in any event, not later than 11:00 a.m. (or 1:00 p.m., in the case of
Bonds accruing interest at Daily, Weekly or Flexible Rates), New York City time,
on the date fixed for purchase (or two Business Days prior to the date fixed for
purchase in the event tendered Bonds accrue interest at Term Rates), the
Remarketing Agent shall give notice to the Tender Agent by telephone (promptly
confirmed in writing or electronically) of the names, addresses and taxpayer
identification numbers of the purchasers, the denominations of Bonds to be
delivered to each purchaser and, if available, payment instructions for
regularly scheduled interest payments, or of any changes in any such information
previously communicated.
(ii) Sources of Payments; Drawings on Letter of Credit.
The Remarketing Agent shall cause to be paid to the Trustee on the date fixed
for purchase of tendered Bonds, all amounts representing proceeds of the
remarketing of such Bonds, such payments to be made in the manner and at the
time specified in Section 3.3(a) above. If such amounts will not be sufficient
to pay the principal amount thereof plus the accrued and unpaid interest thereon
(if any) to the purchase date, the Trustee shall by 2:00 p.m., New York City
time, on the purchase date draw under the Letter of Credit, if any, then held by
the Trustee, if the Letter of Credit so provides, in accordance with its terms
in a manner so as to furnish immediately available funds by 4:00 p.m., New York
City time, on such purchase date, in an amount sufficient, together with the
remarketing proceeds available for such purchase, to enable the Trustee to pay
the purchase price of Bonds to be purchased on such purchase date. If no Letter
of Credit is then held by the Trustee, or if the Letter of Credit shall have
been dishonored, the Borrower shall deliver or cause to be delivered to the
Trustee immediately available funds in an amount equal to such deficiency prior
to 2:30 p.m., New York City time, on the date set for purchase of tendered Bonds
accruing interest at Daily Rates, Weekly Rates and Term Rates (3:00 p.m., New
York City time, in the case of Flexible Rate Bonds) (the obligation of the
Borrower to deliver such moneys not being conditioned upon receipt by the
Borrower of the foregoing notice from the Trustee). All monies received by the
Trustee as remarketing proceeds or from drawings under any Letter of Credit and
additional amounts, if any, received from the Borrower shall be deposited by the
Trustee in the appropriate account of the Bond Purchase Fund to be used solely
for the payment of the purchase price of tendered Bonds and shall not be
commingled with other funds held by the Trustee.
(iii) Payments by the Trustee. Not later than 4:00
p.m., New York City time, on the date set for purchase of tendered Bonds and
upon receipt by the Trustee of 100% of the aggregate purchase price of the
tendered Bonds, the Trustee shall pay the purchase price of such Bonds to the
Owners thereof in immediately available funds (or by wire transfer). The Trustee
shall apply such moneys to purchase the tendered Bonds in the following order:
(A) moneys paid to it by the Remarketing Agent as proceeds of the remarketing of
such Bonds by the Remarketing Agent, (B) proceeds of a drawing under any Letter
of Credit, and (C) other monies made available by the Borrower. If sufficient
funds are not available for the purchase of all tendered Bonds, no purchases
shall be consummated, all as further set forth in Section 3.4 hereof.
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(iv) Registration and Delivery of Tendered or Purchased
Bonds. On the date of purchase, the Tender Agent shall register and deliver (or
hold) or cancel all Bonds purchased on any purchase date as follows: (A) Bonds
purchased or remarketed by the Remarketing Agent shall be registered and made
available to the Remarketing Agent by 2:15 p.m., New York City time, in
accordance with the instructions of the Remarketing Agent; (B) Bonds purchased
with proceeds of a drawing under any Letter of Credit shall be held as Pledged
Bonds in accordance with subparagraph (v) below; and (C) Bonds purchased with
amounts provided by the Borrower shall be registered in the name of the Borrower
and shall be held in trust by the Tender Agent on behalf of the Borrower and
shall not be released from such trust unless the Tender Agent shall have
received written instructions from the Borrower. All interest payable on Bonds
registered in the name of the Borrower shall be payable to the Borrower.
Notwithstanding anything herein to the contrary, so long as the Bonds are held
under the book-entry only system in accordance with Section 2.11 hereof, Bonds
will not be delivered as set forth above; rather, transfers of beneficial
ownership of the Bonds to the person indicated above will be effected on the
registration books of DTC pursuant to its rules and procedures.
(v) Pledged Bonds. Bonds purchased with proceeds of a
drawing under a Letter of Credit pursuant to this Section shall constitute
"Pledged Bonds" and shall be held by the Tender Agent as agent for the Letter of
Credit Issuer as pledgee of the Borrower pursuant to the Pledge Agreement (and
shall be shown as such on the Registration Books) unless and until (1) the
Trustee and the Tender Agent have written confirmation from the Letter of Credit
Issuer to the extent contemplated by the terms of the Letter of Credit that the
Letter of Credit has been reinstated with respect to such drawing and (2) the
Letter of Credit Issuer has notified the Tender Agent by telephone (thereafter
promptly confirmed in writing) that such Bonds have been released from the
pledge pursuant to the Pledge Agreement and are no longer Pledged Bonds. Pending
reinstatement of the Letter of Credit and release of such pledge as aforesaid,
such Bonds shall not be transferable or deliverable to any party (including the
Borrower) except the Letter of Credit Issuer pursuant to the Pledge Agreement.
Unless the Letter of Credit Issuer has notified the Trustee of the occurrence of
an event of default under the Reimbursement Agreement, all interest payable on
Pledged Bonds shall be payable to the Borrower. Upon receipt by the Trustee of
notice from the Letter of Credit Issuer of the occurrence of an event of default
under the Reimbursement Agreement, all interest payable on Pledged Bonds shall
be payable to the Letter of Credit Issuer. The Remarketing Agent shall, at the
request of the Letter of Credit Issuer, continue to use its best efforts to
arrange for the sale of any Pledged Bonds, subject to full reinstatement of the
Letter of Credit with respect to the drawings with which such Bonds were
purchased, at a price equal to the principal amount thereof plus accrued
interest.
Notwithstanding anything to the contrary in this subsection, if
and for so long as the Bonds are to be registered in accordance with Section
2.11 hereof, the registration requirements under this subsection (v) shall be
deemed satisfied if Pledged Bonds are (1) registered in the name of DTC or its
nominee in accordance with Section 2.11 hereof, (2) credited on the books of DTC
to the account of the Tender Agent (or its nominee) and (3) further credited on
the books of the Tender Agent (or its nominee) to the account of the Letter of
Credit Issuer (or its designee).
(vi) Resale of Bonds Purchased by the Borrower. In the
event that any Bonds are registered to the Borrower pursuant to subparagraph
(iv) above to the extent requested by
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the Borrower, the Remarketing Agent shall offer for sale and use its best
efforts to sell such Bonds at a price equal to the principal amount thereof plus
accrued interest.
(vii) Delivery of Tendered Bonds; Effect of Failure to
Surrender Bonds. All Bonds (other than Bonds held in a book-entry-only system)
to be purchased on any date shall be required to be delivered to the Principal
Office of the Tender Agent not later than (A) 1:00 p.m., New York City time, on
the purchase date in the case of Bonds accruing interest at Flexible or Daily
Rates; (B) 12:00 noon, New York City time, on the purchase date in the case of
Bonds accruing interest at Weekly Rates; or (C) 5:00 p.m., New York City time,
on the second Business Day prior to the purchase date in the case of Bonds
accruing interest at Term Rates. If the Owner of any Bond (or portion thereof)
in certificated form that is subject to optional or mandatory purchase pursuant
to this Article fails to deliver such Bond to the Tender Agent for purchase on
the purchase date, and if the Tender Agent is in receipt of the purchase price
therefor, such Bond (or portion thereof) shall nevertheless be deemed purchased
on the day fixed for purchase thereof and ownership of such Bond (or portion
thereof) shall be transferred to the purchaser thereof as provided in subsection
(b)(iv) above. Any Owner who fails to deliver such Bond for purchase shall have
no further rights thereunder and hereunder except the right to receive the
purchase price thereof upon presentation and surrender of said Bond to the
Tender Agent. The Tender Agent shall, as to any tendered Bonds which have not
been delivered to it (i) promptly notify the Remarketing Agent of such
nondelivery and (ii) cause the Trustee to place a stop transfer against an
appropriate amount of Bonds registered in the name of such Owner(s) on the
Registration Books. The Tender Agent shall cause the Trustee to place such
stop(s) commencing with the lowest serial number Bond registered in the name of
such Owner(s) until stop transfers have been placed against an appropriate
amount of Bonds until the appropriate tendered Bonds are delivered to the Tender
Agent. Upon such delivery, the Tender Agent shall cause the Trustee to make any
necessary adjustments to the Registration Books.
Section 3.4. Inadequate Funds for Tenders. If the funds available for
purchases of Bonds pursuant to this Article III are inadequate for the purchase
of all Bonds tendered on any purchase date, the Tender Agent shall, after any
applicable grace period: (a) return all tendered Bonds to the Owners thereof;
(b) return all moneys received for the purchase of such Bonds to the Persons
providing such monies; and (c) notify the Issuer and the Remarketing Agent of
the return of such Bonds and moneys and the failure to make payment for tendered
Bonds.
Section 3.5. [Reserved]
Section 3.6. Bond Purchase Fund. There is hereby created with the
Trustee a segregated trust fund to be designated the "Bond Purchase Fund". The
Bond Purchase Fund shall consist of three sub-accounts to be designated
respectively the "Remarketing Account", the "Letter of Credit Purchase Account"
and the "Borrower Purchase Account".
The Trustee shall deposit or cause to be deposited into the Remarketing
Account, when and as received, all moneys delivered to the Trustee as and for
the purchase price of remarketed Bonds by or on behalf of the Remarketing Agent
or the Tender Agent. The Trustee shall disburse moneys from the Remarketing
Account to pay the purchase price of Bonds properly tendered for purchase upon
surrender of such Bonds.
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The Trustee shall deposit or cause to be deposited into the Letter of
Credit Purchase Account, when and as received, all proceeds from a drawing under
the Letter of Credit pursuant to Section 3.3(b) hereof. The Trustee shall
disburse moneys from the Letter of Credit Purchase Account to pay the purchase
price of Bonds properly tendered for purchase upon surrender of such Bonds;
provided that such proceeds shall not be applied to purchase Pledged Bonds or
Bonds held in the name of the Issuer, or the Borrower, or to any general partner
of the Borrower, any affiliate of the Borrower or any guarantor of the
Borrower's obligations identified to the Trustee in a certificate of the
Borrower.
The Trustee shall deposit or cause to be deposited into the Borrower
Purchase Account, when and as received, all moneys delivered to the Trustee by
or for the account of the Borrower pursuant to Section 3.3(b) hereof. The
Trustee shall disburse moneys from the Borrower Purchase Account to pay the
purchase price of Bonds properly tendered for purchase by or on behalf of the
Borrower upon surrender of such Bonds or to reimburse the Letter of Credit
Issuer for drawings under the Letter of Credit for such purpose.
The funds held by the Trustee in the Bond Purchase Fund shall not
constitute part of the Trust Estate which is subject to the lien of this
Indenture. The moneys in the Bond Purchase Fund shall be used solely to pay the
purchase price of Bonds as aforesaid (or to reimburse the Letter of Credit
Issuer for drawings under the Letter of Credit for such purpose) and may not be
used for any other purposes. It shall be the duty of the Trustee to hold the
moneys in the Bond Purchase Fund, without liability for interest thereon, for
the benefit of the Owners of Bonds which have been properly tendered for
purchase or deemed tendered on the purchase date, and if sufficient funds to pay
the purchase price for such tendered Bonds shall be held by the Trustee in the
Bond Purchase Fund for the benefit of the Owners thereof, each such Owner shall
thereafter be restricted exclusively to the Bond Purchase Fund for any claim of
whatever nature on such Owner's part under this Indenture or on, or with respect
to, such tendered Bond. The provisions of Section 4.8 hereof shall govern any
funds held in the Bond Purchase Fund for such Owners of the Bonds which remain
unclaimed for a period of two years after the applicable purchase date.
ARTICLE IV
GENERAL PROVISIONS
Section 4.1. Authorization for Indenture; Indenture to Constitute
Contract. This Indenture is entered into pursuant to the Refunding Law. In
consideration of the purchase of the Bonds by the Bond Owners, the provisions of
this Indenture shall be part of the contract of the Issuer with the Owners of
the Bonds, and shall be deemed to be and shall constitute a contract among the
Issuer, the Trustee, any Letter of Credit Issuer, the Remarketing Agent, the
Tender Agent and the Bond Owners. The provisions hereof are covenants and
agreements with such Bond Owners, which the Issuer hereby determines to be
necessary and desirable for the security and payment of the Bonds.
Section 4.2. Payment of Principal, Premium, if any, and Interest. The
Issuer covenants that it will duly and punctually pay or cause to be paid the
principal of, premium, if any, purchase price of and interest on the Bonds
issued under this Indenture at the place, on the dates and in the manner
provided herein and therein according to the true intent and meaning hereof and
thereof, but solely from the payments, revenues and receipts specifically
assigned herein for such purposes as set forth in Section 5.3 and, with respect
to the purchase price of Bonds, Section 3.6 of this Indenture.
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Section 4.3. Performance of Covenants; Issuer Warranties. The Issuer
covenants that it will faithfully comply with the stipulations and provisions
required to be performed by it and contained in this Indenture, or in any of its
proceedings pertaining hereto. The Issuer warrants that it is duly authorized
under the laws of the State, including particularly and without limitation the
Refunding Law, to issue the Bonds authorized hereby and to execute this
Indenture and to assign its rights under or with respect to the Loan Agreement
and all amounts payable thereunder or with respect thereto, which hereby are
assigned in the manner and to the extent herein set forth; that all actions on
its part for the issuance of the Bonds and the execution and delivery of this
Indenture have been duly and effectively taken; and that the Bonds are and will
be valid and binding limited obligations of the Issuer enforceable in accordance
with the terms thereof and hereof, except as enforcement thereof and hereof may
be limited by bankruptcy, insolvency, moratorium, reorganization and other
similar laws affecting the rights of creditors and by the application of general
principles of equity, if such remedies are pursued.
Section 4.4. Instruments of Further Assurance. The Issuer covenants that
it will do, execute, acknowledge and deliver, or cause to be done, executed,
acknowledged and delivered, such indentures supplemental hereto and such further
acts, instruments and transfers as the Trustee or the Borrower reasonably may
require for the better and more effectual assignment to the Trustee of all
payments, revenues and other amounts payable under or with respect to the Loan
Agreement, and any other income and other moneys assigned hereby to the payment
of the principal of, premium, if any, and interest on the Bonds. The Issuer
further covenants that it will not create or suffer to be created any lien,
encumbrance or charge upon its interest in the revenues and other amounts
payable under or with respect to the Trust Estate, except the lien and charge
granted hereby.
Section 4.5. Limitation on Issuer's Actions. The Issuer shall have no
obligation to undertake any affirmative action, to execute any document, or to
file or record any document or instrument unless it is requested in writing to
do so by the Trustee, the Borrower or other authorized party and its fees and
expenses incurred in taking such actions are tendered to the Issuer by the
requesting party.
Section 4.6. Registration of Bonds; Trustee Appointed Bond Registrar;
Persons Treated as Owners. (a) Registration. The Trustee is hereby appointed as
registrar of the Bonds and as such shall maintain the Registration Books as
provided by this Indenture. The Registration Books shall note any Bond owned by
the Borrower and shall reflect the information required by the registration
information form contained in Section 2.3 to be provided by Bond Owners in
connection with the transfer of Bonds. At reasonable times and under reasonable
regulations established by the Trustee, the Registration Books may be inspected
and copied by the Borrower, the Issuer, the Tender Agent, the Remarketing Agent
or the Owners (or designated representatives thereof) of at least 25% in
aggregate principal amount of Bonds then Outstanding.
(b) Transfer and Exchange; Restrictions on Transfer. UNTIL
JUNE 17, 2000, THE TRUSTEE SHALL NOT REGISTER ANY TRANSFER OR EXCHANGE OF ANY
BONDS UNLESS SUCH TRANSFEREE DELIVERS TO THE TRUSTEE AN INVESTOR LETTER
SUBSTANTIALLY IN THE FORM SET FORTH IN EXHIBIT B TO THIS INDENTURE AND UNLESS
THE BONDS BEAR THE LEGEND IN THE FORM SET FORTH IN EXHIBIT C. The ownership of a
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Bond may be transferred (in the amount of any Authorized Denomination; provided,
that any portion thereof retained is itself in an Authorized Denomination) only
upon surrender thereof at the Principal Office of the Trustee or, in the case of
tenders pursuant to Article III hereof, at the Principal Office of the Tender
Agent (as agent of the Trustee), accompanied by an assignment, duly executed by
the Owner of such Bond or its duly authorized attorney-in-fact, in such form as
shall be satisfactory to the Trustee or the Tender Agent, as the case may be,
along with the address and social security number or federal employer
identification number of such transferee (or, if registration is to be made in
the name of multiple individuals, of all such transferees) and, if such
transferee is a trust, the name and address of the trustee(s) and the date of
the trust of the proposed transferee. Upon the due presentation of any Bond for
transfer and on request of the Trustee, the Issuer shall execute in the name of
the transferee, and the Trustee or the Tender Agent shall authenticate and
deliver, a new fully registered Bond or Bonds, in any Authorized Denomination,
in an aggregate principal amount equal to the unmatured and unredeemed principal
amount of such transferred fully registered Bond, and bearing interest at the
same rate, and maturing on the same date, as such transferred Bond. All Bonds
surrendered to the Trustee or the Tender Agent for transfer pursuant to this
Section 4.6 shall be cancelled by the Trustee and shall not be redelivered.
Bonds may be exchanged at the Principal Office of the
Trustee for a like aggregate principal amount of Bonds of Authorized
Denominations. All Bonds surrendered to the Trustee for exchange pursuant to
this Section 4.6 shall be cancelled by the Trustee and shall not be redelivered.
Neither the Issuer nor the Trustee shall be required to make any such transfer
or exchange of any Bond during the ten (10) Business Days immediately preceding
the selection of the Bonds for redemption or, with respect to a Bond, after such
Bond or any portion thereof has been selected for redemption. Notwithstanding
the foregoing provisions, the Trustee or the Tender Agent shall authenticate and
make available for receipt by the purchaser or purchasers of any Bond tendered
or deemed to be tendered in accordance with the provisions of the form of Bond
contained herein, against payment therefor, a new fully registered Bond or
Bonds, in any Authorized Denomination, in an aggregate principal amount equal to
the principal amount of the Bond so tendered or deemed to be tendered and
bearing interest at the same rate, and maturing on the same date, as such
tendered or deemed tendered Bond.
The Trustee shall attach to each Bond issued in transfer or
exchange for a Bond (or a portion of a Bond) called for redemption or mandatory
tender a copy of the notice thereof.
(c) Charges. In all cases of the transfer of a Bond, the
Trustee shall register on the Registration Books, such Bond in accordance with
the provisions of this Indenture. The Issuer, the Tender Agent or the Trustee
may make a charge to the Bond Owner for every such transfer and every exchange
of a Bond sufficient to reimburse it for any tax, fee or other governmental
charge required to be paid with respect to such transfer or exchange, and may
demand that such charge be paid before any new Bond is delivered.
(d) Ownership. As to any Bond, the person in whose name the
ownership of such Bond shall be registered on the Registration Books shall be
deemed and regarded as the absolute owner thereof for all purposes, and payment
of or on account of the principal of, premium, if any, purchase price of and
interest on any such Bond shall be made only to or upon the order of the
registered Owner thereof or its legal representative. All such payments shall be
valid and effectual to satisfy and discharge the liability upon such Bond,
including the interest thereon, to the extent of the sum or sums so paid.
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Section 4.7. Cancellation. All Bonds which have been paid at maturity or
redeemed prior to maturity shall not be reissued but shall be cancelled by the
Trustee. All Bonds which are cancelled by the Trustee shall be disposed of by
the Trustee, and a certificate of the disposition thereof shall be furnished
promptly to the Issuer; provided, however, that if the Issuer shall so direct
the Trustee, the Trustee shall forward the cancelled Bonds to the Issuer.
Section 4.8. Non-presentment of Bonds. If any check representing payment
of interest, principal, premium or purchase price on any Bond is returned to the
Trustee or the Tender Agent or is not presented for payment by the payee
thereof, or any Bond is not presented for payment of principal or premium at the
maturity or redemption date, or purchase price at the purchase date, if the
proceeds of a remarketing of the Bonds by the Remarketing Agent, or funds
provided by the Borrower or any Letter of Credit Issuer and/or Government
Obligations purchased with such funds, sufficient to pay such interest, or such
principal and premium or purchase price, as is applicable, shall have been made
available to the Trustee or the Tender Agent for the benefit of the Owner of the
applicable Bond, all liability of the Issuer to the Owner of such Bond for such
interest or such principal and premium or purchase price shall forthwith cease,
terminate and be completely discharged, and thereupon it shall be the duty of
the Trustee or the Tender Agent to hold such moneys and/or Government
Obligations, without investing or reinvesting the same and without liability for
interest thereon, for the benefit of the Owner of such Bond, who shall
thereafter be restricted exclusively to such funds for any claim of whatever
nature on such Owner's part under this Indenture or on, or with respect to, such
Bond, and thereafter such Bond shall no longer be considered to be Outstanding.
The Trustee's or Tender Agent's obligation to hold such moneys and/or Government
Obligations with respect to such Bond shall continue for a period equal to two
years following the date on which the applicable payment shall have become due,
at which time the Trustee or the Tender Agent, upon request of the Borrower and
upon payment of all fees and expenses due and owing to it and receipt of
indemnity satisfactory to it, shall surrender such funds so held to the
Borrower. Following such surrender, any claim under this Indenture by the Owner
of such Bond of whatever nature shall be made only upon the Borrower and all
liability of the Issuer, the Trustee and the Tender Agent with respect thereto
shall cease.
The provisions of this Section 4.8 shall be subject to all applicable
escheat and unclaimed property laws.
Section 4.9. Rights Under Loan Agreement. This Indenture, the Loan
Agreement and the documents executed by the Borrower in connection therewith,
duly executed counterparts or originals of which have been filed with the
Trustee, set forth the covenants and the obligations of the Issuer, the Borrower
and the Trustee. Reference is hereby made to such documents for detailed
statements of the covenants and obligations set forth therein. The Issuer and
the Trustee agree that the Trustee, for and on behalf of the Bond Owners, in its
name or, to the extent permitted by law, in the name of the Issuer, may enforce
all rights of the Issuer and all obligations of the Borrower under and pursuant
to the Loan Agreement and such documents, subject to the Issuer's right to
enforce the Reserved Rights under the Loan Agreement to carry out its public
purposes in making the Loan.
Section 4.10. Legal Existence of Issuer. The Issuer covenants that it
will at all times maintain its legal existence and will duly procure any
necessary renewals and extensions thereof; will use its best efforts to
maintain, preserve and renew all the rights, powers, privileges and franchises
owned by it; and will comply with all valid acts, rules, regulations and orders
of any
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legislative, executive, judicial or administrative body applicable to the Issuer
in connection with the Bonds.
Section 4.11. Tax-Exempt Status of Bonds. The Issuer covenants to commit
or suffer no act within its control that would alter the status or character of
the Bonds, or the interest to be paid on the Bonds, for purposes of State or
federal taxation.
Section 4.12. Diminution of, or Encumbrance on, Trust Estate. The Issuer
covenants not to sell, transfer, assign, pledge, release, encumber or otherwise
diminish or dispose of, directly or indirectly, by merger or otherwise, or cause
or suffer the same to occur, or create or allow to be created or to exist any
lien upon, all or any part of its interests in the Trust Estate, except as
expressly permitted by this Indenture.
Section 4.13. Books, Records and Accounts. The Trustee agrees to keep
proper books for the registration of, and transfer of ownership of, each Bond,
and proper books, records and accounts in which complete and correct entries
shall be made of all transactions relating to the receipt, disbursement,
investment, allocation and application of the proceeds received from the sale of
the Bonds, the Revenues, the documents executed by the Borrower in connection
therewith, the funds and accounts created pursuant to this Indenture, and all
other moneys held by the Trustee hereunder. The Trustee shall, during regular
business hours and upon reasonable prior notice, make such books, records and
accounts available for inspection and copying by the Issuer, the Borrower and
the Bond Owners.
Section 4.14. Temporary Bonds. Until definitive Bonds are ready for
delivery, there may be executed, and, upon written request of the Issuer, the
Trustee or the Tender Agent shall authenticate and deliver, in lieu of
definitive Bonds, but subject to the same limitations and conditions, temporary
printed, engraved, lithographed or typewritten registered Bonds (without
coupons), in any Authorized Denomination, substantially of the tenor hereinabove
set forth for definitive Bonds, and with such omissions, insertions and
variations as may be appropriate. If temporary Bonds shall be issued, as soon as
is practicable the Issuer shall cause the definitive Bonds to be prepared and to
be executed and deposited with the Trustee, and the Trustee or the Tender Agent,
upon presentation to it at its respective Principal Office of any temporary
Bond, shall cancel the same and authenticate and deliver in exchange therefor at
the required location, without charge to the Owner thereof, a definitive Bond or
Bonds of an equal aggregate principal amount and bearing interest at the same
rate as the temporary Bond or Bonds so surrendered. Until so exchanged the
temporary Bonds shall be entitled in all respects to the same benefit and
security of this Indenture as the definitive Bonds to be issued and
authenticated hereunder.
Section 4.15. Mutilated, Lost, Stolen or Destroyed Bonds. If any Bond is
mutilated, lost, stolen or destroyed, the Trustee, upon request, shall
authenticate a new Bond, dated as provided in Article II hereof, of the same
denomination and bearing interest at the same rate as the Bond mutilated, lost,
stolen or destroyed; provided, however, that, in the case of any mutilated Bond,
such mutilated Bond shall first be surrendered to the Trustee, and, in the case
of any lost, stolen or destroyed Bond, there shall first be furnished to the
Trustee evidence of such loss, theft or destruction satisfactory to the Trustee,
together with indemnity covering the Trustee, the Tender Agent and the Issuer
satisfactory to the Trustee and the Issuer. If any such Bond shall have matured,
instead of issuing a replacement Bond the Issuer may pay the same. The Trustee
and the Issuer may
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charge the Owner of such Bond with their reasonable fees and expenses in
connection with the issuance of any such replacement Bond.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, lost, stolen or destroyed Bonds.
Section 4.16. Notice to Remarketing Agent and Rating Agencies. The
Trustee shall provide the Remarketing Agent, any Letter of Credit Issuer and
each Rating Agency then rating the Bonds, if the Bonds are then rated, with
prior written notice as early as practicable, of (i) the appointment of any
successor Trustee, Tender Agent or Remarketing Agent, (ii) any supplement or
amendment to this Indenture or the Loan Agreement, (iii) the provision of any
Letter of Credit, the expiration of any Letter of Credit, the renewal of any
Letter of Credit or the provision of an Alternate Letter of Credit, (iv) the
payment in full of all of the Bonds, (v) the giving of a notice of mandatory
tender of the Bonds, or (vi) the conversion of the Bonds to a new Rate Period.
Each notice to the Rating Agencies hereunder shall be directed to the respective
addresses provided by the Rating Agencies. The Trustee's agreement to give the
notices to the Rating Agencies provided for in this Section is made as a matter
of courtesy and accommodation only, and the Trustee shall incur no liability to
any Person for its failure to give such notices.
ARTICLE V
REVENUES AND FUNDS
Section 5.1. Creation of Refunding Fund; Application of Original
Proceeds of Bonds; Source of Payment of Bonds. (a) There is hereby created by
the Issuer and ordered established with the Trustee a trust fund to be
designated the "California Statewide Communities Development Authority Apartment
Development Revenue Refunding Bonds, Series
1998A Refunding Fund" (the "Refunding Fund").
(b) Proceeds from the sale of the Bonds in the amount of
$335,697,778.67 shall be deposited by the Trustee in the Refunding Fund. The
Trustee shall immediately transfer 334,251,124.83 of such proceeds as specified
in the Redemption Agreement, to the trustee for the Prior Bonds to be applied by
such trustee to the repayment in full of the Prior Bonds, such repayment to be
made not later than the Closing Date. The Trustee shall deposit the proceeds
remaining in the amount of $1,446,653.84 to the Revenue Fund.
(c) The Bonds herein authorized and all payments by the
Issuer hereunder are not and shall never become general obligations of the
Issuer, but are limited obligations payable solely and only from the Revenues
received under the Loan Agreement, the documents executed by the Borrower in
connection therewith and the Funds and Accounts created pursuant to this
Indenture, and as authorized by the Refunding Law and provided herein. No
covenant or agreement contained in the Bonds, in this Indenture or in any other
agreement referred to in this Indenture shall be deemed to be the covenant or
agreement of any officer, member, agent or employee of the Issuer in his or her
individual capacity, and neither such persons nor any official executing the
Bonds shall be liable personally on the Bonds or be subject to any personal
liability or accountability by reason of the issuance thereof.
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Section 5.2. Creation of Revenue Fund. There is hereby created by the
Issuer and ordered established with the Trustee a trust fund to be designated
the "California Statewide Communities Development Authority Apartment
Development Revenue Refunding Bonds, Series 1998A Revenue Fund" (the "Revenue
Fund"). The Revenue Fund shall consist of two sub-accounts to be designated,
respectively, the "Letter of Credit Revenue Account" and the
"Borrower Revenue Account".
Section 5.3. Payments into Revenue Fund. There shall be deposited into
the Revenue Fund when received: (i) the amount required by Section 5.1(b) above;
(ii) the amount of $61,124.83 received from the trustee for the Prior Bonds
pursuant to the Redemption Agreement; (iii) all payments (other than purchase
price payments) specified in Section 2.7 of the Loan Agreement; (iv) all moneys
required to be so deposited in connection with any redemption of Bonds; and (v)
all other moneys when received by the Trustee which are required to be deposited
into the Revenue Fund or which are accompanied by directions that such moneys
are to be paid into the Revenue Fund, including without limitation, moneys
received pursuant to the Loan Agreement and any amounts due any Letter of Credit
Issuer pursuant to the Reimbursement Agreement. All amounts received for deposit
into the Revenue Fund shall be deposited by the Trustee as follows: (a) any
amounts received pursuant to a drawing under any Letter of Credit for the
payment of the principal of, redemption price, if any, and interest on the Bonds
shall be deposited into the Letter of Credit Revenue Account and (b) all other
amounts shall be deposited into the Borrower Revenue Account. Any amounts
received for deposit in the Revenue Fund shall not be commingled with any other
moneys held by the Trustee and any amounts deposited into specific Accounts of
the Revenue Fund shall not be commingled with moneys held in any other Account.
Section 5.4. Use of Moneys in Revenue Fund. The Issuer hereby authorizes
and directs the Trustee to withdraw sufficient funds from the Revenue Fund to
pay the principal of, premium, if any, and interest on the Bonds as the same
become due and payable, which authorization and direction the Trustee hereby
accepts. Amounts in the Revenue Fund shall be withdrawn by the Trustee in the
following order and priority: (a) amounts in the Letter of Credit Revenue
Account, if any, shall be applied to pay the principal of, premium, if any, and
interest on the Bonds as the same become due and payable; provided, no such
amounts shall be applied to make such payments on the Pledged Bonds or any other
Bonds registered in the name of the Borrower or its affiliates or the Issuer),
and (b) amounts in the Borrower Revenue Account shall be applied to pay the
principal of, premium, if any, and interest on the Bonds as the same become due
and payable only to the extent amounts in (a) above are not available, and
thereafter to reimburse any Letter of Credit Issuer for any amounts outstanding
under the Reimbursement Agreement, upon receipt by the Trustee from the Letter
of Credit Issuer of written notice as to the amounts owed to it under the
Reimbursement Agreement. Notwithstanding anything herein to the contrary, no
amounts contained in the Borrower Revenue Account shall be used to pay principal
of, premium, if any or interest on the Bonds so long as amounts are available to
be drawn under the Letter of Credit for such purposes.
Section 5.5. Investment of Moneys. Subject to the restrictions
hereinafter set forth in this Section 5.5 and in the Tax Certificate, moneys
held in the Revenue Fund (other than moneys in the Letter of Credit Revenue
Account and moneys on deposit for the redemption of Bonds) and in the Rebate
Fund shall be invested and reinvested by the Trustee upon the written
instructions of the Borrower in Permitted Investments, maturing no later than
the date on which it is estimated that such moneys will be required to be paid
out hereunder, which instructions shall specify the particular investment to be
made and shall certify that such investment constitutes a Permitted Investment
and
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is otherwise permitted to be made hereunder and under the Loan Agreement
(including Section 7.5 thereof). Moneys held in the Bond Purchase Fund shall not
be invested by the Remarketing Agent or the Tender Agent. Moneys held in the
Letter of Credit Revenue Account and moneys held for the redemption of Bonds
shall be invested only in Government Obligations, which mature as needed for
payment, upon the written instructions of the Borrower, which instructions shall
specify the particular investment to be made and shall certify that such
investment constitutes a Government Obligation and is otherwise permitted to be
made hereunder. All investment instructions hereunder shall be provided to the
Trustee no later than one Business Day prior to the making of the investment
directed therein. The Trustee may make any and all such investments through its
own investment department or through any of its affiliates or subsidiaries. The
Trustee shall be entitled to rely on all written investment instructions
provided by the Borrower hereunder and shall have no duty to monitor the
compliance thereof with the restrictions set forth in this Section 5.5 and in
the Tax Certificate. The Trustee shall not be responsible or liable for the
performance of any such investments or for keeping the moneys held by it
hereunder fully invested at all times. Absent the provision of investment
instructions hereunder, the Trustee shall invest moneys held pursuant hereto in
investments described in clause (iii) of the definition of "Permitted
Investments." Any obligations acquired by the Trustee as a result of such
investment or reinvestment shall be held by or under the control of the Trustee
(except for such investments held in book entry form) and shall be deemed to
constitute a part of the Fund or Account from which the moneys used for its
purchase were taken. All investment income shall be retained in the Fund or
Account to which the investment is credited from which such income is derived,
and with respect to the Revenue Fund shall be available for the purposes set
forth in Section 5.4 hereof (and to the extent so available shall serve as a
credit against the amount due from the Borrower under Section 2.7 of the Loan
Agreement on the next succeeding Loan payment date). Any investment losses shall
be charged to the Fund or Account from which such investment was made. Monies
held under Section 4.8 shall not be invested. The Issuer (and the Borrower by
its execution of the Loan Agreement) acknowledges that to the extent regulations
of the Comptroller of the Currency or other applicable regulatory entity grant
the Issuer or the Borrower the right to receive brokerage confirmations of
security transactions as they occur, the Issuer and the Borrower specifically
waive receipt of such confirmations to the extent permitted by law. The Trustee
will furnish the Issuer and the Borrower periodic cash transaction statements
which include detail for all investment transactions made by the Trustee
hereunder. To the extent the Trustee does not receive written instructions for
investment from the Borrower, the Trustee shall invest, to the extent reasonably
practicable in investments described in clause (iii) of the definition of
"Permitted Investments."
The Trustee may make any investments hereunder through its own bond or
investment department or trust investment department, or those of its parent or
any affiliate.
The Trustee or any of its affiliates may act as sponsor, advisor or
manager in connection with any investments made by the Trustee hereunder.
Section 5.6. Moneys Held in Trust. All moneys required to be deposited
with or paid to the Trustee for the account of any Fund or Account under any
provisions of this Indenture shall be held by the Trustee in trust, and, except
for moneys deposited with or paid to the Trustee for redemption of Bonds, notice
of the redemption for which has been duly given and except for moneys in the
Bond Purchase Fund and the Rebate Fund, shall, while held by the Trustee,
constitute part of the Trust Estate and be subject to the security interest
created hereby.
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Section 5.7. Repayment to Borrower from Indenture Funds. Any amounts
remaining in any Fund or Account created under this Indenture, after payment or
provision for payment in full of the Bonds in accordance with Article VI hereof,
any sums due any Letter of Credit Issuer, the fees, charges and expenses of the
Issuer, the Trustee, the Tender Agent, the Remarketing Agent and any co-trustee
appointed hereunder, and all other amounts required to be paid hereunder or
under the Loan Agreement, and after and to the extent that the Borrower shall
determine that the payment of such remaining amounts may be made without
violation of the provisions of the Tax Certificate, shall be paid, upon the
expiration of, or upon the sooner termination of, the terms of this Indenture,
to the Borrower, provided that the Borrower shall have delivered a certificate
to the Trustee to the effect that all conditions precedent to such payment set
forth in this Section have been complied with.
Section 5.8. Tax Covenants. The Issuer covenants with the Owners of the
Bonds that, notwithstanding any other provision of this Indenture or any other
instrument, it will not make any investment or other use of the proceeds of the
Bonds or any other moneys held under this Indenture which would cause the Bonds
to be "arbitrage bonds" under Section 148 of the Code or "federally guaranteed"
obligations under Section 149 of the Code, and it further covenants that it will
comply with all applicable requirements of Sections 103 and 141-150 of the Code
(except that the Issuer shall be deemed to have complied with these requirements
as long as it acts on the written direction of the Borrower). The foregoing
covenants shall extend throughout the term of the Bonds to all Funds and
Accounts created under this Indenture and all moneys on deposit to the credit of
any such Fund or Account, and to any other amounts which are proceeds of the
Bonds or which have been replaced with proceeds of the Bonds for purposes of
Sections 103 and 141-150 of the Code. It is expressly understood that because
investments hereunder are to be made by the Trustee only pursuant to
instructions of the Borrower, the Trustee shall have no liability with respect
thereto if, as a result of an investment made pursuant to such instructions, the
Bonds become "arbitrage bonds" under Section 148 of the Code or "federally
guaranteed" obligations under Section 149 of the Code or the covenants of this
Section are otherwise violated.
Section 5.9. Rebate Fund. There is hereby created by the Issuer and
ordered established with the Trustee a trust fund to be designated the
"California Statewide Communities Development Authority Apartment Development
Revenue Refunding Bonds, Series 1998A Rebate Fund" (the "Rebate Fund"). All
money at any time deposited in the Rebate Fund shall be held by the Trustee in
trust, to the extent required to satisfy the Rebate Requirement (as defined in
the Tax Certificate) and as calculated by the Rebate Analyst, for payment to the
United States Government, and neither the Issuer nor the Borrower nor the
Bondholders shall have any rights in or claim to such moneys. All amounts
deposited into or on deposit in the Rebate Fund shall be governed by this
Section and by the Tax Certificate. The Trustee shall conclusively be deemed to
have complied with such provisions if it follows the written instructions of the
Borrower, including supplying all necessary information in the manner set forth
in the Tax Certificate, and shall not be required to take any actions thereunder
in the absence of written instructions from the Borrower.
Within 55 days of the end of each fifth Bond Year, the Borrower
shall or shall cause the Rebate Analyst to calculate the amount of rebatable
arbitrage, in accordance with Section 148(f)(2) of the Code and Section 1.148-3
of the Rebate Regulations (taking into account any applicable exceptions with
respect to the computation of the rebatable arbitrage, described, if applicable,
in the Tax Certificate (e.g., the temporary investments exceptions of
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Section 148(f)(4)(B) and (C) of the Code), for this purpose treating the last
day of the applicable Bond Year as a (computation) date, within the meaning of
Section 1.148-1(b) of the Rebate Regulations (the "Rebatable Arbitrage").
Within 55 days of the end of each fifth Bond Year, upon the
written direction of the Borrower, an amount shall be deposited to the Rebate
Fund by the Trustee from amounts provided by the Borrower, if and to the extent
required so that the balance in the Rebate Fund shall equal the amount of
Rebatable Arbitrage so calculated in accordance with the preceding paragraph.
The Trustee shall pay, as directed by the Borrower, to the United
States Treasury, out of amounts in Rebate Fund:
(i) Not later than 60 days after the end of (A) the fifth Bond
Year, and (B) each applicable fifth Bond Year thereafter, an amount
equal to at least 90% of the Rebatable Arbitrage calculated as of the
end of such Bond Year; and
(ii) Not later than 60 days after the payment of all the Bonds,
an amount equal to 100% of the Rebatable Arbitrage calculated as of the
end of such applicable Bond Year, and any income attributable to the
Rebatable Arbitrage, computed in accordance with Section 148(f) of the
Code.
Each payment required to be made under this Section shall be made
to the Internal Revenue Service Center, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ on or
before the date on which such payment is due, and shall be accompanied by
Internal Revenue Service Form 8038-T, which shall be prepared by the Rebate
Analyst or the Borrower and provided to the Trustee.
Notwithstanding any provision of this Indenture to the contrary,
the obligation to remit payment of Rebatable Arbitrage to the United States and
to comply with all other requirements of this Section 5.9 and the requirements
of the Tax Certificate shall survive the defeasance or payment in full of the
Bonds.
Any funds remaining in the Rebate Fund after redemption and
payment of all of the Bonds and payment and satisfaction of any Rebate
Requirement, or provision made therefor satisfactory to the Trustee, shall be
withdrawn and remitted to the Borrower as provided for in Section 5.7 of this
Indenture.
The Trustee shall keep such records of the computations made
pursuant to this Section 5.9 as are required under Section 148(f) of the Code to
the extent furnished to the Trustee. The Trustee shall keep and make available
to the Borrower such records concerning the investments of the gross proceeds of
the Bonds and the investments of earnings from those investments made by the
Trustee as may be requested by the Borrower in order to enable the Borrower to
make the aforesaid computations as are required under Section 148(f) of the
Code.
Notwithstanding the foregoing, the computations and payments of
Rebatable Arbitrage referred to in this Section 5.9 need not be made to the
extent that neither the Issuer nor the Borrower will thereby fail to comply with
any requirements of Section 148(f) of the Code based on an opinion of Bond
Counsel, a copy of which shall be provided to the Trustee.
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The Trustee shall not be responsible for calculating rebate
amounts or for the adequacy or correctness of any rebate report or rebate
calculations. The Trustee shall be deemed conclusively to have complied with the
provisions of this Indenture or any other agreement relating to the Bonds
regarding calculation and payment of rebate if it follows the directions of the
Borrower and it shall have no independent duty to review any such calculations
or enforce compliance with such rebate requirements.
ARTICLE VI
DISCHARGE OF INDENTURE
Section 6.1. Discharge. If the Issuer shall pay or cause to be paid, or
there shall be otherwise paid, or provision shall be made for the payment of,
the principal, premium, if any, and interest due or to become due on the Bonds
at the times and in the manner stipulated therein, and if the Issuer shall not
then be in default under any of the other covenants and promises in such Bonds
and this Indenture to be kept, performed and observed by it or on its part, and
if the Issuer shall pay or cause to be paid to the Trustee all sums of money due
or to become due according to the provisions hereof or of the Bonds and of the
Loan Agreement, then, except for the rights of the Trustee under Section 8.2
hereof, these presents and the interests in the Trust Estate and rights hereby
granted shall cease, determine and be void, and the Trustee shall take such
actions as may be required by the Issuer to evidence the cancellation and
discharge of the lien of this Indenture. Any Bond shall be deemed to be paid
within the meaning of this Article VI and for all purposes of this Indenture
when (i) payment of the principal of and the applicable redemption premium, if
any, on such Bond, plus interest thereon to the due date thereof (whether such
due date be by reason of maturity or upon redemption as provided in this
Indenture, or otherwise), shall have been provided to the Trustee by irrevocably
depositing with the Trustee, in trust, and the Trustee shall have irrevocably
set aside exclusively for such payment, any combination of (1) funds provided by
the Borrower sufficient to make such payment, and/or (2) Government Obligations
(purchased with such funds) not subject to redemption or prepayment and maturing
as to principal and interest in such amounts and at such times as will, in the
written opinion of a firm of nationally recognized independent certified public
accountants delivered to the Trustee, provide sufficient moneys, without
reinvestment of any matured amounts, to make such payment without reinvestment
(and there shall be no such reinvestment); (ii) the Trustee shall have been
given irrevocable written instructions to call all outstanding Bonds for
redemption on a date certain, if such Bonds are to be called for redemption
prior to maturity; (iii) the Trustee shall have received a Favorable Opinion of
Bond Counsel; and (iv) all necessary and proper fees, compensation, expenses and
indemnities of the Trustee and the Tender Agent pertaining to the Bonds shall
have been paid or the payment thereof provided for to the satisfaction of the
Trustee.
Prior to the defeasance of Bonds in a Daily Rate or a Weekly Rate, the
Borrower shall be required to effect a conversion of the Bonds to a Flexible
Rate or a Term Rate having a term equal to or greater than the date of
redemption contained in the notice set forth in (ii) above. Prior to the
defeasance of Bonds having a Term Rate which have Term Rate Periods shorter than
the redemption date contained in the notice set forth in (ii) above, the
Borrower shall be required to effect a conversion of the Bonds to a Flexible
Rate or to a Term Rate having a term equal to or greater than the redemption
date set forth in (ii) above. Prior to the defeasance of Bonds having a Term
Rate, the
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Trustee shall establish a redemption date for the Bonds which is on or prior to
the termination date of the Term Rate Period unless the Bonds mature at the end
of the Term Rate Period.
ARTICLE VII
EVENTS OF DEFAULT AND REMEDIES
Section 7.1. Events of Default. Each of the following events is hereby
defined as, and declared to constitute, an "Event of Default" under this
Indenture:
(i) failure to pay (a) interest on any Outstanding Bond
when due, or (b) the principal or purchase price of, or premium, if any,
on, any Outstanding Bond, whether at the stated maturity thereof, upon
the purchase date thereof, upon any proceedings for redemption, or upon
the maturity thereof or by declaration of acceleration;
(ii) failure by the Issuer to perform or observe any of
the other covenants, agreements or conditions contained in this
Indenture, and the continuation thereof for the period after notice
specified in Section 7.12 hereof; or
(iii) the occurrence and continuance of an event of
default under the Loan Agreement.
Section 7.2. Acceleration. (A) Upon the occurrence of an Event of
Default described in Section 7.1(i), the Trustee shall accelerate the maturity
of the Bonds then Outstanding, whereupon the principal of and all accrued
interest on all of the Bonds shall become immediately due and payable, without
premium, and no interest shall accrue on any Bond from and after the date of
such acceleration. Upon the occurrence of any other Event of Default, the
Trustee may, and if requested to do so by the Owners of not less than
twenty-five percent (25%) in aggregate principal amount of the Bonds then
Outstanding, shall, accelerate the maturity of the Bonds, whereupon the
principal of and all accrued interest on the Bonds shall become immediately due
and payable, without premium, and no interest shall accrue on any Bond from and
after the date of such acceleration. In the event of any acceleration of the
Bonds, the Trustee shall give the Issuer and the Borrower written notice of the
acceleration of the Loan.
Section 7.3. Other Remedies; Rights of Bond Owners. Subject to the next
succeeding paragraph, upon the occurrence of any Event of Default described in
Section 7.1, the Trustee shall upon the written request of the Owners of at
least twenty-five percent (25%) in aggregate principal amount of the Bonds
outstanding and upon receipt of an indemnity satisfactory to the Trustee, pursue
any available remedy by suit at law or in equity to enforce the payment of the
principal or purchase price of, premium, if any, and interest on the Bonds then
Outstanding, and the performance by the Issuer of its obligations hereunder,
including, without limitation, the following:
(i) by mandamus, or other suit, action or proceeding at law
or in equity, enforce all rights of the Bond Owners, and require the
Issuer to carry out its obligations under this Indenture;
(ii) bring suit upon the Bonds;
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(iii) by action, suit or proceeding at law or in equity
require the Issuer to account for any moneys received by the Issuer as
if it were the trustee of an express trust for the Bond Owners; and
(iv) by action, suit or proceeding at law or in equity,
specifically enforce the provisions of the Loan Agreement or enjoin any
acts or things which may be unlawful or in violation of the rights of
the Bond Owners under this Indenture.
Any judgment against the Issuer shall be enforceable only against the Trust
Estate. There shall not be authorized any deficiency judgment against any assets
of, or the general credit of, the Issuer. Subject to the prior rights of the
Bond Owners, the Issuer shall be entitled to reimbursement for any of its
expenses in connection with such proceeding from any available funds in the
Trust Estate.
If an Event of Default shall have occurred and is continuing, and if
requested to do so by the Owners of not less than twenty-five percent (25%) in
aggregate principal amount of the Bonds then Outstanding, and if indemnified as
provided in Section 8.1(l) hereof, the Trustee shall be obligated (subject to
Section 7.4 hereof) to exercise one or more of the rights and powers conferred
by this Section 7.3 or by Section 7.2 hereof as the Trustee, being advised by
counsel, shall deem most expedient in the interests of the Bond Owners.
No remedy conferred upon or reserved to the Trustee or the Bond Owners
by the terms of this Indenture is intended to be exclusive of any other remedy,
but each and every such remedy shall be cumulative and shall be in addition to
any other remedy given to the Trustee or the Bond Owners hereunder or now or
hereafter existing at law or in equity. No delay or omission to exercise any
right or power accruing upon any default or Event of Default shall impair any
such right or power or shall be construed to be a waiver of any such default or
Event of Default or an acquiescence therein; and every such right and power may
be exercised from time to time as often as may be deemed expedient. No waiver of
any default or Event of Default hereunder, whether by the Trustee or the Bond
Owners, shall extend to or shall affect any subsequent default or Event of
Default or shall impair any right or remedy consequent thereon.
The above provisions, however, are subject to the condition that if,
after the principal of all the Bonds then Outstanding shall have been so
declared to be due and payable and prior to the entry of a judgment or decree
for the payment of any moneys due pursuant to the Bonds, this Indenture or the
Loan Agreement, all accrued and unpaid interest on the Bonds, at the applicable
rate per annum borne by the Bonds at the time of acceleration, and all other
sums payable under this Indenture, except the principal of, and interest on, the
Bonds which by such declaration shall have become due and payable, shall have
been paid by or on behalf of the Issuer, all other Events of Default hereunder
shall have been cured or waived, and the Issuer also shall have performed all
other things in respect of which it may have been in default under this
Indenture, and shall have paid the reasonable fees and expenses of the Trustee
and of the Owners of the Bonds, including reasonable attorneys' fees paid or
incurred then and in every such case, the Owners of not less than a majority in
aggregate principal amount of the Bonds then Outstanding, by written notice to
the Trustee may rescind and annul such declaration, whereupon the Trustee shall
give written notice thereof to the Issuer and the Borrower by registered mail.
Any such rescission and annulment shall be binding upon all holders of the
Bonds, but no such rescission and annulment shall extend to or affect any
subsequent default or impair any right or remedy consequent thereon.
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Section 7.4. Right of Bond Owners to Direct Proceedings. Anything in
this Indenture to the contrary notwithstanding, upon the occurrence and
continuance of an Event of Default, the Owners of a majority in aggregate
principal amount of the Bonds then Outstanding shall have the right, at any
time, by an instrument or instruments in writing executed and delivered to the
Trustee, to direct the method and place of conducting all proceedings to be
taken in connection with the enforcement of the terms and conditions of this
Indenture, or for the appointment of a receiver or for any other proceedings
hereunder; provided, however, that direction shall not be otherwise than in
accordance with the provisions of law and of this Indenture and shall not
involve the Trustee in personal liability.
Section 7.5. Appointment of Receiver. Upon the occurrence and
continuance of an Event of Default, and upon the filing of a suit or other
commencement of judicial proceedings to enforce the rights of the Trustee and
the Bond Owners under this Indenture, the Trustee shall be entitled, as a matter
of right, to request the appointment of a receiver or receivers of the Trust
Estate and of the revenues, issues, earnings, income, products and profits
thereof, pending such proceedings, with such powers as the court making such
appointment shall confer.
Section 7.6. Waiver of Certain Laws. Upon the occurrence of an Event of
Default, to the extent that such rights may then lawfully be waived, neither the
Issuer, nor anyone claiming through or under it, shall claim or seek to take
advantage of any appraisement, valuation, stay, extension or redemption laws now
or hereafter in force, in order to prevent or hinder the enforcement of this
Indenture. The Issuer, for itself and all who may claim through or under it,
hereby waives, to the extent that it lawfully may do so, the benefit of all such
laws.
Section 7.7. Application of Moneys. All moneys relating to the Bonds
received by the Trustee pursuant to any right given or action taken under the
provisions of this Article VII shall (after payment of the costs and expenses
(including legal fees and expenses) of the proceedings resulting in the
collection of such moneys and of the fees and expenses, liabilities and advances
of the Issuer, the Trustee and the Tender Agent, it being understood that such
payment shall not be made from any moneys already held for the benefit of the
Bond Owners in the Bond Purchase Fund or the Letter of Credit Revenue Account or
pursuant to Section 4.8) be deposited in the Accounts of the Revenue Fund as
required under Section 5.3 hereof, and all moneys in such Accounts shall be
applied as required under Section 5.4 hereof as follows:
(i) Unless the principal of all the Bonds Outstanding shall
have become or shall have been declared due and payable, all such moneys
shall be applied:
FIRST - To the payment to the persons entitled thereto of
all installments of interest then due on the Outstanding Bonds
and, if the amount available shall not be sufficient to pay in
full any particular installment, then to the payment ratably,
according to the amounts due on such installment, to the persons
entitled thereto, without any discrimination or privilege; and
SECOND - To the payment to the persons entitled thereto of
the unpaid principal of, and premium, if any, on, the Outstanding
Bonds which shall have become due (other than Bonds matured or
called for redemption for the payment of which moneys are already
held pursuant to the provisions of this Indenture) in the
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order of their due dates, and, if the amount available shall not
be sufficient to pay in full the principal of each Bond due on
any particular date, together with such premium, then to the
payment ratably, according to the amount of principal and premium
due on such date, to the persons entitled thereto, without any
discrimination or privilege.
(ii) If the principal of all the Outstanding Bonds shall
have become due or shall have been declared due and payable by
acceleration, all such moneys shall be applied to the payment of the
principal, premium, if any, and interest then due on such Bonds, without
preference or priority of principal and premium over interest or of
interest over principal and premium, or of any installment of interest
over any other installment of interest, or of any Bond over any other
Bond, ratably, according to the amounts due respectively for principal,
premium, if any, and interest, to the persons entitled thereto, without
any discrimination or privilege.
(iii) If the principal of all the Outstanding Bonds shall
have been declared due and payable by acceleration, and if such
declaration shall thereafter have been rescinded and annulled under the
provisions of this Article VII, then the moneys shall be applied in
accordance with the provisions of subsection (i) above; provided,
however, that in the event that the principal of all the Bonds shall
later become due or be declared due and payable by acceleration, the
moneys shall be applied in accordance with the provisions of subsection
(ii) above.
Whenever moneys are to be applied pursuant to the provisions of this Section
7.7, such moneys shall be applied at such times, and from time to time, as the
Trustee shall determine is appropriate upon due consideration of the amount of
such moneys available for application and the likelihood of additional moneys
becoming available for such application in the future.
Whenever the Trustee shall apply such funds it shall fix the date of
application, which shall be an Interest Payment Date unless it shall deem, in
the reasonable exercise of its discretion, another date more suitable. The
Trustee shall give such notice as it may deem appropriate of the deposit with it
of any such moneys and of the fixing of any such date.
For purposes of this Section, the term "principal" shall include the
principal component of the purchase price of the Bonds, and the term "interest"
shall include the interest component of the purchase price of the Bonds.
Section 7.8. Remedies Vested in Trustee. All rights of action (including
the right to file proofs of claim) under this Indenture and under the Bonds or
any Bond may be enforced by the Trustee without the possession of any Bond or
the production thereof in any trial or proceedings related thereto, and any such
suit or proceeding instituted by the Trustee shall be brought in its name as
Trustee without the necessity of joining as plaintiff or defendant the Owner of
any Bond.
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Section 7.9. Rights and Remedies of Bond Owners. No Owner of any Bond
shall have any right to institute any suit, action or proceeding in equity or at
law for the enforcement of this Indenture or for the execution of any trust
hereof or for the appointment of a receiver or any other remedy hereunder,
unless:
(i) an Event of Default has occurred of which the Trustee
has been notified as provided in Section 8.1(h) hereof, or of which by
said Section 8.1(h) the Trustee is deemed to have notice;
(ii) the Owners of not less than twenty-five percent (25%)
in aggregate principal amount of the Bonds then Outstanding shall have
made written request to the Trustee, and shall have offered the Trustee
reasonable opportunity either to proceed to exercise the powers
hereinbefore granted or to institute such action, suit or proceeding in
the name or names of such Owners, and shall have offered to the Trustee
indemnity as provided in Section 8.1(l) hereof; and
(iii) the Trustee shall thereafter fail or refuse to
exercise the powers hereinbefore granted, or to institute such action,
suit or proceeding in its own name, within 60 days;
and such notification, request and offer of indemnity are hereby declared in
every case, at the option of the Trustee, to be conditions precedent to the
execution of the powers and trusts of this Indenture (other than its obligations
to draw under any Letter of Credit as required to make payments of principal of,
premium, if any, and interest on the Bonds when due), and to any action or cause
of action for the enforcement of this Indenture, or for the appointment of a
receiver or for any other remedy hereunder. No one or more Owners of the Bonds
shall have any right in any manner whatsoever to affect, disturb or prejudice
the lien of this Indenture by such Owners' action, and all proceedings at law or
in equity shall be instituted, had and maintained in the manner herein provided
and (except as herein otherwise provided) for the equal and ratable benefit of
the Owners of all Bonds then Outstanding. Nothing in this Indenture, however,
shall affect or impair the right of any Bond Owner to enforce the payment of the
principal of, premium, if any, and interest on any Bond owned by such Bond Owner
at and after the maturity thereof, or the obligation of the Issuer to pay the
principal of, premium, if any, and interest on any Bond to the Owner thereof at
the time and place, from the source, and in the manner expressed in such Bond.
Nothing contained herein shall be construed as permitting or affording any Bond
Owner a right or cause of action against the Trustee or in respect of the Bonds
where a default has been waived under Section 7.11 hereof or cured under Section
7.12 hereof.
Section 7.10. Termination of Proceedings. In case the Trustee shall have
proceeded to enforce any right under this Indenture by the appointment of a
receiver or otherwise, and such proceedings shall have been discontinued or
abandoned for any reason, or shall have been determined adversely to the
Trustee, then and in every such case the Issuer, the Trustee and the Bond Owners
shall be restored to their former positions and rights hereunder, and all
rights, remedies and powers of the Trustee shall continue as if no such
proceedings had been taken.
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Section 7.11. Waivers of Events of Default. The Trustee may in its
discretion waive any Event of Default hereunder and its consequences, and shall
do so upon the written request of the Owners of a majority in aggregate
principal amount of the Bonds then Outstanding; provided, however, that the
Trustee may not waive an Event of Default described in subparagraph (i) of
Section 7.1 hereof without the consent of the registered Owners of all Bonds
then Outstanding.
Section 7.12. Notice of Default; Opportunity to Cure Defaults. Anything
herein to the contrary notwithstanding, no failure to act under Section 7.1(ii)
hereof shall constitute an Event of Default until actual notice of such failure
by registered or certified mail shall be given to the Issuer and the Borrower by
the Trustee, or to the Issuer, the Borrower and the Trustee by the Owners of not
less than twenty-five percent (25%) in aggregate principal amount of all Bonds
Outstanding, any such notice to specify the failure, require it to be remedied
and to state that such notice is a "Notice of Default" hereunder, and the Issuer
and the Borrower shall have had sixty (60) days after receipt of such notice at
their option to correct such failure or to cause such failure to be corrected,
and shall not have corrected such failure or caused such failure to be corrected
within the applicable period; provided, however, that if such failure be such
that it cannot be corrected within the applicable period, it shall not
constitute an Event of Default if corrective action is instituted by the Issuer
and the Borrower, or either of them, within the applicable period and diligently
pursued until the default is corrected.
With regard to any failure to act for which notice is given under the
provisions of this Section 7.12, the Issuer, to the full extent permitted by
law, hereby grants the Borrower full authority to perform and observe for the
account of the Issuer any covenant or obligation alleged in said notice not to
have been performed or observed in the name and stead of the Issuer with full
power to do any and all things and acts to the same extent that the Issuer could
do and perform any such things and acts, with power of substitution.
ARTICLE VIII
THE TRUSTEE, TENDER AGENT AND REMARKETING AGENT
Section 8.1. Acceptance of Trusts. The Trustee hereby accepts the trusts
imposed upon it by this Indenture, and agrees to perform said trusts, but only
upon and subject to the following express terms and conditions:
(a) The Trustee, prior to the occurrence of an Event of Default
and after the curing or waiving of all Events of Default which may have
occurred, undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture and no implied covenants or
obligations shall be read into this Indenture against the Trustee. In
case an Event of Default has occurred (which has not been cured or
waived), the Trustee shall exercise such of the rights and powers vested
in it by this Indenture, and use the same degree of care and skill in
their exercise, as a prudent person would exercise or use under the
circumstances in the conduct of such person's affairs.
(b) The Trustee may execute any of the rights or powers hereunder
or perform any duties hereunder either directly or by or through agents,
receivers or attorneys and the Trustee shall not be responsible for the
acts of such agents, receivers or attorneys if selected
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and appointed by the Trustee with due care; provided that any such
agents or attorneys shall be responsible for their acts to the same
extent as the Trustee would have been responsible had the Trustee
performed such acts itself. The Remarketing Agent shall not be deemed an
agent of the Trustee for any purpose, and the Trustee shall not be
responsible for the compliance of the Remarketing Agent with its
obligations under this Indenture or in connection with the transactions
contemplated herein. The Trustee shall be entitled to the advice of
counsel (which may be an employee of the Trustee or an affiliate of the
Trustee) concerning all matters of trust hereof and its duties
hereunder, and in all cases may pay such reasonable compensation to all
such attorneys, agents, receivers and employees as may reasonably be
employed in connection with the trust hereof. The Trustee may act upon
the opinion or advice of any attorneys approved by the Trustee in the
exercise of reasonable care. The Trustee shall not be responsible for
any loss or damage resulting from any action or non-action exercised in
good faith in reliance upon such opinion or advice.
(c) The Trustee shall not be responsible for any recital herein
or in the Bonds (other than the certificate of authentication thereon),
the legality, sufficiency or validity of this Indenture, the Loan
Agreement, the Bonds or any document or instrument relating hereto or
thereto; the recording or filing of any instrument required by this
Indenture to secure the Bonds; the validity of the execution by the
Issuer of this Indenture or of any supplement hereto or amendment hereof
or of any instrument of further assurance; or the validity, priority,
perfection or sufficiency of the security for the Bonds issued hereunder
or intended to be secured hereby, or otherwise as to the maintenance of
the security hereof.
(d) The Trustee shall not be accountable for the use of any Bonds
authenticated or delivered hereunder. The Trustee may in good faith buy,
sell, own and hold any of the Bonds (or beneficial interests therein)
and may join in any action which any Bond Owner may be entitled to take
with like effect as if the Trustee were not a party to this Indenture.
The Trustee may also engage in or be interested in any financial or
other transaction with the Issuer, the Tender Agent, the Remarketing
Agent, any Letter of Credit Issuer or the Borrower; provided, however,
that if the Trustee determines that any such relationship is in conflict
with its duties under this Indenture, it shall eliminate the conflict or
resign as Trustee. To the extent permitted by law, the Trustee may also
purchase Bonds (or beneficial interests therein) with like effect as if
it were not the Trustee.
(e) The Trustee shall be protected in acting upon, and may
conclusively rely upon, any notice, request or other paper or document
reasonably believed by it to be genuine and correct, and reasonably
believed by it to have been signed or sent by the proper person or
persons. Any action taken by the Trustee pursuant to this Indenture or
the Loan Agreement upon the request, authority or consent of any person,
who at the time of making such request or giving such authority or
consent is the Owner of any Bond, shall be conclusive and binding upon
all future Owners of the same Bond and any Bond issued in replacement
therefor.
(f) As to the existence or nonexistence of any fact, or as to the
sufficiency or validity of any instrument, paper or proceeding, the
Trustee shall be entitled to rely upon a certificate signed by a duly
authorized representative of the Issuer, the Tender Agent, the
Remarketing Agent or the Borrower as sufficient evidence of the facts
therein contained; and
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prior to the occurrence of a default of which the Trustee has been
notified as provided in subsection (h) of this Section 8.1, or of which
by said subsection (h) it is deemed to have notice, the Trustee shall
also be at liberty to accept a similar certificate to the effect that
any particular dealing, transaction or action is necessary or expedient.
The Trustee may, at its discretion, secure such further evidence
(including, but not limited to, legal opinions) deemed necessary or
advisable by it, but shall in no case be bound to secure the same. The
Trustee may accept a certificate of the officer of the Issuer charged
with the maintenance of its books and records over the seal of the
Issuer to the effect that a resolution or ordinance in the form therein
set forth has been adopted and is in full force and effect.
(g) The right of the Trustee to perform any discretionary act
enumerated in this Indenture shall not be construed as a duty. No
provision of this Indenture shall be construed to relieve the Trustee
from liability for its negligence or willful misconduct in the
performance of its powers and duties under this Indenture, except that
(i) this subsection shall not be construed to limit the
effect of subsection (a) of this Section;
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates
or opinions furnished to the Trustee and conforming to the
requirements of this Indenture or the Loan Agreement, as the case
may be;
(iii) the Trustee shall not be liable for any error of
judgment made in good faith by its officers, unless it shall be
proved that the Trustee was negligent in ascertaining the
pertinent facts;
(iv) the Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in good faith in
accordance with any direction of Bond Owners given pursuant to
Section 7.4; and
(v) no provision of this Indenture shall be deemed to require
the Trustee to expend or risk its own funds or otherwise incur
any financial liability in the performance of any of its duties
hereunder, or in the exercise of its rights or powers.
(h) The Trustee shall not be required to take notice or be deemed
to have notice of any default or Event of Default hereunder or under the
Loan Agreement, or in any other document or instrument executed in
connection with the execution and delivery of the Bonds, except an Event
of Default under Section 7.1(i) hereof, unless the Trustee shall be
specifically notified in writing of such default or Event of Default by
the Issuer, the Tender Agent, the Borrower or the Owners of at least
twenty-five percent (25%) in aggregate principal amount of the Bonds
then Outstanding. All notices or other instruments required by this
Indenture to be delivered to the Trustee shall be delivered at the
Principal Office of the Trustee, and, in the absence of such notice so
delivered, the Trustee may conclusively assume there is no default or
Event of Default except as aforesaid.
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(i) At any and all reasonable times, and upon prior notice, the
Trustee and its duly authorized agents, attorneys, experts, engineers,
accountants and representatives shall have the right (but not any duty)
to inspect fully all books, papers and records of the Issuer pertaining
to this Indenture, the Loan Agreement, the Tax Certificate and the
Bonds, and to take such photocopies and memoranda therefrom and in
regard thereto as may be desired.
(j) The Trustee shall not be required to give any bond or surety
in respect of the execution of the trust created hereby or the powers
granted hereunder.
(k) Notwithstanding anything contained elsewhere in this
Indenture to the contrary, the Trustee shall have the right, but not the
obligation, to demand, in respect of the withdrawal of any cash, the
release of any property, or the taking of any action whatsoever within
the purview of this Indenture or the Loan Agreement, any showing,
certificate, opinion, appraisal or other information, or corporate
action or evidence thereof, in addition to that required by the terms
hereof as a condition of such action by the Trustee, as deemed desirable
for the purposes of establishing the right of the Issuer or the Borrower
to the withdrawal of any cash, the release of any property or the taking
of any other action by the Trustee.
(l) Before taking any action referred to in Article VII or
Section 8.3 hereof (except with respect to acceleration of the Bonds,
payment of the Bonds upon such acceleration or their due date or
requests for payment under any Letter of Credit) the Trustee may require
that a satisfactory indemnity bond be furnished for the reimbursement of
all expenses which it may incur and to protect it against all liability,
except liability which is adjudicated to have resulted from its
negligence or willful misconduct, by reason of any action so taken.
(m) All moneys received by the Trustee shall, until used, applied
or invested as herein provided, be held in trust for the purposes for
which they were received, but need not be segregated from other funds,
except to the extent required by law or this Indenture. The Trustee
shall be under no liability for interest on any moneys received by it
hereunder.
(n) Notwithstanding the effective date of this Indenture or
anything to the contrary in this Indenture, the Trustee shall have no
liability or responsibility for any act or event relating to this
Indenture which occurs prior to the date the Trustee formally executes
this Indenture and commences acting as Trustee hereunder.
(o) The Trustee has no obligation or liability to the Bond Owners
for the payment of interest or premium, if any, on, or principal or
purchase price of, the Bonds, but rather the Trustee's sole obligations
are to administer, for the benefit of the Borrower and the Bond Owners,
the various Funds and Accounts established hereunder.
(p) Notwithstanding the final payment of the principal of or
interest on the Bonds, whether at maturity, upon redemption or
otherwise, the duties of the Trustee under Section 5.9 of this Indenture
shall survive the termination of this Indenture.
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(q) Any request or direction of the Issuer, any Letter of Credit
Issuer or the Borrower mentioned herein or in the Loan Agreement shall
be sufficiently evidenced by a writing signed by any authorized officer
thereof.
(r) The Trustee shall have no responsibility with respect to any
information, statement, or recital in any official statement, offering
memorandum or any other disclosure material prepared or distributed with
respect to the Bonds.
(s) The Trustee and the Tender Agent may rely upon any
representation that a party is a Beneficial Owner or a Direct
Participant for purposes of this Indenture.
(t) The Tender Agent shall be entitled to the same protections,
immunities and limitations from liability afforded the Trustee
hereunder.
(u) The Trustee is authorized and directed in its capacity as
Trustee to enter into the Loan Agreement, the Regulatory Agreements and
the Redemption Agreement.
Section 8.2. Annual Fees, Charges and Expenses of Trustee and Tender
Agent. The Trustee and the Tender Agent shall be entitled to reasonable
compensation for all services, including any extraordinary services, rendered by
them under this Indenture. In addition, the Trustee and the Tender Agent shall
be entitled to reimbursement for their charges and expenses (including
reasonable counsel fees and expenses) incurred in connection with such services
and to indemnity against losses, liabilities and expenses. Such compensation,
reimbursement and indemnity shall be paid by the Borrower pursuant to Section
9.3 of the Loan Agreement; provided, however, that to the extent not so paid,
the Trustee may make disbursements from the Borrower Revenue Account of the
Revenue Fund to pay such amounts. The Trustee's and the Tender Agent's right to
receive compensation, reimbursement of expenses and indemnity under this Section
8.2 and under the applicable provisions of the Loan Agreement shall be secured
by a prior lien upon the Trust Estate (excluding that portion of the Trust
Estate consisting of funds received from drawings under a Letter of Credit and
funds already held for the benefit of particular Bond Owners pursuant to any
other provisions of this Indenture, as to which such lien shall be subordinate
to the lien created hereby for the benefit of the Bond Owners). The Issuer has
required the Borrower, pursuant to the Loan Agreement, to indemnify and hold
harmless the Trustee and the Tender Agent against any liabilities which the
Trustee and the Tender Agent may incur in the exercise and performance of their
powers and duties hereunder and under any other agreement referred to herein
which are not due to the Trustee's or the Tender Agent's negligence or willful
misconduct, and for any fees and expenses of the Trustee and the Tender Agent to
the extent funds are not available under this Indenture for the payment thereof.
The rights of the Trustee and the Tender Agent under this Section 8.2 shall
survive the payment in full of the Bonds and the discharge of this Indenture.
Section 8.3. Notice to Bond Owners of Default. If a default occurs of
which the Trustee is required by Section 8.1(h) hereof to take notice or of
which notice of default is given as provided in Section 8.1(h) hereof, then the
Trustee shall promptly give written notice thereof by first class mail, postage
prepaid, to each Owner of Bonds then Outstanding. The Trustee shall promptly
give written notice to the Remarketing Agent, the Issuer, any Letter of Credit
Issuer, the Rating Agency (subject to the last sentence of Section 4.16) and the
Borrower by certified mail of any such notice of default sent to any Owner of
Bonds as provided hereunder.
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Section 8.4. Intervention by Trustee. In any judicial proceeding to
which the Issuer or the Borrower is a party, and which, in the opinion of the
Trustee and its counsel, has a substantial bearing on the interests of the
Owners of the Outstanding Bonds, the Trustee may intervene on behalf of the
Owners of the Bonds and shall do so if requested in writing by the Owners of at
least twenty-five percent (25%) in aggregate principal amount of the Bonds then
Outstanding, and when provided with sufficient indemnity pursuant to Section
8.1(l) hereof.
Section 8.5. Successor Trustee by Merger or Otherwise. Any corporation
or association into which the Trustee may be converted or merged, with which it
may be consolidated, or to which it may sell or transfer its trust business and
assets as a whole or substantially as a whole, or any corporation or association
resulting from any such conversion, sale, merger, consolidation or transfer to
which it is a party, ipso facto, shall be and become the Trustee hereunder
vested with all of the title to the Trust Estate and all the trusts, powers,
discretions, immunities, privileges, responsibilities, obligations and all other
matters as was its predecessor, without the execution or filing of any
instrument or any further act, deed or conveyance on the part of any of the
parties hereto, anything herein to the contrary notwithstanding; provided,
however, that such successor Trustee meets the requirements of Section 8.14(a)
hereof.
Section 8.6. Resignation by Trustee. The Trustee may resign from the
trusts hereby created by giving written notice to the Issuer, the Borrower, any
Letter of Credit Issuer, the Tender Agent, the Remarketing Agent and the Owners
of the Bonds then Outstanding, and shall so resign whenever it ceases to be
qualified to act as Trustee hereunder. Such notice shall be sent by certified
mail, postage prepaid, to the Bond Owners. Such resignation shall take effect
only upon the appointment of a successor Trustee. If no successor Trustee is
appointed pursuant to Section 8.8 hereof within thirty (30) days after the
delivery of such notice, the resigning Trustee may petition any court of
competent jurisdiction for the appointment of a successor Trustee.
Section 8.7. Removal of Trustee. The Trustee may be removed at any time
by the Borrower, so long as no event of default has occurred and is continuing
under the Loan Agreement, by the Issuer, or, if the Issuer is in default
hereunder, by an instrument or substantially concurrent instruments in writing
delivered to the Issuer, the Trustee, the Tender Agent, the Remarketing Agent
and signed by the holders of more than fifty percent (50%) in aggregate
principal amount of the Bonds outstanding. Such removal shall take effect only
upon the appointment of a successor Trustee.
Section 8.8. Appointment of Successor Trustee. In case the Trustee shall
resign, be removed, be dissolved, be in the course of dissolution or liquidation
or otherwise become incapable of acting or not be qualified to act hereunder, or
in case the Trustee shall be taken under the control of any public officer or
officers or a receiver appointed by a court, a successor may be appointed by the
Issuer, with the consent of the Borrower, and notice to the Remarketing Agent,
the Tender Agent and the Bond Owners. Such notice shall be sent by first class
mail, postage prepaid, to the Bond Owners.
Section 8.9. Successor Trustee. Every successor Trustee appointed
hereunder shall execute, acknowledge and deliver to its predecessor, the Tender
Agent, the Remarketing Agent, the Borrower, any Letter of Credit Issuer and the
Issuer an instrument in writing accepting such appointment hereunder, and
thereupon such successor, without any further act, deed or conveyance,
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shall become fully vested with the title to the Trust Estate and all of the
trust powers, discretions, immunities, privileges, responsibilities, obligations
and all other matters of its predecessor; but such predecessor shall,
nevertheless, on the written request of the Issuer, or of its successor Trustee,
execute and deliver an instrument transferring to such successor Trustee all the
estates, properties, rights, powers and trusts of such predecessor hereunder;
and every predecessor Trustee shall, upon payment of its charges, deliver all
securities and moneys held by it as the Trustee hereunder to its successor
Trustee. Should any instrument in writing from the Issuer be required by any
successor Trustee for more fully and certainly vesting in such successor the
estates, rights, powers and duties hereby vested or intended to be vested in the
predecessor any and all such instruments in writing shall, on request, be
executed, acknowledged and delivered by the Issuer. The resignation of any
Trustee and the instrument or instruments removing any Trustee and appointing a
successor hereunder, together with all other instruments provided for in this
Article VIII, shall be filed and/or recorded by the successor Trustee in each
recording office where this Indenture shall have been filed and/or recorded. No
appointment of a successor Trustee hereunder shall become effective unless such
successor meets the requirements of Section 8.14(a) hereof.
Section 8.10. Appointment of Tender Agent. (a) The initial Tender Agent
hereunder shall be U.S. Bank Trust National Association. The Tender Agent shall
have power to act (i) in the authentication and delivery of Bonds in connection
with transfers and exchanges, and (ii) in effecting purchases and sales of Bonds
pursuant hereto, receiving notices of tender for purchase, making deliveries of
Bonds and holding Bonds pursuant hereto. For all purposes of this Indenture, the
authentication and delivery of Bonds by the Tender Agent shall be deemed to be
the authentication and delivery of Bonds "by the Trustee."
(b) Any successor corporation or association to the initial Tender Agent
is otherwise eligible under this Section to act as Tender Agent, without the
execution or filing of any document or any further act on the part of the
parties hereto, the Tender Agent or such successor corporation or association;
provided, however, that such successor corporation or association meets the
requirements of paragraph (c) below.
(c) The Tender Agent may at any time resign by giving thirty (30) days'
written notice of resignation to the Trustee, any Letter of Credit Issuer, the
Borrower, the Remarketing Agent and the Issuer, and by mailing notice of such
resignation by first class mail to the registered owners of the Bonds. The
Borrower may at any time terminate the agency of any Tender Agent by giving
written notice of termination to such Tender Agent, the Trustee, any Letter of
Credit Issuer, the Remarketing Agent and the Issuer, and by mailing notice of
such termination by certified mail to the registered owners of the Bonds. Such
resignation or termination shall take effect only upon the Trustee's assumption
of the duties of the Tender Agent or upon the appointment by the Trustee, upon
the direction of the Borrower, of a successor Tender Agent, and the acceptance
by the successor Tender Agent of such appointment. Any successor to the Tender
Agent (i) shall at all times be a commercial bank or trust company, (ii) shall
at all times be organized and doing business under the laws of the United States
or of any state, (iii) shall have a combined capital and surplus of at least
$50,000,000, (iv) shall be authorized under such laws to exercise corporate
trust powers, (v) shall be subject to supervision or examination by federal or
state authority, and (vi) shall have a rating at least "Baa3" or "P-3" by
Moody's (or Moody's shall have provided written evidence that such successor is
otherwise acceptable to Moody's) if the Bonds are then rated by Moody's and at
least "BBB-" or "A-3" by Standard & Poor's (or Standard & Poor's shall have
provided written evidence
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that such successor is otherwise acceptable to Standard & Poor's) if the Bonds
are then rated by Standard & Poor's . If such successor Tender Agent publishes
reports of condition at least annually pursuant to law or the requirements of
federal or state authority, then for the purposes of this Section, the combined
capital and surplus of such successor Tender Agent shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. Upon receiving such a notice of resignation or upon such a
termination, or in case at any time any successor Tender Agent shall cease to be
eligible under this Section, the Trustee shall either assume the duties of the
Tender Agent, or the Trustee shall appoint a successor Tender Agent upon the
direction of the Borrower; and in such event the Trustee shall give written
notice of such assumption or appointment to the Issuer, the Borrower, any Letter
of Credit Issuer and the Remarketing Agent, and shall mail notice of such
assumption or appointment by certified mail to all registered owners of the
Bonds. The Trustee agrees to furnish to the Tender Agent and the Rating Agencies
(subject to the final sentence of Section 4.16), if the Bonds are rated, a copy
of all notices sent to, or delivered by, it under this Section. The Tender Agent
shall be entitled to all exculpations and indemnifications granted to the
Trustee, as applicable, pursuant to this Article VIII.
Section 8.11. Remarketing Agent. The Borrower shall appoint a
Remarketing Agent for the Bonds at least 90 days prior to the end of the initial
Term Rate Periods.
Section 8.12. Qualifications of Successor Remarketing Agents;
Resignation or Removal of Remarketing Agents. (a) Each successor Remarketing
Agent shall be (i) an institution rated at least "Baa3" or "P-3" by Moody's (or
Moody's shall have provided written evidence that such successor Remarketing
Agent is otherwise acceptable to Moody's) if the Bonds are then rated by
Moody's, and at least "BBB-" or "A-3" by Standard & Poor's (or Standard & Poor's
shall have provided written evidence that such successor Remarketing Agent is
otherwise acceptable to Standard & Poor's) if the Bonds are then rated by
Standard & Poor's, (ii) acceptable to any Letter of Credit Issuer, and (iii)
authorized by law to perform all the duties imposed upon it by this Indenture.
So long as the Bonds are held in a book-entry only system, each successor
Remarketing Agent shall be the sole participant in such system with respect to
the Bonds.
(b) A Remarketing Agent (whether initial or successor) may at any time
resign and be discharged of the duties and obligations created by this Indenture
by giving at least thirty (30) days' written notice to the Issuer, the Borrower,
any Letter of Credit Issuer, the Tender Agent and the Trustee (with a copy
thereof mailed by certified mail to each of the Bond Owners). A Remarketing
Agent (whether initial or successor) may be removed at any time by an instrument
signed by the Borrower, and filed, at least thirty (30) days prior to such
removal, with the Remarketing Agent, any Letter of Credit Issuer, the Issuer and
with the Trustee. No removal or resignation hereunder shall become effective
prior to the earlier to occur of (i) acceptance of appointment of a successor
Remarketing Agent hereunder, or (ii) thirty (30) days from the date of the
notices described in this Section.
Section 8.13. Appointment of Separate or Co-Trustee. It is the intent of
the parties to this Indenture that there shall be no violations of any law of
any jurisdiction (including particularly the laws of the State) denying or
restricting the rights of banking corporations or associations to transact
business as a trustee in such jurisdiction. It is recognized that in case of
litigation under this Indenture, and in particular in the case of the
enforcement of this Indenture on default, or in case the Trustee deems that by
reason of any present or future law of any jurisdiction it may not exercise any
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of the powers, rights or remedies herein granted to the Trustee, or hold title
to the properties, in trust, as herein granted, or take any other action which
may be desirable or necessary in connection therewith, it may be necessary that
the Trustee appoint an additional individual or institution as a separate
trustee or co-trustee. The following provisions of this Section 8.13 are adapted
to these ends.
If the Trustee appoints an additional individual or institution as a
separate trustee or co-trustee to exercise such powers, rights or remedies, to
hold such title or to take such action, each and every remedy, power, right,
claim, demand, cause of action, immunity, estate, duty, obligation, title,
interest and lien expressed or intended by this Indenture to be exercised by,
vested in or conveyed to the Trustee with respect thereto shall be exercisable
by, vested in and conveyed to such separate trustee or co-trustee, but only to
the extent necessary to enable such separate trustee or co-trustee to exercise
such powers, rights and remedies, to hold such title or to take such action and
every covenant and obligation necessary for the exercise thereby by such
separate trustee or co-trustee shall run to and be enforceable by either of
them.
Should any instrument in writing from the Issuer be required by the
separate trustee or co-trustee so appointed by the Trustee for more fully
vesting in and confirming to them such properties, rights, powers, trusts,
duties and obligations, any and all such instruments in writing shall, on
request, be executed, acknowledged and delivered by the Issuer. If any separate
trustee or co-trustee, or a successor to either, shall die, become incapable of
acting or not be qualified to act, resign or be removed, all the estates,
properties, rights, powers, trusts, duties and obligations of such separate
trustee or co-trustee, so far as permitted by law, shall vest in and be
exercised by the Trustee until the appointment of a successor to such separate
trustee or co-trustee.
Section 8.14. Qualifications. (a) Each successor to the Trustee and each
institutional co-trustee (if any) shall at all times be a bank or trust company,
which (i) is organized as a banking corporation or association and doing
business under the laws of the United States or any state thereof, (ii) is
authorized under such laws to exercise corporate trust powers, (iii) is subject
to supervision or examination by federal or state authority, (iv) has combined
capital and surplus (as set forth in its most recent published report of
condition) of at least $50,000,000, and (v) shall not have become incapable of
acting or have been adjudged a bankrupt or an insolvent nor have had a receiver
appointed for itself or for any of its property, nor have had a public officer
take charge or control of it or its property or affairs for the purpose of
rehabilitation, conservation or liquidation.
(b) Should any successor to the Trustee or any institutional co-trustee
at any time cease to be eligible, pursuant to this Section 8.14, to act as
successor Trustee or co-trustee (as the case may be), it shall promptly notify
the Owners of all Outstanding Bonds, the Issuer, the Borrower, any Letter of
Credit Issuer, the Remarketing Agent and the Tender Agent of such fact; such
notice shall be sent by certified mail, postage prepaid, to the Bond Owners. Any
such notice shall set forth all the relevant facts known to the Trustee or such
co-trustee (as the case may be).
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ARTICLE IX
SUPPLEMENTAL INDENTURES
Section 9.1. Supplemental Indentures Not Requiring Consent of Bond
Owners. Subject to the terms and provisions of Sections 9.3 and 9.4 of this
Indenture, the Issuer and the Trustee may, without the consent of, or notice to,
any of the Bond Owners, enter into an indenture or indentures supplemental to
this Indenture, not inconsistent with the terms and provisions hereof, for any
one or more of the following purposes: (i) to cure any ambiguity, formal defect
or omission in this Indenture; (ii) to grant to or confer upon the Trustee, for
the benefit of the Bond Owners, any additional rights, remedies, powers or
authorities that may lawfully be granted to or conferred upon the Bond Owners or
the Trustee; (iii) to subject to this Indenture additional revenues, properties
or collateral; (iv) to modify, amend or supplement this Indenture, or any
indenture supplemental hereto, in such manner as to permit the qualification
hereof and thereof under the Trust Indenture Act of 1939, as amended, or any
similar federal statute hereafter in effect, or to permit the qualification of
the Bonds for sale under the securities laws of any of the states of the United
States, and if the Issuer so determines, to add to this Indenture or any
indenture supplemental hereto such other terms, conditions and provisions as may
be permitted by the Trust Indenture Act of 1939, as amended, or any similar
federal statute; (v) to add to the covenants and agreements of the Issuer
contained in this Indenture other covenants and agreements thereafter to be
observed for the protection of the Bond Owners or to surrender or limit any
right, power or authority herein reserved to or conferred upon the Issuer; (vi)
to modify, amend or supplement this Indenture, or any indenture supplemental
hereto, in any manner, provided that such modification, amendment or supplement
does not take effect until the next succeeding Conversion Date or commencement
of a Term Rate Period; and (vii) to make any other change which does not have a
material adverse effect upon the interests of the Bond Owners.
Section 9.2. Supplemental Indentures Requiring Consent of Bond Owners.
Exclusive of supplemental indentures covered by Section 9.1 hereof, this
Indenture may be amended or supplemented only as provided in this Section 9.2.
Subject to the terms and provisions contained in Sections 9.3 and 9.4 of this
Indenture, the Owners of more than fifty percent (50%) in aggregate principal
amount of the Bonds then Outstanding shall have the right, from time to time, to
approve the execution by the Issuer and the Trustee of such indenture or
indentures supplemental hereto as shall be deemed necessary and desirable by the
Issuer for the purposes of modifying, altering, amending, adding to or
rescinding, in any particular, any of the terms or provisions contained in this
Indenture or in any supplemental indenture. If at any time the Issuer shall
request the Trustee to enter into any such supplemental indenture for any of the
purposes of this Section, the Trustee shall, upon being satisfactorily
indemnified with respect to expenses, cause notice of the proposed execution of
such supplemental indenture to be mailed by certified mail to the Bond Owners.
Such notice shall briefly set forth the nature of the proposed supplemental
indenture and shall state that copies thereof are on file at the principal
corporate trust office of the Trustee for inspection by all Bond Owners. If,
within sixty (60) days, or such longer period as shall be prescribed by the
Issuer, following the mailing of such notice, the Owners of the requisite
percentage in aggregate principal amount of the Bonds Outstanding at the time of
the execution of any such supplemental indenture shall have consented to and
approved the execution thereof as herein provided, no Owner of any Bond shall
have any right to object to any of the terms and provisions contained therein,
or the operation thereof; or in any manner to question the propriety of the
execution thereof; or to enjoin or
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restrain the Trustee or the Issuer (subject to Section 9.4) from executing the
same or from taking any action pursuant to the provisions thereof. Upon the
execution of any such supplemental indenture as in this Section and Section 9.4
permitted and provided, this Indenture shall be and be deemed to be modified and
amended in accordance therewith.
Section 9.3. Limitation Upon Amendments and Supplements. Nothing
contained in Sections 9.1 and 9.2 hereof shall permit, or be construed as
permitting, without the consent and approval of the Owners of all of the Bonds
then Outstanding (i) an extension of the maturity of the principal of, or the
time for payment of any redemption premium or interest on, any Bond or a
reduction in the principal amount of any Bond, or the rate of interest or
redemption premium thereon, or a reduction in the amount of, or extension of the
time of any payment required by, any Bond; (ii) a privilege or priority of any
Bond over any other Bond (except as herein provided); (iii) a reduction in the
aggregate principal amount of the Bonds required for consent to such a
supplemental indenture; (iv) the deprivation of the Owner of any Bond then
Outstanding of the lien created by this Indenture; or (v) the amendment of this
Section 9.3. No amendment or supplement to this Indenture may be entered into
without the Trustee and the Issuer first receiving (a) a Favorable Opinion of
Bond Counsel; and (b) written evidence from each Rating Agency then rating the
Bonds (if the Bonds are then rated) to the effect that such Rating Agency has
reviewed the amendment or supplement, and that the effectiveness thereof will
not, by itself, result in a reduction or withdrawal of such Rating Agency's then
current rating on the Bonds.
Section 9.4. Consent of Trustee, Letter of Credit Issuer, Borrower,
Remarketing Agent and Tender Agent Required. This Indenture may not be amended
without the consent of the Trustee and any Letter of Credit Issuer. The Trustee
shall not be required to give its consent to any amendment which shall increase
its duties, responsibilities, obligations or standards of care or decrease the
protections afforded by this Indenture. Anything herein to the contrary
notwithstanding, an amendment or supplemental indenture under this Article IX
shall not become effective unless and until the Borrower shall have consented in
writing to the execution and delivery thereof; provided, however, that the
consent of the Borrower shall not be required during any period that an event of
default exists under the Loan Agreement. The Trustee shall inform the Tender
Agent and the Remarketing Agent of any amendment or supplement to this Indenture
affecting the respective rights and obligations of the Tender Agent and the
Remarketing Agent, and such amendment or supplement shall not become effective
unless and until the Tender Agent or the Remarketing Agent, as the case may be,
shall have consented in writing to the provisions thereof which affect its
rights and obligations.
ARTICLE X
AMENDMENT OF CERTAIN LOAN DOCUMENTS
Section 10.1. Amendments of Loan Agreement and Tax Certificate Not
Requiring Consent of Bond Owners. Subject to the terms and provisions of
Sections 10.3 and 10.4 of this Indenture, the Issuer and the Borrower may, with
the prior written consent of the Trustee, amend or modify the Loan Agreement or
the Tax Certificate, or any provision thereof, or may consent to the amendment
or modification thereof, in any manner not inconsistent with the terms and
provisions of this Indenture, for any one or more of the following purposes: (i)
to cure any ambiguity or formal defect in the Loan Agreement or the Tax
Certificate; (ii) to grant to or confer upon the Issuer or the Trustee,
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for the benefit of the Bond Owners, any additional rights, remedies, powers or
authorities that lawfully may be granted to or conferred upon the Issuer or the
Trustee; (iii) to amend or modify the Loan Agreement or the Tax Certificate, or
any part thereof, in any manner specifically required or permitted by the terms
thereof, including, without limitation, as may be necessary to maintain the
exclusion from gross income for purposes of federal or State income taxation of
the interest on the Bonds; (iv) to amend or modify the Loan Agreement in any
manner, provided that such amendment or modification shall not take effect until
the next succeeding Conversion Date or commencement of a Term Rate Period; and
(v) to make any other change which does not have a material adverse effect upon
the interests of the Bond Owners.
Section 10.2. Amendments of Loan Agreement and Tax Certificate Requiring
Consent of Bond Owners. Exclusive of amendments and modifications covered by
Section 10.1 hereof, the Loan Agreement or the Tax Certificate may be amended or
modified with the prior written consent of the Trustee only as provided in this
Section 10.2. Subject to the terms and provisions contained in Sections 10.3 and
10.4 of this Indenture, the Owners of greater than fifty percent (50%) in
aggregate principal amount of the Bonds then Outstanding shall have the right,
from time to time, to consent to and approve any amendment or modification of
the Loan Agreement or the Tax Certificate as shall be deemed necessary and
desirable by the Trustee for the purpose of amending and modifying, in any
particular, any of the terms or provisions contained in the Loan Agreement or
the Tax Certificate. If at any time the Trustee shall be asked to enter into or
to consent to any such amendment or modification, the Trustee shall, upon being
satisfactorily indemnified with respect to expenses, cause notice of the
proposed execution of such modification or amendment to be mailed by certified
mail to the Bond Owners. Such notice shall briefly set forth the nature of the
proposed amendment or modification and shall state that copies thereof are on
file at the principal corporate trust office of the Trustee for inspection by
the Bond Owners. If, within sixty (60) days, or such longer period as shall be
prescribed by the Issuer, following the mailing of such notice, the Owners of
the requisite percentage in aggregate principal amount of the Bonds Outstanding
at the time of the execution of any such amendment or modification shall have
consented to and approved the execution thereof as herein provided, no Owner of
any Bond shall have any right to object to any of the terms and provisions
contained therein, or the operation thereof; or in any manner to question the
propriety of the execution thereof; or to enjoin or restrain the Trustee or the
Issuer from executing or consenting to the same or from taking any action
pursuant to the provisions thereof.
Section 10.3. Limitation Upon Amendment of Loan Agreement. Nothing
contained in Sections 10.1 and 10.2 of this Indenture shall permit, or be
construed as permitting, without the approval and consent of the Owners of all
of the Bonds then Outstanding, (i) the extension of the time for any payment
under the Loan Agreement or a reduction in the amount of any payment under the
Loan Agreement, or (ii) the payment to any person other than the Trustee and the
Tender Agent as provided herein of any amount (except amounts due under Sections
7.11, 8.5 and 9.3 of the Loan Agreement) due under the Loan Agreement. No
amendment of the Loan Agreement may be entered into without the Trustee and the
Issuer first receiving (a) a Favorable Opinion of Bond Counsel, and (b) written
evidence from each Rating Agency then rating the Bonds (if the Bonds are then
rated) to the effect that the appropriate Rating Agency has reviewed the
amendment, and that the effectiveness thereof will not, by itself, result in a
reduction or withdrawal of such Rating Agency's then current rating on the
Bonds. The Trustee shall not be required to give its consent to any amendment of
the Loan Agreement or the Tax Certificate which shall increase its duties,
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responsibilities, obligations or standards of care or decrease the protections
afforded by the Loan Agreement, the Tax Certificate or the Indenture .
Section 10.4. Letter of Credit Issuer's Consent. The Letter of Credit
Issuer's consent shall be required for the following purposes: (i) execution and
delivery of any supplemental Loan Agreement or any amendment, supplement or
change to or modification of the Loan Agreement; (ii) removal of the Trustee and
selection and appointment of any successor trustee or paying agent; and (iii)
initiation or approval of any action not described in (i) or (ii) above which
requires Bondholder consent.
ARTICLE XI
MISCELLANEOUS
Section 11.1. Consents of Bond Owners. Any consent, request, direction,
approval, objection or other instrument required by this Indenture to be signed
and executed by a Bond Owner may be in any number of concurrent writings of
similar tenor, and may be signed or executed by such Bond Owner in person or by
such Bond Owner's agent appointed in writing. The fact and date of the execution
by any person of any such consent, request, direction, approval, objection or
other instrument, or of the writing appointing any such agent, may be proved in
any jurisdiction by the certificate of any officer who by law has the power to
take acknowledgments within such jurisdiction that the person signing such
writing acknowledged before him the execution thereof, or by an affidavit of any
witness to such execution or in any other manner satisfactory to the Trustee,
and if made in any such manner shall be sufficient for any of the purposes of
this Indenture, and shall be conclusive in favor of the Trustee with regard to
any action taken by it under such request or other instrument. The ownership of
Bonds shall be proved by the Registration Books.
Section 11.2. Limitation of Rights. With the exception of rights herein
expressly conferred, nothing expressed or mentioned in or to be implied from
this Indenture or the Bonds is intended, or shall be construed, to give to any
person other than the parties hereto, the Tender Agent, the Borrower, the
Remarketing Agent, any Letter of Credit Issuer and the Owners of the Bonds any
legal or equitable right, remedy or claim under or with respect to this
Indenture or any covenants, conditions and provisions herein contained. This
Indenture and all of the covenants, conditions and provisions hereof are
intended to be, and are, for the sole and exclusive benefit of the parties
hereto, the Borrower, the Tender Agent, any Letter of Credit Issuer, the
Remarketing Agent and the Owners of the Bonds as herein provided.
Section 11.3. Severability. If any provisions of this Indenture shall be
held or deemed to be or shall, in fact, be invalid, inoperative or
unenforceable, the same shall not affect any other provision or provisions
herein contained or render the same invalid, inoperative or unenforceable to any
extent whatever.
Section 11.4. Notices. Except as otherwise provided in this Indenture,
all notices, certificates or other communications hereunder shall be
sufficiently given and shall be deemed given when personally delivered or when
sent by telecopy or, if sent by certified mail, postage prepaid, upon receipt
addressed as follows:
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If to the Issuer: California Statewide Communities
Development Authority
▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Secretary
If to the Trustee U.S. Bank Trust National Association
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust
If to the Borrower: Irvine Apartment Communities, L.P.
c/o Irvine Apartment Communities, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: Chief Financial Officer
If to the Underwriter: ▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn.: Municipal Note Trader
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
A duplicate copy of each notice given hereunder by either party hereto shall be
given to the Tender Agent and the Borrower. If a separate Tender Agent is
appointed under this Indenture, it shall notify the Trustee of the address to
which notices, certificates or other communications shall be sent. Any person or
entity listed above may, by notice given hereunder, designate any further or
different addresses to which subsequent notices, certificates or other
communications shall be sent.
Section 11.5. Payments or Performance Due on Other Than Business Days.
Except as specifically provided herein, if the day for making any payment or the
last day for taking any action, including, without limitation, exercising any
remedy, under this Indenture falls on a day other than a Business Day, such
payment may be made, or such action may be taken, on the next succeeding
Business Day, and, if so made or taken, shall have the same effect as if made or
taken on the date required by this Indenture. The amount of any payment due
under this Indenture shall not be affected because payment is made on a date
other than the date specified in this Indenture pursuant to this Section 11.5.
Section 11.6. Execution of Counterparts. This Indenture may be executed
in several counterparts, each of which shall be an original and all of which
shall constitute but one and the same instrument.
Section 11.7. Applicable Law. This Indenture shall be governed by and
construed in accordance with the laws of the State.
Section 11.8. Disqualified Bonds. In determining whether the Owners of
the requisite aggregate principal amount of Bonds have concurred with any
demand, request, direction, consent or
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waiver under this Indenture, Bonds (including Pledged Bonds) which are owned or
held by or for the account of the Borrower, or by any person directly or
indirectly controlling or controlled by, or under direct or indirect common
control with, the Borrower shall be disregarded and deemed not to be Outstanding
for purposes of any such determination (unless the Borrower owns all of the
Bonds, in which event such Bonds shall be deemed to be Outstanding for purposes
of any such determination); provided, that in determining whether the Trustee
shall be protected in relying upon any such demand, request, direction, consent
or waiver under this Indenture, only Bonds which the Trustee knows to be so
owned shall be so disregarded.
Section 11.9. References to Letter of Credit Issuer. Notwithstanding
anything herein to the contrary, all rights and powers granted to the Letter of
Credit Issuer under this Indenture and all references thereto shall not be
effective if no Letter of Credit is in effect or if it has been wrongfully
dishonored. As of the Closing Date, no Letter of Credit shall be in effect for
the Series 1998A Bonds.
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
executed in their respective names by their respective duly authorized officers,
all as of the day and year first above written.
CALIFORNIA STATEWIDE COMMUNITIES
DEVELOPMENT AUTHORITY
By: /s/ signature illegible
---------------------------------
Member of the Commission
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Trustee
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
---------------------------------
Authorized Officer
ATTEST:
/s/ signature illegible
---------------------------------
Authorized Officer
S-1
83
EXHIBIT A
ALLOCATION OF PROJECTS
SERIES 1998A-1
1. Project Name: San Paulo
Project Address: San ▇▇▇▇ and Harvard Avenues
Irvine, California
Allocation Amount: $24,800,000
SERIES 1998A-2, 1998A-3 AND 1998A-4
1. Project Name: Berkeley Court II
Project Address: ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Allocation Amount: $2,510,000
2. Project Name: Dartmouth Court
Project Address: ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Allocation Amount: $17,563,000
3. Project Name: Newport North
Project Address: 2 Milano
Newport Beach, California
Allocation Amount: $38,540,000
4. Project Name: Rancho Alisal
Project Address: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ #▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Allocation Amount: $20,935,000
5. Project Name: San Marco
Project Address: ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Allocation Amount: $24,692,000
6. Project Name: Turtle Rock Canyon Apartments
Project Address: ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Number of Units: 217
Allocation Amount: $19,073,000
▇-▇
▇▇
▇. Project Name: Rancho Tierra
Project Address: ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Allocation Amount: $19,916,000
8. Project Name: Rancho Maderas
Project Address: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Allocation Amount: $19,663,000
9. Project Name: San ▇▇▇▇ ▇▇ Apartments
Project Address: ▇▇▇▇ ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Number of Units: 112
Allocation Amount: $7,205,000
10. Project Name: Berkeley Court I
Project Address: ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Allocation Amount: $5,415,000
11. Project Name: Cedar Creek
Project Address: ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, #▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Allocation Amount: $8,715,000
12. Project Name: Columbia Court
Project Address: ▇▇-▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Allocation Amount: $2,640,000
13. Project Name: Cornell Court
Project Address: ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Allocation Amount: $5,280,000
14. Project Name: Deerfield II
Project Address: ▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Allocation Amount: $3,400,000
15. Project Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇
Project Address: ▇▇ ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Allocation Amount: $10,000,000
▇-▇
▇▇
▇▇. Project Name: Woodbridge Willows
Project Address: ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Allocation Amount: $9,800,000
17. Project Name: Northwood Park
Project Address: ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Allocation Amount: $7,875,000
18. Project Name: Stanford Court
Project Address: ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Allocation Amount: $14,085,000
19. Project Name: Cross Creek
Project Address: ▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Allocation Amount: $6,855,000
20. Project Name: Harvard Court
Project Address: ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Allocation Amount: $5,235,000
21. Project Name: San Marino Villas
Project Address: ▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Allocation Amount: $9,997,000
22. Project Name: Northwood Place
Project Address: ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Allocation Amount: $30,595,000
23. Project Name: San Remo Villas I
Project Address: ▇▇▇▇ ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Allocation Amount: $6,835,000
24. Project Name: San ▇▇▇▇ Villas
Project Address: ▇ ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Allocation Amount: $12,566,000
A-3
86
EXHIBIT B
INVESTOR LETTER
[Date]
Irvine Apartment Communities, L.P.
Newport Beach, California
U.S. Bank Trust National Association
Los Angeles, California
Ladies and Gentlemen:
We are delivering this letter in connection with an offering of
Apartment Development Revenue Refunding Bonds, Series 1998A (Irvine Apartment
Communities, L.P.) (the "Bonds") of the California Statewide Communities
Development Authority (the "Authority"), all as described in the Official
Statement relating to the offering.
We hereby confirm that:
(i) any purchase of Bonds by us will be for our own account or an
account over which we exercise sole investment discretion (and for which we have
authority to make, and do make, the statements contained in this letter), and we
are, and any such account is, (1) a person which is a: bank, savings and loan
association, insurance company, or fund (including partnerships, trusts, mutual
funds, long term bond funds, hedge funds, separate accounts and portfolio
managers) that regularly purchase municipal revenue obligations, such as
multifamily housing bonds, the ultimate obligor of which is a non-municipal
entity ("Qualified Person") and (2) either a "qualified institutional buyer" as
defined in Rule 144A under the Securities Act of 1933, or an "institutional
accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act of 1933;
(ii) we agree that, if we or any such account resell or transfer an
interest in the Bonds before June 17, 2000, such interest may only be resold or
transferred to a Qualified Person and only if a letter substantially in the same
form and to the same effect as this letter is executed promptly by the
transferee and delivered to the Trustee (as defined below) acting pursuant to
the Indenture of Trust relating to the Bonds between the Authority and U.S. Bank
Trust National Association, as Trustee (the "Trustee");
(iii) we agree that, prior to June 17, 2000, we will give each
subsequent transferee notice of these restrictions; and
(iv) our Participant of the Depository Trust Company, now the Securities
Depository, currently is _______________, and its account number is
________________.
B-1
87
We understand that, on or prior to June 17, 2000, the Trustee will not
be required to accept for registration or transfer any Bonds, except upon
receipt of a letter in the form of this investor letter by the Trustee from the
buyer.
We acknowledge that you and others will rely upon our confirmations,
acknowledgments and agreements set forth herein, and we agree to notify you
promptly in writing if any of our representations or warranties herein ceases to
be accurate and complete.
THIS LETTER SHALL BE GOVERNED, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF CALIFORNIA WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAW.
Very truly yours,
By: _____________________________
Name:
Office:
cc: ▇.▇. ▇▇▇▇▇▇ Securities, Inc.
B-2
88
EXHIBIT C
LEGEND FOR BONDS PRIOR TO JUNE 17, 2000
UNLESS OTHERWISE AGREED BY THE OPERATING PARTNERSHIP AND THE
HOLDER HEREOF, UNTIL JUNE 17, 2000, THIS BOND MAY NOT BE OFFERED,
SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT TO A PERSON WHO
REPRESENTS THAT IT IS A PERSON WHICH IS A BANK, SAVINGS AND LOAN
ASSOCIATION, INSURANCE COMPANY, OR FUND (INCLUDING PARTNERSHIPS,
TRUSTS, MUTUAL FUNDS, LONG-TERM BOND FUNDS, HEDGE FUNDS, SEPARATE
ACCOUNTS AND PORTFOLIO MANAGERS) THAT REGULARLY PURCHASES
MUNICIPAL REVENUE OBLIGATIONS, SUCH AS MULTIFAMILY HOUSING BONDS,
THE ULTIMATE OBLIGOR OF WHICH IS A NON-MUNICIPAL ENTITY, THAT IS
PURCHASING FOR ITS OWN ACCOUNT OR FOR ONE OR MORE ACCOUNTS FOR
WHICH IT EXERCISES SOLE INVESTMENT DISCRETION. THE HOLDER OF THIS
BOND WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY
PURCHASER FROM IT OF THE BONDS EVIDENCED HEREBY OF THE RESALE
RESTRICTIONS SET FORTH ABOVE.
C-1