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Home My WebLink AboutRES NO 126-13RESOLUTION NO. 126- 13 RESOLUTION APPROVING THE EXECUTION AND DELIVERY OF CITY OF BAKERSFIELD GAS TAX, TRANSPORTATION IMPACT FEE AND RESTRICTED UTILITY FRANCHISE AND SURCHARGE REVENUE CERTIFICATES OF PARTICIPATION, SERIES 2013 (THOMAS ROADS IMPROVEMENT PROGRAM) PURSUANT TO A TRUST AGREEMENT, AUTHORIZING THE EXECUTION AND DELIVERY OF A TRUST AGREEMENT, A CERTIFICATE PURCHASE AGREEMENT, AND AN INSTALLMENT SALE AGREEMENT AND AUTHORIZING THE INSTITUTION AND FILING OF A RELATED VALIDATION ACTION AND OTHER MATTERS RELATING THERETO RECITALS: WHEREAS, the City of Bakersfield (the "City ") is a charter city organized and existing under the laws of the State of California (the "State "); and WHEREAS, Section 12 of Article III of the Charter of the City, authorizes the City, among other things, to acquire property for any municipal purpose, and provide for the construction of public improvements; and WHEREAS, the Bakersfield Public Benefit Corporation (the "Corporation ") was formed to assist the City, among other things, in the financing and/or refinancing of the Project (as defined herein), pursuant to the Nonprofit Public Benefit Corporation Law (being Part 2 of Division 2 of Title 1 of the California Corporations Code, as amended) (the "Nonprofit Public Benefit Corporation Law ") and pursuant to the articles of incorporation ( "Articles of Incorporation ") and bylaws of the Corporation (the "Bylaws "); and WHEREAS, the City has determined that the design, acquisition and construction of public street and highway projects (and as more fully described in the herein defined 2013 Installment Sale Agreement, the "Project ") is necessary and proper for, and for the benefit of, the City, and under the terms of applicable law, the payment for such Project may be made from (i) motor vehicle fuel tax revenues received by the City from the State (the "Gas Tax Revenues "), and deposited into the Gas Tax Fund (as defined in the hereinafter defined 2013 Installment Sale Agreement); (ii) transportation impact fee revenues received by the City from developers of land to mitigate traffic impacts caused by a development project (the "Transportation Impact Fee Revenues "), and deposited into the Transportation Impact Fee Trust Fund (as defined in the 2013 Installment Sale Agreement); (iii) certain additional electricity franchise payments and the electricity and gas surcharge payments paid to the City by certain franchisees for the use of the City's streets (the "Restricted Utility Franchise and Surcharge Revenues "), and deposited into the Roads Program Utility Franchise Fee and Surcharge Fund (as defined in the 2013 Installment Sale Agreement); and (iv) any other moneys of the City that are legally available to pay for the Project; and 4810 -4563- 2786.9 •, 1 KE <J U WHEREAS, the Project is a component part of the City's overall Thomas Roads Improvement Program which is a cooperative effort between the City, the County of Kern (the "County "), the California Department of Transportation and the Kern Council of Governments ( "TRIP Projects "); and WHEREAS, TRIP Projects have been identified as necessary to relieve the stress on outdated infrastructure caused by years of rapid growth in population, interregional travel and freight movement; and WHEREAS, the Corporation will acquire and construct the Project for, and sell the Project to, the City, pursuant to the 2013 Installment Sale Agreement, by and between the City and the Corporation (the "2013 Installment Sale Agreement "); and WHEREAS, pursuant to the 2013 Installment Sale Agreement, the City, acting as agent for the Corporation, will agree to design, acquire and construct the Project using proceeds from the sale of City of Bakersfield Gas Tax, Transportation Impact Fee and Restricted Utility Franchise and Surcharge Revenue Certificates of Participation, Series 2013 (Thomas Roads Improvement Program) (the "Certificates ") evidencing and representing a proportionate undivided interests of the owners thereof in the 2013 Installment Sale Payments (as defined herein) to be made by the City under the 2013 Installment Sale Agreement; and WHEREAS, the City Council of the City (the "City Council ") intends to authorize the execution and delivery of additional Contracts (as defined in the 2013 Installment Sale Agreement) at some time in the future and from time to time for the purpose of financing the design, acquisition and construction of additional street and highway improvements, which are necessary and proper for, and for the benefit of, the City, the payment for which may be made from Gas Tax Revenues, Transportation Impact Fee Revenues, Restricted Utility Franchise and Surcharge Revenues and any other moneys of the City that are legally available to pay for the Project; and WHEREAS, the 2013 Installment Sale Payments payable by the City in connection with the 2013 Installment Sale Agreement (the "2013 Installment Sale Payments ") will be deposited with a Trustee, as may be selected by the Corporation (the "Trustee "), pursuant to a Trust Agreement (the "Trust Agreement "), by and among the Corporation, the Trustee and the City; and WHEREAS, the City Council hereby authorizes the Trustee to execute and deliver the Certificates; and WHEREAS, the Corporation may determine that securing the timely payment of the principal and interest evidenced by the Certificates by obtaining a bond insurance policy (a "Certificate Insurance Policy ") with respect thereto issued by a municipal bond insurer (a "Certificate Insurer ") could be economically advantageous to the City; and WHEREAS, such purchaser /investment banking firm as may be selected in the sole discretion of the Corporation (the "Purchaser/Underwriter "), has submitted to the City and the Corporation a proposed form of an agreement to purchase the Certificates in the form of a Certificate Purchase Agreement (the "Certificate Purchase Agreement "); and � g A KEG 2 r� n 4810 - 4563- 2786.9 = rn 0 R 1u 1 i SA1._ WHEREAS, the City and the Corporation intend to assist the Purchaser /Underwriter in the preparation of a preliminary official statement (a "Preliminary Official Statement ") in connection with the sale and delivery of the Certificates, a form of such Preliminary Official Statement to be presented to this City Council at a later date; and WHEREAS, the City hereby finds that the financing of such public capital improvements within the City and outside of the City are for public purposes and will result in significant public benefits in the form of lower interest rates, as the cost of the Project are expected to increase over time, and the timely construction of the Project and thereby facilitate regional mobility, economic growth and development and reduce travel time through major transportation corridors; and WHEREAS, the Internal Revenue Service has issued Treasury Regulation Section 1.150 2, the final regulations with respect to the use of proceeds of tax- exempt debt obligations for reimbursement purposes (the "Reimbursement Regulations "); and WHEREAS, in order to comply with the Reimbursement Regulations, the City hereby declares its intent to reimburse the City for capital expenditures related to the Project with proceeds from the sale of the Certificates; WHEREAS, all acts, conditions and things required by the laws of the State of California to exist, to have happened and to have been performed precedent to and in connection with the consummation of such financing authorized hereby do exist, have happened and have been performed in regular and due time, form and manner as required by law, and the City is now duly authorized and empowered, pursuant to each and every requirement of law, to consummate such financing for the purpose, in the manner and upon the terms herein provided; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF BAKERSFIELD, as follows: Section 1. The foregoing recitals herein contained are true and correct and the City Council so finds. Section 2. Special Obligations. The Certificates and the 2013 Installment Sale Payments shall be special obligations of the City, secured by and payable from Revenues and from the funds and accounts held by the Trustee and /or the City under the Trust Agreement, as and to the extent therein described. Section 3. Project. The Project is hereby approved. The Mayor of the City, the City Manager and the Finance Director of the City (each an "Authorized Officer," and together, the "Authorized Officers ") are authorized to implement the Project in accordance with the provisions of the 2013 Installment Sale Agreement and this Resolution. Section 4. Form of the 2013 Installment Sale Agreement. The form of the 2013 Installment Sale Agreement, on file with the Clerk of the City Council, is hereby approved, and the Authorized Officers, are each hereby authorized and directed, for and in the name and on behalf of the City, to execute and deliver the 2013 Installment Sale Agreement in substantially said form, with such changes, insertions and omissions therein as the Authorized Officer or 3 4810- 4563- 2786.9 �Ax�a r J r7 RIC:I^tifit Authorized Officers executing the same may require or approve, such approval to be conclusively evidenced by the execution and delivery thereof, provided, however, that the aggregate amount of the principal components of the 2013 Installment Sale Payments shall not exceed $290,000,000, the true interest cost applicable to the interest components of the 2013 Installment Sale Payments shall not exceed 7.5% per annum and the final principal payment due on the 2013 Installment Sale Agreement shall be no later than December 31, 2053. The pledge to secure the 2013 Installment Sale Payments as set forth in the 2013 Installment Sale Agreement is hereby approved. Section 5. Form of the Trust Agreement. The form of the Trust Agreement, on file with the Clerk of the City Council, is hereby approved, and the Authorized Officers, are each hereby authorized and directed, for and in the name and on behalf of the City, to execute and deliver the Trust Agreement in substantially said form, with such changes, insertions and omissions therein as the Authorized Officer executing the same may require or approve, such approval to be conclusively evidenced by the execution and delivery thereof. Section 6. The Certificates. The execution and delivery of the Certificates, on the terms and conditions set forth in, and subject to the limitations specified in, the Trust Agreement and the 2013 Installment Sale Agreement, is hereby authorized and approved. The Certificates shall bear interest at the rates, shall mature on the dates, shall be subject to call and prepayment, shall be issued in the form and shall be as otherwise provided in the Trust Agreement, as the same shall be completed. Section 7. Form of the Certificate Purchase Agreement. The form of Certificate Purchase Agreement, on file with the Clerk of the City Council is hereby approved, and the Authorized Officers are each hereby authorized and directed, for and in the name and on behalf of the City, to execute and deliver the Certificate Purchase Agreement in substantially said form, with such changes therein as the Authorized Officer executing the same may require or approve, such approval to be conclusively evidenced by the execution and delivery thereof; provided, however, that the underwriter's discount for the sale of the Certificates shall not exceed 1.50% of the aggregate principal amount of the principal components of the 2013 Installment Sale Payments payable under the 2013 Installment Sale Agreement and the Purchaser/Underwriter is authorized thereto to purchase the Certificates for the purchase price set forth in the Certificate Purchase Agreement. Section 8. Authorization to Obtain Certificate Insurance Policy. The Corporation is hereby authorized to apply for a Certificate Insurance Policy for the Certificates and to obtain such Certificate Insurance Policy if the present value cost of such Certificate Insurance Policy is less than the present value of the estimated interest savings with respect to the Certificates. Section 9. Approval of Validation Proceedings. The Mayor of the City, the City Manager, the Finance Director of the City, the City Attorney and all officers, agents and employees of the City, for and on behalf of the City, be and they hereby are authorized and directed to instruct Kutak Rock LLP, as special counsel to the City, to bring a validation action under Section 860 et seq. of the California Code of Civil Procedure to determine the legality and validity of the 2013 Installment Sale Agreement, any additional Contracts, the Trust Agreement, the Certificate Purchase Agreement, the Certificates, the other documents and proceedings 0 4810- 4563- 2786.9 ;J 6p f,_ authorized pursuant to this Resolution and the pledge of Gas Tax Revenues, Transportation Impact Fee Revenues and Restricted Utility Franchise and Surcharge Revenues for the construction and financing of the Project; provided however, that prior to the commencement of the validation action, the Corporation shall have been duly incorporated in accordance with the laws of the State and shall have duly authorized its participation in the financing and construction of the Project. Section 10. Authorization for Reimbursement of Capital Expenditures. The City Council hereby declares its official intent to reimburse the capital expenditures related to the Project from proceeds of the sale of the Certificates within eighteen (18) months of the date of the expenditures of moneys on the capital expenditures or on the date upon which the project, if any, containing the capital expenditures is placed in service or abandoned, whichever is later (but in no event more than three (3) years after the date of the original expenditure of such moneys). Section 11. Additional Authorization. The Authorized Officers and all officers, agents and employees of the City, for and on behalf of the City, be and they hereby are authorized and directed to do any and all things necessary to effect the execution and delivery of the Certificates, the 2013 Installment Sale Agreement and the Certificate Purchase Agreement and to carry out the terms thereof. The Mayor of the City, the City Manager, the Finance Director of the City, the City Attorney and all other officers, agents and other employees of the City are further authorized and directed, for and on behalf of the City, to execute all papers, documents, certificates and other instruments that may be required in order to carry out the authority conferred by this Resolution and by the Certificates, the 2013 Installment Sale Agreement and the Certificate Purchase Agreement or to evidence the same authority and its exercise. The foregoing authorization includes, but is in no way limited to, authorizing the Authorized Officers and City staff to assist in the preparation of a Preliminary Official Statement and official statement (and upon such preparation, the form of the Preliminary Official Statement shall be presented to the City Council for approval prior to its distribution by the Purchaser/Underwriter), authorizing City staff to pay costs of issuance of the Certificates and the underwriting fees; authorizing the Finance Director of the City to direct the investment of the proceeds of the Certificates in one or more of the permitted investments provided for under the Trust Agreement and to execute any documents relating to such investments; authorizing the execution by the Authorized Officers, or any of them, of a tax compliance certificate as required by the Trust Agreement for the purpose of complying with the arbitrage and rebate requirements of the Code and any documents required by The Depository Trust Company; and to execute any certificates and documents required by the Certificate Insurer as a condition of delivering its Certificate Insurance Policy, if any. Section 12. Costs of Issuance. The City authorizes funds of the City, together with the proceeds of the Certificates, to be used to pay costs of issuance of the Certificates, including, but not limited to, costs and expenses of attorneys, accountants, financial advisors, the costs associated with rating agencies, printing, publication and mailing expenses and any related filing fees thereof. Section 13. Severability. The provisions of this Resolution are hereby declared to be severable and if any section, phrase or provision shall for any reason be declared to be invalid, �A Ke 5 � 9� t� c,1y 4810- 4563 - 2786.9 ORIGINAL such declaration shall not affect the validity of the remainder of the sections, phrases and provisions hereof. Section 14. Prior Actions. All actions heretofore taken by the officers, employees and agents of the City with respect to the transactions set forth above are hereby approved, confirmed and ratified. Section 15. Governing Law. This resolution shall be construed and governed in accordance with the laws of the State of California. Section 16. Effective Date of Resolution. This Resolution shall take effect immediately upon its passage. [Remainder of page intentionally left blank] n 4810- 4563- 2786.9 Q zPz t-- m U O I HEREBY CERTIFY that the foregoing Resolution was passed and adopted by the Council of the City of Bakersfield at a regular meeting thereof held on September 25, 2013, by the following vote: NOES: A13STAIN: ABSENT: ✓ ✓ ✓ �/ %1-1 „// RIVERA, SMITH, WEIR, HANSON, SULLIVAN, IOITNSON 4"4,� ��eo” ROBERTA GAFFORD, CMC CITY CLERK and Ex Officio Clerk of the Council of the City of Bakersfield APPROVED: Z///, B1. V...44 HAR EY L. HALL Mayor APPROVED AS TO FORM: VIRGINIAX.ENNARO CityAtto e By: ANDREW HEGLUND Deputy City Attorney 7 4810- 4563- 2786.9 c.�i b Draft Trust Agreement cv ORIGINAL TRUST AGREEMENT by and among 1 1, as Trustee, BAKERSFIELD PUBLIC BENEFIT CORPORATION, as the Corporation and CITY OF BAKERSFIELD, CALIFORNIA, as the City Dated as of 1,20 City of Bakersfield Gas Tax, Transportation Impact Fee and Restricted Utility Franchise and Surcharge Revenue Certificates of Participation, Series 2013 (Thomas Roads Improvement Program) 4830 - 8589- 9794.7 o��,NK 9- u v o ORIGINAL... Section 1.01. Section 1.02. Section 2.01. Section 2.02. Section 2.03. Section 2.04. Section 2.05. Section 2.06. Section 2.07. Section 2.08. Section 2.09. Section 2.10. Section 2.11. Section 2.12 Section 2.13 Table of Contents Page ARTICLE I DEFINITIONS; EQUAL SECURITY Definitions.......................................................................... ..............................2 EqualSecurity ................................................................... ..............................1 l ARTICLE I1 EXECUTION AND DELIVERY OF CERTIFICATES Preparation and Purpose of Certificates ............................ .............................11 Terms of the Certificates ................................................... .............................12 Prepayment of Certificates ................................................ .............................13 Formof Certificates ........................................................... .............................16 Executionof Certificates ................................................... .............................16 Transfer and Payment of Certificates ................................ .............................16 Exchangeof Certificates .................................................... .............................17 Certificate Registration Books ........................................... .............................17 Mutilated, Destroyed, Stolen or Lost Certificates ............. .............................17 TemporaryCertificates ...................................................... .............................18 Procedure for the Execution and Delivery of Certificates; Establishment of Funds and Accounts ............................... .............................18 Validity of Certificates ...................................................... .............................19 Special Covenants as to Book -Entry Only System for Certificates ...............19 ARTICLE III REVENUES Section 3.01. Pledge of Revenues; Assignment ...................................... .............................21 Section 3.02. Receipt and Deposit of Revenues in the Revenue Fund .... .............................22 Section 3.03. Establishment and Maintenance of Funds and Accounts for Use of Money in the Revenue Fund .............................................. .............................22 Section 3.04. Deposit and Investments of Money in Funds and Accounts ..........................24 ARTICLE IV COVENANTS Section 4.01. Compliance With Trust Agreement ................................... .............................25 Section 4.02. Amendment of 2013 Installment Sale Agreement ............ .............................25 Section 4.03. Against Encumbrances ...................................................... .............................25 Section 4.04. Tax Covenants: Rebate Fund ............................................. .............................25 Section 4.05. Accounting Records and Reports ...................................... .............................26 Section 4.06. Observance of Laws and Regulations ............................... .............................26 Section 4.07. Further Assurances ............................................................ .............................26 Section 4.08. Recordation and Filing ...................................................... .............................27 Section 4.09. Acquisition of the Project .................................................. .............................27 ARTICLE V THE TRUSTEE 4830- 8589- 9794.7 A K6- '9 , Jr <J t7 ORIGINAL. Table of Contents (continued) Page Section5.01. The Trustee ........................................................................ .............................27 Section 5.02. Liability of Trustee ............................................................ .............................28 ARTICLE VI AMENDMENT OF THIS TRUST AGREEMENT Section 6.01. Amendment of this Trust Agreement ................................ .............................30 Section 6.02. Disqualified Certificates .................................................... .............................31 Section 6.03. Endorsement or Replacement of Certificates After Amendment ...................31 Section 6.04. Amendment by Mutual Consent ........................................ .............................31 Section 6.05. Information to Rating Agency ........................................... .............................31 ARTICLE VII EVENTS OF DEFAULT AND REMEDIES OF OWNERS Section 7.01. Events of Default ............................................................... .............................31 Section 7.02. Application of Funds Upon Acceleration of 2013 Installment Sale Agreement......................................................................... .............................32 Section 7.03. Other Remedies of the Trustee .......................................... .............................32 Section7.04. Non - Waiver ....................................................................... .............................32 Section 7.05. Actions by Trustee as Attorney -in- Fact ............................. .............................33 Section 7.06. Remedies Not Exclusive; Credit Provider's Right To Control Remedies........................................................................... .............................33 Section 7.07. Limitation on Owners' Right To Sue ................................ .............................34 Section 7.08. Limited Liability of the City .............................................. .............................34 Section 7.09. Limited Liability of the Corporation ................................. .............................34 Section 10.01. Liability of Corporation Limited to Revenues .................. .............................39 Section 10.02. Benefits of this Trust Agreement Limited to Parties ......... .............................39 Section 10.03. Successor Is Deemed Included in All References to Predecessor ..................39 Section 10.04. Execution of Documents by Owners ................................. .............................40 Section 10.05. Waiver of Personal Liability .............................................. .............................40 ii 4830 - 8589- 9794.7 0 AKF9 n tPr m r. r c RIGINAL ARTICLE VIII DEFEASANCE Section 8.01. Discharge of Certificates ................................................... .............................35 Section8.02. Unclaimed Money ............................................................. .............................36 ARTICLE IX PROVISIONS RELATING TO THE CREDIT PROVIDER (IF ANY) Section 9.01. Claims Upon the Credit Facility and Payments by and to the Credit Provider............................................................................. .............................36 Section 9.02. Notices to Credit Provider ................................................. .............................38 Section 9.03. Consent of the Credit Provider .......................................... .............................39 ARTICLE X MISCELLANEOUS Section 10.01. Liability of Corporation Limited to Revenues .................. .............................39 Section 10.02. Benefits of this Trust Agreement Limited to Parties ......... .............................39 Section 10.03. Successor Is Deemed Included in All References to Predecessor ..................39 Section 10.04. Execution of Documents by Owners ................................. .............................40 Section 10.05. Waiver of Personal Liability .............................................. .............................40 ii 4830 - 8589- 9794.7 0 AKF9 n tPr m r. r c RIGINAL Table of Contents (continued) Page Section 10.06. Acquisition of Certificates by Corporation ....................... .............................40 Section 10.07. Destruction of Canceled Certificates ................................. .............................40 Section 10.08. Content of Certificates; Post - Issuance Legal Opinions ..... .............................40 Section 10.09. Accounts and Funds; Business Days ................................. .............................41 Section 10.10. Article and Section Headings and References ................... .............................41 Section 10.11. Partial Invalidity ................................................................ .............................41 Section 10.12. Execution in Several Counterparts .................................... .............................41 Section 10.13. [Credit Provider Deemed Owner ....................................... .............................42 Section10.14. Notices ............................................................................... .............................42 EXHIBIT A [FORM OF CERTIFICATE] EXHIBIT B FORM REQUISITION FROM THE ACQUISITION FUND iii 4830 - 8589- 9794.7 y. r r O OR GINAL TRUST AGREEMENT THIS TRUST AGREEMENT, made and entered into as of 1, 20_ (this "Trust Agreement ") by and among [TRUSTEE] (the "Trustee "), [a national banking association duly organized and existing under and by virtue of the laws of the United States of America], the BAKERSFIELD PUBLIC BENEFIT CORPORATION, a nonprofit public benefit corporation duly organized and existing under and by virtue of the laws of the State of California (the "Corporation ") and CITY OF BAKERSFIELD, CALIFORNIA, a charter city and municipal corporation organized and existing under the Constitution of the State of California (the "City "); WITNESSETH: WHEREAS, the Corporation is a nonprofit public benefit corporation duly organized and operating pursuant to the Nonprofit Public Benefit Corporation Law of the State of California (the "State ") (being Part 2 of Division 2 of Title 1 of the California Corporations Code, as amended) (the "Nonprofit Public Benefit Corporation Law "); and WHEREAS, the City is a municipal corporation and chartered city duly organized and existing under and pursuant to the provisions of the Constitution of the State and the Charter of the City of Bakersfield (the "Charter "); and WHEREAS, the Bakersfield Public Benefit Corporation (the "Corporation ") was formed to assist the City, among other things, in the financing and /or refinancing of the Project (as defined herein), pursuant to the Nonprofit Public Benefit Corporation Law (being Part 2 of Division 2 of Title 1 of the California Corporations Code, as amended) (the "Nonprofit Public Benefit Corporation Law ") and pursuant to the articles of incorporation ( "Articles of Incorporation ") and bylaws of the Corporation (the "Bylaws "); and WHEREAS, Section 12 of Article III of the Charter, authorizes the City, among other things, to acquire property for any municipal purpose, appropriate the money of the City for all lawful purposes, regulate and control the streets and is further authorized to exercise, any and all rights, powers or privileges granted or prescribed by the general laws of the State; and WHEREAS, the City has determined that the consummation of the transactions contemplated in the 2013 Installment Sale Agreement (as described herein) and this Trust Agreement will be for public purposes, as required by the applicable provisions of the Nonprofit Public Benefit Corporation Law; and WHEREAS, the City has designated the Trustee to act as its trustee with respect to the funds received by the City in connection with the sale of the Certificates (as described herein) and with respect to the moneys paid by the City as 2013 Installment Sale Payments (as described herein); and WHEREAS, the City has executed the Certificate Purchase Agreement (as described herein), confirming the sale to [PURCHASER/UNDERWRITER] (the "Purchaser ") of the Certificates which evidence and represent proportionate and undivided interests in the 2013 Installment Sale Payments payable in connection with the 2013 Installment Sale Agreement; and 4830 -8589- 9794.7 A kF�s v � ORIGINAL WHEREAS, the City has authorized and directed the Trustee to execute and deliver on its behalf pursuant to the terms of this Trust Agreement, the Certificates in an amount equal to the aggregate principal amount of the principal installments payable by the City pursuant to the 2013 Installment Sale Agreement; and WHEREAS, the Corporation is empowered pursuant to the 2013 Installment Sale Agreement, the aforementioned Law and the articles of incorporation and bylaws of the Corporation to cause the acquisition of the Project (as hereinafter defined) and to finance the Project through the execution and delivery of the Certificates; and WHEREAS, in order to provide for the execution and delivery of the Certificates (as hereinafter defined), to establish and declare the terms and conditions upon which the Certificates are to be executed, delivered and secured and to secure the payment of the principal thereof and interest thereon, the Corporation and the City have each authorized the execution and delivery of this Trust Agreement; and WHEREAS, the execution of the 2013 Installment Sale Agreement and the approval of the execution and delivery of this Trust Agreement and the Certificates have been in all respects duly and validly authorized by the City Council of the City pursuant to a resolution duly adopted (the "City Resolution "); and WHEREAS, the Certificates and the form of assignment to be endorsed thereon are to be substantially in the form set forth in Exhibit A, with necessary or appropriate variations, omissions and insertions, as permitted or required hereby; and WHEREAS, the Trustee has accepted the trust created by this Trust Agreement and in evidence thereof has joined in the execution hereof; and WHEREAS, all acts, conditions and things required by law to exist, to have happened and to have been performed precedent to and in connection with the execution and entering into of the Trust Agreement, the Credit Facility (if any), and delivery of the Certificates do exist, have happened and have been performed in regular and due time, form and manner as required by law, and the parties hereto are now duly authorized to execute and enter into this Trust Agreement; NOW, THEREFORE, IN CONSIDERATION OF THE PREMISES AND OF THE MUTUAL AGREEMENTS AND COVENANTS CONTAINED HEREIN AND FOR OTHER VALUABLE CONSIDERATION, THE RECEIPT AND SUFFICIENCY OF WHICH ARE HEREBY ACKNOWLEDGED, THE PARTIES HERETO DO HEREBY AGREE AS FOLLOWS: ARTICLE I DEFINITIONS; EQUAL SECURITY Section 1.01. Definitions. Unless the context otherwise requires, the terms defined in this Section shall for all purposes hereof and of any Supplemental Trust Agreement and of any 2 4830 - 8589- 9794.7, ORIGINAL certificate, opinion, request or other document herein or therein mentioned have the meanings herein specified: "Acquisition Fund" means the fund by that name established and maintained pursuant to Section 2.11. "Administration Fee" means, an amount equal to the sum of the Trustee Fee, the Rebate Analyst Fee and any other similar fee payable in connection with the administration of the Project financing, payable by the City, in accordance with the 2013 Installment Sale Agreement, on the fifteenth day of the month preceding each Certificate Payment Date, for the administrative costs related to financing the Project. "Administration Fund" means the fund by that name established and maintained pursuant to Section 3.03. "Authorized City Representative" means the person or persons designated in Section 8.12 of the 2013 Installment Sale Agreement or any other person at the time designated to act on behalf of the City by written certificate furnished to the Trustee, containing the specimen signature of such person and signed on behalf of the City by an Authorized City Representative. "Authorized Corporation Representative" means any one of the President/Executive Director, Vice President or Chief Financial Officer of the Corporation. "Business Day" means any day on which the Trustee is open for business at its corporate trust office in [CITY], [STATE]. "Certificates" means the City of Bakersfield Gas Tax, Transportation Impact Fee and Restricted Utility Franchise and Surcharge Revenue Certificates of Participation, Series 2013 (Thomas Roads Improvement Program). The term "Serial Certificates" means Certificates for which no sinking fund payments are provided. The term "Term Certificates" means Certificates which are payable on or before their specified payment dates from sinking fund payments established for that purpose and calculated to prepay such Certificates on or before their specified payment dates. "Certificate Payment Date" means a date on which principal evidenced and represented by the Certificates is due and payable, being J of each year commencing 20 "Charter" means the Charter of the City, as may be in effect from time to time. "City" shall mean the City of Bakersfield, California, a charter city and municipal corporation duly organized and existing under the Constitution and laws of the State. "City Parity Obligations" shall have the meaning set forth in the 2013 Installment Sale Agreement. "City Resolution" shall have the meaning set forth in the whereas clauses herein. 3 �gAKFq 4830 - 8589- 9794.7 p P� r 0 o ORIGINAL "Code" means the Internal Revenue Code of 1986, as amended and the regulations issued thereunder. "Corporation" means the Bakersfield Public Benefit Corporation, a nonprofit public benefit corporation, incorporated in 2013 and pursuant to the Nonprofit Public Benefit Corporation Law (as such term is defined in the granting clauses herein) and certain articles of incorporation and bylaws, and empowered to assist the City in facilitating the financing of public and capital improvements for the benefit of the residents of the City and/or the local metropolitan area. "Costs of Issuance" means all items of expense directly or indirectly payable by or reimbursable to the City, or the Corporation and related to the authorization, execution and delivery of the Certificates, including, but not limited to, the Credit Provider fees (if any), costs of preparation and reproduction and delivery of documents, filing and recording fees, fees and charges of the Trustee and its counsel, legal fees and charges, fees and disbursements of consultants and professionals, fees of rating agencies, fees and charges for preparation, execution and safekeeping of the Certificates and any other costs, charges or fees in connection with the original execution, delivery, marketing and sale of the Certificates. "Cost of Issuance Fund' means the fund by that name established and maintained pursuant to Section 2.11. "Credit Facility" shall have the meaning set forth in the 2013 Installment Sale Agreement. "Credit Provider" shall have the meaning set forth in the 2013 Installment Sale Agreement. "Event of Default" shall have the meaning set forth in Section 7.01 herein. "Fitch" shall mean Fitch Ratings, a corporation organized and existing under the laws of the State of Delaware, its successors and its assigns, and, if such corporation shall for any reason no longer perform the functions of a securities rating agency, "Fitch" shall be deemed to refer to any nationally recognized rating agency designated by the City. "Independent Certified Public Accountant" means any certified public accountant or firm of such accountants duly licensed and entitled to practice and practicing as such under the laws of the State or a comparable successor, appointed and paid by the Corporation, and who, or each of whom: (a) is in fact independent according to the Statement of Auditing Standards No. 1 and not under the domination of the Corporation; (b) does not have a substantial financial interest, direct or indirect, in the operations of the Corporation; and 4 4830 - 8589- 9794.7 A K% �- m U � ORIGINAL (c) is not connected with the Corporation as a member, officer or employee of the Corporation, but who may be regularly retained to audit the accounting records of and make reports thereon to the Corporation. "Interest Fund" means the fund by that name established pursuant to Section 3.03. "Interest Payment Date" means a date on which interest evidenced and represented by the Certificates is due and payable, being [ and of each year, commencing [ J 20[1. "Investment Agreement" shall mean an investment agreement or guaranteed investment contract (a) with or guaranteed by a national or state chartered bank or savings and loan, an insurance company or other financial institution whose unsecured debt is rated in the highest short-term rating category (if the term of the Investment Agreement is less than three years) or in either of the two highest long -term Rating Categories (if the term of the Investment Agreement is three years or longer) by one or more of the Rating Agencies, or (b) which investment agreement or guaranteed investment contract is fully secured by obligations described in items (a) or (b) of the definition of Permitted Investments which are (i) valued not less frequently than monthly and have a fair market value, exclusive of accrued interest, at all times at least equal to 103% of the principal amount of the investment, together with the interest accrued and unpaid thereon, (ii) held by the Trustee (who shall not be the provider of the collateral) or by any Federal Reserve Bank or a depository acceptable to the Trustee, (iii) subject to a perfected first lien on behalf of the Trustee, and (iv) free and clear from all third -party liens. " Moody's" shall mean Moody's Investors Service, a corporation organized and existing under the laws of the State of Delaware, its successors and its assigns, and, if such corporation shall for any reason no longer perform the functions of a securities rating agency, " Moody's" shall be deemed to refer to any other nationally recognized rating agency designated by the City. "Nonprofit Public Benefit Corporation Law" means the Nonprofit Public Benefit Corporation Law (being Part 2 of Division 2 of Title 1 of the California Corporations Code, as amended) and all laws amendatory thereof or supplemental thereto. "Note Participations" means [ 1 "Office of the Trustee" means the corporate trust office of the Trustee in [CITY], [STATE]. "Opinion of Counsel" means a written opinion of counsel of recognized national standing in the field of law relating to municipal obligations, appointed and paid by the Corporation and satisfactory to and approved by the Trustee (who shall be under no liability by reason of such approval). "Outstanding" means, when used as of any particular time with reference to Certificates (subject to the provisions of Section 6.02), all Certificates except: (a) Certificates theretofore canceled by the Trustee or surrendered to the Trustee for cancellation; 5 Q�gAK, q 4830 - 8589- 9794.7 r-- m U p ORIGINAL. (b) Certificates paid or deemed to have been paid within the meaning of Section 8.01; and (c) Certificates in lieu of or in substitution for which other Certificates shall have been executed and delivered by the Corporation pursuant hereto. "Owner" means any person who shall be the registered owner of any Outstanding Certificate. "Permitted Investments" shall mean any of the following, but only to the extent permitted by the laws of the State and the City's investment policy: (a) United States Obligations; (b) Obligations, debentures, notes or other evidences of indebtedness issued or guaranteed by any of the following instrumentalities or agencies of the United States of America: Federal Home Loan Bank System; Export-Import Bank of the United States; Federal Financing Bank; Government National Mortgage Association; Federal National Mortgage Association; Student Loan Marketing Association; Federal Farm Credit Bureau; Farmers Home Administration; Federal Home Loan Mortgage Corporation; and Federal Housing Administration; (c) Direct and general long -term obligations of any state, which obligations are rated in one of the two highest Rating Categories by one or more of the Rating Agencies; (d) Direct and general short-term obligations of any state which obligations are rated in the highest Rating Category by one or more of the Rating Agencies; (e) Interest - bearing demand or time deposits (including certificates of deposit) or interests in money market portfolios issued by state banks or trust companies or national banking associations that are members of the Federal Deposit Insurance Corporation ( "FDIC ") or by savings and loan associations that are members of the FDIC, which deposits or interests must either be (i) continuously and fully insured by FDIC and with banks that are rated at least in the highest short-term Rating Category by one or more of the Rating Agencies or is rated in one of the two highest long -term Rating Categories by one or more of the Rating Agencies; or (ii) fully secured by obligations described in item (a) or (b) of this definition of Permitted Investments (A) which are valued not less frequently than monthly and have a fair market value, exclusive of accrued interest, at all times at least equal to the principal amount of the investment, (B) held by the Trustee (who shall not be the provider of the collateral) or by any Federal Reserve Bank or a depository acceptable to the Trustee, (C) subject to a perfected first lien in favor of the Trustee, and (D) free and clear from all third -party liens; (f) Long -term or medium -term corporate debt guaranteed by any corporation that is rated in one of the two highest Rating Categories by one or more of the Rating Agencies; 6 4830 - 8589 - 9794.7 t -- m ORIG(A;r1L (g) Repurchase agreements which are (A) entered into with banks or trust companies organized under state law, national banking associations, insurance companies or government bond dealers reporting to, trading with, and recognized as a primary dealer by, the Federal Reserve Bank of New York and which either are members of the Security Investors Protection Corporation or with a dealer or parent holding company that has an investment grade rating from one or more of the Rating Agencies and (B) fully secured by obligations specified in items (a) or (b) of this definition of Permitted Investments (1) which are valued not less frequently than monthly and have a fair market value, exclusive of accrued interest, at least equal to the amount invested in the repurchase agreements, (2) held by the Trustee (who shall not be the provider of the collateral) or by any Federal Reserve Bank or a depository acceptable to the Trustee, (3) subject to a perfected first lien in favor of the Trustee and (4) free and clear from all third -party liens; (h) Prime commercial paper of a United States corporation, finance company or banking institution rated in the highest short-term Rating Category of one or more of the Rating Agencies; (i) Shares of a diversified open -end management investment company (as defined in the Investment Company Act of 1940, as amended) or shares in a regulated investment company (as defined in Section 851(a) of the Code) that is (A) a money market fund that has been rated in one of the two highest Rating Categories by one or more of the Rating Agencies or (B) a money market fund or account of the Trustee or its affiliates or any state or federal bank that is rated at least in the highest short-term Rating Category by one or more of the Rating Agencies or is rated in one of the two highest long -term Rating Categories by one or more of the Rating Agencies, or whose own bank holding company parent is rated at least in the highest short-term Rating Category by one or more of the Rating Agencies or is rated in one of the two highest long -term Rating Categories by one or more of the Rating Agencies, or that has a combined capital and surplus of not less than $50,000,000 (all investments included in this clause (i) may include funds which the Trustee or its affiliates provide investment advisory or other management services); 0) Interest bearing notes issued by a banking institution having a combined capital and surplus of at least $500,000,000 and whose senior debt is in the highest Rating Category by one or more of the Rating Agencies; (k) Public housing bonds issued by public agencies which are either unconditionally guaranteed as to principal and interest by the United States of America, or rated in the highest Rating Category by one or more of the Rating Agencies; (1) Obligations issued or guaranteed by Private Export Funding Corporation, Resolution Funding Corporation and any other instrumentality or agency of the United States of America; (m) Investment Agreements; ®AKc � 4830 - 8589- 9794.7 % C� y� ORiGINA� (n) Any other type of investment consistent with City policy in which the City directs the Trustee to invest provided that there is delivered to the Trustee a certificate of an Authorized City Representative stating that each of the Rating Agencies then maintaining a rating on the Certificates has been informed of the proposal to invest in such investment and each of such Rating Agencies has confirmed that such investment will not adversely affect the rating then assigned by such rating agency to any of the Certificates; (o) Any state administered pool investment fund in which the City is statutorily permitted or required to invest (including but not limited to the State of California Local Agency Fund ( "LAIF ") established pursuant to Section 16429.1 et seq. of the Government Code of the State); and (p) any other investment which is a permitted investment of the City in accordance with the laws of the State. "Prepayment Price" means, with respect to any Certificate (or portion thereof), the principal amount with respect to such Certificate (or portion), plus the applicable premium, if any, payable upon prepayment thereof pursuant to the provisions of such Certificate and this Trust Agreement. "Principal Fund' means the account by that name established and maintained pursuant to Section 3.03. "Project" has the meaning ascribed to such term in the 2013 Installment Sale Agreement. "Project Costs" means all costs of payment of, or reimbursement for, the engineering, design, acquisition, installation, provision and financing of the Project, including, but not limited to, engineering and installation management costs, administrative costs and capital expenditures relating to financing payments, costs of accounting, feasibility, environmental and other reports, interest during the period of acquisition and installation of the Project, insurance costs, inspection costs, permit fees, filing and recording costs, printing costs, reproduction and binding costs, initial fees and charges of the Corporation and the Trustee, escrow fees, financing discounts, legal fees and charges, financial and other professional consultant fees and charges in connection with the foregoing. "Certificate Purchase Agreement" means that certain Certificate Purchase Agreement by and between the City and the Purchaser relating to the 2013 Installment Sale Agreement and the Certificates. "Purchase Price" means with respect to any Certificate (or portion thereof) the principal amount with respect to such Certificate (or portion), plus the applicable premium, if any, payable upon purchase thereof pursuant to the provisions of such Certificate and this Trust Agreement. "Purchaser" means I I as Purchaser /Underwriter of the Certificates. "Qualified Reserve Instrument" means an insurance policy meeting the requirements of Section 3.03(c). 4830 - 8589- 9794.7 t C, AK& .r "Rating Agency" and "Rating Agencies" shall mean Fitch, Moody's or S &P, or any other nationally recognized rating agency of municipal obligations, but only if such Rating Agencies have been requested by the City to maintain a rating on the Certificates and such Rating Agencies are then maintaining a rating on any of the Certificates. "Rating Category" and "Rating Categories" shall mean (a) with respect to any long -term rating category, all ratings designated by a particular letter or combination of letters, without regard to any numerical modifier, plus or minus sign or other modifier, and (b) with respect to any short-term rating category, all ratings designated by a particular letter or combination of letters and taking into account any numerical modifier, but not any plus or minus sign or other modifier. "Rebate Amount" means, for any given period, the amount determined by the Rebate Analyst as required to be rebated or paid as a yield reduction payment to the United States of America with respect to the Certificates. "Rebate Analyst" means the entity chosen by the City to determine the amount of required deposits, if any, to the Rebate Fund. "Rebate Analyst's Fee" means the fee payable to the Rebate Analyst, payable by the City in accordance with the 2013 Installment Sale Agreement. "Rebate Fund" means the fund by that name established and maintained pursuant to Section 4.04. "Record Date" means the fifteenth day of the month next preceding each Interest Payment Date, whether or not such day is a business day. [ "Related Document" or "Related Documents" has the meaning set forth in Section 9.03 of this Trust Agreement.] "Representation Letter" has the meaning set forth in Section 2.01 of this Trust Agreement. "Request" or "Certificate" means an instrument in writing signed on behalf of the City by an Authorized City Representative, and with respect to the Corporation means an instrument in writing signed on behalf of the Corporation by an Authorized Corporation Representative or other person at the time designated to act on behalf of the Corporation by written certificate furnished to the Trustee. "Reserve Fund" means the fund by that name established and maintained pursuant to Section 3.03. "Reserve Fund Requirement" means, as of any date of calculation, an amount equal to the least of (a) 10% of the initial stated principal amount (within the meaning of Section 148 of the Code) of the 2013 Installment Sale Payments; (b) 125% of the average annual 2013 Installment Sale Payments; or (c) the Maximum Annual Debt Service, as defined in the 2013 Installment Sale Agreement. Z 4830 - 8589- 9794.7 ti -- t)RIQNA1_ "Revenues" means all 2013 Installment Sale Payments and other payments paid by the City and received by the Corporation pursuant to the 2013 Installment Sale Agreement and all interest or other income from any investment of any money in any fund or account (other than the Rebate Fund) pursuant to Section 3.04. "Revenue Fund" means the fund by that name established and maintained pursuant to Section 3.02. "Securities Depositories" means: The Depository Trust Company, 711 Stewart Avenue, Garden City, New York 11530, Fax (516) 227 -4039 or 4190; or such other addresses and /or such other securities depositories as the Corporation may designate to the Trustee in writing. "State" means the State of California. "Supplemental Trust Agreement" means any trust agreement then in full force and effect which has been duly executed and delivered by the Corporation and the Trustee amendatory hereof or supplemental hereto; but only if and to the extent that such Supplemental Trust Agreement is specifically authorized hereunder. "Surplus Account" means the account by that name established and maintained pursuant to Section 3.03. "S &P" shall mean Standard & Poor's Ratings Services, a corporation organized and existing under the laws of the State of New York, its successors and their assigns, and if such corporation shall for any reason no longer perform the functions of a securities rating agency, "S &P" shall be deemed to refer to any other nationally recognized securities rating agency designated by the City. "Tax Certificate" means the Tax Certificate dated the date of initial delivery of the Certificates and executed and delivered by the City. "Trust Agreement" means this Trust Agreement, dated as of 1, 2013, by and among the Corporation, the City and the Trustee, as originally executed and as it may from time to time be amended or supplemented by all Supplemental Trust Agreements executed pursuant to the provisions hereof. "Trustee" means ( or any successor thereto appointed pursuant to this Trust Agreement. "Trustee's Fee" means the annual administration fee of the Trustee, payable by the City in accordance with the 2013 Installment Sale Agreement. "United States Obligations" shall mean direct and general obligations of the United States of America, or obligations that are unconditionally guaranteed as to principal and interest by the United States of America, including, with respect only to direct and general obligations and not to guaranteed obligations, evidences of ownership of proportionate interests in future interest and /or principal payments of such obligations, provided that investments in such proportionate interests must be limited to circumstances wherein: (a) a bank or trust company 10 <<�AKF9 4830 - 8589- 9794.7 - m acts as custodian and holds the underlying United States Obligations; (b) the owner of the investment is the real party in interest and has the right to proceed directly and individually against the obligor of the underlying United States Obligations; and (c) the underlying United States Obligations are held in a special account separate from the custodian's general assets and are not available to satisfy any claim of the custodian, any person claiming through the custodian or any person to whom the custodian may be obligated. "United States Obligations" shall include any stripped interest or principal portion of United States Treasury securities and any stripped interest portion of Resolution Funding Corporation securities. "2013 Installment Sale Agreement" means the 2013 Installment Sale Agreement, dated as of 1, 2013, between the Corporation and the City as originally executed and as may from time to time be amended or supplemented pursuant to the provisions hereof and thereof. "2013 Installment Sale Payments" means the periodic payments scheduled to be paid by the City under and pursuant to the 2013 Installment Sale Agreement. Section 1.02. Equal Security. In consideration of the acceptance of the Certificates by the Owners and, if there is a Credit Provider, the delivery of a Credit Facility by the Credit Provider, this Trust Agreement shall be deemed to be and shall constitute a contract among the Trustee, the City, the Credit Provider (if any), and the Owners to secure the full and final payment of the interest and principal evidenced and represented by the Certificates, subject to the agreements, conditions, covenants and terms contained herein; and all agreements, conditions, covenants and terms contained herein required to be observed or performed by or on behalf of the Trustee shall be for the equal and proportionate benefit, protection and security of all Owners without distinction, preference or priority as to benefit, protection or security of any Certificates over any other Certificates by reason of the number or date thereof or the time of execution or delivery thereof or otherwise for any cause whatsoever, and for the benefit of the Credit Provider (if any), except as expressly provided herein or therein. The Credit Provider (if any) shall be deemed a third -party beneficiary of all covenants and conditions contained in this Trust Agreement. ARTICLE II EXECUTION AND DELIVERY OF CERTIFICATES Section 2.01. Preparation and Purpose of Certificates. The Corporation has reviewed all proceedings heretofore taken relative to the authorization of the Certificates and has found, as a result of such review, and hereby finds and determines that all acts, conditions and things required by law to exist, to have happened and to have been performed precedent to and in the execution and delivery of the Certificates do exist, have happened and have been performed in due time, form and manner as required by law, and that the Corporation is now duly authorized, pursuant to each and every requirement of the Nonprofit Public Benefit Corporation Law, to cause the Certificates to be executed and delivered in the form and manner provided herein for the purpose of providing funds to pay for and construct the Project, and that the Certificates shall be entitled to the benefit, protection and security of the provisions hereof. The Trustee is hereby authorized and directed to prepare the Certificates in the initial aggregate principal amount of $ , evidencing and representing the aggregate principal components of the 2013 11 0� g AKF9� 4830 -8589- 9794.7 r t _m V (D ORIGNAL Installment Sale Payments and each evidencing and representing a proportionate, undivided interest in the 2013 Installment Sale Payments. The City hereby authorizes the Trustee to execute a letter of representations to be delivered to DTC in connection with the delivery of the Note Participations (the "Representation Letter "). The City is required to make the 2013 Installment Sale Payments with respect to the 2013 Installment Sale Agreement which shall be evidenced by the Certificates which evidence and represent a proportionate and undivided interest in the 2013 Installment Sale Payments. The City has, pursuant to the City Resolution, authorized and directed the Trustee on behalf of the City to prepare and execute the Certificates and to deliver the Certificates to the Purchaser upon payment of the purchase price thereof, pursuant to the terms of this Trust Agreement. Section 2.02. Terms of the Certificates. The Certificates shall be designated "City of Bakersfield Gas Tax, Transportation Impact Fee and Restricted Utility Franchise and Surcharge Revenue Certificates of Participation, Series 2013 (Thomas Roads Improvement Program)." The Certificates shall be dated as of _, 2013, shall be executed and delivered only in fully registered form in denominations of $5,000 or any integral multiple of $5,000 (not exceeding the principal amount of Certificates payable at any one time), and shall be payable on the Certificate Payment Dates and in the principal amounts and evidence and represent interest at the rates as set forth in the following schedule: Certificate Payment Date (__) Principal Amount Interest Rate Except as otherwise provided in Section 2.13 hereof, the principal evidenced and represented by the Certificates shall be payable in lawful money of the United States of America by check upon presentation thereof at maturity or on prepayment prior to maturity at the Office of the Trustee. The Certificates shall evidence and represent interest at the rates set forth above, payable on the Interest Payment Date. The Certificates shall evidence and represent interest from the Interest Payment Date next preceding the date of registration thereof, unless such date of registration is an Interest Payment Date, in which event they shall evidence and represent interest from such date, or unless such date of registration is prior to the first Interest Payment Date, in which event they shall evidence and represent interest from , 20_; provided, 12 4830 -8589- 9794.7 o`` g A K, �� Fn U ORIGINAL however, that if at the time of registration of any Certificate interest is then in default on the Outstanding Certificates, such Certificate shall evidence and represent interest from the Interest Payment Date to which interest has previously been paid or made available for payment on the Outstanding Certificates. Payment of interest evidenced and represented by the Certificates due on or before the maturity or prior prepayment thereof shall be made to the person whose name appears in the Certificates registration records maintained by the Trustee pursuant to Section 2.08 as the registered owner thereof as of the close of business on the Record Date preceding each Interest Payment Date, whether or not such day is a Business Day, such interest to be paid by check mailed (except as otherwise provided in Section 2.13 hereof) on such Interest Payment Date (or the next Business Day if such Interest Payment Date is not a Business Day) to such registered owner at the address as it appears in such books or at such other address as may have been filed with the Trustee for that purpose. Except as otherwise provided in Section 2.13 hereof, payment of the principal evidenced and represented by the Certificates shall be made by check upon the surrender thereof at maturity or on prepayment prior to maturity at the Office of the Trustee. The Owner of $1,000,000 or more in aggregate principal amount evidenced by the Certificates may request in writing that the Trustee pay the interest evidenced by such Certificates by wire transfer and the Trustee shall comply with such request for all Interest Payment Dates following the fifteenth day after receipt of such request until such request is rescinded. Section 2.03. Prepayment of Certificates. (a) Optional Prepayment. The Certificates maturing on or after , 20_, shall be subject to optional prepayment prior to maturity, at the option of the Corporation upon direction of the City, on or after , 20_ in whole or in part (by lot within any maturity), on any date, at a prepayment price equal to the principal amount to be prepaid, plus accrued interest to the date fixed for prepayment, without premium. The City shall provide notice to the Corporation and the Trustee at least 45 days prior to the prepayment date (or such lesser period of time acceptable to the Trustee in its sole discretion) specifying the principal amount evidenced by and maturities of the 2013 Installment Sale Payments to be prepaid. (b) Mandatory Sinking Fund Prepayment. The Certificates maturing on 20_, are subject to mandatory prepayment on of each year commencing 20_, in part, from mandatory sinking fund payments, on each specified below, at a prepayment price equal to the principal evidenced thereby, plus accrued interest evidenced thereby to the date fixed for prepayment, without premium. The principal evidenced by such Certificates to be so prepaid and the dates therefor shall be as follows: Mandatory Prepayment Date Principal Amount M. o�gAKF9� 13 4830 - 8589- 9794.7 � o ORIGINAL The amount of each such prepayment shall be reduced in the event and to the extent that 2013 Installment Sale Payments payable on the [corresponding Certificate Payment Date] are optionally prepaid pursuant to the 2013 Installment Sale Agreement and applied to the prepayment of Certificates maturing on , 20_. In such event, the City shall provide the Trustee with a revised sinking fund prepayment schedule. The Certificates maturing on , 20_, are subject to mandatory prepayment on of each year commencing , 20_ in part, from mandatory sinking fund payments, on each specified below, at a prepayment price equal to the principal evidenced thereby, plus accrued interest evidenced thereby to the date fixed for prepayment, without premium. The principal evidenced by such Certificates to be so prepaid and the dates therefor shall be as follows: Mandatory Prepayment Date ( Principal Amount The amount of each such prepayment shall be reduced in the event and to the extent that 2013 Installment Sale Payments payable on the corresponding [Certificate Payment Date] are optionally prepaid pursuant to the 2013 Installment Sale Agreement and applied to the prepayment of Certificates maturing on , 20_. In such event, the City shall provide the Trustee with a revised sinking fund prepayment schedule. (c) Selection of Certificates. Whenever provision is made in this Trust Agreement for the prepayment or purchase of less than all of the Certificates or any given portion thereof, the Trustee shall, select the Certificates, pro rata among maturities, as specified by the City to be prepaid or purchased, from all Certificates subject to prepayment or purchase or such given portion thereof equal to a multiple of $5,000 or any integral multiple thereof not previously called for prepayment or purchase. If the City fails to designate the prepayment order of the Certificates, then such prepayment shall be done on a proportionate basis among all of the Certificates and by lot within a maturity. The Trustee shall promptly notify the Corporation in writing of any prepayment or purchase of Certificates and of the Certificates or portions thereof so selected for prepayment or purchase. (d) [Purchase in Lieu of Prepayment. In lieu of prepayment of any Certificates, amounts on deposit in the Revenue Fund or in any sinking account therein may also be used and withdrawn by the Trustee at any time, upon the Request of the Corporation, for the purchase of such Certificates at public or private sale as and when 14 4830 -8589- 9794.7 �� g AK,r9q y -n M r- c� c7 ORIG Na.L and at such prices (including brokerage and other charges, but excluding accrued interest, which is payable from the Interest Fund) as the Corporation may in its discretion determine, but not in excess of the principal amount thereof plus accrued interest to the purchase date. The principal amount of any Certificates so purchased by the Trustee in any 12 -month period ending 60 days prior to any Certificate Payment Date in any year shall be credited towards and shall reduce the principal amount of such Term Certificates required to be prepaid on such Certificate Payment Date in such year. Any purchase of Certificates in lieu of prepayment shall require the prior written approval of the Credit Provider (if any) if any Certificate so purchased is not cancelled upon purchase.] (e) Notice or Prepayment or Purchase. Notice of prepayment or purchase shall be mailed by first -class mail by the Trustee, not less than 30 nor more than 60 days prior to the prepayment or purchase date, to (i) the respective Owners of any Certificates designated for prepayment or purchase at their addresses appearing on the registration books of the Trustee, and (ii) if the Certificates are no longer held by the depository, to the Securities Depositories and the Municipal Securities Rulemaking Board through its Electronic Municipal Marketplace Access (EMMA) System. Notice of prepayment shall be given by facsimile, certified, registered, or overnight mail to the Securities Depositories and the Municipal Securities Rulemaking Board through its Electronic Municipal Marketplace Access (EMMA) System. Each notice of prepayment or purchase shall state the date of such notice, the date of initial execution and delivery of the Certificates, the prepayment or purchase date, the Prepayment Price or Purchase Price, the place or places of prepayment or purchase (including the name and appropriate address or addresses of the Trustee), the CUSIP number (if any) of the Certificates of each Certificate Payment Date or Dates, and, if less than all of the Certificates of any such Certificate Payment Date, the distinctive certificate numbers of the Certificates with such Certificate Payment Date, to be prepaid or purchased and, in the case of Certificates to be prepaid or purchased in part only, the respective portions of the principal amount thereof to be prepaid or purchased. Each such notice shall also state that on said date there will become due and payable on each of said Certificates the Prepayment Price or Purchase Price represented thereby or of said specified portion of the principal amount thereof in the case of a Certificate to be prepaid or purchased in part only, together with interest accrued with respect thereto to the prepayment or purchase date, and that from and after such prepayment or purchase date, interest thereon shall cease to accrue, and shall require that such Certificates be then surrendered at the address or addresses of the Trustee specified in the prepayment or purchase notice. If any of the Certificates are prepaid pursuant to an advance refunding, notice of such advance refunding and prepayment shall be given in the same manner as above provided, and also within the same time period with respect to the actual prepayment date. Notice of prepayment or purchase of Certificates shall be given by the Trustee, at the expense of the Corporation. Conditional notice of prepayment may be given at the direction of the Corporation and shall be given if funds sufficient to prepay the Certificates are not then on deposit with the Trustee. 15 4830 - 8589- 9794.7 r <_i o RHGINAL Failure by the Trustee to give notice pursuant to this Section 2.03 to the Municipal Securities Rulemaking Board through its Electronic Municipal Marketplace Access (EMMA) System or Securities Depositories shall not affect the sufficiency of the proceedings for prepayment or purchase. Failure by the Trustee to mail notice of prepayment or purchase pursuant to this Section 2.03 to any one or more of the respective Owners of any Certificates designated for prepayment or purchase shall not affect the sufficiency of the proceedings for prepayment with respect to the Owner or Owners to whom such notice was mailed. (f) Partial Prepayment of Purchase of Certificates. Upon surrender of any Certificate to be prepaid or purchased in part only, the Trustee shall execute and deliver to the registered owner thereof, at the expense of the Corporation, a new Certificate or Certificates of authorized denominations, and having the same Certificate Payment Date, equal in aggregate principal amount to the unprepaid or unpurchased portion of the Certificate surrendered. (g) Effect of Prepayment. Notice of prepayment having been duly given as aforesaid, and moneys for payment of the Prepayment Price of, together with interest accrued to the prepayment date with respect to, the Certificates (or portions thereof) so called for prepayment being held by the Trustee, on the prepayment date designated in such notice, the Certificates (or portions thereof) so called for prepayment shall become due and payable at the Prepayment Price specified in such notice and interest accrued with respect thereto to the prepayment date, interest with respect to the Certificates so called for prepayment shall cease to accrue, said Certificates (or portions thereof) shall cease to be entitled to any benefit or security under this Trust Agreement, and the Owners of said Certificates shall have no rights in respect thereof except to receive payment of said Prepayment Price and accrued interest. All Certificates prepaid pursuant to the provisions of this Section shall be cancelled upon surrender thereof by the Trustee. All Certificates purchased pursuant to the provisions of this Section shall be registered in the name of the Corporation and delivered to, or as directed in writing by, the Corporation. Section 2.04. Form of Certificates. The Certificates and the registration endorsement and assignment to appear thereon shall be substantially in the forms set forth in Exhibit A hereto attached and by this reference herein incorporated (provided that on the face of each Certificates, at the place where the portion of the form set forth below appears on the reverse side of such Certificate, there shall be inserted the following sentence: REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS CERTIFICATE SET FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL, FOR ALL PURPOSES, HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE). Section 2.05. Execution of Certificates. The Certificates shall be executed by the Trustee by the manual signature of an authorized signatory of the Trustee. Only those Certificates executed manually and dated by the Trustee, shall be entitled to any benefit, protection or security hereunder or be valid or obligatory for any purpose, and such execution by the Trustee shall be conclusive evidence that the Certificates so executed and registered have C14 4830 - 8589- 9794.7 �gAK�9 Cam' S� t rn _ i_ been duly authorized, executed and delivered hereunder and are entitled to the benefit, protection and security hereof. Section 2.06. Transfer and Payment of Certificates. Any Certificates may, in accordance with its terms, be transferred in the records maintained pursuant to the provisions of Section 2.08 by the person in whose name it is registered, in person or by his duly authorized attorney, upon surrender of such Certificates for cancellation accompanied by delivery of a duly executed written instrument of transfer in a form approved by the Trustee. Whenever any Certificates shall be surrendered for transfer, the Trustee shall execute and deliver to the transferee a new Certificate or Certificates of the same series and maturity for a like aggregate principal amount. The Trustee shall require the payment by the Owner requesting such transfer of any tax or other governmental charge required to be paid with respect to such transfer as a condition precedent to the exercise of such privilege. The Corporation and the Trustee may deem and treat the registered owner of any Certificates as the absolute owner of such Certificates for the purpose of receiving payment thereof and for all other purposes, whether such Certificates shall be overdue or not, and neither the Corporation nor the Trustee shall be affected by any notice or knowledge to the contrary; and payment of the interest and principal and prepayment premium, if any, evidenced and represented by such Certificates shall be made only to such registered owner, which payments shall be valid and effectual to satisfy and discharge liability on such Certificates to the extent of the sum or sums so paid. The Trustee shall not be required to execute, register the transfer of or exchange any Certificates during the 15 days preceding each Interest Payment Date or the date of selection by the Trustee of Certificates for prepayment, or to register the transfer of or exchange any Certificates which have been selected for prepayment in whole or in part. Section 2.07. Exchange of Certificates. Certificates may be exchanged at the office of the Trustee for a like aggregate principal amount of Certificates of the same series and payment date of other authorized denominations. The Trustee shall require the payment by the Owner requesting such exchange of any tax or other governmental charge required to be paid with respect to such exchange as a condition precedent to the exercise of such privilege. Section 2.08. Certificate Registration Books. The Trustee will keep at its office sufficient books for the registration and transfer of the Certificates which shall at all times be open to inspection by the City or any Owner on reasonable notice during regular business hours on any Business Day, and upon presentation for such purpose the Trustee shall, under such reasonable regulations as it may prescribe, register or transfer the Certificates in such books as hereinabove provided. Section 2.09. Mutilated, Destroyed, Stolen or Lost Certificates. If any Certificate shall become mutilated the Trustee at the expense of the Owner shall thereupon authenticate and deliver a new Certificate of like tenor and number in exchange and substitution for the Certificate so mutilated, but only upon surrender to the Trustee of the Certificate so mutilated. Every mutilated Certificate so surrendered to the Trustee shall be canceled. 17 �c �AK69' 4830 -8589- 9794.7 O JT F- m ORIGiNAi. If any Certificate shall be lost, destroyed or stolen, evidence of such loss, destruction or theft may be submitted to the Trustee and, if such evidence be satisfactory to the Trustee and the Corporation and indemnity satisfactory to the Trustee and the Corporation shall be given, the Trustee, at the expense of the Owner, shall thereupon execute and deliver, a new Certificate of like tenor and number in lieu of and in substitution for the Certificate so lost, destroyed or stolen. The Trustee may require payment of a reasonable sum for each new Certificate executed and delivered under this Section 2.09 and of the expenses which may be incurred by the Corporation and the Trustee in the premises. Any Certificate executed and delivered under the provisions of this Section in lieu of any Certificate alleged to be lost, destroyed or stolen shall be equally and proportionately entitled to the benefits of this Trust Agreement with all other Certificates of the same series secured by this Trust Agreement. Neither the Corporation nor the Trustee shall be required to treat both the original Certificate and any duplicate Certificate as being Outstanding for the purpose of determining the principal amount of Certificates which may be executed and delivered hereunder or for the purpose of determining any percentage of Certificates Outstanding hereunder, but both the original and duplicate Certificate shall be treated as one and the same. Section 2.10. Temporary Certificates. The Certificates executed and delivered under this Trust Agreement may be initially executed and delivered in temporary form exchangeable for definitive Certificates when ready for delivery. The temporary Certificates may be printed, lithographed or typewritten, shall be of such denominations as may be determined by the Trustee, shall be in fully registered form and may contain such reference to any of the provisions of this Trust Agreement as may be appropriate. Every temporary Certificate shall be executed and delivered by the Trustee upon the same conditions and terms and in substantially the same manner as definitive Certificates. If the Trustee executes and delivers temporary Certificates it will execute and furnish definitive Certificates without delay and thereupon the temporary Certificates may be surrendered, for cancellation, in exchange therefor at the Office of the Trustee, and the Trustee shall deliver in exchange for such temporary Certificates an equal aggregate principal amount of definitive Certificates of authorized denominations. Until so exchanged, the temporary Certificates shall be entitled to the same benefits under this Trust Agreement as definitive Certificates delivered hereunder. Section 2.11. Procedure for the Execution and Delivery of Certificates; Establishment of Funds and Accounts. At any time after the sale of the Certificates, the Trustee shall execute the Certificates for delivery hereunder, and thereupon the Certificates shall be delivered by the Trustee to the purchaser thereof upon the Request of the Corporation and upon receipt of payment therefor from the purchaser thereof. Upon receipt of payment for the Certificates from the purchaser thereof, the Trustee shall set aside and deposit the proceeds received from such sale in the following respective accounts or funds or with the following respective persons, in the following order of priority: (a) The Trustee shall deposit in the Reserve Fund within the Revenue Fund established pursuant to Section 3.03 hereof a sum equal to the Reserve Fund Requirement. 0 AKF9 18 4830 - 8589- 9794.7 r -- m :)RIGIIVAL (b) The "Cost of Issuance Fund" is hereby established as a separate trust fund with the Trustee. The Trustee shall deposit a sum equal to the amount set forth in such Request of the Corporation in the Cost of Issuance Fund. The moneys in the Cost of Issuance Fund shall be disbursed, upon the Request of the Corporation, to pay Costs of Issuance. Upon the payment in full of the Costs of Issuance or the making of adequate provision for the payment thereof, evidenced by a Certificate of the Corporation to the Trustee, any balance remaining in such fund shall be transferred to the Acquisition Fund, and pending such transfer and application, the moneys in such fund may be invested as permitted by Section 3.04 hereof, provided, however, that investment income resulting from any such investment shall be retained in the Cost of Issuance Fund. (c) There shall be further created a special trust fund to be held by the Trustee called the "Acquisition Fund." The Trustee shall deposit a sum equal to the amount set forth in such Request of the Corporation in the Acquisition Fund. Moneys in the Acquisition Fund shall be disbursed to the City pursuant to a Requisition in the form attached hereto as Exhibit B. Such Requisition shall be in the form of a sequentially numbered requisition and shall set forth the name and address of the person or persons to whom said amounts are to be disbursed and state the amounts to be disbursed are for Project Costs properly chargeable to the Acquisition Fund and have not been the subject of any previous requisition. Upon delivery to the Trustee of a Request of the City, any Certificate proceeds remaining in the Acquisition Fund upon completion of the Project (which completion shall be evidenced by such Request of the City) shall be applied by the Trustee to offset scheduled 2013 Installment Sale Payments required to be paid by the City under the 2013 Installment Sale Agreement or in such other manner as may be directed in such Request of the City. Unless the Credit Provider (if any) otherwise directs, upon the occurrence and continuance of an Event of Default or an event which with notice or lapse of time would constitute an Event of Default, amounts on deposit in the Acquisition Fund shall not be disbursed, but shall instead be applied to the payment of the scheduled principal and interest represented by the Certificates as such amounts become due and payable or the prepayment price of the Certificates. Section 2.12. Validity of Certificates. The validity of the Certificates shall not be dependent on or affected in any way by the proceedings taken by the Corporation or the Trustee for the financing of the Project or by any contracts made by the Corporation or its agents in connection therewith, and shall not be dependent upon the completion of the Project or upon the performance by any person, firm or corporation of his or its obligation with respect thereto. The recital contained in the Certificates that the same are executed and delivered pursuant hereto shall be conclusive evidence of their validity and of the regularity of their execution and delivery, and all Certificates shall be incontestable from and after their execution and delivery. The Certificates shall be deemed to be executed and delivered, within the meaning hereof, whenever the definitive Certificates (or any temporary Certificates exchangeable therefor) shall have been delivered to the purchaser thereof and the proceeds of sale thereof received. Section 2.13. Special Covenants as to Book -Entry Only System for Certificates. (a) Except as otherwise provided in Sections 2.13(a) and (b), all of the Certificates initially executed and delivered shall be registered in the name of Cede & 19 4830 -8589- 9794.7 11 g, A o 9s ORIGINAL y n r -- Co., as nominee for The Depository Trust Company, New York, New York ( "DTC "), or such other nominee as DTC shall request pursuant to the Representation Letter. Payment of the interest evidenced and represented by any Certificate registered in the name of Cede & Co. shall be made on each Interest Payment Date for such Certificates to the account, in the manner and at the address indicated in or pursuant to the Representation Letter. (b) The Certificates initially shall be executed and delivered in the form of a single authenticated fully registered certificate for each stated payment date of such Certificates, representing the aggregate principal amount evidenced and represented by the Certificates payable on such payment date. Upon initial execution and delivery, the ownership of all such Certificates shall be registered in the registration records maintained by the Trustee pursuant to Section 2.08 hereof in the name of Cede & Co., as nominee of DTC, or such other nominee as DTC shall request pursuant to the Representation Letter. The Trustee, the City, the Corporation and any paying agent may treat DTC (or its nominee) as the sole and exclusive owner of the Certificates registered in its name or the name of its nominee for the purposes of payment of the principal or prepayment price and interest evidenced and represented by such Certificates, selecting the Certificates or portions thereof to be prepaid, giving any notice permitted or required to be given to Owners hereunder, registering the transfer of Certificates, obtaining any consent or other action to be taken by Owners of the Certificates and for all other purposes whatsoever; and neither the Trustee or the Corporation or any paying agent shall be affected by any notice to the contrary. Neither the Trustee, the City, nor the Corporation or any paying agent shall have any responsibility or obligation to any Participant (which shall mean, for purposes of this Section 2.13, securities brokers and dealers, banks, trust companies, clearing corporations and other entities, some of whom directly or indirectly own DTC), any person claiming a beneficial ownership interest in the Certificates under or through DTC or any Participant, or any other person which is not shown on the registration records as being a Owner, with respect to (i) the accuracy of any records maintained by DTC or any Participant; (ii) the payment by DTC or any Participant of any amount in respect of the principal, prepayment price or interest evidenced and represented by the Certificates; (iii) any notice which is permitted or required to be given to Owners of Certificates hereunder; (iv) the selection by DTC or any Participant of any person to receive payment in the event of a partial prepayment of the Certificates; or (v) any consent given or other action taken by DTC as Owner of Certificates. The Trustee shall pay all principal, premium, if any, and interest evidenced and represented by the Certificates only at the times, to the accounts, at the addresses and otherwise in accordance with the Representation Letter, and all such payments shall be valid and effective to satisfy fully and discharge the obligations with respect to the principal, premium, if any, and interest evidenced and represented by the Certificates to the extent of the sum or sums so paid. 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 its then existing nominee, the Certificates will be transferable to such new nominee in accordance with Section 2.13(f). (c) In the event that the Corporation determines that it is in the best interests of the City or the beneficial owners of the Certificates that they be able to obtain p,AK6 20 9 4830 - 8589- 9794.7 = �� r c� O C)RIG NAL. certificates, the Trustee shall, upon the written instruction of the Corporation, so notify DTC, whereupon DTC shall notify the Participants of the availability through DTC of such certificates. In such event, the Certificates will be transferable in accordance with subsection (f) of this Section 2.13. DTC may determine to discontinue providing its services with respect to the Certificates at any time by giving written notice of such discontinuance to the Corporation, the City and the Trustee and discharging its responsibilities with respect thereto under applicable law. In such event, the Certificates will be transferable in accordance with Section 2.13(f). Whenever DTC requests the Corporation, the City and the Trustee to do so, the Trustee, the City and the Corporation will cooperate with DTC in taking appropriate action after reasonable notice to arrange for another securities depository to maintain custody of all certificates evidencing the Certificates then Outstanding. In such event, the Certificates will be transferable to such securities depository in accordance with Section 2.13(f), and thereafter, all references in this Trust Agreement to DTC or its nominee shall be deemed to refer to such successor securities depository and its nominee, as appropriate. (d) Notwithstanding any other provision of this Trust Agreement to the contrary, so long as all Certificates Outstanding are registered in the name of any nominee of DTC, all payments with respect to the principal, premium, if any, and interest evidenced and represented by such Certificate and all notices with respect to each such Certificate shall be made and given, respectively, to DTC as provided in the Representation Letter. (e) The Trustee is hereby authorized and requested to execute and deliver the Representation Letter and, in connection with any successor nominee for DTC or any successor depository, enter into comparable arrangements, and shall have the same rights and immunities with respect to its actions thereunder as it has with respect to its actions under this Trust Agreement. (f) In the event that any transfer or exchange of Certificates is authorized under Section 2.13(b) or (c), such transfer or exchange shall be accomplished upon receipt by the Trustee from the registered Owner thereof of the Certificates to be transferred or exchanged and appropriate instruments of transfer to the permitted transferee, all in accordance with the applicable provisions of Sections 2.06 and 2.07 hereof. In the event Certificates are delivered to Owners other than Cede & Co., its successor as nominee for DTC as Owner of all the Certificates, another securities depository as Owner of all the Certificates, or the nominee of such successor securities depository, the provisions of Sections 2.06 and 2.07 hereof shall also apply to, among other things, the registration, exchange and transfer of the Certificates and the method of payment of principal, premium, if any, and interest evidenced and represented by the Certificates. 21 4830 -8589- 9794.7 y -r F. m U O ORIGINAL LIV111 42111 REVENUES Section 3.01. Pledge of Revenues; Assignment. All Revenues and any other amounts (including proceeds of the sale of the Certificates) held by the Trustee in any fund or account established hereunder (other than amounts on deposit in the Acquisition Fund created pursuant to Section 2.11 and the Rebate Fund created pursuant to Section 4.04) are hereby irrevocably pledged to the payment of the principal, interest and premium, if any, evidenced and represented by the Certificates as provided herein, and the Revenues shall not be used for any other purpose while any of the Certificates remain Outstanding; provided, however, that out of the Revenues and other moneys there may be applied such sums for such purposes as are permitted hereunder. This pledge shall constitute a first pledge of and charge and lien upon the Revenues and all other moneys on deposit in the funds and accounts established hereunder (other than amounts on deposit in the Acquisition Fund created pursuant to Section 2.11 and the Rebate Fund created pursuant to Section 4.04) for the payment of the interest and principal evidenced and represented by the Certificates in accordance with the terms hereof and thereof. The Corporation hereby assigns to the Trustee all of the Corporation's rights and remedies under the 2013 Installment Sale Agreement, including, but not limited to, the Corporation's security interest in and lien upon the Revenues. Section 3.02. Receipt and Deposit of Revenues in the Revenue Fund. In order to carry out and effectuate the pledge, charge and lien contained herein, the Corporation agrees and covenants that all Revenues when and as received shall be received by the Corporation in trust hereunder for the benefit of the Owners and shall be deposited when and as received by the Corporation in the "Revenue Fund" which fund is hereby created and which fund the Corporation hereby agrees and covenants to maintain with the Trustee so long as any Certificates shall be Outstanding under this Trust Agreement. All Revenues, whether received by the Corporation in trust or deposited with the Trustee as herein provided, shall nevertheless be allocated, applied and disbursed solely for the purposes and uses hereinafter in this Article set forth, and shall be accounted for separately and apart from all other accounts, funds, money or other resources of the Corporation, and the Corporation shall have no beneficial right or interest in any of the Revenues except only as herein provided. Section 3.03. Establishment and Maintenance of Funds and Accounts for Use of Money in the Revenue Fund. Subject to Section 4.04, all money in the Revenue Fund shall be set aside by the Trustee in the following respective special funds and accounts within the Revenue Fund in the following order of priority: (i) Interest Fund; (ii) Principal Fund; (ii) Reserve Fund; (iv) Administration Fund; and 22 4830 -8589- 9794.7 r- m U &-, ORitr,-iNAI (v) Surplus Account. All money in each of such funds and accounts shall be held in trust by the Trustee and shall be applied, used and withdrawn only for the purposes hereinafter authorized in this Section. (a) Interest Fund. On or before the Business Day immediately preceding each Interest Payment Date, the Trustee shall set aside from amounts deposited by the City in the Revenue Fund and deposit in the Interest Fund that amount of money which is equal to the amount of interest becoming due and payable on the next succeeding Interest Payment Date. No such deposit need be made if the amount contained in the Interest Fund is at least equal to the aggregate amount of interest becoming due and payable in connection with the 2013 Installment Sale Agreement on such Interest Payment Date. All money in the Interest Fund shall be used and withdrawn by the Trustee solely for the purpose of paying the interest evidenced and represented by the Certificates as it shall become due and payable (including accrued interest evidenced and represented by any Certificates purchased or prepaid prior to the payment dates thereof). (b) Principal Fund. On or before the Business Day immediately preceding each Certificate Payment Date the Trustee shall set aside from amounts deposited by the City in the Revenue Fund and deposit in the Principal Fund an amount of money equal to the amount of principal becoming due and payable on the next succeeding Certificate Payment Date. No such deposit need be made if the amount contained in the Principal Fund is at least equal to the aggregate amount of principal becoming due and payable in connection with the 2013 Installment Sale Agreement on such Certificate Payment Date. All money in the Principal Fund shall be used and withdrawn by the Trustee solely for the purpose of paying the principal evidenced and represented by the Certificates as it shall become due and payable, whether on their respective Certificate Payment Dates or prepayment, except that any money in any sinking fund account shall be used and withdrawn by the Trustee only to purchase or to prepay or to pay Term Certificates for which such sinking fund account was created. (c) Reserve Fund. The Trustee shall set aside from amounts deposited by the City in the Revenue Fund and deposit in the Reserve Fund that amount of money (or other authorized deposit of security) which shall be required to maintain the Reserve Fund in the full amount of the Reserve Fund Requirement. No deposit need be made in the Reserve Fund so long as there shall be on deposit therein a sum equal to the Reserve Fund Requirement. All money in the Reserve Fund (including all amounts which may be obtained from any insurance policy on deposit in the Reserve Fund) shall be used and withdrawn by the Trustee solely for the purpose of replenishing the Interest Fund or the Principal Fund, in that order, in the event of any deficiency at any time in either of such funds, but solely for the purpose of paying the interest, principal or prepayment premiums, if any, payable in connection with the 2013 Installment Sale Agreement, except that any cash amounts in the Reserve Fund in excess of the amount required to be on deposit therein shall be withdrawn from the Reserve Fund on each Interest Payment Date and deposited in the Interest Fund. 23 4830 -8589- 9794.7 g AKE9 ORIGNAL o- m U p In lieu of making a Reserve Fund Requirement deposit or in replacement of moneys then on deposit in the Reserve Fund (which shall be transferred by the Trustee to the City upon delivery of an insurance policy satisfying the requirements stated below), the City may also deliver to the Trustee an insurance policy (a "Qualified Reserve Instrument ") securing an amount, together with moneys or Permitted Investments on deposit in the Reserve Fund, no less than the Reserve Fund Requirement, issued by an insurance company licensed to issue insurance policies guaranteeing the timely payment of the principal and interest components of the 2013 Installment Sale Agreement and whose unsecured debt obligations (or for which obligations secured by such insurance company's insurance policies) are rated in the two highest Rating Categories of the Rating Agencies. The prior written consent of the Credit Provider (if any) shall be a condition precedent to the deposit of any credit instrument provided in lieu of a cash deposit into the Reserve Fund, if any. Notwithstanding anything to the contrary set forth in this Trust Agreement, amounts on deposit in the Reserve Fund shall be applied solely to the payment of debt service due on the Certificates. If and to the extent that the Reserve Fund has been funded with a combination of cash (or Permitted Investments) and a Qualified Reserve Instrument, then all such cash (or permitted Investments) shall be completely used before any demand is made on such Qualified Reserve Instrument, and replenishment of the Qualified Reserve Instrument shall be made prior to any replenishment of any cash (or Permitted Investments). If the Reserve Fund is funded, in whole or in part, with more than one Qualified Reserve Instrument, then any draws made against such Qualified Reserve Instrument shall be made pro -rata. The provider and the structure of any Qualified Reserve Instrument delivered pursuant to this Section 3.03(c) must be consented to in writing by the Credit Provider (if any). (d) Administration Fund. On or before the Business Day immediately preceding each Certificate Payment Date, the Trustee shall set aside from amounts deposited by the City in the Revenue Fund and deposit in the Administration Fund an amount equal to the Administration Fee. All money in the Administration Fund shall be used and withdrawn by the Trustee solely for the purpose of paying the fees of the Trustee and the Rebate Analyst, payable with respect to the 2013 Installment Sale Agreement, except that any cash amounts in the Administration Fund in excess of the amount required to be on deposit therein shall be withdrawn from the Administration Fund on each Interest Payment Date and deposited in the Interest Fund. (e) Surplus Account. On the Business Day immediately following each Interest Payment Date the Trustee shall deposit in the Surplus Account all money remaining in the Revenue Fund after the deposits required by Section 4.04 and by paragraphs (a), (c), (c) and (d) of this Section have been made. On — of each year, beginning on _, 2013, the Trustee shall disburse the money in the Surplus Account to the City to the extent the City's deposit of moneys, together with investment earnings thereon, if any, exceeded the deposits required by paragraphs (a), (b), (c) and (d) of this section. 24 4830 - 8589- 9794.7 s � m CD O ORIGINAL Section 3.04. Deposit and Investments of Money in Funds and Accounts. Subject to Section 4.04, all money held by the Trustee in any of the fund or accounts established pursuant hereto shall be invested and reinvested in Permitted Investments at the Request of the City received not less than two Business Days prior to the date of making such investment. The Trustee shall notify the City no less than two Business Days prior to the date moneys held hereunder will be available for investment, requesting that the City deliver to the Trustee a Request of the City specifying the Permitted Investments to be acquired by the Trustee with such moneys. All money held in the Reserve Fund shall be invested and reinvested in Permitted Investments with a term to maturity not exceeding five years or on the final maturity date of the Certificates, whichever date is earlier; provided, however, that if an obligation may be prepaid at par on the business day prior to each Interest Payment Date during which such obligation is outstanding, such obligation may have any maturity. All such Permitted Investments shall be valued by the Trustee not less frequently than semi - annually on each Interest Payment Date at the lower of the cost or market value thereof. Subject to Section 4.04, all interest or profits received prior to the completion of the Project (as certified in writing by the Authorized City Representative) on any money so invested shall be deposited in the Acquisition Fund, and all interest or profits received subsequent thereto on any money so invested shall be deposited in the Interest Fund. The Trustee may act as a principal or agent in making or disposing of any investment. ARTICLE IV COVENANTS Section 4.01. Compliance With Trust Agreement. The Trustee will not execute or deliver any Certificates in any manner other than in accordance with the provisions hereof, and the City will not suffer or permit any default to occur hereunder, but will faithfully observe and perform all the agreements, conditions, covenants and terms contained herein required to be observed and performed by them. Section 4.02. Amendment of 2013 Installment Sale Agreement. The City and the Corporation will not amend or permit the amendment of the 2013 Installment Sale Agreement without the prior written consent of the Credit Provider (if any) and without (a)(i) a determination that such amendment does not materially adversely affect the interest of the Owners, or (ii) the written consents of the Owners of a majority in aggregate principal amount of the Certificates then Outstanding; and (b) an Opinion of Counsel to the effect that such amendment will not cause interest payable with respect to the 2013 Installment Sale Agreement to be included in gross income for federal income tax purposes; provided that no such supplement, amendment, modification or termination shall reduce the amount of 2013 Installment Sale Payments to be made to the Corporation or the Trustee by the City pursuant to the 2013 Installment Sale Agreement, or extend the time for making such payments, or permit the creation of any lien prior to or on a parity with the lien created by the 2013 Installment Sale Agreement on Revenues (except as expressly provided in the 2013 Installment Sale Agreement), in each case without the written consent of all of the Owners of the Certificates then Outstanding. 25 4830 - 8589- 9794.7 gAK'6�9 O � D r ORIGfNAL Section 4.03. Against Encumbrances. The Corporation will not make any pledge of or place any charge or lien upon the Revenues except as provided herein, and will not issue any bonds, notes or obligations payable from the Revenues or secured by a pledge of or charge or lien upon the Revenues except the Certificates. Section 4.04. Tax Covenants: Rebate Fund. (a) In addition to the funds created pursuant to Section 3.03, the Trustee shall establish and maintain a fund separate from any other fund or account established and maintained hereunder designated as the "Rebate Fund ". There shall be deposited in the Rebate Fund such amounts, including the Rebate Amount, as are required to be deposited therein pursuant to the Tax Certificate. 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), for payment to the United States of America. Notwithstanding the provisions of Sections 3.01, 3.02, 3.04, 7.02 and 10.01 relating to the pledge of Revenues, the allocation of money in the Revenue Fund, the investments of money in any fund or account, the application of funds upon acceleration and the defeasance of Outstanding Certificates, all amounts required to be deposited into or on deposit in the Rebate Fund shall be governed exclusively by this Section 4.04 and by the Tax Certificate (which is incorporated herein by reference). The Trustee shall be deemed conclusively to have complied with such provisions if it follows the written directions of the Corporation, and shall have no liability or responsibility to enforce compliance by the City with the terms of the Tax Certificate. (b) Any funds remaining in the Rebate Fund after prepayment and payment with respect to all of the Certificates or provision made therefor satisfactory to the Trustee, including accrued interest and payment of any applicable fees to the Trustee and satisfaction of the Rebate Requirement (as defined in the Tax Certificate), shall be withdrawn by the Trustee and remitted to or upon the written direction of the Corporation. Section 4.05. Accounting Records and Reports. The Trustee shall keep proper books of record and accounts in accordance with industry standards in which complete and correct entries shall be made of all transactions made by the Trustee relating to the receipt, investment, disbursement, allocation and application of all funds received by the Trustee hereunder. Such records shall specify the account or fund to which each investment (or portion thereof) held by the Trustee is to be allocated and shall set forth, in the case of each investment: (a) its purchase price; (b) identifying information, including par amount, coupon rate, and payment dates; (c) the amount received at maturity or its sale price, as the case may be; (d) the amounts and dates of any payments made with respect thereto; and (e) such documentation as is required to be obtained as evidence to establish that all investments have been purchased in arms' length transactions with no amounts paid to reduce the yield on the investments. Such records shall be open to inspection by the Credit Provider (if any), the Corporation and the City at any reasonable time during regular business hours on reasonable notice. ►.. 4830 -8589- 9794.7 .r v O ORIGINAL. Section 4.06. Observance of Laws and Regulations. The City will faithfully observe and perform all lawful and valid obligations or regulations now or hereafter imposed on it by contract, or prescribed by any state or national law, or by any officer, board or commission having jurisdiction or control, as a condition of the continued enjoyment of each and every franchise, right or privilege now owned or hereafter acquired by them, including their right to exist and carry on their respective businesses, to the end that such observance or performance is material to the transactions contemplated hereby. Section 4.07. Further Assurances. Whenever and so often as reasonably requested to do so by the Trustee, the Credit Provider (if any) or any Owner, the City will promptly execute and deliver or cause to be executed and delivered all such other and further assurances, documents or instruments, and promptly do or cause to be done all such other and further things as may be necessary or reasonably required in order to further and more fully vest in the Trustee, the Credit Provider (if any), and the Owners all rights, interests, powers, benefits, privileges and advantages conferred or intended to be conferred upon them hereby. Section 4.08. Recordation and Filing. The City will file, record, register, renew, refile and rerecord all such documents, including financing statements (or continuation statements in connection therewith), as may be required by law in order to maintain at all times a security interest in the 2013 Installment Sale Agreement under and pursuant to this Trust Agreement, all in such manner, at such times and in such places as may be required in order to fully perfect, preserve and protect the benefit, protection and security of the Owners and the Credit Provider (if any), and the rights of the Trustee hereunder, and the City will do whatever else may be necessary or be reasonably required in order to perfect and continue the pledge of and lien on the 2013 Installment Sale Agreement as provided herein. Section 4.09. Acquisition of the Project. Subject to and as provided in the 2013 Installment Sale Agreement, the Corporation will cause to be acquired and constructed the Project with all practicable dispatch and such acquisition will be made in an expeditious manner and in conformity with the law so as to complete the same as soon as possible. ARTICLE V THE TRUSTEE Section 5.01. The Trustee. shall serve as the Trustee for the Certificates for the purpose of receiving all money which the Corporation and the City are required to deposit with the Trustee hereunder and for the purpose of allocating, applying and using such money as provided herein and for the purpose of paying the interest, principal and prepayment premiums, if any, evidenced and represented by the Certificates presented for payment in [CITY], [STATE], with the rights and obligations provided herein. The Corporation agrees that it will at all times maintain a Trustee having a principal office in [CITY] or [CITY], [STATE]. The Corporation may at any time, unless there exists any event of default as defined in Section 7.01, remove the Trustee initially appointed and any successor thereto and may appoint a successor or successors thereto by an instrument in writing; provided that any such successor 4830 - 8589 - 9794.7 27 ` 0 N O (� C7 n i cif 6'!_ shall (a) be a bank or trust company doing business and having a principal office in [CITY] or [CITY], [STATE]; (b) have (or in the case of a bank or trust company which is part of a bank holding company system, the related bank holding company shall have) a combined capital (exclusive of borrowed capital) and surplus of at least $75,000,000; and (c) be subject to supervision or examination by federal or state authority. If such bank or trust company publishes a report of condition at least annually, pursuant to law or to the requirements of any supervising or examining authority above referred to, then for the purpose of this Section the combined capital and surplus of such bank or trust company shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. The Trustee may at any time resign by giving written notice of such resignation to the Corporation and by mailing to the Owners notice of such resignation. Upon receiving such notice of resignation, the Corporation shall promptly appoint a successor Trustee by an instrument in writing. Any removal or resignation of a Trustee and appointment of a successor Trustee shall become effective only upon the acceptance of appointment by the successor Trustee. If, within 30 days after notice of the removal or resignation of the Trustee no successor Trustee shall have been appointed and shall have accepted such appointment, the removed or resigning Trustee may petition any court of competent jurisdiction for the appointment of a successor Trustee, which court may thereupon, after such notice, if any, as it may deem proper and prescribe and as may be required by law, appoint a successor Trustee having the qualifications required hereby. The Trustee is hereby authorized to prepay the Certificates when duly presented for payment on their respective Certificate Payment Dates or on prior prepayment. The Trustee shall cancel all Certificates upon payment thereof or upon the surrender thereof by the Corporation and shall destroy such Certificates and a certificate of destruction shall be delivered to the Corporation. The Trustee shall keep accurate records of all Certificates paid and discharged and canceled by it. The Corporation, solely from amounts held in the Costs of Issuance Fund or paid by the City specifically for such purpose, shall from time to time, subject to any agreement between the Corporation and the Trustee then in force, pay to the Trustee compensation for its services, reimburse the Trustee for all its advances and expenditures including but not limited to advances to and fees and expenses of independent accountants and in -house and other counsel or other experts employed by it and reasonably required in the exercise and performance of its rights and obligations hereunder, and, to the extent permitted by law, indemnify and hold the Trustee and its officers, directors, employees and agents harmless against any claim, loss, liability, damages, expenses (including legal fees and expenses) or advances not arising from the Trustee's own active or passive negligence, willful misconduct or breach of fiduciary duty, which the Trustee may incur in the exercise and performance of its rights and obligations hereunder. The obligations of the Corporation under this paragraph to compensate, indemnify, reimburse and hold the Trustee harmless shall constitute additional indebtedness hereunder, and such indebtedness shall have priority over the Certificates in respect of all property and funds held or collected by the Trustee as such, except funds held in trust by the Trustee for the benefit of the Owners of particular Certificates, including, without limitation, funds held by the Trustee in trust to prepay all or a portion of Outstanding Certificates prior to their respective Certificate Payment Dates for which a notice of prepayment has been sent as provided herein. ►.:3 4830 - 8589- 9794.7 o�gAK, �� r v p ORIGINAL Section 5.02. Liability of Trustee. The recitals of facts, agreements and covenants herein and in the Certificates shall be taken as recitals of facts, agreements and covenants of the Corporation, and the Trustee assumes no responsibility for the use of any proceeds of the Certificates, the correctness of the same, the collection of the Revenues or makes any representation as to the sufficiency or validity hereof, of the Certificates or any security therefor or any offering material distributed in connection with the Certificates and shall not incur any responsibility in respect thereof other than in connection with the rights or obligations assigned to or imposed upon it herein, in the Certificates or in law or equity. The Trustee shall not be liable in connection with the performance of its duties hereunder except for its own negligence, willful misconduct or breach of fiduciary duty. The Trustee shall not be bound to recognize any person as the Owner of a Certificate unless and until such Certificate is submitted for inspection, if required, and such Certificate is registered in such person's name. Whenever the Trustee shall deem it necessary or desirable that a factual or legal matter be established or proved prior to taking or suffering any action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) may, in the absence of bad faith on the part of the Trustee, be deemed to be conclusively proved and established by a certificate conforming to the requirements herein or an opinion of counsel, which certificate or opinion shall be full warrant to the Trustee for any action taken or suffered under the provisions hereof upon the faith thereof, but in its discretion the Trustee may in lieu thereof accept other evidence of such matter or may require such additional evidence as it may deem reasonable. In accepting the trust hereby created, the Trustee acts solely as Trustee for the Owners and not in its individual capacity and all persons, including without limitation the Owners, the Corporation and the City, having any claim against the Trustee arising from this Trust Agreement not attributable to the Trustee's negligence or willful misconduct shall look only to the funds and accounts held by the Trustee hereunder for payment except as otherwise provided herein. The duties and obligations of the Trustee shall be determined solely by the express provisions of this Trust Agreement, the Trustee shall not be liable except for the performance of such duties and obligations as are specifically set forth in this Trust Agreement, and no implied covenants or obligations (fiduciary or otherwise) shall be read into this Trust Agreement against the Trustee. The Trustee shall not be liable with respect to any action taken or not taken hereunder in good faith in accordance with the direction of the Owners of not less than a majority in aggregate principal amount of the Certificates at the time Outstanding. The Trustee shall, during the existence of any event of default (which has not been cured), exercise such of the rights and powers vested in it by this Trust Agreement, and use the same degree of care and skill in their exercise, as a prudent person would exercise of use under the circumstances in the conduct of its own affairs. The permissive right of the Trustee to do things enumerated in this Trust Agreement shall not be construed as a duty and it shall not be answerable for other than its negligence or willful misconduct. The immunities and exceptions from liability of the Trustee shall extend to its officers, directors, employees and agents and such immunities and exceptions and its right to payment of its fees and expenses shall survive its resignation or removal and the final payment and defeasance of the Certificates. Under no circumstances shall the Trustee be liable in its individual capacity for the obligations evidenced by the Certificates. The Trustee, in its individual or any other capacity, may become the Owner of any Certificates or other 29 4830 -8589- 9794.7 o`` AK�9s � r r- m_ U � ORIGINAI. obligations of any party hereto with the same rights which it would have if not the Trustee. At any and all reasonable times, the Trustee, and its agents shall have the right to fully inspect the Project, including all books, papers and records of the City pertaining to the Project and the Certificates, and to take such memoranda therefrom and with regard thereto and make photocopies thereof as may be desired. The Trustee shall not be required to give any bond or surety in respect of the execution of said trusts and powers or otherwise in respect of the premises. Before taking or refraining from any action hereunder at the request or direction of the Owners, the Trustee may require that an indemnity bond satisfactory to the Trustee be furnished to it and be in full force and effect. None of the provisions contained herein or in the 2013 Installment Sale Agreement shall require the Trustee to expend or risk its own funds or continue to do so or otherwise incur individual financial liability in the performance of any of its duties or in the exercise of any of its rights or powers if it shall reasonably believe that repayment of such funds or adequate indemnity against such risk or liability is not assured to it. The Trustee may rely and shall be protected in acting or failing to act upon any paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties. The Trustee shall not be required to take notice or be deemed to have notice of any Event of Default hereunder except failure by the City to make any payment of principal or interest under the 2013 Installment Sale Agreement when due, unless the Trustee shall be specifically notified in writing at its principal corporate trust office of such default by the Credit Provider (if any), or the Owners of not less than 25% of the aggregate principal amount of Certificates then Outstanding. Notwithstanding any other provision hereof, the Trustee shall have the right, but shall not be required, to demand any showings, certificates, opinions, appraisals or other information, or official action or evidence thereof, required as a condition of such action deemed by the Trustee to be desirable for the purpose of establishing the rights of the Trustee with respect to the authentication of any Certificates, the withdrawal of any cash, the release of any property or the taking of any other action by the Trustee. ARTICLE VI AMENDMENT OF THIS TRUST AGREEMENT Section 6.01. Amendment of this Trust Agreement. This Trust Agreement and the rights and obligations of the Corporation, the City, the Trustee and the Owners may be amended at any time by a Supplemental Trust Agreement which shall become binding when the written consents of the Owners of a majority in aggregate principal amount evidenced and represented by the Certificates then Outstanding, exclusive of Certificates disqualified as provided in Section 6.02, are filed with the Trustee. No such amendment shall (a) extend the Certificate Payment Date of or reduce the interest rate on or amount of interest or principal or prepayment premium, if any, evidenced and represented by any Certificate without the express written consent of the Owner of such Certificate; or (b) permit the creation by the Corporation of any pledge of or charge or lien upon the Revenues as provided herein superior to or on a parity with the pledge, charge and lien created hereby for the benefit of the Certificates; or (c) reduce the percentage of Certificates required for the written consent to any such amendment or any amendment of the 30 4830 -8589- 9794.7 `9, pK, 9 o` r s c.� O ORIGINAL 2013 Installment Sale Agreement pursuant to Section 4.02 hereof; or (d) modify any rights or obligations of the Trustee, the Corporation or the City without their prior written assent thereto, respectively. This Trust Agreement and the rights and obligations of the Corporation, the City and of the Owners may also be amended at any time by a Supplemental Trust Agreement which shall become binding upon adoption without the consent of any Owners, but only to the extent permitted by law and after receipt of an approving Opinion of Counsel, for any purpose that will not in the judgment of the Trustee materially adversely affect the interests of the Owners, including (without limitation) for any one or more of the following purposes: (a) to add to the agreements and covenants required herein to be performed by the Corporation, other agreements and covenants thereafter to be performed by the Corporation or the City, or to surrender any right or power reserved herein to or conferred herein on the Corporation or the City; (b) to make such provisions for the purpose of curing any ambiguity or of correcting, curing or supplementing any defective provision contained herein or in regard to questions arising hereunder which the Corporation or the City may deem desirable or necessary and not inconsistent herewith; (c) to add to the agreements and covenants required herein, such agreements and covenants as may be necessary to qualify this Trust Agreement under the Trust Indenture Act of 1939; or (d) for any other purpose that does not materially adversely affect the interests of the Owners. Section 6.02. Disqualified Certificates. Certificates owned or held by or for the account of the Corporation or the City shall not be deemed Outstanding for the purpose of any consent or other action or any calculation of Outstanding Certificates provided in this Article, and shall not be entitled to consent to or take any other action provided in this Article. Section 6.03. Endorsement or Replacement of Certificates After Amendment. After the effective date of any action taken as hereinabove provided, the Corporation may determine that the Certificates may bear a notation by endorsement in form approved by the Corporation as to such action, and in that case upon demand of the Owner of any Outstanding Certificates and presentation of his Certificate for such purpose at the office of the Trustee a suitable notation as to such action shall be made on such Certificate. If the Corporation shall so determine, new Certificates so modified as, in the opinion of the Corporation, shall be necessary to conform to such action shall be prepared and executed, and in that case upon demand of the Owner of any Outstanding Certificate a new Certificate or Certificates shall be exchanged at the office of the Trustee without cost to each Owner for its Certificate or Certificates then Outstanding upon surrender of such Outstanding Certificates. Section 6.04. Amendment by Mutual Consent. The provisions of this Article shall not prevent any Owner from accepting any amendment as to the particular Certificates held by him; provided that due notation thereof is made on such Certificates. 31 4830 - 8589- 9794.7 r- c� p ORIGINAL Section 6.05. Information to Rating Agency. The Corporation shall provide any Rating Agency rating the Certificates a copy of each amendment to this Trust Agreement or to the 2013 Installment Sale Agreement promptly following the execution or adoption of such amendment. ARTICLE VII EVENTS OF DEFAULT AND REMEDIES OF OWNERS Section 7.01. Events of Default. If any default in the payment of 2013 Installment Sale Payments or any other "Event of Default" defined in the 2013 Installment Sale Agreement shall occur and be continuing, or if any default shall be made by the City in the performance or observance of any other of the covenants, agreements or conditions on its part herein contained and such default shall have continued for a period of 30 days after written notice thereof shall have been given to the City by the Trustee or the Owners of not less than a majority in aggregate principal amount evidenced and represented by the Certificates at the time Outstanding, then such default shall constitute an "Event of Default" hereunder, and in each and every such case during the continuance of such Event of Default the Trustee or the Owners of not less than a majority in aggregate principal amount evidenced and represented by the Certificates at the time Outstanding shall be entitled, upon notice in writing to the City, but subject to the provisions of Section 7.06, to exercise the remedies provided under the 2013 Installment Sale Agreement then in default which are necessary or desirable to collect the City's 2013 Installment Sale Payments. No grace period for a covenant default shall exceed 30 days or be extended for more than 60 days, without the prior written consent of the Credit Provider (if any), so long as it has not failed to comply with its payment obligations under the Credit Facility. No grace period shall be permitted for payment defaults. The Owners of Certificates, for purposes of this Trust Agreement and the 2013 Installment Sale Agreement, to the extent of their interest, shall be entitled to all rights and security of the Corporation pursuant to the 2013 Installment Sale Agreement and this Trust Agreement. The City recognizes the rights of the Owners of the Certificates, acting directly or through the Trustee, to enforce the obligations and covenants contained in the 2013 Installment Sale Agreement and this Trust Agreement; provided that in no event shall the City be liable for any obligations, covenants or damages except those which arise out of the 2013 Installment Sale Agreement. Section 7.02. Application of Funds Upon Acceleration of 2013 Installment Sale Agreement. All 2013 Installment Sale Payments received after an acceleration and that are available to pay the costs and expenses of the Trustee and the Corporation (if any), the payment of rebate to the United States of America under the Code (if any), interest and principal due on the Certificates and any amounts due and owing the Credit Provider (if any) shall be applied in the manner as provided in Section 6.02 of the 2013 Installment Sale Agreement. Section 7.03. Other Remedies of the Trustee. The Trustee shall have the right: (a) by mandamus or other action or proceeding or suit at law or in equity to enforce its rights hereunder against the City or any supervisor, council member, board �gAKE9 4830 - 8589- 9794.7 32 � m r CJ p ORIG6NAL member, trustee, member, officer or employee thereof, and to compel the City or any such supervisor, council member, board member, trustee, member, officer or employee thereof to observe or perform its or his or her duties under applicable law and the agreements, conditions, covenants and terms contained herein, or in the 2013 Installment Sale Agreement, required to be observed or performed by it or him or her; (b) by suit in equity to enjoin any acts or things which are unlawful or violate the rights of the Trustee, the Owners the Credit Provider (if any); or (c) by suit in equity upon the happening of any default hereunder to require the City and any supervisor, council member, board member, trustee, member, officer and employee to account as the trustee of any express trust. Section 7.04. Non - Waiver. A waiver by the Trustee of any default hereunder or breach of any obligation hereunder shall not affect any subsequent default hereunder or any subsequent breach of an obligation hereunder or impair any rights or remedies on any such subsequent default hereunder or on any such subsequent breach of an obligation hereunder. No delay or omission by the Trustee to exercise any right or remedy accruing upon any default hereunder shall impair any such right or remedy or shall be construed to be a waiver of any such default hereunder or an acquiescence therein, and every right or remedy conferred upon the Trustee by applicable law or by this Article may be enforced and exercised from time to time and as often as shall be deemed expedient by the Trustee. If any action, proceeding or suit to enforce any right or to exercise any remedy is abandoned or determined adversely to the Trustee, the Credit Provider (if any), or the City, the Trustee, the Credit Provider (if any), and the City shall be restored to their former positions, rights and remedies as if such action, proceeding or suit had not been brought or taken. Notwithstanding anything to the contrary, no waiver by the Trustee of any default hereunder or breach of any obligation hereunder with respect to the City shall be effective without the prior written consent of the Credit Provider (if any). Section 7.05. Actions by Trustee as Attorney -in -Fact. Any action, proceeding or suit which any Owner shall have the right to bring to enforce any right or remedy hereunder may be brought by the Trustee for the equal benefit and protection of all Owners, whether or not the Trustee is an Owner, and the Trustee is hereby appointed (and the successive Owners, by taking and holding the Certificates executed and delivered hereunder, shall be conclusively deemed to have so appointed it) the true and lawful attorney -in -fact of the Owners for the purpose of bringing any such action, proceeding or suit and for the purpose of doing and performing any and all acts and things for and on behalf of the Owners as a class or classes as may be advisable or necessary in the opinion of the Trustee as such attorney -in -fact. The Trustee shall not take the Credit Facility (if any) into account in determining whether the rights of the Owners of the Certificates are adversely affected by any actions taken or not taken pursuant to the terms of this Trust Agreement. Section 7.06. Remedies Not Exclusive; Credit Provider's Right To Control Remedies. No remedy herein conferred upon or reserved to the Owners is intended to be 33 4830 - 8589- 9794.7 � 0 AKF9 o' s� rj C> ORGAAL exclusive of any other remedy, and each such remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute or otherwise and may be exercised without exhausting and without regard to any other remedy conferred by the Nonprofit Public Benefit Corporation Law or any other law. If any remedial action hereunder is discontinued or abandoned, the Trustee and the Owners shall be restored to their former positions. The Credit Provider (if any), so long as it has not failed to comply with its payment obligations under the Credit Facility (if any), shall have the right to direct the remedies upon any Event of Default hereunder but only if the amount available to be paid or drawn under the Credit Facility equals the full amount of interest and principal with respect to the Certificates remaining unpaid to Owners; and in such circumstances, the prior consent of the Credit Provider (if any), shall be required to any remedial action proposed to be taken by the Trustee hereunder. The Trustee shall immediately notify such Credit Provider (if any), of any Event of Default of which the Trustee has actual knowledge. The rights granted to the Credit Provider (if any) under this Trust Agreement or any other Related Document to request, consent to or direct any action are rights granted to the Credit Provider in consideration of its issuance of the Credit Facility. Any exercise by the Credit Provider of such rights is merely an exercise of the Credit Provider's contractual rights and shall not be construed or deemed to be taken for the benefit, or on behalf, of the Owners and such action does not evidence any position of the Credit Provider, affirmative or negative, as to whether the consent of the Owners or any other person is required in addition to the consent of the Credit Provider. Section 7.07. Limitation on Owners' Right To Sue. No Owner of any Certificate executed and delivered hereunder shall have the right to institute any suit, action or proceeding at law or equity, for any remedy under or upon this Trust Agreement, unless (a) such Owner shall have previously given to the Trustee written notice of the occurrence of an event of default as defined in Section 7.01 hereunder; (b) the Owners of at least a majority in aggregate principal amount of all the Certificates then Outstanding shall have made written request upon the Trustee to exercise the powers hereinbefore granted or to institute such suit, action or proceeding in its own name; (c) said Owners shall have tendered to the Trustee reasonable security or indemnity against the costs, expenses and liabilities to be incurred in compliance with such request; and (d) the Trustee shall have refused or omitted to comply with such request for a period of 60 days after such request and consent shall have been received by, and said tender of indemnity shall have been made to, the Trustee. Such notification, request, consent, tender of indemnity and refusal or omission are hereby declared, in every case, to be conditions precedent to the exercise by any owner of Certificates of any remedy hereunder; it being understood and intended that no one or more owners of Certificates shall have any right in any manner whatever by his or their action to enforce any right under this Trust Agreement, except in the manner herein provided, and that all proceedings at law or in equity to enforce any provision of this Trust Agreement shall be instituted, had and maintained in the manner herein provided and for the equal benefit of all Owners of the Outstanding Certificates. 34 4830 -8589- 9794.7 'br, KF9 > m Section 7.08. Limited Liability of the City. Except as expressly provided in the 2013 Installment Sale Agreement, the City shall not have any obligation or liability to the Corporation, the Trustee, the Owners or the Credit Provider (if any), with respect to this Trust Agreement or the preparation, execution, delivery, transfer, exchange or cancellation of the Certificates or the receipt, deposit or disbursement of the principal and interest payable with respect to the 2013 Installment Sale Agreement by the Trustee, or with respect to the performance by the Trustee of any obligation contained herein required to be performed by it. Section 7.09. Limited Liability of the Corporation. Except as expressly provided herein, the Corporation shall not have any obligation or liability to the Trustee, the Owners or the Credit Provider (if any), with respect to the payment when due of the 2013 Installment Sale Payments by the City, or with respect to the observance or performance by the City of the other agreements, conditions, covenants and terms contained in the 2013 Installment Sale Agreement, or with respect to the performance by the Trustee of any obligation contained herein required to be performed by it. Notwithstanding anything to the contrary contained in the Certificates, this Trust Agreement or any other document related thereto, the Corporation shall not have any liability hereunder or by reason hereof or in connection with any of the transactions contemplated hereby except to the extent payable from moneys received from or with respect to the 2013 Installment Sale Agreement and available thereof in accordance with this Trust Agreement. ARTICLE VIII DEFEASANCE Section 8.01. Discharge of Certificates. (a) If the City shall pay or cause to be paid or there shall otherwise be paid to the Owners of all Outstanding Certificates the interest, principal and prepayment premiums, if any, evidenced and represented thereby at the times and in the manner stipulated herein and therein, then the Owners of such Certificates shall cease to be entitled to the pledge of and charge and lien upon the Revenues as provided herein, and all agreements, covenants and other obligations of the Corporation and the City to the Owners of such Certificates hereunder shall thereupon cease, terminate and become void and be discharged and satisfied. In such event, the Trustee shall execute and deliver to the Corporation all such instruments as may be necessary or desirable to evidence such discharge and satisfaction and the Trustee shall pay over or deliver to the Corporation all money or securities held by it pursuant hereto which are not required for the payment of the interest and principal and prepayment premiums, if any, evidenced and represented by such Certificates. (b) Any Outstanding Certificates shall prior to the maturity date or prepayment date thereof be deemed to have been paid within the meaning of and with the effect expressed in paragraph (a) of this section if (i) in case any of such Certificates are to be prepaid on any date prior to their respective Certificate Payment Dates, the Corporation shall have given to the Trustee in form satisfactory to it irrevocable instructions to provide notice in accordance with Section 2.03; (ii) there shall have been 4830 - 8589 - 9794.7 35 84 g AKF9 0" r- v O deposited with the Trustee either (A) money in an amount which shall be sufficient; or (B) United States Obligations, which are not subject to redemption prior to maturity (including United States Obligations issued or held in book -entry form on the books of the United States Treasury), in each case the interest on and principal of which when paid will provide money which, together with the money, if any, deposited with the Trustee at the same time, shall be sufficient, in the opinion of an Independent Certified Public Accountant, to pay when due the interest to become due with respect to such Certificates on and prior to the Certificate Payment Date or prepayment date thereof, as the case may be, and the principal and prepayment premiums, if any, evidenced and represented by such Certificates; and (C) in the event such Certificates are not by their terms subject to prepayment within the next succeeding 60 days, the Corporation shall have given the Trustee in form satisfactory to it irrevocable instructions to mail as soon as practicable, a notice to the Owners of such Certificates that the deposit required by clause (B) above has been made with the Trustee and that such Certificates are deemed to have been paid in accordance with this Section and stating the Certificate Payment Date or prepayment date upon which money is to be available for the payment of the principal and prepayment premiums, if any, with respect to such Certificates. In addition, the Corporation shall cause to be delivered (1) a report of an Independent Certified Public Account verifying the sufficiency of the escrow established to pay the Certificates in full on the maturity or prepayment date ( "Verification "); (2) an escrow deposit agreement in form and substance acceptable to nationally recognized bond counsel; (3) an opinion of nationally recognized bond counsel to the effect that the Certificates are no longer "Outstanding" under this Trust Agreement; and (4) a certificate of discharge of the Trustee with respect to the Certificates; each Verification and defeasance opinion shall be acceptable in form and substance, and addressed, to the Corporation, Trustee and Credit Provider (if any). Certificates shall be deemed "Outstanding" under this Trust Agreement unless and until they are in fact paid and retired or the above criteria are met. [No payment under the Credit Facility (if any) shall be deemed a payment with respect to the Certificates under paragraph (a) of this Section, and if any payments with respect to the Certificates are made pursuant to the Credit Facility, the Certificates shall remain Outstanding until paid in full by the City.] Section 8.02. Unclaimed Money. Anything contained herein to the contrary notwithstanding, any money held by the Trustee in trust for the payment and discharge of any of the Certificates which remains unclaimed for two years after the date when such Certificates have become due and payable, either at their stated Certificate Payment Dates or by call for prepayment prior to such dates, if such money was held by the Trustee at such date, or for two years after the date of deposit of such money if deposited with the Trustee after the date when such Certificates have become due and payable, shall be repaid by the Trustee to the Corporation as its absolute property free from trust, and the Trustee shall thereupon be released and discharged with respect thereto and the Owners shall not look to the Trustee for the payment of such Certificates. Any moneys held by the Trustee in trust for the payment and discharge of any Certificates shall not bear interest or be otherwise invested from and after such Certificate Payment Date or prepayment date. 36 4830 -8589- 9794.7 y -n � -- m v ORIGINAL ARTICLE IX PROVISIONS RELATING TO THE CREDIT PROVIDER (IF ANY) Section 9.01. Claims Upon the Credit Facility and Payments by and to the Credit Provider. (a) If, on the third Business Day prior to the related scheduled interest payment date or principal payment date ( "Payment Date ") there is not on deposit with the Trustee, after making all transfers and deposits required under this Trust Agreement, moneys sufficient to pay the principal and interest evidenced and represented by the Certificates due on such Certificate Payment Date or Interest Payment Date, the Trustee shall give notice to the Credit Provider and to its designated agent (if any) (the "Credit Provider's Fiscal Agent ") by telephone or facsimile of the amount of such deficiency by 12:00 noon, New York City time, on such Business Day. If, on the second Business Day prior to the related Payment Date, there continues to be a deficiency in the amount available to pay the principal and interest evidenced and represented by the Certificates due on such Payment Date, the Trustee shall make a claim under the Credit Facility and give notice to the Credit Provider and the Credit Provider's Fiscal Agent (if any) by telephone of the amount of such deficiency, and the allocation of such deficiency between the amount required to pay interest evidenced and represented by the Certificates and the amount required to pay principal evidenced and represented by the Certificates, confirmed in writing to the Credit Provider and the Credit Provider's Fiscal Agent by 12:00 noon, New York City time, on such second Business Day by filling in the form of Notice of Claim and Certificate delivered with the Credit Facility. (b) The Trustee shall designate any portion of payment of principal evidenced and represented by the Certificates paid by the Credit Provider (if any), whether by virtue of mandatory sinking fund prepayment, maturity or other advancement of maturity, on its books as a reduction in the principal amount of Certificates registered to the then current Owner, whether DTC or its nominee or otherwise, and shall issue a replacement Certificate to the Credit Provider, registered in the name of , in a principal amount equal to the amount of principal so paid (without regard to authorized denominations); provided that the Trustee's failure to so designate any payment or issue any replacement Certificate shall have no effect on the amount of principal or interest payable by the Corporation on any Certificate or the subrogation rights of the Credit Provider. (c) The Trustee shall keep a complete and accurate record of all funds deposited by the Credit Provider into the Policy Payments Account (defined below) and the allocation of such funds to payment of the interest and principal evidenced and represented by any Certificate. The Credit Provider shall have the right to inspect such records at reasonable times upon reasonable notice to the Trustee. (d) Upon payment of a claim under the Credit Facility, the Trustee shall establish a separate special purpose trust account for the benefit of Owners referred to herein as the "Policy Payments Account" and over which the Trustee shall have exclusive gAK�r 37 4830 - 8589 - 9794.7 � m r v Q Ofd UNA. control and sole right of withdrawal. The Trustee shall receive any amount paid under the Credit Facility in trust on behalf of Owners and shall deposit any such amount in the Policy Payments Account and distribute such amount only for purposes of making the payments for which a claim was made. Such amounts shall be disbursed by the Trustee to Owners in the same manner as principal and interest payments are to be made with respect to the Certificates under the sections hereof regarding payment of Certificates. It shall not be necessary for such payments to be made by checks or wire transfers separate from the check or wire transfer used to pay debt service with other funds available to make such payments. (e) Funds held in the Policy Payments Account shall not be invested by the Trustee and may not be applied to satisfy any costs, expenses or liabilities of the Trustee. Any funds remaining in the Policy Payments Account following a Payment Date shall promptly be remitted to the Credit Provider. (f) The Credit Provider shall, to the extent it makes any payment of principal or interest evidenced and represented by the Certificates, become subrogated to the rights of the recipients of such payments in accordance with the terms of the Credit Facility. Each obligation of the City to the Credit Provider under the Related Documents shall survive discharge or termination of such Related Documents. (g) The Credit Provider reserves the right to charge a reasonable fee as a condition to executing any amendment, waiver or consent proposed in respect of this Trust Agreement or any other Related Document. (h) After payment of reasonable expenses of the Trustee, the application of funds realized upon default shall be applied to the payment of expenses of the City or rebate only after the payment of past due and current principal and interest represented by the Certificates and amounts required to restore the Reserve Fund to the Reserve Fund Requirement. (i) The Credit Provider shall be entitled to pay principal or interest evidenced and represented by the Certificates that shall become due for payment but shall be unpaid by reason of nonpayment by the Issuer (as such terms are defined in the Credit Facility) and any amounts due on the Certificates as a result of acceleration of the maturity thereof in accordance with this Trust Agreement, whether or not the Credit Provider has received a Notice of Nonpayment (as such terms are defined in the Credit Facility) or a claim upon the Credit Facility. Section 9.02. Notices to Credit Provider. The Credit Provider shall be provided with the following information by the City or Trustee, as the case may be: (a) annual audited financial statements within [270] days after the end of the City's fiscal year (together with a certification of the City that it is not aware of any default or Event of Default under this Trust Agreement), and the City's annual budget within 30 days after the approval thereof together with such other information, data or reports as the Credit Provider shall reasonably request from time to time; 38 � ,N 4830 - 8589- 9794.7 ~ r V C7 ORIGINAL (b) notice of any draw upon the Reserve Fund within two Business Days after knowledge thereof other than (i) withdrawals of amounts in excess of the Reserve Fund Requirement, and (ii) withdrawals in connection with a refunding of Certificates; (c) notice of any default known to the Trustee or Corporation within five Business Days after knowledge thereof, (d) prior notice of the advance refunding or prepayment of any of the Certificates, including the principal amount, maturities and CUSIP numbers thereof, (e) notice of the resignation or removal of the Trustee and the appointment of, and acceptance of duties by, any successor thereto; (f) notice of the commencement of any proceeding by or against the City commenced under the United States Bankruptcy Code or any other applicable bankruptcy, insolvency, receivership, rehabilitation or similar law (an "Insolvency Proceeding "); (g) notice of the making of any claim in connection with any Insolvency Proceeding seeking the avoidance as a preferential transfer of any payment of principal or interest evidenced and represented by the Certificates; (h) a full original transcript of all proceedings relating to the execution of any amendment, supplement or waiver to the Related Documents; and (i) all reports, notices and correspondence to be delivered to Owners under the terms of the Related Documents. Section 9.03. Consent of the Credit Provider. Any amendment, supplement, modification to, or waiver of, this Trust Agreement or any other transaction document, including any underlying security agreement (each a "Related Document "), that requires the consent of Owners or adversely affects the rights and interests of the Credit Provider shall be subject to the prior written consent of the Credit Provider. ARTICLE X MISCELLANEOUS Section 10.01. Liability of Corporation Limited to Revenues. The Certificates are limited obligations of the Corporation and are payable, as to interest, principal and any premiums upon the prepayment of any thereof, solely from the Revenues as provided herein, and the Corporation is not obligated to pay them except from the Revenues. All the Certificates are equally secured by a pledge of and charge and lien upon the Revenues, and the Revenues constitute a trust fund for the security and payment of the interest, principal and prepayment premiums, if any, with respect to the Certificates as provided herein. The Certificates are not a debt of the Corporation, the City, the State of California or any of its political subdivisions, and neither the Corporation, the City, said State nor any of its political subdivisions is liable thereon, nor in any event shall the Certificates be payable out of any funds or properties other than those 39 4830- 8589- 9794.7 ], 11 of the Corporation as provided herein. The Certificates do not constitute an indebtedness within the meaning of any constitutional or statutory limitation or restriction. Section 10.02. Benefits of this Trust Agreement Limited to Parties. Nothing contained herein, expressed or implied, is intended to give to any person other than the City, the Credit Provider, the Corporation, the Trustee and the Owners any right, remedy or claim under or by reason hereof. Any agreement or covenant required herein to be performed by or on behalf of the City or the Corporation shall be for the sole and exclusive benefit of the Trustee, the Credit Provider (if any), the Corporation and the Owners. Section 10.03. Successor Is Deemed Included in All References to Predecessor. Whenever either the City, the Corporation, or the Trustee or any officer thereof is named or referred to herein, such reference shall be deemed to include the successor to the powers, duties and functions that are presently vested in the City, the Corporation or the Trustee or such officer, and all agreements, conditions, covenants and terms contained herein required to be observed or performed by or on behalf of the City, the Corporation or the Trustee or any officer thereof shall bind and inure to the benefit of the respective successors thereof whether so expressed or not. Section 10.04. Execution of Documents by Owners. Any declaration, request or other instrument which is permitted or required herein to be executed by Owners may be in one or more instruments of similar tenor and may be executed by Owners in person or by their attorneys appointed in writing. The fact and date of the execution by any Owner or his attorney of any declaration, request or other instrument or of any writing appointing such attorney may be proved by the certificate of any notary public or other officer authorized to make acknowledgments of deeds to be recorded in the state or territory in which he purports to act that the person signing such declaration, request or other instrument or writing acknowledged to him the execution thereof, or by an affidavit of a witness of such execution duly sworn to before such notary public or other officer. The ownership of any Certificates and the amount, maturity, number and date of holding the same may be proved by the registration books relating to the Certificates at the office of the Trustee. Any declaration, request or other instrument or writing of the Owner of any Certificate shall bind all future Owners of such Certificate with respect to anything done or suffered to be done by the City, the Corporation or the Trustee in good faith and in accordance therewith. Section 10.05. Waiver of Personal Liability. No member, officer or employee of the Corporation or the City shall be individually or personally liable for the payment of the interest, principal or prepayment premiums, if any, with respect to the Certificates by reason of their execution and delivery, but nothing herein contained shall relieve any such member, officer or employee from the performance of any official duty provided by any applicable provisions of law, the 2013 Installment Sale Agreement or hereby. Section 10.06. Acquisition of Certificates by Corporation. All Certificates acquired by the Corporation, whether by purchase or gift or otherwise, shall be surrendered to the Trustee for cancellation. 40 4830 - 8589- 9794.7 o4�AKF9s i-- m ORIGNAL. Section 10.07. Destruction of Canceled Certificates. Whenever provision is made herein for the cancellation of any Certificates, the Trustee shall destroy such Certificates and furnish to the Corporation a certificate of such destruction. Section 10.08. Content of Certificates; Post - Issuance Legal Opinions. Every Certificate of the Corporation or the City with respect to compliance with any agreement, condition, covenant or term contained herein shall include: (a) a statement that the person or persons executing such certificate have read such agreement, condition, covenant or term and the definitions herein relating thereto; (b) a brief statement as to the nature and scope of the examination or investigation upon which the statements contained in such certificate are based; (c) a statement that, in the opinion of the signers, they have made or caused to be made such examination or investigation as is necessary to enable them to express an informed opinion as to whether or not the City or the Corporation has complied with such agreement, condition, covenant or term; and (d) a statement as to whether, in the opinion of the signers, the City or the Corporation has complied with such agreement, condition, covenant or term. Any Certificate of the Corporation or any City may be based, insofar as it relates to legal matters, upon an Opinion of Counsel unless the person or persons executing such certificate know that the Opinion of Counsel with respect to the matters upon which his or their certificate may be based, as aforesaid, is erroneous, or in the exercise of reasonable care should have known that the same was erroneous. Any Opinion of Counsel may be based, insofar as it relates to factual matters and information with respect to which is in the possession of the City or the Corporation, upon a representation by an officer or officers of the City or the Corporation unless the counsel executing such Opinion of Counsel knows that the representation with respect to the matters upon which his opinion may be based, as aforesaid, is erroneous, or in the exercise of reasonable care should have known that the same was erroneous. Section 10.09. Accounts and Funds; Business Days. Any account or fund required herein to be established and maintained by the Trustee may be established and maintained in the accounting records of the Trustee either as an account or a fund, and may, for the purposes of such accounting records, any audits thereof and any reports or statements with respect thereto, be treated either as an account or a fund; but all such records with respect to all such accounts and funds shall at all times be maintained in accordance with the Tax Certificate and sound accounting practice and with due regard for the protection of the security of the Certificates and the rights of the Owners. Any action required to occur hereunder on a day which is not a Business Day shall be required to occur on the next succeeding Business Day. Section 10.10. Article and Section Headings and References. The headings or titles of the several articles and sections hereof and the table of contents appended hereto shall be solely for convenience of reference and shall not affect the meaning, construction or effect hereof. All references herein to "Articles," "Sections" and other subdivisions or clauses are to the corresponding articles, sections, subdivisions or clauses hereof; and the words "hereby," "herein " "hereof " "hereto," "herewith," "hereunder" and other words of similar import refer to this Trust Agreement as a whole and not to any particular article, section, subdivision or clause hereof. 41 4830 - 8589 - 9794.7 _r r n °'!�iNAL. Section 10.11. Partial Invalidity. If any one or more of the agreements or covenants or portions thereof required hereby to be performed by or on the part of the City, the Corporation or the Trustee shall be contrary to law, then such agreement or agreements, such covenant or covenants or such portions thereof shall be null and void and shall be deemed separable from the remaining agreements and covenants or portions thereof and shall in no way affect the validity hereof or of the Certificates, and the Owners and the Credit Provider (if any), shall retain all the benefit, protection and security afforded to them under the Nonprofit Public Benefit Corporation Law or any other applicable provisions of law. The City, the Corporation and the Trustee hereby declare that they would have executed and delivered this Trust Agreement and each and every other article, section, paragraph, subdivision, sentence, clause and phrase hereof and would have authorized the execution and delivery of the Certificates pursuant hereto irrespective of the fact that any one or more articles, sections, paragraphs, subdivisions, sentences, clauses or phrases hereof or the application thereof to any person or circumstance may be held to be unconstitutional, unenforceable or invalid. Section 10.12. Execution in Several Counterparts. This Trust Agreement may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original; and all such counterparts, or as many of them as the City, the Corporation and the Trustee shall preserve undestroyed, shall together constitute but one and the same instrument. Section 10.13. [Credit Provider Deemed Owner. For the purposes of (a) the giving of consents to amendments to this Trust Agreement pursuant to Section 6.01 hereof; (b) the giving of any other consent of the Owners hereunder; and (c) the control and direction of all rights and remedies upon the occurrence of an Event of Default, the Credit Provider (if any), shall be deemed to be the sole Owner of the Certificates for so long as it has not failed to comply with its payment obligations under the Credit Facility (if any); provided, however, that, notwithstanding the foregoing, the Credit Provider (if any) shall not be deemed to be the Owner of the Certificates for any consent to an amendment to this Trust Agreement that (i) extends the Certificate Payment Date of any Certificate or reduces the rate of interest represented thereby or extends the time of payment of such interest or reduces the amount of principal represented thereby, (ii) reduces the percentage of Owners whose consent is required for the execution of any amendment hereof or supplement hereto, or (iii) amends Section 6.01 hereof.] Section 10.14. Notices. Except as otherwise provided herein, for the purposes hereof, any notice, consent, request, requisition, direction, certificate or demand or other communication may be served or presented, and such notice or demand may be made and shall be deemed to have been sufficiently given or served for all purposes by being deposited, first -class postage prepaid, in a post office letter box, addressed, as the case may be, to the parties as follows: to the Corporation: Bakersfield Public Benefit Corporation 1600 Truxtun Avenue Bakersfield, California 93301 Attention: President/Executive Manager to the Trustee: 42 4830 - 8589- 9794.7 ��gAKF9� r- m U p ORIGINAL to the City: City of Bakersfield, California 1600 Truxtun Avenue Bakersfield, California 93301 Attention: to the Credit Provider: In each case in which notice or other communication refers to an Event of Default, then a copy of such notice or other communication shall also be sent to the attention of the L I and shall be marked to indicate "URGENT MATERIAL ENCLOSED." If to the Purchaser: Any such communication may also be sent by facsimile at the facsimile numbers given above. Any party may change its address by notice to each other party. [Remainder of page intentionally left blank] 43 4830 - 8589- 9794.7 s > m U �J ORIGINAI IN WITNESS WHEREOF, the Corporation and the City have caused this Trust Agreement to be signed in its names by such person as has been designated by its governing board, and the Trustee, to evidence its acceptance of the trust hereby created, has caused this Trust Agreement to be signed in the name of the Trustee by an authorized officer of the Trustee, all as of the day and year first above written. 44 4830 - 8589- 9794.7 U �, }- m U O 0 R1G1 NIA L BAKERSFIELD PUBLIC BENEFIT CORPORATION , [Title] CITY OF BAKERSFIELD, CALIFORNIA Em , Mayor APPROVED AS TO FORM: , City Attorney APPROVED AS TO CONTENT AND COUNTERSIGNED: By: Finance Director [TRUSTEE], as Trustee By Authorized [Officer /Signatory] 45 4830- 8589- 9794.7 o``gAK, �q T ORIGINAL, EXHIBIT A [FORM OF CERTIFICATE] CITY OF BAKERSFIELD GAS TAX, TRANSPORTATION IMPACT FEE AND RESTRICTED UTILITY FRANCHISE AND SURCHARGE REVENUE CERTIFICATES OF PARTICIPATION, SERIES 2013 (THOMAS ROADS IMPROVEMENT PROGRAM) Certificate Payment Interest Rate Date Dated as of CUSIP No. % ,20 ,2013 REGISTERED OWNER: CEDE & CO. PRINCIPAL SUM: DOLLARS THIS IS TO CERTIFY that the registered owner named above, as the registered owner of this City of Bakersfield Gas Tax, Transportation Impact Fee and Restricted Utility Franchise and Surcharge Revenue Certificate of Participation, Series 2013 (Thomas Roads Improvement Program) (the "Certificates "), is the owner of a proportionate undivided interest in the rights to receive certain 2013 Installment Sale Payments (as that term is defined in the Trust Agreement hereinafter mentioned) under and pursuant to that certain 2013 Installment Sale Agreement (the "the 2013 Installment Sale Agreement ") by and between the City of Bakersfield, a municipal corporation and chartered city situated in the County of Kern, State of California (the "City "), a duly organized and existing political subdivision of the State of California, and the Bakersfield Public Benefit Corporation (the "Corporation "), a nonprofit public benefit corporation duly organized and existing under and by virtue of the laws of the State of California, all of which rights to receive such 2013 Installment Sale Payments having been assigned without recourse by the Corporation to [ 1, as trustee (the "Trustee "), [a trust company duly organized and existing under and by virtue of the laws of the United States and having a Principal Corporate Trust Office in [City], [State]. Capitalized terms used herein and not otherwise defined shall have the meaning set forth in the Trust Agreement (as hereinafter defined) or the 2013 Installment Sale Agreement. The registered owner of this Certificate is entitled to receive, subject to the terms of the 2013 Installment Sale Agreement on the certificate payment date set forth above (the "Certificate Payment Date "), upon surrender of this Certificate on the Certificate Payment Date at the Principal Corporate Trust Office of the Trustee, the principal sum specified above representing the registered owner's fractional undivided share of the 2013 Installment Sale Payments designated as principal components coming due on the Certificate Payment Date, and on each and , commencing , 20_ (each an "Interest Payment Date "). The Certificates shall evidence and represent interest from the Interest Payment Date next preceding the date of registration thereof, unless such date of registration is an Interest Payment Date, in which event, they shall evidence and represent interest from such date, or unless such date of registration is prior to the first Interest Payment Date, in which event they shall evidence and represent interest from , 20_; provided, however, that if at the time of registration of 4830 - 8589- 9794.7 t- m U b any Certificate interest is then in default on the Outstanding Certificates, such Certificate shall evidence and represent interest from the Interest Payment Date to which interest has previously been paid or made available for payment on the Outstanding Certificates. Payment of interest evidenced and represented by the Certificates due on or before the maturity or prior prepayment thereof shall be made to the person whose name appears in the Certificates registration records maintained by the Trustee pursuant to the Trust Agreement as the registered owner thereof as of the close of business on the Record Date preceding each Interest Payment Date, whether or not such day is a Business Day, such interest to be paid by check mailed on such Interest Payment Date (or the next Business Day if such Interest Payment Date is not a Business Day) to such registered owner at the address as it appears in such books or at such other address as may have been filed with the Trustee for that purpose. The Owner of $1,000,000 or more in aggregate principal amount evidenced by the Certificates may request in writing that the Trustee pay the interest evidenced by such Certificates by wire transfer and the Trustee shall comply with such request for all Interest Payment Dates following the fifteenth day after receipt of such request until such request is rescinded. All such amounts are payable in lawful money of the United States of America. Certificates that are book -entry certificates will be governed by the book - entry provisions of the Trust Agreement and the Representation Letter. This Certificate is one of the duly authorized Certificates of the series set forth above, which have been executed by the Trustee pursuant to the terms of a Trust Agreement (together with any supplements or amendments thereto, the "Trust Agreement ") by and between the Trustee, the City and the Corporation, dated as of 1, 20_. Copies of the Trust Agreement are on file at the Principal Corporate Trust Office of the Trustee, and reference is hereby made to the Trust Agreement and to any and all amendments thereof and supplements thereto for a description of the agreements, conditions, covenants and terms securing the Certificates, for the nature, extent and manner of enforcement of such agreements, conditions, covenants and terms, for the rights and remedies of the registered owners of the Certificates with respect thereto and for the other agreements, conditions, covenants and terms upon which the Certificates are executed and delivered thereunder, to which agreements, conditions, covenants and terms the owner hereof, by acceptance hereof, hereby consents. To the extent and in the manner permitted by the terms of the Trust Agreement and the 2013 Installment Sale Agreement, the provisions of the Trust Agreement and the 2013 Installment Sale Agreement may be amended or supplemented by the parties thereto. This Certificate is transferable by the registered owner hereof, in person or by his attorney duly authorized in writing, at the Principal Corporate Trust Office of the Trustee but only in the manner, subject to the limitations and upon payment of the charges provided in the Trust Agreement, and upon surrender of this Certificate for cancellation accompanied by delivery of a duly executed written instrument of transfer in the form appearing hereon. Upon such transfer, a new Certificate or Certificates of the same series and Certificate Payment Date representing the same principal amount will be executed and delivered to the transferee in exchange herefor. The Certificates are exchangeable at the Principal Corporate Trust Office of the Trustee for a like aggregate principal amount of Certificates of authorized denominations of the same series and Certificate Payment Date, in the manner, subject to the limitations and upon payment of the charges provided in the Trust Agreement. A -2 A KF9 4830 - 8589- 9794.7 �n m c.� p c_`_�!G dAI. The Trustee may treat the registered owner hereof as the absolute owner hereof for all purposes, whether or not this Certificate shall be overdue, and the Trustee shall not be affected by any knowledge or notice to the contrary; and payment of the interest and principal represented by this Certificate shall be made only to such registered owner, which payments shall be valid and effectual to satisfy and discharge liability represented by this Certificate to the extent of the sum or sums so paid. The Certificates are authorized to be executed and delivered in the form of fully registered Certificates in denominations of $5,000 each or any integral multiple thereof so long as no Certificate shall represent principal becoming payable on more than one Certificate Payment Date. The Certificates are subject to optional and mandatory prepayment prior to their respective Certificate Payment Dates, as provided in the Trust Agreement. The Certificates each evidence and represent a fractional undivided interest in the 2013 Installment Sale Payments in an amount equal to the aggregate principal amount of Certificates originally executed and delivered by the Trustee pursuant to the Trust Agreement and enjoy the benefits of a security interest in the moneys held in the funds established pursuant to the Trust Agreement, subject to the provisions of the Trust Agreement permitting the disbursement thereof for or to the purposes and on the conditions and terms set forth therein. The obligations of the City to make the 2013 Installment Sale Payments are special obligations of the City payable solely from Gas Tax Revenues, Transportation Impact Fee Revenues and/or Restricted Utility Franchise and Surcharge Revenues (all as defined in the 2013 Installment Sale Agreement), and do not constitute debts of the City or of the State of California or of any political subdivision thereof within the meaning of any constitutional or statutory debt limitation or restriction. The Trustee has no obligation or liability to the Certificate owners for the payment of the interest or principal represented by the Certificates, but rather the Trustee's sole obligations are to administer, for the benefit of the City and the Corporation and the Certificate owners, the various funds and accounts established under the Trust Agreement and the 2013 Installment Sale Agreement. The Corporation has no obligation or liability whatsoever to the Certificate owners. The Owner hereby has a proportionate undivided ownership interest in the 2013 Installment Sale Payments payable pursuant to the 2013 Installment Sale Agreement, as set forth in Exhibit A to the 2013 Installment Sale Agreement. Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation ( "DTC "), to Trustee or its agent for the registration of transfer, exchange, or payment, and any certificate executed and delivered is registered in the name of Cede & Co. or in such other name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein. A -3 4830 - 8589- 9794.7 o� g ,A KF9 � O ORIGAAL The Corporation has certified to the Trustee that all acts, conditions and things required by the statutes of the State of California and the Trust Agreement to exist, to have happened and to have been performed precedent to and in connection with the execution and delivery of this Certificate do exist, have happened and have been performed in regular and due time, form and manner as required by law, and that the Trustee is duly authorized to execute and deliver this Certificate. This is to further certify that the amount of this Certificate, together with all other Certificates executed and delivered under the Trust Agreement, is not in excess of the amount of Certificates authorized to be executed and delivered thereunder. IN WITNESS WHEREOF, this Certificate has been dated as of the date set forth above and has been executed by the manual signature of an authorized signatory of the Trustee. Date of Execution: '2013 :A A -4 4830 - 8589- 9794.7 as Trustee Authorized Signatory c�``r6 AKe9 +_ m r )RIGINAL [FORM OF ASSIGNMENT] For value received, the undersigned do(es) hereby sell, assign and transfer unto whose address is whose social security or Taxpayer Identification No. is and do(es) hereby irrevocably constitute and appoint to transfer such Certificate on the Certificate register substitution in the premises. Dated: Signature must be guaranteed by an eligible guarantor institution. 4830 -8589- 9794.7 of the Trustee, and the within Certificate attorney with full power of Note: The signature(s) to this Assignment must correspond with the name(s) as written on the face of the within Certificate in every particular, without alteration or enlargement or any change whatsoever. FEW o``�AKF9s 2 ORIGINAL c.� i� [STATEMENT OF INSURANCE , has delivered its financial guaranty insurance policy (the "Policy ") with respect to the scheduled payments due of principal of and interest on this Certificate to [ 1, [City], [State], or its successor, as paying agent for the Certificates (the "Paying Agent "). Said Policy is on file and available for inspection at the principal office of the Paying Agent and a copy thereof may be obtained from or the Paying Agent. All payments required to be made under the Policy shall be made in accordance with the provisions thereof. The owner of this Certificate acknowledges and consents to the subrogation rights of as more fully set forth in the Policy.] A -6 4830 - 8589- 9794.7 4gAK£9 � m u ORIGINAL EXHIBIT B FORM REQUISITION FROM THE ACQUISITION FUND To: f _ ], as Trustee From: City of Bakersfield, California Dated Date: Re: City of Bakersfield Gas Tax, Transportation Impact Fee and Restricted Utility Franchise and Surcharge Revenue Certificates of Participation, Series 2013 (Thomas Roads Improvement Program) Requisition No. — The undersigned, on behalf of the City of Bakersfield, California (the "City "), acting as agent of the Bakersfield Public Benefit Corporation (the "Corporation ") pursuant to the 2013 Installment Sale Agreement, dated as of [_], 2013 (the "Agreement "), by and between the Corporation and the City, hereby requests payment from the Acquisition Fund, established and maintained under the Trust Agreement, dated as of [,, 2013 (the "Trust Agreement "), by and among, the City, the Corporation and the Trustee, in the amount of $ [by wire /check/ACH (circle one)] for purposes for which the City is authorized to expend moneys. If the payment is by wire or ACH, please fill in the following information: Name, Address and Phone Number of City's Bank: ABA# : Account No.: The undersigned hereby certifies as follows: The amount requisitioned hereby is for Project Costs (as defined in the Trust Agreement) incurred in connection with the Project (as defined in the Trust Agreement), is properly chargeable to the Acquisition Fund and has not been the subject of any previous requisition. The name and address of the person or persons to whom said amounts are to be disbursed and the amounts to be disbursed are as follows: 4830 -8589- 9794.7 - r-- �_i d 2. As of the date hereof, no event has occurred and is continuing which constitutes an Event of Default under the Agreement would constitute an Event of Default but for the requirement that notice be given, or time elapse, or both. 3. The information contained herein is true and correct as of the date of this Requisition. 4. Capitalized terms will herein have the meanings assigned to such terms in the Trust Agreement. Authorized City Representative 4830 - 8589- 9794.7 ��ArF9 ORIGINAL_ 4830 - 8589- 9794.7 r <� r] Draft Certificate Purchase Agreement CERTIFICATE PURCHASE AGREEMENT CITY OF BAKERSFIELD GAS TAX, TRANSPORTATION IMPACT FEE AND RESTRICTED UTILITY FRANCHISE AND SURCHARGE REVENUE CERTIFICATES OF PARTICIPATION, SERIES 2013 (THOMAS ROADS IMPROVEMENT PROGRAM) ,20_ Bakersfield Public Benefit Corporation 1600 Truxtun Avenue Bakersfield, CA 93301 City of Bakersfield 1600 Truxtun Avenue Bakersfield, CA 93301 Ladies and Gentlemen: The undersigned, (the "Purchaser/Underwriter "), offers to enter into this Certificate Purchase Agreement (this "Purchase Agreement ") with the City of Bakersfield, California (the "City ") and the Bakersfield Public Benefit Corporation (the "Corporation ") with regard to the City of Bakersfield Gas Tax, Transportation Impact Fee and Restricted Utility Franchise and Surcharge Revenue Certificates of Participation, Series 2013 (Thomas Roads Improvement Program) (the "Certificates "), which Purchase Agreement, upon the acceptance hereof by the City and the Corporation, will be binding upon the Corporation, the City, and the Purchaser/Underwriter. This offer is made subject to the acceptance by the Corporation and the City and execution of the Purchase Agreement and delivery of the same to the Purchaser/Underwriter at or prior to 11:59 p.m., California time, on the date hereof, but it shall be irrevocable until such time as it is sooner accepted by the City and the Corporation. Capitalized terms used in the Purchase Agreement and not otherwise defined herein shall have the respective meaning set forth for such terms in the hereinafter defined Trust Agreement and 2013 Installment Sale Agreement. 1. Purchase and Sale. Upon the terms and conditions and upon the basis of the representations, warranties, and agreements set forth herein, the City and the Corporation hereby agree to sell and deliver to the Purchaser/Underwriter for such purpose, all (but not less than all) of the $ aggregate principal amount of the Certificates, evidencing and representing a proportionate undivided interest in the 2013 Installment Sale Payments of the City made pursuant to the 2013 Installment Sale Agreement, dated as of , 2013 (the "2013 Installment Sale Agreement ") by and between the City and the Corporation. [The purchase price of the Certificates shall be $ (representing the par amount of the Certificates, 4850- 7491 - 7650.5 o4�AKF9s r U �J ORIGINAL [less /plus] a net original issue [discount/premium] of $ , less an underwriter's discount of $); [it being acknowledged that the Purchaser/Underwriter will on the date of Closing, on behalf of the City, wire the $ aggregate premium for the [Certificate Insurance Policy] (as defined below) to the [Certificate Insurer] (as defined below) directly, and deliver net proceeds to the Trustee in the amount of $ .] [Payment of the principal of and interest on the 2013 Installment Payments when due will be guaranteed by a financial guaranty insurance policy (the "[Certificate Insurance Policy] ") to be issued simultaneously with the delivery of the Certificates by [ ] (the "[Certificate Insurer] ").] 2. The Certificates. The Certificates shall be as described in and shall be issued and secured under the provisions of the Trust Agreement, dated as of , 2013 (the "Trust Agreement "), by and among the City, the Corporation and [TRUSTEE], as trustee (the "Trustee "). The Certificates shall be payable and subject to prepayment as provided in the Trust Agreement. The Certificates are payable solely from 2013 Installment Sale Payments (the "2013 Installment Sale Payments ") paid by the City from: (i) moneys on deposit in the Gas Tax Fund, which moneys in such fund comprise all amounts received by the City from the State of California (the "State ") in accordance with Streets and Highways Code §§ 2103, 2105, 2106 and 2107, as such provisions may be amended, and all other revenues (except revenues received by the City in accordance with the Streets and Highways Code § 2107.5), if any, received by the City from taxes imposed on the purchase of motor vehicle fuels and any payments, subventions or reimbursements received by the City from the State in lieu of such revenues (collectively, the "Gas Tax Revenues); (ii) moneys on deposit in the Transportation Impact Fee Trust Fund, which moneys in such fund comprise fees paid to the City by developers to mitigate traffic impacts caused by a development project in accordance with certain provisions of the City's Municipal Code; (iii) moneys on deposit in the Roads Program Utility Franchise Fee and Surcharge Fund, which moneys comprise certain additional electricity franchise payments and the electricity and gas surcharge received by the City from certain franchisees for the use of the City's streets and which are dedicated and restricted by the City for the purpose of capital improvements associated with the City's Roads Program pursuant to City ordinance (collectively, the "Revenues ") [and (iv) and any other moneys of the City that are legally available to pay for the Project (as defined below).] The Certificates shall be dated, shall mature, shall bear interest at the rates per annum, shall be subject to prepayment and shall have the yields all as set forth on Exhibit A attached hereto and as further described in the Official Statement and shall be executed and delivered under and pursuant to the Trust Agreement. The Certificates are being delivered to provide funds[, together with other lawfully available moneys of the City] to (a) facilitate the financing of certain Capital Improvements related to the City Roads Program (both as defined herein) within the City and outside the City that will directly benefit the City (the "Project "); (b) pay costs of issuance associated with the Certificates;[ and (c) pay any premium associated with the issuance of the [Certificate Insurance Policy] by the [Certificate Insurer].] 2 4850- 7491- 7650.5 v n ORIGINAL "Capital Improvements" shall mean any new construction, re- construction, resurfacing, repair or maintenance work where project costs exceed $5,000 and where such work carries a useful life exceeding one year or where such repair or maintenance work extends the useful life of an existing facility by at least one year. "City Roads Program" shall mean any costs related to design, right -of -way, new construction, re- construction, resurfacing, repair or maintenance work on any city roadway, bike lane, bike path, or pedestrian path within the City right of way. Additionally, any costs related to design, right -of -way, construction or any other improvements related to any bridge, road widening or freeway facility in the greater Bakersfield area which is a component or project segment of the Thomas Roads Improvement Program. 3. Public Offering. The Purchaser/Underwriter agrees to make a bona fide public offering of all the Certificates at a price not in excess of the respective initial public offering prices to be set forth on the cover page of the Official Statement. The Purchaser/Underwriter reserves the right to change such initial offering prices as the Purchaser /Underwriter shall deem necessary in connection with the marketing of the Certificates and to offer and sell the Certificates to certain dealers (including dealers depositing such Certificates into investment trusts) and others at prices lower than the initial offering prices set forth on the cover page of the Official Statement. The Purchaser/Underwriter also reserves the right to (i) overallot or effect transactions that stabilize or maintain the market prices of the Certificates at levels above those which might otherwise prevail in the open market and (ii) discontinue such stabilizing, if commenced, at any time, "Public offering" shall include an offering to a representative number of institutional investors or registered investment companies, regardless of the number of such investors to which the Certificates are sold. The City and the Corporation acknowledge and agree that (i) the purchase and sale of the Certificates pursuant to this Certificate Purchase Agreement is an arm's - length commercial transaction between the City, the Corporation and the Purchaser/Underwriter, (ii) in connection therewith and with the discussions, undertakings and procedures leading up to the consummation of such transaction, the Purchaser/Underwriter is and has been acting solely as a principal and is not acting as a municipal advisor (as defined in Section 1513(e)(4) of the Securities Exchange Act of 1934, as amended), or an agent, advisor or fiduciary of the City or the Corporation, (iii) the Purchaser/Underwriter has not assumed an advisory or fiduciary responsibility in favor of the City or the Corporation with respect to the offering of the Certificates contemplated hereby or the discussions, undertakings and procedures leading thereto (irrespective of whether the Purchaser/Underwriter, or any affiliates of the Purchaser/Underwriter, have provided other services or are currently providing other services to the City and/or the Corporation on other matters) and the Purchaser/Underwriter has no obligations to the City with respect to the offering of the Certificates contemplated hereby except the obligations expressly set forth in this Certificate Purchase Agreement, (iv) the Purchaser/Underwriter has financial and other interests that differ from those of the City and the Corporation, and (v) the City and the Corporation have consulted with their own legal, financial and other advisors to the extent it deemed appropriate in connection with the offering of the Certificates. 4. Preliminary Official Statement; Official Statement. The Preliminary Official Statement with respect to the Certificates, dated , 20_ (the "Preliminary Official 3 4850 -7491- 7650.5 04� AK49 s n 3 ORIGINAL Statement "), as amended to conform to the terms of this Purchase Agreement, and dated the date hereof, and with such changes and amendments as are mutually agreed to by the Corporation, the City, and the Purchaser /Underwriter, including the cover page, the appendices, and all information incorporated therein by reference, is herein collectively referred to as the "Official Statement." The Corporation represents that it has deemed the sections of the Preliminary Official Statement entitled [ "THE CORPORATION" and "NO LITIGATION — The Corporation "] to be final as of the date of Preliminary Official Statement, pursuant to Rule 15c2- 12 of the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended (the "Rule "). The City represents that it has deemed the Preliminary Official Statement to be final as of its date pursuant to the Rule, except for (a) information regarding the Corporation, [the Certificate Insurer, and the Certificate Insurance Policy], and (b) the omission of the offering prices, interest rates, selling compensation, aggregate principal amount, principal amount per maturity, dates and amounts of mandatory sinking fund payments, delivery dates, ratings, and identity of the purchasers and any other terms of the Certificates relating to such matters and any other information permitted to be omitted by the Rule. The Corporation and the City hereby authorize, or have previously authorized, as applicable, the use by the Purchaser/Underwriter of (a) the Trust Agreement, (b) the 2013 Installment Sale Agreement, (c) the Continuing Disclosure Certificate (as hereinafter defined), and (d) each of the Preliminary Official Statement and the Official Statement, and any supplements or amendments thereto, and the information contained in each of such documents, in connection with the public offering and sale of the Certificates. The Corporation will deliver to the Purchaser/Underwriter, within seven business days after the date of this Purchase Agreement and in sufficient time to accompany any confirmation requesting payment from any customers of the Purchaser/Underwriter, copies of the Official Statement in final form (including all documents incorporated by reference therein) and any amendment or supplement thereto in such quantities as the Purchaser/Underwriter may reasonably request in order to comply with the obligations of the Purchaser /Underwriter pursuant to the Rule and the rules of the Municipal Securities Rulemaking Board. As soon as practicable following receipt thereof from the Corporation, the Purchaser/Underwriter shall deliver the Official Statement to the Municipal Securities Rulemaking Board. The City will undertake pursuant to a Continuing Disclosure Certificate, to be dated as of the Closing (as hereinafter defined) (the "Continuing Disclosure Certificate "), to provide certain annual financial information and notice of certain enumerated events. A description of this undertaking is set forth in the Official Statement. 5. The Closing. At 8:00 a.m., California time, on , 20_, or at such other time or on such other business day as shall have been mutually agreed upon by the Corporation, the City, and the Purchaser/Underwriter (the "Closing "), the Corporation will cause the Trustee to execute and deliver to the Purchaser/Underwriter, under the Fast Automated Securities Transfer System of The Depository Trust Company ( "DTC "), the Certificates in fully - registered book -entry form, duly executed and registered in the name of Cede & Co., as nominee of DTC, and subject to the terms and conditions hereof, the Purchaser/Underwriter will accept such delivery and pay the purchase price of the Certificates by wire transfer payable in immediately available funds to or upon the order of the Corporation at such place in [Los 4 4850- 7491 - 7650.5 J > fri J � ORK3 AL Angeles, California] as shall have been mutually agreed upon by the Corporation and the Purchaser/Underwriter. This payment and delivery for the Certificates is referred to herein as the "Closing." The Certificates shall be made available for inspection by the Purchaser/Underwriter at least one business day prior to the Closing. 6. Representations, Warranties and Covenants of the Corporation. The Corporation represents, warrants, and covenants to the Purchaser /Underwriter that: (a) The Corporation is a nonprofit public benefit corporation duly organized and existing under the laws of the State. (b) The Corporation has the legal right and power to execute and deliver, and to perform its obligations under, the Trust Agreement, the 2013 Installment Sale Agreement, and this Purchase Agreement (collectively, the "Corporation Documents "). The Corporation has duly authorized the execution and delivery of the Certificates and the execution and delivery of, and performance of its obligations under, the Corporation Documents and, as of the date hereof, such authorizations are in full force and effect and have not been amended, modified, or rescinded. When executed and delivered by the respective parties thereto, the Corporation Documents will constitute legal, valid, and binding obligations of the Corporation in accordance with their respective terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium, or similar laws and the application of equitable principles relating to or affecting creditors' rights generally. The Corporation has complied, and will at the Closing be in compliance in all respects, with its obligations under the Corporation Documents. (c) The Certificates will be paid from 2013 Installment Sale Payments pursuant to the 2013 Installment Sale Agreement, which payments have been duly and validly authorized pursuant to applicable law. (d) The Certificates will be executed and delivered in accordance with the Trust Agreement and will conform in all material respects to the descriptions thereof contained in the Official Statement, and the Trust Agreement creates a valid pledge of, first lien upon, and security interest in, the Revenues. (e) for purposes of the Rule, the Corporation has heretofore deemed final the sections of the Preliminary Official Statement entitled [ "THE CORPORATION" and "NO LITIGATION — The Corporation "] prior to its use and distribution by the Purchaser/Underwriter, except for the information specifically permitted to be omitted by paragraph (b)(1) of the Rule; and (f) The information in the sections of the Official Statement entitled "[THE CORPORATION" and "NO LITIGATION —The Corporation "] [any other portion of the Official Statement that the Corporation makes representations to] is true and correct in all material respects, and such information does not contain, any misstatement of any material fact and does not omit any statement necessary to make the statements, in the light of the circumstances in which such statements were made, not misleading. 5 4850- 7491 - 7650.5 Ak, q t- m 0 (g) The Corporation covenants with the Purchaser /Underwriter that for 25 days after the date of Closing (the "Delivery Period "), if any event occurs that might or would cause the Official Statement, as then supplemented or amended, to contain an untrue statement of a material fact or to omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, the Corporation shall notify the Purchaser/Underwriter thereof, and if in the opinion of the Purchaser/Underwriter such event requires the preparation and publication of a supplement or amendment to the Official Statement, the Corporation will cooperate with the Purchaser/Underwriter in the preparation of an amendment or supplement to the Official Statement, at the expense of the City, in a form and in a manner approved by the Purchaser/Underwriter. (h) The Corporation will advise the Purchaser/Underwriter promptly of any proposal to amend or supplement the Official Statement and will not affect or consent to any such amendment or supplement without the consent of the Purchaser/Underwriter. The Corporation will advise the Purchaser/Underwriter promptly of the institution of any proceedings known to it by any governmental agency prohibiting or otherwise affecting the use of the Official Statement in connection with the offering, sale, or distribution of the Certificates. (i) If the Official Statement is supplemented or amended, the Official Statement, as so supplemented or amended, as of the date of such supplement or amendment, will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. 0) The Corporation is not in breach of or in default under any applicable constitutional provision, law, or administrative rule or regulation of the State or the United States, or any applicable judgment, decree, consent, or other agreement to which the Corporation is a party, and no event has occurred and is continuing that, with the passage of time or the giving of notice, or both, would constitute such a default or event of default under any of the foregoing. (k) The authorization, execution, and delivery by the Corporation of the Corporation Documents, and compliance by the Corporation with the provisions thereof, do not and will not conflict with or constitute a breach of or default by the Corporation under any applicable constitutional provision, law, or administrative rule or regulation of the State or the United States, or any applicable judgment, decree, consent, or other agreement to which it is bound or by which its properties may be affected, nor will any such execution, delivery, adoption, or compliance result in the creation or imposition of any lien, charge, or other security interest or encumbrance of any nature whatsoever upon any of the properties or assets of the Corporation under the terms of any such law, administrative regulation, judgment, decree, loan agreement, indenture, bond, note, resolution, agreement, or other instrument, except as provided by the Corporation Documents. 0 4850 -7491- 7650.5 o��AKF9s h- 7l f 7'- V 11'�) ORIGINAL (1) No authorization, consent, or approval of, or filing or registration with, any Governmental Authority (as defined below) or court is, or under existing requirements of law will be, necessary for the valid execution and delivery of, or performance by the Corporation of its obligations under, the Corporation Documents, other than any authorization, consent, approval, filing, or registration as may be required under the Blue Sky or securities laws of any state in connection with the offering, sale, execution, or delivery of the Certificates. All authorizations, consents, or approvals of, or filings or registrations with, any Governmental Authority or court necessary for the valid execution and delivery of, and performance by the Corporation of its obligations with respect to, the Certificates will have been duly obtained or made prior to the execution and delivery of the Certificates (and disclosed to the Purchaser/Underwriter). As used herein, the term "Governmental Authority" refers to any legislative body or governmental official, department, commission, board, bureau, agency, instrumentality, body, or public benefit corporation. (m) The Corporation shall furnish such information, execute such instruments, and take such other action in cooperation with the Purchaser/Underwriter as the City may reasonably request at the expense of the Purchaser/Underwriter and /or the City in order (i) to qualify the Certificates for offer and sale under the Blue Sky or other securities laws and regulations of such states and other jurisdictions of the United States as the Purchaser/Underwriter may designate and (ii) to determine the eligibility of the Certificates for investment under the laws of such states and other jurisdictions, and shall use its best efforts to continue such qualifications in effect so long as required for the distribution of the Certificates; provided, however, that the Corporation shall not be required to execute a general consent to service of process or qualify to do business in connection with any such qualification or determination in any jurisdiction. (n) To the knowledge of the Corporation, there is no action, suit, proceeding, inquiry, or investigation, at law or in equity, before or by any court, regulatory agency, or public board or body, pending or threatened (i) in any way questioning the existence of the Corporation or the titles of the officers of the Corporation to their respective offices; (ii) affecting, contesting, or seeking to prohibit, restrain, or enjoin the execution and delivery of the Certificates or the execution or delivery of any of the Corporation Documents, or the payment or collection of any amounts pledged or to be pledged to pay the principal and interest with respect to the Certificates, or in any way contesting or affecting the validity of the Certificates or the Corporation Documents or the consummation of the transactions contemplated thereby or any proceeding of the Corporation taken with respect to any of the foregoing, or contesting the exclusion of the portion of the 2013 Installment Sale Payments designated as and comprising interest and received by the Owners of the Certificates from taxation or contesting the powers of the Corporation and its authority to pledge the 2013 Installment Sale Payments; (iii) that may result in any material adverse change relating to the Corporation that will materially adversely affect the Corporation's ability to apply 2013 Installment Sale Payments to pay the Certificates when due; or (iv) contesting the completeness or accuracy of the Preliminary Official Statement or the Official Statement or any supplement or amendment thereto or asserting that the Preliminary Official Statement or the Official Statement contained any untrue statement of a material fact or omitted to state any 7 4850- 7491 - 7650.5 f rfl r- v b ORIGINAL material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. (o) Other than in the ordinary course of its business or as contemplated by the Official Statement, between the date of this Purchase Agreement and the date of Closing the Corporation will not, without the prior written consent of the Purchaser/Underwriter, offer or issue any certificates, bonds, notes, or other obligations for borrowed money or incur any material liabilities, direct or contingent, payable from or secured by a pledge of the 2013 Installment Sale Payments. (p) Any certificate signed by any official or other representative of the Corporation and delivered to the Purchaser/Underwriter pursuant to this Purchase Agreement shall be deemed a representation and warranty by the Corporation to the Purchaser/Underwriter as to the truth of the statements therein made. 7. Representations, Warranties and Covenants of the City. The City represents, warrants, and covenants to the Purchaser/Underwriter and the Corporation that: (a) The City is a charter city, duly organized and existing under the Constitution and laws of the State. (b) The City has the legal right and power to execute and deliver, and to perform its obligations under, the Trust Agreement, the 2013 Installment Sale Agreement, the Continuing Disclosure Certificate, and this Purchase Agreement (collectively, the "City Documents "). The City has duly authorized the execution and delivery of, and the performance of its obligations under, the City Documents and as of the date hereof such authorizations are in full force and effect and have not been amended, modified, or rescinded. When executed and delivered by the respective parties thereto, the City Documents will constitute legal, valid, and binding obligations of the City in accordance with their respective terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium, or similar laws and the application of equitable principles relating to or affecting creditors' rights generally. The City has complied, and will at the Closing be in compliance in all respects, with its obligations under the City Documents. (c) The 2013 Installment Sale Payments payable under the 2013 Installment Sale Agreement have been duly and validly authorized, pursuant to applicable law. (d) The Certificates will be executed and delivered in accordance with the Trust Agreement and will conform in all material respects to the descriptions thereof contained in the Official Statement. The Trust Agreement creates a valid pledge of, first lien upon, and security interest in, the Revenues. (e) for purposes of the Rule, the City has heretofore deemed final the Preliminary Official Statement prior to its use and distribution by the Purchaser/Underwriter, except for (i) information regarding the Corporation, [the Certificate Insurer and the Certificate Insurance Policy], and (ii) the omission of the offering prices, interest rates, selling compensation, aggregate principal amount, principal E:3 4850 -7491- 7650.5 �gaKf:y � m r U p amount per maturity, dates and amounts of mandatory sinking fund payments, delivery dates, ratings, and identity of the purchasers and any other terms of the Certificates relating to such matters and any other information specifically permitted to be omitted by paragraph (b)(1) of the Rule; (f) The information in the Official Statement (excluding any information with respect to the Corporation, DTC, the book -entry only system, [the Certificate Insurer and the Certificate Insurance Policy)] is true and correct in all material respects, and such information does not contain any misstatement of any material fact and does not omit any statement necessary to make the statements therein, in the light of the circumstances in which such statements were made, not misleading. (g) The City covenants with the Purchaser/Underwriter that, during the Delivery Period, if any event occurs that might or would cause the Official Statement, as then supplemented or amended, to contain an untrue statement of a material fact or to omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, the City shall notify the Purchaser/Underwriter thereof, and if in the opinion of the Purchaser/Underwriter such event requires the preparation and publication of a supplement or amendment to the Official Statement, the City will cooperate with the Purchaser/Underwriter and the Corporation in the preparation of an amendment or supplement to the Official Statement, at the expense of the City, in a form and in a manner approved by the Purchaser/Underwriter. (h) The City will advise the Purchaser/Underwriter promptly of any proposal to amend or supplement the Official Statement and will not effect or consent to any such amendment or supplement without the consent of the Purchaser/Underwriter. The City will advise the Purchaser/Underwriter promptly of the institution of any proceedings known to it by any governmental agency prohibiting or otherwise affecting the use of the Official Statement in connection with the offering, sale, or distribution of the Certificates. (i) If the Official Statement is supplemented or amended, the Official Statement as so supplemented or amended, as of the date of such supplement or amendment, will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. 0) The City is not in breach of or in default under any applicable constitutional provision, law, or administrative rule or regulation of the State or the United States, or any applicable judgment, decree, consent, or other agreement to which the City is a party, and no event has occurred and is continuing that, with the passage of time or the giving of notice, or both, would constitute such a default or event of default under any of the foregoing. (k) The authorization, execution, and delivery by the City of the City Documents, and compliance by the City with the provisions thereof, do not and will not conflict with or constitute a breach of or default by the City under any applicable 9 4850- 7491 - 7650.5 O � r J 0 (DRIGINAL constitutional provision, law, or administrative rule or regulation of the State or the United States, or any applicable judgment, decree, consent, or other agreement to which it is bound or by which its properties may be affected. (1) No authorization, consent, or approval of, or filing or registration with, any Governmental Authority or court is, or under existing requirements of law will be, necessary for the valid execution and delivery of, or performance by the City of its obligations under, the City Documents, other than any authorization, consent, approval, filing, or registration as may be required under the Blue Sky or securities laws of any state in connection with the offering, sale, execution, or delivery of the Certificates. (m) The City will furnish such information, execute such instruments, and take such other action in cooperation with the Purchaser/Underwriter as the Purchaser/Underwriter may reasonably request in order to: (i) qualify the Certificates for offer and sale under the Blue Sky or other securities laws and regulations of such states and other jurisdictions of the United States as the Purchaser/Underwriter may designate, and (ii) determine the eligibility of the Certificates for investment under the laws of such states and other jurisdictions, and will use their best efforts to continue such qualifications in effect so long as required for the distribution of the Certificates; provided, however, that the City shall not be required to execute a general consent to service of process or qualify to do business in connection with any such qualification or determination in any jurisdiction. (n) There is no action, suit, proceeding, inquiry, or investigation, at law or in equity, before or by any court, regulatory agency, or public board or body, pending or, to the best knowledge of the City, threatened (i) in any way questioning the existence of the City or the titles of the officers of the City to their respective offices; (ii) affecting, contesting, or seeking to prohibit, restrain, or enjoin the execution and delivery of the Certificates or the execution or delivery of any of the City Documents, or the payment or collection of any amounts pledged or to be pledged to pay the principal and interest with respect to the Certificates, or in any way contesting or affecting the validity of the Certificates or the City Documents or the consummation of the transactions contemplated thereby or any proceeding of the City taken with respect to any of the foregoing, or contesting the exclusion of the portion of the 2013 Installment Sale Payments designated as and comprising interest and received by the Owners of the Certificates from taxation or contesting the powers of the City and its authority to pledge the 2013 Installment Sale Payments; (iii) that may result in any material adverse change relating to the City that will materially adversely affect the City's ability to pay 2013 Installment Sale Payments when due; or (iv) contesting the completeness or accuracy of the Preliminary Official Statement or the Official Statement or any supplement or amendment thereto or asserting that the Preliminary Official Statement or the Official Statement contained any untrue statement of a material fact or omitted to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. (o) Other than in the ordinary course of its business or as contemplated by the Official Statement, between the date of this Purchase Agreement and the date of Closing 10 4850 -7491 - 7650.5 r c1 rJ C %RICINAL the City will not, without the prior written consent of the Purchaser/Underwriter, offer or issue any certificates, bonds, notes, or other obligations for borrowed money or incur any material liabilities, direct or contingent, payable from or secured by a pledge of the 2013 Installment Sale Payments. (p) The financial information regarding the City contained in the Official Statement fairly present the financial position and results of the operations of the City as of the dates and for the periods therein set forth, and, to the best of the City's knowledge, the City's audited financial statements have been prepared in accordance with generally accepted accounting principles consistently applied. (q) Any certificate signed by any official or other representative of the City and delivered to the Purchaser/Underwriter pursuant to this Purchase Agreement shall be deemed a representation and warranty by the City to the Purchaser/Underwriter as to the truth of the statements therein made. (r) The City has not failed during the previous five (5) years to comply in all material respects with any previous undertakings in a written continuing disclosure contract or agreement under the Rule. (s) To the extent permitted by law, the City agrees to indemnify and hold harmless the Corporation and its officers, directors, agents, and employees against any and all losses, claims, damages, liabilities, and expenses arising out of any statement or information in the Preliminary Official Statement or in the Official Statement (other than statements or information specifically related to the Corporation, the Program, DTC, the book -entry only system, [the Certificate Insurer and the Certificate Insurance Policy] that is untrue or incorrect in any material respect or that omits to state any material fact that is necessary to make such statement or information therein not misleading in any material respect. 8. Closing Conditions. The Purchaser /Underwriter has entered into this Purchase Agreement in reliance upon the representations, warranties, and covenants of the Corporation and the City contained herein and in the Corporation Documents and the City Documents to which each of the Corporation or the City, is a party, and the performance by the Corporation and by the City of their respective obligations hereunder, both as of the date hereof and as of the date of Closing. The Purchaser/Underwriter's obligations under this Purchase Agreement are and shall be subject to the following further conditions: (a) Bring -Down Representation. The representations and warranties of the Corporation and the City contained herein shall be true, complete, and correct in all material respects on the date hereof and at and as of the Closing, as if made at and as of the Closing, and the statements made in all certificates and other documents delivered to the Purchaser/Underwriter at the Closing pursuant hereto shall be true, complete, and correct in all material respects at the Closing; the Corporation and the City shall be in compliance with each of the agreements made by it in this Purchase Agreement (unless such agreements are waived by the Purchaser/Underwriter); there shall not have occurred an adverse change in the financial position, results of operations, or financial condition of 11 BAKE 4850- 7491 - 7650.5 F_ r ORIGINAL the City that materially adversely affects the ability of the City to pay 2013 Installment Sale Payments when due or otherwise perform any of its obligations under the City Documents; and there shall not have occurred an adverse change in the financial position of the Corporation that materially adversely affects the ability of the Corporation to make payments of principal and interest with respect to the Certificates when due or otherwise perform any of its obligations under the Corporation Documents. (b) Executed Agreements and Performance Thereunder. At the time of the Closing, the Corporation Documents and the City Documents shall be in full force and effect, and shall not have been amended, modified, or supplemented (except as may be agreed to in writing by the Purchaser/Underwriter); all actions that, in the opinion of Kutak Rock LLP, Special Counsel to the City ( "Special Counsel "), shall be necessary in connection with the transactions contemplated hereby shall have been duly taken and shall be in full force and effect; and the City shall perform or shall have performed its obligations required under or specified in the City Documents to be performed at or prior to the Closing and the Corporation shall perform or shall have performed its obligations required under or specified in the Corporation Documents to be performed at or prior to the Closing. (c) Official Statement Accurate and Complete. At the time of the Closing, the Official Statement (as amended and supplemented) shall be true and correct in all material respects, and shall not omit any statement or information necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. (d) No Default. (i) No default by the City or the Corporation shall have occurred and be continuing in the payment of the principal of or premium, if any, or interest on any bond, note, or other evidence of indebtedness issued by the City or the Corporation, respectively, and (ii) no bankruptcy, insolvency, or other similar proceeding in respect of the City or the Corporation shall be pending or, to the knowledge of the City or the Corporation, contemplated. (e) Termination Events. The Purchaser/Underwriter may terminate this Purchase Agreement by written notification to the Corporation and the City if at any time after the date hereof and prior to the Closing: (i) the marketability of the Certificates or the market price thereof, in the opinion of the Purchaser/Underwriter, has been materially adversely affected by an amendment to the Constitution of the United States or by any legislation in or by the Congress of the United States or by the State, or the amendment of legislation pending as of the date of this Purchase Agreement in the Congress of the United States, or the recommendation to Congress or endorsement for passage (by press release, other form of notice or otherwise) of legislation by the President of the United States, the Treasury Department of the United States, the Internal Revenue Service or the Chairman or ranking minority member of the Committee on Finance of the United States Senate or the Committee on Ways and Means of the United States House of Representatives, or the proposal for consideration of 12 4850- 7491 - 7650.5 ~ r t) GRiGiNAL legislation by either such Committee or by any member thereof, or the presentment of legislation for consideration as an option by either such Committee, or by the staff of the Joint Committee on Taxation of the Congress of the United States, or the favorable reporting for passage of legislation to either House of the Congress of the United States by a Committee of such House to which such legislation has been referred for consideration, or any decision of any federal or State court or any ruling or regulation (final, temporary or proposed) or official statement on behalf of the United States Treasury Department, the Internal Revenue Service or other federal or State Agency materially adversely affecting the federal or State tax status of the City, or the interest on bonds or notes or obligations of the general character of the Certificates; or (ii) the United States shall have become engaged in hostilities which have resulted in a declaration of war or a national emergency or there has occurred any other outbreak of hostilities or a national or international calamity or crisis, financial or otherwise, the effect of such outbreak, calamity or crisis on the financial markets of the United States, being such as, in the reasonable opinion of the Purchaser/Underwriter, would affect materially and adversely the ability of the Purchaser /Underwriter to market or deliver the Certificates; or (iii) there shall have occurred a general suspension of trading on the New York Stock Exchange, or a general banking moratorium shall have been declared by Federal, California, or New York authorities having jurisdiction and being in force; or (iv) there shall have occurred an adverse change in the financial position, results of operations, or financial condition of the City that, in the reasonable opinion of the Purchaser/Underwriter, materially adversely affects the market for the Certificates; or (v) any legislation, ordinance, rule, or regulation shall be introduced in, or be enacted by, any governmental body, department, or agency of the State, or a decision by any court of competent jurisdiction within the State or any court of the United States shall be rendered that, in the reasonable opinion of the Purchaser/Underwriter, materially adversely affects the market price of the Certificates; or (vi) legislation shall be enacted by the Congress of the United States, or a decision by a court of the United States shall be rendered, or a stop order, ruling, regulation, or official statement by, or all behalf of, the Securities and Exchange Commission or any other governmental agency having jurisdiction of the subject matter shall be issued or made to the effect that the execution, delivery, offering, or sale of the Certificates, including all underlying obligations, as contemplated hereby or by the Official Statement, is in violation or would be in violation of, or that securities of the general character of the Certificates, or the Certificates, are not exempt from registration under, any provision of the federal securities laws, including the Securities Act of 1933, as amended and as then in effect, or that the 13 4850 -7491 - 7650.5 g A K�r O r, t- ;n u c, ORIGINA:!_ Trust Agreement needs to be qualified under the Trust Indenture Act of 1939, as amended and as then in effect; or (vii) additional material restrictions not in force as of the date hereof shall have been imposed upon trading in securities generally by any governmental authority or by any national securities exchange, which restrictions materially adversely affect the ability of underwriters to trade obligations of the general character of the Certificates; or (viii) any rating of the Certificates shall have been downgraded, suspended, or withdrawn by a national rating service, which, in the Purchaser/Underwriter's reasonable opinion, materially adversely affects the marketability or market price of the Certificates; or (ix) the commencement of any action, suit, or proceeding described in Section 6(n) or 7(n) that, in the judgment of the Purchaser/Underwriter, materially adversely affects the market price of the Certificates; or (x) any rating of the [Certificate Insurer] shall have been downgraded, suspended, or withdrawn by a national rating service, which, in the Purchaser /Underwriter's reasonable opinion, materially adversely affects the marketability or market price of the Certificates; or (xi) any event occurring, or information becoming known, that, in the reasonable judgment of the Purchaser/Underwriter, makes any statement or information contained in the Official Statement, as of its date, untrue in any material adverse respect, or has the effect that the Official Statement, as of its date, contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. (f) At or prior to the Closing, the Purchaser/Underwriter shall receive the following documents: (i) Final Opinion. The opinion of Special Counsel, dated the date of Closing, in substantially the form included in the Official Statement as Appendix _, addressed to the City (and accompanied by reliance letters to the Corporation, the Purchaser /Underwriter, the Trustee, [and the Certificate Insurer]); (ii) Supplemental Opinion. A supplemental opinion of Special Counsel, in form and substance satisfactory to the Purchaser/Underwriter, dated the date of Closing, addressed to the Purchaser /Underwriter and the City, in the form and substance acceptable to the Purchaser/Underwriter, to the effect that: (A) the Certificates are not subject to registration requirements of the Securities Act of 1933, as amended, and the Trust Agreement is exempt from qualification pursuant to the Trust Indenture Act of 1939, as 14 4850- 7491- 7650.5 11 R, o 9 U ORIGINAL amended; provided that no opinion shall be expressed with respect to the [Certificate Insurance Policy]; (B) this Purchase Agreement has been duly executed and delivered by the City and is a valid and binding agreement of the City; and (C) the statements contained in the Official Statement under the captions [ "INTRODUCTION," "THE CERTIFICATES," "SECURITY AND SOURCES OF PAYMENT FOR THE CERTIFICATES," "TAX MATTERS," "APPENDIX _— SUMMARY OF CERTAIN PROVISIONS OF PRINCIPAL LEGAL DOCUMENTS," and "APPENDIX _— PROPOSED FORM OF SPECIAL COUNSEL OPINION, "] insofar as such statements expressly summarize certain provisions of the Trust Agreement, the 2013 Installment Sale Agreement, the Certificates, and the opinion of Special Counsel concerning certain federal tax matters relating to the Certificates, are accurate in all material respects; (iii) City Attorney Opinion. An opinion of the City Attorney, in form and substance satisfactory to the Purchaser/Underwriter, dated the date of Closing, addressed to the Corporation, the Purchaser/Underwriter, [and the Certificate Insurer], to the effect that: (A) the City is a charter city, duly organized and validly existing under the Constitution and laws of the State; (B) the City has full legal power and lawful authority to enter into the City Documents; (C) the resolution of the City, adopted on , 2013, approving and authorizing the execution and delivery of the City Documents and the resolution of the City, adopted on , 2013, approving the Official Statement (collectively, the "City Resolutions ") were each duly adopted at a meeting of the city council or other governing body of the City that was called and held pursuant to law and with all public notice required by law and at which a quorum was present and acting throughout, and the City Resolutions are in full force and effect and have not been modified, amended, or rescinded as of the date of Closing; (D) the City Documents have been duly authorized, executed, and delivered by the City and, assuming due authorization, execution, and delivery by the other parties thereto, such documents constitute the legal, valid, and binding agreements of the City enforceable in accordance with their terms, subject to laws relating to bankruptcy, insolvency, or other laws affecting the enforcement of creditors' rights generally and the application of equitable principles if equitable remedies are sought; 15 4850- 7491 - 7650.5 6 AKF9 o :r y P {J r O (E) the execution and delivery by the City of the City Documents, and compliance by the City with the provisions thereof, under the circumstances contemplated thereby, do not and will not in any material respect conflict with or constitute a breach of or default under any law, administrative regulation, court decree, resolution, or agreement to which the City is subject to or by which it is bound; (F) nothing has come to the attention of such counsel which would lead it to believe that the Official Statement (excluding therefrom the financial and statistical data and forecasts included therein, information about The Depository Trust Company and its book -entry system [and information about the Certificate Insurer], as to which no view need be expressed) contains any untrue statement of a material fact or omits to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; (G) except as otherwise disclosed in the Official Statement, there is no litigation, proceeding, action, suit or investigation, at law or in equity, before or by any court, governmental agency or body, pending and for which the City has been served or, to the best knowledge of such counsel, threatened (a) in any way questioning the existence of the City or the titles of the officers of the City to their respective offices; (b) affecting, contesting, or seeking to prohibit, restrain, or enjoin the execution and delivery of the Certificates or any of the City Documents, or the payment or collection of any amounts pledged or to be pledged to pay the 2013 Installment Sale Payments or the principal and interest with respect to the Certificates, or in any way contesting or affecting the validity of the Certificates or the City Documents or the consummation of the transactions contemplated thereby or any proceeding of the City taken with respect to any of the foregoing, or contesting the exclusion of the interest payable with respect to the Certificates from taxation or contesting the powers of the City and its authority to pledge the 2013 Installment Sale Payments; (c) that may result in any material adverse change relating to the City that will materially adversely affect the City's ability to pay the 2013 Installment Sale Payments when due; or (H) nothing has come to the attention of such counsel which would lead it to believe that the Official Statement (excluding therefrom the financial and statistical data and forecasts included therein, information about The Depository Trust Company and its book -entry system [and information about the Certificate Insurer] as to which no opinion need be expressed) contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; and 16 4850 -7491 - 7650.5 of 9, A y -^ F- Fn CJ � ORIGINAL (I) no additional authorization, approval, consent, waiver, or any other action by any person, board, or body, public or private, not previously obtained is required as of the date of Closing for the City to enter into the City Documents, or to perform its obligations thereunder; (iv) Opinion of Counsel to Corporation. An opinion of counsel to the Corporation (which may be counsel to the City), in form and substance satisfactory to the Purchaser/Underwriter, dated the date of Closing, addressed to the Purchaser/Underwriter and the [Certificate Insurer], to the effect that: (A) the Corporation is a nonprofit public benefit corporation organized and existing under the laws of the State of California; and (B) the resolution of the Corporation approving and authorizing the execution and delivery of the Corporation Documents and approving the Official Statement (the "Corporation Resolution ") was duly adopted at a meeting of the governing body of the Corporation. The Corporation Resolution is in full force and effect and has not been amended, modified or rescinded; (v) Opinion of Disclosure Counsel. An opinion of [Goodwin Procter LLP], as Disclosure Counsel, dated the date of Closing and addressed to the City, the Corporation and the Purchaser/Underwriter, to the effect that, without passing upon or assuming any responsibility for the accuracy, completeness or fairness of the statements contained in the Official Statement and making no representation that they have independently verified the accuracy, completeness or fairness of any such statements, based upon the information made available to them in the course of their participation in the preparation of the Official Statement, nothing has come to such counsel's attention which would lead them to believe that the Official Statement, (excluding therefrom financial statements, financial, numerical and statistical data, forecasts, estimates, assumptions and expressions of opinion included therein, and information regarding The Depository Trust Company and its book -entry system, the [Certificate Insurer], the [Certificate Insurance Policy] and Appendices [j [j and [I as to which no opinion need be expressed) contains an untrue statement of a material fact or omits to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. (vi) Purchaser /Underwriter's Counsel Opinion. A letter from [City], [State], counsel to the Purchaser/Underwriter ( "Purchaser/Underwriter's Counsel "), dated the date of Closing, addressed to the Purchaser/Underwriter, to the effect that, based upon its participation in the preparation of the Official Statement as Purchaser/Underwriter's Counsel and without having undertaken to determine independently the fairness, accuracy, or completeness of the statements contained in the Official Statement, such counsel has no reason to believe that, as of the date of the Closing, the Official Statement (excluding therefrom the reports, financial and statistical data and forecasts 17 4850- 7491 - 7650.5 h��AKF9�, T r- n r t) O C)RiG{NAL therein, the information with respect to DTC and the book -entry system, the information with respect to the [Certificate Insurer] and the [Certificate Insurance Policy], and the information included in the Appendices thereto, as to which no view need be expressed) contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; (vii) City Certificate. A certificate of the City, in form and substance satisfactory to the Purchaser/Underwriter, dated the date of Closing, to the effect that: (A) the representations, warranties, and covenants of the City contained herein are true and correct in all material respects on and as of the date of Closing as if made on the date of Closing and the City has complied with all of the terms and conditions of this Purchase Agreement required to be complied with by the City at or prior to the date of Closing; (B) the City has complied with all the agreements and satisfied all the conditions on its part to be performed or satisfied at or prior to the date of Closing pursuant to the Purchase Agreement with respect to the execution and delivery of the Certificates; (C) to the best knowledge of the City, there is no action, suit, proceeding, inquiry, or investigation, at law or in equity, before or by any court, government agency, public board or body, pending or threatened against the City, affecting the existence of the City or the titles of its officers to their respective offices, or affecting or seeking to prohibit, restrain, or enjoin the sale, execution, or delivery of the Certificates or contesting or affecting, as to the City, the validity or enforceability of the Certificates; the City Documents or contesting the tax exempt status of interest represented by the Certificates, or contesting the completeness or accuracy of the Preliminary Official Statement or the Official Statement, or contesting the powers of the City or any authority for the execution and delivery of the Certificates, or in any way contesting or challenging the consummation of the transactions contemplated under the City Documents, or, except as disclosed in the Official Statement, that might result in a material adverse change in the financial condition of the City or materially adversely affect the City's expenditure authority under (i) California Constitution Article XIX and Streets and Highways Code Section 2101 or its rights to receive gas tax apportionment from the Highway Users Tax Fund, and (ii) California Government Code Section 55000 et seq., nor is there any known basis for any such action, suit, proceeding, inquiry, or investigation, wherein an unfavorable decision, ruling, or finding would materially adversely affect the authorization, execution, delivery, or performance by the City of the City Documents or the execution by the Trustee of the Certificates; In 4850- 7491 - 7650.5 o��A KF9q > :` r— c.> cJ ORIGINAL (D) no event affecting the City has occurred since the date of the Official Statement that has not been disclosed therein or in any supplement or amendment thereto, which event should be disclosed in the Official Statement in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; and (E) [between the date of the Purchase Agreement and the date of Closing, the City has not offered or issued any bonds, notes, or other obligations for borrowed money, or incurred any material liabilities, other than with the written consent of the Purchaser/Underwriter, nor has there been any adverse change of a material nature in the financial position, results of operations, or condition, financial or otherwise, of the City]; (viii) Corporation Certificate. A certificate of the Corporation, in form and substance satisfactory to the Purchaser/Underwriter, dated the date of Closing, to the effect that: (A) the representations and warranties of the Corporation contained in this Purchase Agreement are true and correct in all material respects on and as of the date of Closing with the same effect as if made on the date of Closing; and (B) there has been no material adverse change in the financial condition or results of operations of the Corporation from the date of the Official Statement to the date of Closing; (ix) Trustee's Counsel Opinion. An opinion of counsel to the Trustee, dated the date of Closing, addressed to the Purchaser/Underwriter, the City, the Corporation, and the [Certificate Insurer], to the effect that: (A) the Trustee is a national banking association and is validly existing, duly qualified to do business and in good standing under the laws of each jurisdiction in which the performance of its duties under the Trust Agreement and the 2013 Installment Sale Agreement (collectively, the "Trustee Documents ") would require such qualification and has the requisite power and authority to execute, deliver and perform its obligations under the Trustee Documents; (B) the Trustee is duly eligible and qualified to act as Trustee under the Trust Agreement; (C) the Trustee has all requisite power, authority and legal right to execute and deliver the Trustee Documents and to perform its obligations under the Trustee Documents, and has taken all necessary corporate action to authorize the execution and delivery of and the performance of its obligations under the Trustee Documents; T 4850 -7491 - 7650.5 A KF9 > m r v � ORIGNAL (D) the Trustee has duly executed and delivered the Trustee Documents. Assuming the due authorization, execution and delivery thereof by the other parties thereto, the Trustee Documents are the legal, valid and binding agreements of the Trustee enforceable against the Trustee in accordance with their terms, except to the extent enforceability thereof may be subject to (A) bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and other similar laws affecting creditors' rights and remedies heretofore or hereafter enacted, and (B) the application of equitable principles and the exercise of judicial discretion in appropriate cases; (E) the Certificates have been duly executed and delivered by the Trustee; (F) the execution, delivery and performance of the Trustee Documents by the Trustee and the consummation of the transactions contemplated thereby do not and will not (a) to the knowledge of such counsel, conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement, or other agreement or instrument to which the Trustee is a party or by which the Trustee is bound or to which any of the property or assets of the Trustee or any of its subsidiaries is subject, (b) result in any violation of the provisions of the charter, articles of association, by -laws, or applicable resolutions of the Trustee, or (c) to the knowledge of such counsel, result in any violation of any statute or any order, rule, or regulation of any court or government agency or body having jurisdiction over the Trustee or any of its properties or assets; and (G) to the knowledge of such counsel, there are no actions, proceedings or investigations pending or threatened against the Trustee before any court, administrative agency or tribunal (a) asserting the invalidity of the Trustee Documents, (b) seeking to prevent the consummation of any of the transactions contemplated thereby, or (c) that might materially and adversely affect the performance by the Trustee of its obligations under, or the validity or enforceability of the Trustee Documents; (x) Trustee's Certificate. A certificate, dated the date of Closing, signed by a duly authorized officer of the Trustee, to the effect that: (A) the Trustee is a national banking association, duly organized and validly existing under and by virtue of the laws of the United States of America, having the necessary power to enter into, accept, and administer the trusts created under the Trust Agreement and to execute and deliver the Certificates to the Purchaser/Underwriter; 20 4850- 7491 - 7650.5 �gAKF�� y � m r (.7 [J (B) the Trustee Documents have been duly authorized, executed, and delivered by a duly authorized officer of the Trustee, and the execution, delivery, and performance of the Trustee Documents has been duly authorized by all necessary action of the Trustee; (C) the Trustee Documents constitute the legal, valid, and binding obligations of the Trustee enforceable in accordance with their terms, except as enforcement thereof may be limited by bankruptcy, insolvency, or other laws affecting the enforcement of creditors' rights generally and by the application of equitable principles, if equitable remedies are sought; (D) the Certificates have been duly executed and delivered by a duly authorized officer of the Trustee; (E) to the best knowledge of the trustee, no consent, approval, authorization, or other action by any governmental or regulatory authority having jurisdiction over the Trustee that has not been obtained is or will be required for the execution and delivery of the Trustee Documents or the performance by the Trustee of its duties and obligations under the Trustee Documents; (F) to the best knowledge of the Trustee, the execution and delivery by the Trustee of the Trustee Documents and compliance with the terms thereof will not conflict with, or result in a violation or breach of, or constitute a default under, any loan agreement, indenture, bond, note, resolution, or any other agreement or instrument to which the Trustee is a party or by which it is bound, or any law or any rule, regulation, order, or decree of any court or governmental agency or body having jurisdiction over the Trustee or any of its activities or properties (except that no representation, warranty, or agreement need be made by such counsel with respect to any federal or State securities or blue sky laws or regulations); (G) to the best knowledge of the Trustee, the Trustee's action in executing and delivering the Trustee Documents will not contravene the articles or bylaws of the Trustee and is in full compliance with, and does not conflict with, any applicable law or governmental regulation currently in effect, and such action does not conflict with or violate any contract to which the Trustee is a party or any administrative or judicial decision by which the Trustee is bound; and (H) to the best knowledge of the Trustee, there is no action, suit, proceeding, or investigation, at law or in equity, before or by any court or governmental agency, public board, or body that has been served on the Trustee, or to the best knowledge of the Trustee, threatened against the Trustee which in the reasonable judgment of the Trustee would affect the existence of the Trustee or in any way contesting or affecting the 21 4850- 7491- 7650.5 �gAKF9 C7 `fin y r- m U n validity or enforceability of the Trustee Documents or contesting the powers of the Trustee or its authority to enter into and perform its obligations thereunder; (xi) [Certificate Insurer Counsel Opinion. An opinion of counsel to the Certificate Insurer, in form and substance satisfactory to the Purchaser/Underwriter, Special Counsel, and Purchaser/Underwriter's Counsel, with respect to, among other matters, the Certificate Insurance Policy;] (xii) [Certificate Insurer Certificate. A certificate of the Certificate Insurer, in form and substance satisfactory to the Purchaser/Underwriter, Special Counsel, and Purchaser/Underwriter's Counsel, with respect to, among other matters, the Certificate Insurance Policy]; (xiii) certified copies of the City Resolution, the Corporation Resolution, and an incumbency resolution of the Trustee; (xiv) a certified copy of the articles of incorporation of the Corporation, certified by the Secretary of State, a certified copy of the bylaws of the Corporation, certified by the secretary of the Corporation or an authorized officer of the Corporation, and Certificate of Good Standing of the Secretary of State of the State of California relating to the legal existence and good standing of the Corporation; (xv) copies each of the Corporation Documents, the City Documents, the Trustee Documents, and the Official Statement, duly executed and delivered by the respective parties thereto; (xvi) Tax Compliance Certificate. The tax compliance certificate of the City, in form satisfactory to Special Counsel, signed by an appropriate officer of the City; (xvii) [evidence satisfactory to the Purchaser/Underwriter that the Certificates shall have received the [Certificate Insurance Policy] by the Certificate Provider that unconditionally guarantees the timely payments of all debt service with respect to the Certificates;] (xviii) [a no- default certificate of the [Certificate Insurer], in form and substance satisfactory to the Purchaser/Underwriter, Special Counsel, and Purchaser/Underwriter's Counsel]; (xix) [Underlying] Rating. Evidence that the underlying rating on the Certificates of " " by [Standard & Poor's Ratings Services] [Moody's Investors Service] [Other] is in full force and effect on the date of Closing; (xx) [Insured Rating. Evidence that insured rating on the Certificates of by [Standard & Poor's Ratings Services] [Moody's Investors 22 4850 -7491- 7650.5 T Fn iiNAL. Service] [Other] as a result of the [Certificate Insurance Policy] provided by the [Certificate Insurer] is in full force and effect on the date of Closing;] (xxi) CDIAC Statements. A copy of the Notice of Sale required to be delivered to the California Debt and Investment Advisory Commission pursuant to Sections 88550) an 53853 of the California Government Code; (xxii) Default Judgment. A copy of the default judgment rendered on 20_, by the Superior Court of the State of California for the County of Bakersfield in the action entitled City of Bakersfield v. All Persons Interested in the Matter, etc., Case No. (xxiii) Form 8038 -G. Evidence that the federal tax information Form 8038 -G has been prepared for filing; and (xxiv) Additional Documents. Such additional legal opinions, certificates, proceedings, instruments, and other documents as the Purchaser/Underwriter, Special Counsel, or Purchaser/Underwriter's Counsel may reasonably request to evidence compliance by the City and the Corporation with legal requirements, the accuracy, as of the time of Closing, of the Corporation and the City' representations herein contained, and the due performance or satisfaction by the City and the Corporation at or prior to such time of all agreements then to be performed and all conditions then to be satisfied by the City and the Corporation. If any of the City or the Corporation shall be unable to satisfy the conditions to the Purchaser /Underwriter's obligations contained in this Purchase Agreement or if the Purchaser/Underwriter's obligations shall be terminated for any reason permitted by this Purchase Agreement, this Purchase Agreement shall terminate and none of the City, the Corporation, or the Purchaser/Underwriter shall have any further obligation hereunder. 9. The performance by each of the Corporation and the City of its obligations is conditioned upon (a) the performance by the Purchaser/Underwriter of its obligations hereunder and (b) receipt by the Corporation, the City, and the Purchaser/Underwriter of opinions and certificates being delivered at the Closing by persons and entities other than the Corporation and the City. 10. Expenses. No expenses and costs of the Corporation or the City incident to the performance of the Corporation's or the City's obligations in connection with the authorization, sale, execution, and delivery of the Certificates to the Purchaser/Underwriter, such as the costs of preparation (including word processing, printing, and reproduction), distribution and delivery of the Preliminary Official Statement, the Official Statement, the Corporation Documents, or the City Documents, in reasonable quantities, fees of rating agencies, fees and expenses of any financial advisor to the Corporation or the City, and fees and expenses of Special Counsel, Purchaser/Underwriter's Counsel, or any counsel to the City, shall be paid by the Purchaser/Underwriter. Except as indicated above, all out -of- pocket expenses of the Purchaser/Underwriter, including the California Debt and Investment Advisory Commission fee, 23 4850 -7491- 7650.5 �AKF 9 m F- r- `� iJ ORIGINAL. traveling, and other expenses and the fees and expenses of the Purchaser/Underwriter, excluding the fees and expenses of Purchaser/Underwriter's Counsel, shall be paid by the Purchaser /Underwriter. 11. Notices. Any notice or other communication to be given to the Corporation under this Purchase Agreement may be given by delivering the same in writing to the Bakersfield Public Benefit Corporation, 1600 Truxtun Avenue, Bakersfield, California 93301, Attention: [ , or to such other person as the [ may designate in writing; any notice or other communication to be given to the City under this Purchase Agreement may be given by delivering the same in writing to such address and to such person as the City may designate in writing; and any notice or other communication to be given to the Purchaser /Underwriter under this Purchase Agreement may be given by delivering the same in writing to [UNDERWRITER NAME], [STREET ADDRESS], [CITY], [STATE] [ZIP], Attention: [ . The approval of the Purchaser/Underwriter when required hereunder or the determination of their satisfaction as to any document referred to herein shall be in writing signed by the Purchaser/Underwriter and delivered to the Corporation. 12. State Law Governs. For all purposes of this Purchase Agreement, a default shall not be deemed to be continuing if it has been cured, waived, or otherwise remedied. This Purchase Agreement shall be governed by and construed in accordance with the laws of the State applicable to contracts made and performed within the State. 13. Severability. In case any one or more of the provisions contained herein shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision hereof. 14. Counterparts. This Purchase Agreement may be executed by the parties hereto in separate counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute but one and the same instrument. 15. No Assignment. The rights and obligations created by this Purchase Agreement shall not be subject to assignment by the Purchaser/Underwriter or the City without the prior written consent of the other party hereto. 16. Entire Agreement. This Purchase Agreement when accepted by the Corporation and the City in writing shall constitute the entire agreement among the City, the Corporation, and the Purchaser/Underwriter and is made solely for the benefit of the City, the Corporation, and the Purchaser/Underwriter (including the successors or assigns of the Purchaser/Underwriter). No other person shall acquire or have any right hereunder or by virtue hereof. [End of Certificate Purchase Agreement] 24 4850 -7491- 7650.5 o�`�AKF��' -r > Fn v O ORIGINAL [UNDERWRITER] 0 [Title] The foregoing is hereby agreed to and accepted as of the date first above written: BAKERSFIELD PUBLIC BENEFIT CORPORATION IIn Accepted as of the date first stated above: CITY OF BAKERSFIELD LIM Harvey L. Hall, Mayor APPROVED AS TO FORM: I: Virginia Gennaro, City Attorney APPROVED AS TO CONTENT AND COUNTERSIGNED: Nelson K. Smith, Finance Director [Name], [Title] [Signature page to Certificate Purchase Agreement] 25 4850- 7491 - 7650.5 �J gAKF9� v C7 rl'RIG NAL EXHIBIT A CITY OF BAKERSFIELD GAS TAX, TRANSPORTATION IMPACT FEE AND RESTRICTED UTILITY FRANCHISE AND SURCHARGE REVENUE CERTIFICATES OF PARTICIPATION, SERIES 2013 (THOMAS ROADS IMPROVEMENT PROGRAM) Schedule of Terms and Prices Maturity Date Principal Amount Interest Rate Price Yield 4850- 7491 - 7650.5 o�gAKF9� r m r ORIGI�.i 1' Draft Installment Sale Agreement 2013 INSTALLMENT SALE AGREEMENT by and between CITY OF BAKERSFIELD, CALIFORNIA, as Purchaser and BAKERSFIELD PUBLIC BENEFIT CORPORATION, as Seller for the City of Bakersfield Gas Tax, Transportation Impact Fee and Restricted Utility Franchise and Surcharge Revenues Certificates of Participation, Series 2013 (Thomas Roads Improvement Program) Dated as of 1, 20 4824 - 2424 - 8082.8 o�`�aKF9s ti- m r (� rJ ORIGINAL Table of Contents Page ARTICLE I DEFINITIONS Section1.01. Definitions .......................................................................... ..............................2 Section 1.02. Terms Defined in the Trust Agreement ............................. .............................10 ARTICLE II THEPROJECT ................................................................................................ .............................10 ARTICLE III 2013 INSTALLMENT SALE PAYMENTS; ADMINISTRATION FEE Section 3.01. Purchase Price and Administration Fee ............................. .............................10 Section 3.02. Payment of 2013 Installment Sale Payments and Administration Fee ........... I l Section 3.03. Prepayment of 2013 Installment Sale Payments ............... .............................15 ARTICLE IV ADDITIONALCONTRACTS ........................................................................ .............................15 ARTICLE V REPRESENTATIONS AND COVENANTS OF THE CITY AND THE CORPORATION Section 5.01. Corporation; Compliance With 2013 Installment Sale Agreement and TrustAgreement ................................................................ .............................15 Section 5.02. Use of Proceeds of Certificates ......................................... .............................16 Section 5.03. Against Encumbrances; Subordinate Obligations ............. .............................16 Section 5.04. Maintenance of Revenues .................................................. .............................17 Section5.05. Tax Covenants ................................................................... .............................17 Section 5.06. Prompt Acquisition and Construction of the Project ......... .............................18 Section 5.07. Accounting Records and Financial Statements ................. .............................18 Section 5.08. Protection of Security and Rights of the Corporation and the Trustee ........... 18 Section 5.09. Further Assurances ............................................................ .............................18 Section 5.10. Continuing Disclosure ....................................................... .............................18 ARTICLE VI EVENTS OF DEFAULT AND REMEDIES Section 6.01. Events of Default and Acceleration of Principal ............... .............................19 Section 6.02. Application of Revenues Upon Acceleration .................... .............................20 Section6.03. Other Remedies ................................................................. .............................20 Section6.04. Non - Waiver ....................................................................... .............................21 Section 6.05. Remedies Not Exclusive .................................................... .............................21 ARTICLE VII DISCHARGEOF OBLIGATIONS ................................................................ .............................21 4824 - 2424 - 8082.8 o`` 6 AKF9� -r U r- C. ORIGiNAL Table of Contents (continued) Page ARTICLE VIII MISCELLANEOUS Section 8.01. Liability of City Limited to Revenues ............................... .............................22 Section 8.02. Benefits of 2013 Installment Sale Agreement ................... .............................23 Section 8.03. Successor Is Deemed Included in All References to Predecessor ..................23 Section 8.04. Waiver of Personal Liability .............................................. .............................23 Section 8.05. Article and Section Headings, Gender and References ..... .............................23 Section8.06. Partial Invalidity ................................................................ .............................23 Section8.07. Assignment ........................................................................ .............................24 Section8.08. Net Contract ....................................................................... .............................24 Section 8.09. California Law ................................................................... .............................24 Section 8.10. Indemnification .................................................................. .............................24 Section8.11. Funds ................................................................................. .............................24 Section 8.12. Notices; Authorized City Representative .......................... .............................24 Section8.13. Effective Date .................................................................... .............................25 Section 8.14. Execution in Counterparts ................................................. .............................25 EXHIBIT A 2013 INSTALLMENT SALE PAYMENTS SCHEDULE EXHIBIT B DESCRIPTION OF PROJECT ii 4824- 2424 - 8082.8 ORIGiN -`AI 2013 INSTALLMENT SALE AGREEMENT THIS 2013 INSTALLMENT SALE AGREEMENT (this "2013 Installment Sale Agreement "), dated as of 1, 2013, by and between the CITY OF BAKERSFIELD, a charter city and municipal corporation organized and existing under the Constitution of the State of California (the "City "), and the BAKERSFIELD PUBLIC BENEFIT CORPORATION, a nonprofit public benefit corporation duly organized and existing under and by virtue of the laws of the State of California (the "Corporation "); WITNESSETH: WHEREAS, the Corporation is a nonprofit public benefit corporation duly organized and operating pursuant to the Nonprofit Public Benefit Corporation Law of the State of California (being Part 2 of Division 2 of Title 1 of the California Corporations Code, as amended) (the "Nonprofit Public Benefit Corporation Law "); and WHEREAS, the Corporation was formed to assist the City, among other things, in the financing and /or refinancing of the Project (as defined herein) pursuant to the Nonprofit Public Benefit Corporation Law; and WHEREAS, the City has determined that the design, acquisition and construction of public street and highway projects, as hereinafter described (the "Project ") is necessary and proper for City purposes and uses, and under the terms of applicable law, the payment for such public street and highway improvement projects may be made from: (i) motor vehicle fuel tax revenues received by the City from the State of California, and deposited into the Gas Tax Fund (as hereinafter defined), (ii) transportation impact fee revenues received by the City from developers of land, and deposited into the Transportation Impact Fee Trust Fund (as hereinafter defined), and (iii) certain additional electricity franchise payments and the electricity and gas surcharge paid to the City by certain franchisees for the use of the City's streets, and deposited into the Roads Program Utility Franchise Fee and Surcharge Fund (as hereinafter defined), and is for the common benefit of the City as a whole; and WHEREAS, this transaction will benefit the City and its inhabitants in the form of lower interest rates and the timely construction of the Project which will facilitate regional mobility, economic growth and development and reduce travel time through major transportation corridors; and WHEREAS, in order to assist the City in the acquisition and construction of the Project, the Corporation has determined to acquire and construct the Project for, and sell the Project to, the City; and WHEREAS, the City has determined to make Installment Sale Payments (as hereinafter defined) to the Corporation for the repayment of the costs of the design, acquisition and construction of the Project and the incidental costs and expenses related thereto paid by the Corporation; and WHEREAS, all acts, conditions and things required by law to exist, to have happened and to have been performed precedent to and in connection with the execution and delivery of 4824 - 2424 - 8082.8 o� 6 CC, M <� 6 this 2013 Installment Sale Agreement do exist, have happened and have been performed in regular and due time, form and manner as required by law, and the parties hereto are now duly authorized to execute and enter into this 2013 Installment Sale Agreement; NOW, THEREFORE, IN CONSIDERATION OF THE PREMISES AND OF THE MUTUAL AGREEMENTS AND COVENANTS CONTAINED HEREIN AND FOR OTHER VALUABLE CONSIDERATION, THE PARTIES HERETO DO HEREBY AGREE AS FOLLOWS: ARTICLE I DEFINITIONS Section 1.01. Definitions. Unless the context otherwise requires, the terms defined in this Section shall for all purposes hereof and of any amendment hereof or supplement hereto and of any opinion or report or other document mentioned herein or therein have the meanings defined herein, the following definitions to be equally applicable to both the singular and plural forms of any of the terms defined herein: "Accountant's Report" means a report signed by an Independent Certified Public Accountant. "Acquisition Fund" means the fund by that name established pursuant to Section 2.11 of the Trust Agreement. "Administration Fee" means an amount equal to the sum of the Trustee Fee, the Rebate Analyst Fee and any other similar fee payable in connection with the administrative costs related to financing of the Project, payable on the fifteenth day of the month preceding each Certificate Payment Date. "Authorized City Representative" means the person or persons designated in Section 8.12 hereof or any other person at the time designated to act on behalf of the City by written certificate furnished to the Trustee, containing the specimen signature of such person and signed on behalf of the City by an Authorized City Representative. "Authorized Corporation Representative" means any one of the President/Executive Director, Vice President or Chief Financial Officer of the Corporation. "Balloon Indebtedness" shall mean, will under a Contract twenty percent (20 %) or more date or within a Fiscal Year, that portion of si respect to any Installment Sale Payments due of the principal of which matures on the same ch Installment Sale Payments due under such Contract which matures on such date or within such Fiscal Year; provided, however, that to constitute Balloon Indebtedness the amount of Installment Payments due under such Contract maturing on a single date or within a Fiscal Year must equal or exceed 150% of the amount of any Installment Sale Payments due under such Contract which matures during any preceding Fiscal Year. For purposes of this definition, the principal amount maturing on any date shall be reduced by the amount of any Installment Sale Payments due under such Contract, scheduled to be amortized by prepayment or redemption prior to their stated maturity date. 2 4824 - 2424 - 8082.8 4gAKF9 >- rn f- - v a ORIGINAL. "Beneficial Owner" shall have the meaning set forth in Section 5.10 of this 2013 Installment Sale Agreement. "Business Day" means any day on which the Trustee is open for business at its corporate trust office in [CITY], [STATE]. "Capitalized Interest" shall mean the interest portion of Installment Sale Payments under a Contract funded from the proceeds of a series of certificates or other moneys that are deposited with the trustee in the debt service fund for such certificates described in a trust agreement upon the execution and delivery of such certificates to be used to pay interest on the Contract. "Certificates" means the City of Bakersfield Gas Tax, Transportation Impact Fee and Restricted Utility Franchise and Surcharge Revenues Certificates of Participation, Series 2013 (Thomas Roads Improvement Program), executed and delivered in accordance with the Trust Agreement. "City" means the City of Bakersfield, California, a charter city and municipal corporation duly organized and existing under the Constitution and laws of the State of California. "City Parity Obligations" means the certificates, evidencing and representing a proportionate undivided interest in the 2013 Installment Sale Payments and any Installment Sale Payments under additional Contracts, the payments of which are made from the Revenues and that are on a parity with the 2013 Installment Payments. "City Roads Program" shall mean any costs related to design, right -of -way, new construction, re- construction, resurfacing, repair or maintenance work on any city roadway, bike lane, bike path, or pedestrian path within the City right of way. Additionally, any costs related to design, right -of -way, construction or any other improvements related to any bridge, road widening or freeway facility in the greater Bakersfield area which is a component or project segment of the Thomas Roads Improvement Program. "Code" means the Internal Revenue Code of 1986, as amended, and the regulations issued thereunder. "Consultant" means any independent consultant, consulting firm, financial advisory or investment banking firm or other expert recognized to be well qualified for work of the character required and retained by the City to perform acts and carry out the duties provided for such Consultant. "Corporation" means the Bakersfield Public Benefit Corporation, a nonprofit public benefit corporation, incorporated in 2013 and pursuant to the Nonprofit Public Benefit Corporation Law (as such term is defined in the granting clauses herein) and certain articles of incorporation and bylaws, and empowered to assist the City in facilitating the financing of public and capital improvements for the benefit of the residents of the City and/or the local metropolitan area. "Continuing Disclosure Agreement" means the Continuing Disclosure Agreement, dated , 2013, by and between the City and the Trustee, in its capacity as Trustee [and as 4824 - 2424 - 8082.8 $ P K 479 > m v ORIGINAL Dissemination Agent], as originally executed and as it may from time to time be amended or supplemented in accordance with its terms. "Contracts" means all installment sale contracts, including this 2013 Installment Sale Agreement, capital leases, reimbursement agreements or similar obligations of the City authorized and executed by the City under and pursuant to applicable law, the interest and principal and prepayment premium, if any, payments under and pursuant to which are payable from Revenues on a parity with the payment of the 2013 Installment Sale Payments. "Credit Facility and/or Liquidity Facility" shall mean with respect to a "Credit Facility ", a policy of municipal bond insurance, a letter of credit, surety bond, line of credit, guarantee, standby bond purchase agreement, or other financial instrument which obligates a third party to make payment of or provide funds to the Trustee for the payment of the principal of and/or interest evidenced and represented by certificates, evidencing and representing a proportionate undivided interest in a Contract, whether such obligation is to pay in the first instance and seek reimbursement or to pay only if the City fails to do so; and with respect to a "Liquidity Facility" a letter of credit, line of credit, standby bond purchase agreement or other financial instrument, which is available to provide funds with which to purchase certificates, evidencing and representing a proportionate undivided interest in a Contract, that have been tendered for purchase but not remarketed. "Credit Provider and/or Liquidity Provider" shall mean with respect to a "Credit Provider" the party obligated under a Credit Facility to make payment of principal of and interest evidenced and represented by certificates, evidencing and representing a proportionate undivided interest in a Contract; and with respect to a "Liquidity Provider" the entity or which is obligated under a Liquidity Facility to provide funds to purchase certificates, evidencing and representing a proportionate undivided interest in a Contract. "Debt Service" means, for any Fiscal Year, the sum of that portion of the Installment Sale Payments required to be made at the times provided in the Contracts that would have accrued during such Fiscal Year if such Installment Sale Payments were deemed to accrue daily in equal amounts from, in each case, the next preceding Installment Sale Payment Date of interest or principal or the date of the pertinent Contract, as the case may be; provided, that for purposes of calculating Debt Service, the following components of debt service shall be computed as follows: (a) interest payable on Contracts shall be excluded to the extent such payments are to be paid from Capitalized Interest for such Fiscal Year; (b) if all or any portion or portions of Installment Sale Payments under a Contract constitute Balloon Indebtedness, then, for purposes of determining Debt Service, each maturity which constitutes Balloon Indebtedness shall, unless otherwise provided in the Contract pursuant to which such Balloon Indebtedness is incurred or unless provision (c) of this definition then applies to such maturity, be treated as if it were to be amortized over a term of not more than 30 years and with substantially level annual debt service payments commencing not later than the year following the year in which such Balloon Indebtedness was incurred, and extending not later than 30 years from the 4 4824 - 2424 - 8082.8 o4gAKF9 r,, - r c? rj date such Balloon Indebtedness was originally incurred; the interest rate used for such computation shall be that rate quoted in The Bond Buyer 25 Revenue Bond Index, or such successor or replacement index, for the last week of the month preceding the date of calculation as published by The Bond Buyer, or if that index is no longer published, another similar index selected by the City, or if the City fails to select a replacement index, that rate determined by a Consultant to be a reasonable market rate for fixed -rate obligations of a corresponding term incurred under the Contract on the date of such calculation, with no credit enhancement and taking into consideration whether Installment Sale Payments bear interest which is or is not excluded from gross income for federal income tax purposes; with respect to such Contract, only a portion of which constitutes Balloon Indebtedness, the remaining portion shall be treated as described above for fixed rate obligations or such other provision of this definition as shall be applicable and, with respect to any Contract or that portion of a Contract thereof which constitutes Balloon Indebtedness, all payments of principal and interest becoming due prior to the year of the stated maturity of the Balloon Indebtedness shall be treated as described above for fixed rate obligations or such other provision of this definition as shall be applicable; (c) any maturity of Installment Sale Payments under a Contract which constitutes Balloon Indebtedness as described in provision (b) of this definition and for which the stated maturity date occurs within 12 months from the date such calculation is made, shall be assumed to become due and payable on the stated maturity date and provision (b) above shall not apply thereto unless there is delivered to the entity making the calculation a certificate of an Authorized City Representative stating that the City intends to refinance such maturity and stating the probable terms of such refinancing and that the debt capacity of future Revenues of the City is sufficient to successfully complete such refinancing; upon the receipt of such certificate, such Balloon Indebtedness shall be assumed to be refinanced in accordance with the probable terms set out in such certificate and such terms shall be used for purposes of calculating Debt Service, provided that such assumption shall not result in an amortization period longer than or an interest rate lower than that which would be assumed under provision (b) above; (d) if any Installment Sale Payments under a Contract or proposed Contract constitute Tender Indebtedness, then, for purposes of determining Debt Service, such Tender Indebtedness shall be treated as if (a) the principal amount of Installment Payments under such Contract were to be amortized over a term of not more than 30 years commencing in the year in which such Tender Indebtedness is first subject to tender and with substantially level annual Debt Service payments and extending not later than 30 years from the date such Tender Indebtedness was originally incurred, provided, however, notwithstanding the previous provisions of this clause (a), any principal amortization schedule set forth in the applicable Contract shall be applied to determine the principal amortization of such Tender Indebtedness; (b) the interest rate used for such computation shall be that rate quoted in The Bond Buyer 25 Revenue Bond Index, or such successor or replacement index, for the last week of the month preceding the date of calculation as published by The Bond Buyer, or if that index is no longer published, another similar index selected by the City, or if the City fails to select a replacement index, that rate determined by a Consultant to be a reasonable market rate for fixed rate 5 4824 - 2424 - 8082.8 1 ePK' � f, � oRIGINAI obligations of a corresponding term incurred under the applicable Contract on the date of such calculation, with no credit enhancement and taking into consideration whether such Tender Indebtedness bears interest which is or is not excluded from gross income for federal income tax purposes; and (c) with respect to all principal and interest payments becoming due prior to the year in which such Tender Indebtedness is first subject to tender, such payments shall be treated as described above for fixed rate obligations unless the interest during that period is subject to fluctuation, in which case the interest becoming due prior to such first tender date shall be determined as provided in (e) below; (e) if any Installment Sale Payments under a Contract constitute Variable Rate Indebtedness (except to the extent subsection (b) or (c) relating to Balloon Indebtedness or (d) relating to Tender Indebtedness applies), the interest rate used for such computation shall be the rate quoted in The Bond Buyer 25 Revenue Bond Index, or such successor or replacement index, for the last week of the month preceding the date of calculation as published by The Bond Buyer, or if that index is no longer published, another similar index selected by the City or if the City fails to select a replacement index, that rate determined by a Consultant to be a reasonable market rate for fixed -rate obligations of a corresponding term incurred under the applicable Contract on the date of such calculation, with no credit enhancement and taking into consideration whether such Installment Sale Payments bear interest which is or is not excluded from gross income for federal income tax purposes; and (f) If a Credit Provider and /or Liquidity Provider (if any), makes payment of principal of and /or interest on a certificate or advances funds to purchase or provide for the purchase of certificates evidencing and representing a proportionate undivided interest in a Contract and is entitled to reimbursement thereof, pursuant to a separate written agreement with the City, but is not reimbursed, the City's repayment obligation under such written agreement may, if so provided in the written agreement, be afforded the status of a Contract, and; further provided, the payment terms under the written agreement with the City shall be as follows: interest shall be due and payable semiannually and principal shall be due and payable not less frequently than annually and in such annual amounts as to amortize the principal amount thereof in (i) 30 years, or (ii)(a) if shorter, a term extending to the maturity date of the enhanced certificates or (b) if later, the final maturity of the repayment obligation under the written agreement, and providing substantially level annual Debt Service payments, using the rate of interest set forth in the written repayment agreement which would apply to the repayment obligation as of the date such amortization schedule is fixed. The principal amortized as described in the prior sentence shall bear interest in accordance with the terms of the repayment obligation. "Event of Default" means an event described in Section 6.01. "Federal Securities" means United States of America Treasury bills, notes, bonds or certificates of indebtedness, or obligations for which the full faith and credit of the United States of America are pledged for the payment of interest and principal and interest strips of the Resolution Funding Corporation for which separation of principal and interest is maintained in book -entry form. 0 4824 - 2424 - 8082.8 " , AK, 9 C, � s m ~ r- U ORIGINAL "Fiscal Year" means the period beginning on July 1 of each year and ending on the next succeeding June 30, or any other annual accounting period hereafter selected and designated by the governing body of the City as the Fiscal Year of the City. "Gas Tax Fund" means the fund established pursuant to State law by Ordinance No. 2592 adopted by the governing body of the City and which maintains the Gas Tax Revenues. "Gas Tax Revenues" means all amounts received by the City from the State in accordance with Streets and Highways Code §§ 2103, 2105, 2106 and 2107, as such provisions may be amended, and all other revenues (except revenues received by the City in accordance with Streets and Highways Code Section 2107.5), if any, received by the City from taxes imposed on the purchase of motor vehicle fuels and any payments, subventions or reimbursements received by the City from the State in lieu of such revenues, and deposited into and maintained in the Gas Tax Fund. "Independent Certified Public Accountant" means any firm of certified public accountants appointed by the City which is independent pursuant to the Statement on Auditing Standards No. 1 of the American Institute of Certified Public Accountants. "Installment Sale Payments" means the installment sale, rental or other periodic payments scheduled to be paid by the City under and pursuant to the Contracts. "Installment Sale Payment Date" means any date on which Installment Sale Payments are scheduled to be paid by the City under and pursuant to any Contract. "Interest Fund" shall have the meaning set forth in the Trust Agreement. "Interest Payment Date" means a date on which interest evidenced and represented by the Certificates is due and payable, being [ j and j of each year, commencing 1, 20_. "Maximum Annual Debt Service" means the greatest total Debt Service payable in any Fiscal Year during the period commencing with the then current Fiscal Year and terminating with the Fiscal Year in which payments are due under the last Contract. "Opinion of Counsel" means a written opinion of counsel of national reputation generally recognized to be well qualified in the field of law relating to municipal obligations such as the Certificates, retained by the City and satisfactory to the Trustee (who shall be under no liability by reason of such approval). "Other Available Revenues" means revenues, other than Revenues as herein defined, legally available to the City to make Installment Sale Payments, or any other revenues of the City made available, if any. "Owner" shall have the meaning set forth in the Trust Agreement. "Principal Fund" shall have the meaning set forth in the Trust Agreement. 7 4824 - 2424 - 8082.8 oI �RKS9 s� � n ORIGINAL "Project" means the design, engineering, permitting and construction by the Corporation, for sale to the City, of certain street and highway improvements, all as described more particularly in Exhibit B, attached hereto and incorporated herein. "Purchase Price" means the total of all 2013 Installment Sale Payments owed by the City to the Corporation under the conditions and terms hereof for the repayment of the costs of the design, acquisition and construction of the Project and the incidental costs and expenses related thereto paid by the Corporation. "Rebate Amount" means, for any given period, the amount determined by the Rebate Analyst as required to be rebated or paid as a yield reduction payment to the United States of America with respect to the Certificates, "Rebate Analyst" means the entity chosen by the City to determine the amount of required deposits, if any, to the Rebate Fund. "Rebate Analyst's Fee" means the fee payable to the Rebate Analyst, payable annually on each Certificate Payment Date if the City elects to have an annual calculation of the Rebate Amount performed and every five -years if the City elects to have a five -year calculation of the Rebate Amount performed. "Rebate Fund" means the fund by that name established in [Section 4.04 of the Trust Agreement]. [ "Related Document" shall have the meaning set forth in the Trust Agreement.] "Revenues" means, collectively, the Gas Tax Revenues, the Transportation Impact Fee Revenues and the Restricted Utility Franchise and Surcharge Revenues. "Reserve Fund" means the fund by that name established pursuant to Section 3.03 of the Trust Agreement. "Reserve Fund Requirement" means, as of any date of calculation, an amount equal to the least of (f) 10% of the initial stated principal amount (within the meaning of Section 148 of the Code) of the 2013 Installment Sale Payments; (b) 125% of the average annual 2013 Installment Sale Payments, or (c) the Maximum Annual Debt Service. "Restricted Utility Franchise and Surcharge Revenues" means moneys on deposit in the Roads Program Utility Franchise Fee and Surcharge Fund, a special, segregated fund held and administered by the City, which moneys comprise certain additional electricity franchise payments and the electricity and gas surcharge received by the City from certain franchisees for the use of the City's streets and which are dedicated and restricted by the City for the purpose of capital improvements associated with the City's Roads Program pursuant to City Ordinance No. 4726. "Roads Program Utility Franchise Fee and Surcharge Fund" means the fund established by Ordinance No. 4726 adopted by the governing body of the City and which maintains the Restricted Utility Franchise and Surcharge Revenues. 8 4824 - 2424 - 8082.8 �� P, O s� � rJ ORIG[NAL "Subordinate Obligations" shall have the meaning set forth in Section 5.03 herein. "Tax Certificate" means the Tax Certificate dated the date of initial execution and delivery of the Certificates and executed and delivered by the City. "Tender Indebtedness" shall mean any certificate which evidences and represents a proportionate undivided interest in Installment Sale Payments or portions of Installment Sale Payments under a Contract, a feature of which is an option and/or an obligation on the part of the certificate holders, under the terms of such Contract and the related trust agreement, to tender all or a portion of such certificates, evidencing and representing a proportionate undivided interest in the Installment Sale Payments under such Contract, to the City, the Trustee, or other fiduciary or agent or Credit Provider and/or Liquidity Provider (if any) for payment or purchase and requiring that such certificates or portions of certificates be purchased if properly presented. "Thomas Roads Improvement Program " shall mean the cooperative effort between the City, the County of Kern, the California Department of Transportation and the Kern Council of Governments in which projects have been identified as necessary to relieve the stress on outdated infrastructure, caused by years of rapid growth in population, interregional travel, and freight movement. "Transportation Impact Fee Trust Fund" means the fund established by Ordinance No. 3429 adopted by the governing body of the City and which maintains the Transportation Impact Fee Revenues. "Transportation Impact Fee Revenues" means moneys on deposit in the Transportation Impact Fee Trust Fund, a special, segregated fund held and administered by the City which moneys in such fund comprise fees paid to the City by developers to mitigate traffic impacts caused by a development project in accordance with Chapter 15.84 of the City's Municipal Code. "Trust Agreement" means that certain Trust Agreement dated as of 1, 20_, by and among the Trustee, the City and the Corporation, as originally executed and as it may from time to time be amended or supplemented in accordance with its terms. "Trustee" means , [a national banking association duly organized and existing under and by virtue of the laws of the United States], with its corporate trust office in [CITY], [STATE], acting in its capacity as trustee under and pursuant to the Trust Agreement, and its successors and assigns as provided in the Trust Agreement. "Trustee's Fee" means the annual administration fee of the Trustee payable on each Certificate Payment Date, commencing [ J, 20_. "Variable Rate Indebtedness" shall mean any Installment Sale Payment the interest rate on which is not, at the time in question, fixed to maturity. "2013 Installment Sale Agreement" means this installment sale agreement by and between the City and the Corporation, dated as of 1, 2013, as originally executed and 0 4824 - 2424 - 8082.8 4aaKe F m v O n rw-,311`,' A! as it may from time to time be amended or supplemented in accordance herewith and with the terms of the Trust Agreement. "2013 Installment Sale Payments" means the Installment Sale Payments scheduled to be paid by the City under and pursuant to this 2013 Installment Sale Agreement. "2013 Installment Sale Payment Date" means any date on which 2013 Installment Sale Payments are scheduled to be paid by the City under and pursuant to this 2013 Installment Sale Agreement. Section 1.02. Terms Defined in the Trust Agreement. Capitalized terms not otherwise defined herein have the meanings set forth in the Trust Agreement. ARTICLE II THE PROJECT The Corporation hereby agrees to cause the design, acquisition and construction of the Project for, and to sell the Project to, the City; and the City agrees to transfer whatever real or personal property interest it may possess which may be required in order for the Corporation to cause such design, acquisition and construction of the Project. In order to implement this provision, the Corporation hereby appoints the City as its agent for the purpose of such design, acquisition and construction, and the City hereby agrees to enter into such engineering, design and construction contracts and purchase orders as may be necessary, as agent for the Corporation, to provide for the complete design, acquisition and construction of the Project. The City hereby agrees that as such agent it will cause the acquisition and construction of the Project to be diligently completed after the deposit of funds in the Acquisition Fund for such purpose pursuant to Section 2.11 of the Trust Agreement, and that it will use its best efforts to cause the design, acquisition and construction of the Project to be completed by r 1, 201J, except for unforeseeable delays beyond the reasonable control of the City. The Corporation hereby agrees to sell, and hereby sells, the Project to the City. The City hereby agrees to purchase, and hereby purchases, the Project from the Corporation. Notwithstanding the foregoing, it is hereby expressly understood and agreed that the Corporation shall be under no liability of any kind or character whatsoever for the payment of any costs or expenses incurred by the City (whether as agent for the Corporation or otherwise) for the acquisition and construction of the Project and that all such costs and expenses shall be paid by the City, regardless of whether the funds deposited in the Acquisition Fund are sufficient to cover all such costs. ARTICLE III 2013 INSTALLMENT SALE PAYMENTS; ADMINISTRATION FEE Section 3.01. Purchase Price and Administration Fee. (a) The Purchase Price to be paid by the City to the Corporation hereunder is the sum of the principal amount of the City's obligation hereunder plus the interest to 10 4824 - 2424 - 8082.8 OAKS m � o accrue on the unpaid balance of such principal amount from the date hereof over the term hereof, subject to prepayment as provided in Section 3.03. (b) The principal amount of the Purchase Price to be paid by the City to the Corporation hereunder is $ (c) The interest to accrue on the unpaid balance of such principal amount shall be paid by the City as and shall constitute interest paid on the principal amount of the City's Purchase Price obligation hereunder. (d) Interest on the unpaid balance of the principal amount of the Purchase Price shall accrue, from the date of the initial execution and delivery of the Certificates, on the principal component of each 2013 Installment Sale Payment at the following rates calculated on the basis of a 360 -day year comprised of twelve 30 -day months: Principal Component Due Date (� 2014 2015. 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 20 Principal Amount Interest Rate (e) In addition, the City shall pay the Administration Fee for the administrative cost of the Project. Section 3.02. Payment of 2013 Installment Sale Payments and Administration Fee. The City shall, subject to prepayment as provided in Section 3.03, pay the Corporation or the Trustee, as appropriate, (a) the Purchase Price, without offset or deduction of any kind, by 11 4824 - 2424 - 8082.8 �gAKF9 �gAK�� paying the principal installments of the 2013 Installment Sale Payments, which principal installments shall be due annually on each Certificate Payment Date; (b) the interest installments of the 2013 Installment Sale Payments, which interest installments shall be due semiannually on each Interest Payment Date; and (c) the Administration Fee which shall be due annually on each Certificate Payment Date. The 2013 Installment Sale Payments Schedule is set forth in Exhibit A attached hereto. Each 2013 Installment Sale Payment and the Administration Fee shall be payable on and shall be required to be deposited with the Trustee on or before the fifteenth day of the calendar month immediately preceding its due date. The obligation of the City to pay the Purchase Price by paying the 2013 Installment Sale Payments and the Administration Fee is, subject to Section 8.01, absolute and unconditional, and until such time as the 2013 Installment Sale Payments shall have been paid in full (or provision for the payment thereof shall have been made pursuant to Article VII), the City will not discontinue or suspend any 2013 Installment Sale Payments or Administration Fee required to be paid by it under this Section when due, whether or not the Project or any part thereof is complete, or its use is suspended, interfered with, reduced, curtailed or terminated in whole or in part, and such payments shall not be subject to reduction whether by offset or otherwise and shall not be conditional upon the performance or nonperformance by any party to any agreement for any cause whatsoever. In order to carry out and effectuate the obligation of the City contained herein to pay the Purchase Price by paying the 2013 Installment Sale Payments and the Administration Fee, the City agrees and covenants that (i) the Gas Tax Revenues received by it shall be deposited when and as received in the Gas Tax Fund, (ii) the Transportation Impact Fee Revenues received by it shall be deposited when and as received in the Transportation Impact Fee Trust Fund, and (iii) the Restricted Utility Franchise and Surcharge Revenues received by it shall be deposited when and as received in the Roads Program Utility Franchise Fee and Surcharge Fund, and that the Gas Tax Fund, the Transportation Impact Fee Trust Fund and the Roads Program Utility Franchise Fee and Surcharge Fund have previously been established and which such funds City agrees and covenants to maintain so long as any 2013 Installment Sale Payments remain unpaid, and all money on deposit in the Gas Tax Fund, the Transportation Impact Fee Trust Fund and the Roads Program Utility Franchise Fee and Surcharge Fund shall be applied and used only as provided herein. All of the Revenues and all money in the Gas Tax Fund, the Transportation Impact Fee Trust Fund and the Roads Program Utility Franchise Fee and Surcharge Fund and in the funds or accounts so specified and provided for in this Agreement, are hereby irrevocably pledged to the punctual payment of the 2013 Installment Sale Payments and the Administration Fee, and the Revenues and such other money shall not be used for any other purpose while any of the 2013 Installment Sale Payments remain outstanding; subject to the provisions of this Agreement permitting application thereof for the purposes and on the terms and conditions set forth herein. This pledge shall constitute a first lien on the Revenues [and such other money available for the payment of the 2013 Installment Sale Payments and the Administration Fee] in accordance with the terms thereof. [Notwithstanding the foregoing, the City may satisfy its obligation to deposit 2013 Installment Sale Payments with the Trustee by depositing other legally available revenues with 12 4824 - 2424 - 8082.8 H t C� �n a T r m v o ORIGINAL the Trustee, and if and when so deposited, shall be irrevocably pledged to the payment of 2013 Installment Sale Payments.] All money on deposit in the Gas Tax Fund, the Transportation Impact Fee Trust Fund and the Roads Program Utility Franchise Fee and Surcharge Fund shall be set aside and deposited by the City in the various funds and accounts within the Revenue Fund at the following times in the following order of priority: (a) Interest and Principal Fund Deposits. On or before the fifteenth day preceding each Interest Payment Date, the City shall, from the money in the Gas Tax Fund, the Transportation Impact Fee Trust Fund and the Roads Program Utility Franchise Fee and Surcharge Fund, or from any one fund or combination of funds thereof, transfer to the Trustee for deposit in the Interest Fund within the Revenue Fund established under the Trust Agreement, a sum equal to the interest becoming due and payable hereunder on the next succeeding Interest Payment Date, except that no such deposit need be made if the Trustee then holds money in the Interest Fund equal to the amount of interest becoming due and payable hereunder on the next succeeding Interest Payment Date; and on or before the fifteenth day preceding each Certificate Payment Date, the City shall, from the money in the Gas Tax Fund, the Transportation Impact Fee Trust Fund and the Roads Program Utility Franchise Fee and Surcharge Fund, or from any one fund or combination of funds thereof, transfer to the Trustee for deposit in the Principal Fund within the Revenue Fund established under the Trust Agreement, a sum equal to the principal becoming due and payable hereunder on the. next succeeding 2013 Installment Sale Payment Date, except that no such deposit need be made if the Trustee then holds money in the Principal Fund equal to the amount of Principal becoming due and payable hereunder on the next succeeding 2013 Installment Sale Payment Date; and all money on deposit in the Interest Fund and the Principal Fund shall be used to make and satisfy the 2013 Installment Sale Payments due on each date and such payments shall be deposited by the Trustee to the Interest Fund or the Principal Fund, as the case may be, as defined in, created under and in accordance with the terms of, the Trust Agreement. (b) Reserve Fund Deposit. On or before the fifteenth day of each month, the City shall, from the money in the Gas Tax Fund, the Transportation Impact Fee Trust Fund and the Roads Program Utility Franchise Fee and Surcharge Fund, or from any one fund or combination of funds thereof, transfer to the Trustee for deposit in the Reserve Fund within the Revenue Fund that sum, if any, necessary to restore the Reserve Fund to an amount equal to the Reserve Fund Requirement, all in accordance with and subject to the terms and conditions of Section 3.03 of the Trust Agreement. All money in the Reserve Fund shall be used and withdrawn by the Trustee for the purposes specified in Section 3.03 of the Trust Agreement. (c) Administration Fund Deposit. On or before the fifteenth day preceding each Certificate Payment Date, the City shall, from the remaining money on deposit in the Gas Tax Fund, the Transportation Impact Fee Trust Fund and the Roads Program Utility Franchise Fee and Surcharge Fund, or from any one fund or combination of funds thereof, transfer to the Trustee for deposit in the City's Administration Fund within the Revenue Fund established under the Trust Agreement, a sum equal to the Administration 13 4824 - 2424 - 8082.8 �AKF t- r c> � ORIGINAL Fee becoming due and payable hereunder on the next Certificate Payment Date, and all money on deposit in the Administration Fund shall be used to pay the Administration Fee due on such Certificate Payment Date, in accordance with the terms of the Trust Agreement. (d) Reimbursement Advances. The City agrees to pay to the Credit Provider (if any), from Revenues (i) a sum equal to the total of all amounts paid by the Credit Provider (if any), under the Credit Facility (if any) (the "Advances "); and (ii) interest on such Advances from the date paid by the Credit Provider (if any), until payment thereof in full, payable to the Credit Provider (if any), at the Late Payment Rate per annum (collectively, the "Reimbursement Amounts "). "Late Payment Rate" means the lesser of (A) the greater of (1) the per annum rate of interest, publicly announced from time to time by at its principal office in , as its prime or base lending rate (any change in such rate of interest to be effective on the date such change is announced by ) plus U %, and (2) the then applicable highest rate of interest evidenced and represented by the Certificates; and (B) the maximum rate permissible under applicable usury or similar laws limiting interest rates. The Late Payment Rate shall be computed on the basis of the actual number of days elapsed over a year of 360 days. The City hereby covenants and agrees that the Reimbursement Amounts are secured by a lien on and pledge of the Revenues and payable from such Revenues on a parity with the payment of the 2013 Installment Sale Payments. (e) Credit Provider Fees. The City shall pay or reimburse the Credit Provider (if any) from Revenues, any and all charges, fees, costs and expenses that the Credit Provider (if any) may reasonably pay or incur in connection with (i) the administration, enforcement, defense or preservation of any rights or security in any Related Document; (ii) the pursuit of any remedies under the Trust Agreement or any other Related Document or otherwise afforded by law or equity; (iii) any amendment, waiver or other action with respect to, or related to, the Trust Agreement or any other Related Document whether or not executed or completed; (iv) any amount which comes due on the Credit Facility by its terms and which is in excess of the amount treated as principal of and interest on the related certificates; or (v) any litigation or other dispute in connection with the Trust Agreement or any other Related Document or the transactions contemplated thereby, other than costs resulting from the failure of the Credit Provider (if any) to honor its obligations under the Credit Facility and/or Liquidity Facility. The Credit Provider (if any) reserves the right to charge a reasonable fee as a condition to executing any amendment, waiver or consent proposed in respect of the Trust Agreement or any other Related Document. So long as the City has made each required deposit to the Revenue Fund as required by this Section 3.02, the City may expend any remaining money in the Gas Tax Fund, the Transportation Impact Fee Trust Fund and the Roads Program Utility Franchise Fee and Surcharge Fund for any lawful purpose of the City, including, depositing such amounts with a Subordinate Obligation trustee at such times as are sufficient to pay the debt service and reserve requirements on any Subordinate Obligations. 14 4824 - 2424 - 8082.8 o��AK�9 f•-- ref r- C� r; Section 3.03. Prepayment of 2013 Installment Sale Payments. The City may prepay from any source of available funds as a whole or in part on any date, on or after , 20_, all or any part of the principal amount of the unpaid 2013 Installment Sale Payments becoming due on or after , 20_, in such order of prepayment as the City may determine upon written direction to the Corporation and the Trustee (or, if the City fails to designate the order of prepayment, on a proportionate basis among the 2013 Installment Sale Payments and by lot within an Installment Payment Date), at a prepayment price equal to the principal amount prepaid, plus accrued interest to the date of prepayment. Before making any prepayment pursuant to this Section, the City shall give written notice to the Corporation and the Trustee describing such event and specifying the date on which the prepayment will be paid and the order thereof, which date shall be not less than 30 days nor more than 60 days from the date such notice is given. ARTICLE IV ADDITIONAL CONTRACTS So long as the City is not in default hereunder, the City may at any time execute any Contract the Installment Sale Payments under and pursuant to which, as the case may be, are payable from the Revenues on a parity with the payment by the City of the 2013 Installment Sale Payments as provided herein; provided, that (i) the audited Revenues for the Fiscal Year next preceding the date of the adoption by the governing body of the City of the resolution authorizing the execution of such Contract, as evidenced by both a calculation prepared by the City and a special report prepared by an Independent Certified Public Accountant on such calculation on file with the City shall have produced a sum equal to at least [_ 1% of the Maximum Annual Debt Service on all Contracts outstanding after the execution of such amendment or Contract, and (ii) if certificates, evidencing and representing a proportionate undivided interest in the Installment Sale Payments under such additional Contract, are to be executed and delivered pursuant to a trust agreement other than the Trust Agreement, the trustee for such trust agreement shall be the Trustee. Notwithstanding the foregoing provisions, there shall be no limitations on the ability of the City to execute any Contract at any time to refund any outstanding Contract[; provided, there is delivered to the Trustee a certificate of an Authorized City Representative showing that the aggregate annual Debt Service on all outstanding Contracts for each Fiscal Year after the execution of a Contract to refund an outstanding Contract will not exceed the aggregate annual Debt Service for each Fiscal Year prior to the execution of the Contract to refund any outstanding Contract.] ARTICLE V REPRESENTATIONS AND COVENANTS OF THE CITY AND THE CORPORATION Section 5.01. Corporation; Compliance With 2013 Installment Sale Agreement and Trust Agreement. The City is a charter city and municipal corporation duly organized and existing under the Constitution of the State of California, with full legal right, power and 15 4824 - 2424 - 8082.8 A KF9 C c� �- TI r- r- C7 O QRICaINAL authority to execute, deliver and perform its obligations under this 2013 Installment Sale Agreement, and compliance with the provision hereof will not materially conflict with or constitute a material breach of or default under any applicable provision of law, or any applicable regulation or agreement to which the City is a party or may be subject. The City will punctually pay the 2013 Installment Sale Payments in strict conformity with the terms hereof, and will faithfully observe and perform all the agreements, conditions, covenants and terms contained herein required to be observed and performed by it, and will not terminate this 2013 Installment Sale Agreement for any cause including, without limiting the generality of the foregoing, any acts or circumstances that may constitute failure of consideration, destruction of or damage to the Project, commercial frustration of purpose, any change in the tax or other laws of the United States of America or of the State of California or any political subdivision of either or any failure of the Corporation to observe or perform any agreement, condition, covenant or term contained herein required to be observed and performed by it, whether express or implied, or any duty, liability or obligation arising out of or connected herewith or the insolvency, or deemed insolvency, or bankruptcy or liquidation of the Corporation or any force majeure, including Acts of God, tempest, storm, earthquake, war, rebellion, riot, civil disorder, acts of public enemies, blockade or embargo, strikes, industrial disputes, lockouts, lack of transportation facilities, fire, explosion, or acts or regulations of governmental authorities. The Corporation will faithfully observe and perform all the agreements, conditions, covenants and terms contained in the Trust Agreement required to be observed and performed by it, and it is expressly understood and agreed by and among the parties to this 2013 Installment Sale Agreement and the Trust Agreement that each of the agreements, conditions, covenants and terms contained in each such agreement is an essential and material term of the obligation of the City to repay the costs of the acquisition and construction of the Project and the costs and expenses incidental thereto paid by the Corporation pursuant to, and in accordance with, and as authorized under law and this 2013 Installment Sale Agreement. Section 5.02. Use of Proceeds of Certificates. The Corporation and the City agree that the proceeds of the Certificates deposited in the Acquisition Fund will be used by the City, as agent for the Corporation, to pay the costs of the acquisition and construction of the Project and to pay the incidental costs and expenses related thereto as provided herein and in the Trust Agreement. Section 5.03. Against Encumbrances; Subordinate Obligations. The City will pay or cause to be paid when due all sums of money that may become due or purporting to be due for any labor, services, materials, supplies or equipment furnished, or alleged to have been furnished, to or for the City payable from the Revenues or which may impair the security for the 2013 Installment Sale Payments and will keep the Revenues free of any and all liens against any portion of the Revenues. In the event any such lien attaches to or is filed against any portion of the Revenues, the City will cause each such lien to be fully discharged and released at the time the performance of any obligation secured by any such lien matures or becomes due, except that if the City desires to contest any such lien it may do so. If any such lien shall be reduced to final judgment and such judgment or any process as may be issued for the enforcement thereof is not promptly stayed, or if so stayed and such stay thereafter expires, the City will forthwith pay or 16 4824 - 2424 - 8082.8 0 8� A K F 9 r S' >- m � o ORIUNAL cause to be paid and discharged such judgment. The City will, to the maximum extent permitted by law, indemnify and hold the Corporation and the Trustee harmless from, and defend each of them against, any claim, demand, loss, damage, liability or expense (including attorneys' fees) as a result of any such lien or claim of lien against any portion of the Revenues. The City may pledge, encumber or otherwise secure its obligations with the Revenues; provided, that except as permitted by Article IV hereof, in all instances any such pledge, lien or security is wholly subordinate and junior to the obligations of the City contained herein (the "Subordinate Obligations "). Subordinate Obligations may be incurred by the City at such times and upon such terms as the City shall determine; provided that: a) any Subordinate Obligation shall specifically state that such lien on or security interest granted in the Revenues is junior and subordinate to the lien on and security interest in such Revenues and other assets granted to secure the 2013 Installment Payments and other Contracts; b) payment of principal of an interest on such Subordinate Obligations shall be permitted; provided that all deposits required to be made pursuant to Section 3.02(a) through [(e)] herein or under similar provisions set forth in parity Contracts, if any, are then current in accordance with this 2013 Installment Sale Agreement and parity Contracts; and c) such obligations, if a default in payment, may not be accelerated if any 2013 Installment Sale Payments are outstanding. Section 5.04. Maintenance of Revenues. The City will use its best efforts to comply with all provisions of law and any regulations issued thereunder relating to the Revenues, including, but not limited to, as applicable, (i) Sections 2119 (relating to the highway users tax fund) and 2151 through 2155 of the California Streets and Highways Code- (relating to the accounting, reports and audits of the highway users tax fund); (ii) Sections 65089.3 and 65089.4 of the California Government Code relating to conformance with the congestion management program relating to the City; and (iii) Section 66000 et seq. of the California Government Code, setting forth the provisions of the Mitigation Fee Act (relating to the legal requirements for enactment of development impact fees), and will take any and all reasonable actions required in order to maintain the City's ability to receive the Revenues and apply the same as provided herein; provided, that nothing herein shall require the City to take any action or expend any City funds to comply with any such requirements deemed unreasonable in the sole discretion of the City, so long as failure to take such action or expend such funds will not cause the amount of estimated Revenues to be received by the City in the next Fiscal Year to be less than "% of the Maximum Annual Debt Service as of the date of calculation. Section 5.05. Tax Covenants. The City will not directly or indirectly use or permit the use of the proceeds of the obligation provided herein or any other funds of the City or take or omit to take any action which would cause such obligation to be an "arbitrage bond" within the meaning of Section 148 of the Code, or a "federal- guaranteed obligation" under Section 149(b) 17 4824 - 2424 - 8082.8 gAK, o K,%" v r; ORIGINA" of the Code, or a "private activity bond" as described in Section 141 of the Code. To that end, so long as any 2013 Installment Sale Payments are unpaid, the City will comply with all requirements of such sections of the Code to the extent applicable to the obligation provided herein and with the provisions of the Tax Certificate. Upon calculation by the Rebate Analyst of a Rebate Amount, the City shall, from any source of available funds, immediately transfer an amount of money equal to the Rebate Amount to the Trustee for deposit in the Rebate Fund established pursuant to Section 4.04 of the Trust Agreement. The Corporation and the City will at all times do and perform all acts and things permitted by law which are necessary or desirable in order to assure that the interest evidenced and represented by the Certificates will not be included in the gross income of the owners of such certificates for federal income tax purposes under the Code and will take no action that would result in such interest being so included. Section 5.06. Prompt Acquisition and Construction of the Project. The City will take all necessary and appropriate steps to acquire and construct the Project, as agent of the Corporation, with all practicable dispatch and in an expeditious manner and in conformity with law so as to complete the same as soon as possible. Section 5.07. Accounting Records and Financial Statements. (a) The City will keep appropriate accounting records in which complete and correct entries shall be made of all transactions relating to the Revenues and the Project, which records shall be available for inspection by the Corporation and the Trustee at reasonable hours and under reasonable conditions. (b) The City will prepare and file with the Trustee annually within [nine] months after the close of each Fiscal Year audited financial statements of the City for the preceding Fiscal Year. Section 5.08. Protection of Security and Rights of the Corporation and the Trustee. The City will preserve and protect the security hereof and the rights of the Corporation and the Trustee to the 2013 Installment Sale Payments hereunder and will warrant and defend such rights against all claims and demands of all persons. Section 5.09. Further Assurances. The City will adopt, deliver, execute and make any and all further assurances, instruments and resolutions as may be reasonably necessary or proper to carry out the intention or to facilitate the performance hereof and for the better assuring and confirming unto the Corporation of the rights and benefits provided to it herein. Section 5.10. Continuing Disclosure. The City hereby covenants and agrees that it will enter into and comply with and carry out all of the provisions of the Continuing Disclosure Agreement. Notwithstanding any other provision of this 2013 Installment Sale Agreement, failure of the City to comply with the Continuing Disclosure Agreement shall not be considered an Event of Default hereunder; however, the Trustee shall at the written request of any Participating Purchaser /Underwriter (as defined in the Continuing Disclosure Agreement) or the Owner of at least 25% aggregate principal amount in Outstanding Certificates, or any Owner or Beneficial Owner may take such actions as may be necessary and appropriate, including seeking 18 4824 - 2424 - 8082.8 gAK�c r- i_ r, specific performance by court order, to cause the City to comply with its obligations under this Section. For purposes of this Section, `Beneficial Owner" means any person who has the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of, any Certificates (including persons holding Certificates through nominees, depositories or other intermediaries). ARTICLE VI EVENTS OF DEFAULT AND REMEDIES Section 6.01. Events of Default and Acceleration of Principal. If one or more of the following "Events of Default' shall happen, that is to say: (a) if default shall be made in the due and punctual payment of any Installment Sale Payment when and as the same shall become due and payable; (b) if default shall be made by the City in the performance of any of the agreements or covenants contained herein required to be performed by it, and such default shall have continued for a period of 30 days after the City shall have been given notice in writing of such default by the Corporation or the Trustee; or (c) if the City shall file a petition or answer seeking arrangement or reorganization under the federal bankruptcy laws or any other applicable law of the United States of America or any state therein, or if a court of competent jurisdiction shall approve a petition filed with or without the consent of the City seeking arrangement or reorganization under the federal bankruptcy laws or any other applicable law of the United States of America or any state therein, or if under the provisions of any other law for the relief or aid of debtors any court of competent jurisdiction shall assume custody or control of the City or of the whole or any substantial part of its property; then and in each and every such case during the continuance of such Event of Default specified above, the Trustee may, and upon the written request of the Credit Provider (if any) or the owners of not less than a majority of the Outstanding City Parity Obligations, shall by notice in writing to the City, declare the entire principal amount of all unpaid Installment Sale Payments and the accrued interest thereon to be due and payable immediately, and upon any such declaration the same shall become immediately due and payable, anything contained herein to the contrary notwithstanding. This subsection is subject to the condition, however, that if at any time after the entire principal amount of the unpaid Installment Sale Payments and the accrued interest thereon shall have been so declared due and payable and before any judgment or decree for the payment of the money due shall have been obtained or entered the City shall deposit with the Trustee a sum sufficient to pay the unpaid principal amount of all Installment Sale Payments due and payable prior to such declaration and the accrued interest thereon, with interest on such overdue installments at the rate or rates applicable to such unpaid principal amounts of the Installment Sale Payments if paid in accordance with their terms, and the reasonable expenses of the Trustee, and any and all other defaults known to the Trustee (other than in the payment of the entire principal amount of the unpaid Installment Sale Payments and the accrued interest thereon due and payable solely by reason of such declaration) shall have been made good or cured to the 19 4824 - 2424 - 8082.8 P K 8 9�r > m (.J r- ORIGINA, satisfaction of the Trustee or provision deemed by the Trustee to be adequate shall have been made therefor, then and in every such case the Trustee, by written notice to the City, may rescind and annul such declaration and its consequences; but no such rescission and annulment shall extend to or shall affect any subsequent default or shall impair or exhaust any right or power consequent thereon. Section 6.02. Application of Revenues Upon Acceleration. All Revenues upon the date of the declaration of acceleration by the Trustee as provided in Section 6.01 and all Revenues thereafter received shall be applied in the following order: FIRST, to the payment of the fees, costs and expenses of the Trustee and the Corporation, if any, in carrying out the provisions of the 2013 Installment Sale Agreement and any additional Contract, including reasonable compensation to its agents, accountants and counsel and including any indemnification expenses, provided that, the Trustee shall obtain and follow the instructions contained in the Opinion of Counsel and rebate or set aside for rebate from the specified funds held under the Trust Agreement, any amount pursuant to such instructions required to be paid to the United States of America under the Code; SECOND, to the payment of the interest then due and payable on the entire principal amount of the unpaid Installment Sale Payments, and, if the amount available shall not be sufficient to pay in full all such interest then due and payable, then to the payment thereof ratably, according to the interest amounts due thereon without any discrimination or preference; THIRD, to the payment of the unpaid principal amount of the Installment Sale Payments which have become due and payable, whether on the original due date or upon acceleration, with interest on the overdue principal and interest amounts of the unpaid Installment Sale Payments at the rate or rates of interest then applicable to the Installment Sale Payments if paid in accordance with their terms, and, if the amount available shall not be sufficient to pay in full all the amounts due with respect to the Installment Sale Payments on any date, together with such interest, then to the payment thereof ratably, according to the principal amount due on such date, without any discrimination or preference; and FOURTH, to provide for any other amounts due and owing any Credit Provider and /or Liquidity Provider (if any), and if the amount available shall not be sufficient to pay in full all the amounts due with respect to such amounts due and owing any Credit Provider and/or Liquidity Provider on any date, then to the payment thereof ratably, according to any such amounts due and owing on such date, without any discrimination or preference. Section 6.03. Other Remedies. The Trustee shall have the right: (a) by mandamus or other action or proceeding or suit at law or in equity to enforce its rights against the City or any councilmember, officer or employee thereof, and to compel the City or any such councilmember, officer or employee to perform and carry out its or his duties under law and the agreements and covenants required to be performed by it or him contained herein; (b) by suit in equity to enjoin any acts or things which are unlawful or violate the rights of the Corporation or the Trustee; or 20 4824 - 2424 - 8082.8 A K'6 J9 v f-3 OR!GIN.A► (c) by suit in equity upon the happening of an Event of Default to require the City and its council members, officers and employees to account as the trustee of an express trust. Section 6.04. Non - Waiver. Nothing in this Article or in any other provision hereof shall affect or impair the obligation of the City, which is absolute and unconditional, to pay the 2013 Installment Sale Payments from the Revenues to the Trustee at the respective due dates or upon prepayment, or shall affect or impair the right of the Trustee, which is also absolute and unconditional, to institute suit to enforce such payment by virtue of the contract embodied herein. A waiver of any default or breach of duty or contract by the Trustee shall not affect any subsequent default or breach of duty or contract or impair any rights or remedies on any such subsequent default or breach of duty or contract. No delay or omission by the Trustee to exercise any right or remedy accruing upon any default or breach of duty or contract shall impair any such right or remedy or shall be construed to be a waiver of any such default or breach of duty or contract or an acquiescence therein, and every right or remedy conferred upon the Trustee by law or by this Article may be enforced and exercised from time to time and as often as shall be deemed expedient by the Trustee. If any action, proceeding or suit to enforce any right or exercise any remedy is abandoned or determined adversely to the Trustee, the Corporation and the City and the Trustee shall be restored to their former positions, rights and remedies as if such action, proceeding or suit had not been brought or taken. Section 6.05. Remedies Not Exclusive. No remedy herein conferred upon or reserved to the Trustee is intended to be exclusive of any other remedy, and each such remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing in law or in equity or by statute or otherwise and may be exercised without exhausting and without regard to any other remedy conferred by law. ARTICLE VII DISCHARGE OF OBLIGATIONS (a) If the City shall pay or cause to be paid all the 2013 Installment Sale Payments at the times and in the manner provided herein, the right, title and interest of the Corporation herein and the obligations of the City hereunder shall thereupon cease, terminate, become void and be completely discharged and satisfied. (b) Any unpaid principal installment of the 2013 Installment Sale Payments shall on its payment date or date of prepayment be deemed to have been paid within the meaning of and with the effect expressed in Article VII(a) if the City makes payment of such 2013 Installment Sale Payments and the prepayment premium, if applicable, in the manner provided herein. 21 4824 - 2424 - 8082.8 �gAKF9 r ORIUNAi (c) All or any portion of unpaid principal installments of the 2013 Installment Sale Payments shall, prior to their payment dates or dates of prepayment, be deemed to have been paid within the meaning of and with the effect expressed in Article VII(a) if- (i) notice is provided by the City to the Trustee as required by the Trust Agreement; (ii) there shall have been deposited with the Trustee either money in an amount which shall be sufficient, or United States Obligations (as that term is defined in the Trust Agreement) and which are not subject to redemption prior to maturity (including United States Obligations issued or held in book entry form on the books of the Treasury of the United States of America), the interest on and principal of which when paid will provide money which, together with money, if any, deposited with the Trustee, shall be sufficient, in the opinion of an Independent Certified Public Accountant, to pay when due the interest to become due with respect to the principal installments of such 2013 Installment Sale Payments and the principal installments of such 2013 Installment Sale Payments or such portions thereof on and prior to their payment dates or their dates of prepayment, as the case may be, and the prepayment premiums, if any, applicable thereto; and (iii) an opinion of nationally recognized bond counsel is filed with the Trustee to the effect that the action taken pursuant to this subsection will not cause the interest evidenced and represented by the Certificates to be includable in gross income under the Code for federal income tax purposes. (d) After the payment of all 2013 Installment Sale Payments and prepayment premiums, if any, as provided in this Article, and payment of all fees and expenses of the Trustee, the Trustee, upon request of the City, shall cause an accounting for such period or periods as may be requested by the City to be prepared and filed with the City and the Corporation and shall execute and deliver to the City and the Corporation all such instruments as may be necessary or desirable to evidence such total discharge and satisfaction of this 2013 Installment Sale Agreement, and the Trustee shall pay over and deliver to the City, as an overpayment of 2013 Installment Sale Payments, all such money or investments held by it pursuant hereto other than such money and such investments as are required for the payment or prepayment of the 2013 Installment Sale Payments, which money and investments shall continue to be held uninvested by the Trustee in trust for the payment of the 2013 Installment Sale Payments and shall be applied by the Trustee pursuant to the Trust Agreement. ARTICLE VIII MISCELLANEOUS Section 8.01. Liability of City Limited to Revenues. Notwithstanding anything contained herein, the City shall not be required to advance any moneys derived from any source 22 4824- 2424 - 8082.8 o' 9sT U ORIGNAI of income other than the Revenues for the payment of the 2013 Installment Sale Payments or for the performance of any agreements or covenants required to be performed by it contained herein. The obligation of the City to make the 2013 Installment Sale Payments is a special obligation of the City payable solely from the Revenues as provided herein, and does not constitute a debt of the City or of the State of California or of any political subdivision thereof within the meaning of any constitutional or statutory debt limitation or restriction. Section 8.02. Benefits of 2013 Installment Sale Agreement. Nothing contained herein, expressed or implied, is intended to give to any person other than the Corporation, the Credit Provider (if any), the City or the Trustee any right, remedy or claim under or pursuant hereto, and any agreement or covenant required herein to be performed by or on behalf of the Corporation, the Credit Provider (if any), the City or the Trustee shall be for the sole and exclusive benefit of the other parties. Section 8.03. Successor Is Deemed Included in All References to Predecessor. Whenever either the Corporation or the City or the Trustee is named or referred to herein, such reference shall be deemed to include the successor to the powers, duties and functions that are presently vested in the Corporation or the City or the Trustee, and all agreements and covenants required hereby to be performed by or on behalf of the Corporation or the City or the Trustee shall bind and inure to the benefit of the respective successors thereof whether so expressed or not. Section 8.04. Waiver of Personal Liability. No councilmember, officer or employee of the City shall be individually or personally liable for the payment of the 2013 Installment Sale Payment, but nothing contained herein shall relieve any councilmember, officer or employee of the City from the performance of any official duty provided by any applicable provisions of law or hereby. Section 8.05. Article and Section Headings, Gender and References. The headings or titles of the several articles and sections hereof and the table of contents appended hereto shall be solely for convenience of reference and shall not affect the meaning, construction or effect hereof, and words of any gender shall be deemed and construed to include all genders. All references herein to "Articles," "Sections," "Exhibits" and other subdivisions or clauses are to the corresponding articles, sections, exhibits, subdivisions or clauses hereof, and the words "hereby," "herein," "hereof," "hereto," "herewith" and other words of similar import refer to this 2013 Installment Sale Agreement as a whole and not to any particular article, section, exhibit, subdivision or clause hereof. Section 8.06. Partial Invalidity. If any one or more of the agreements or covenants or portions thereof required hereby to be performed by or on the part of the Corporation or the City shall be contrary to law, then such agreement or agreements, such covenant or covenants or such portions thereof shall be null and void and shall be deemed separable from the remaining agreements and covenants or portions thereof and shall in no way affect the validity hereof. The Corporation and the City hereby declare that they would have executed this 2013 Installment Sale Agreement, and each and every other article, section, paragraph, subdivision, sentence, clause and phrase hereof irrespective of the fact that any one or more articles, sections, 23 4824 - 2424 - 8082.8 ORIGI 'Ai paragraphs, subdivisions, sentences, clauses or phrases hereof or the application thereof to any person or circumstance may be held to be unconstitutional, unenforceable or invalid. Section 8.07. Assignment. This 2013 Installment Sale Agreement and any rights hereunder shall be assigned by the Corporation to the Trustee as provided in the Trust Agreement; to which assignment the City hereby expressly acknowledges and consents. Section 8.08. Net Contract. This 2013 Installment Sale Agreement shall be deemed and construed to be a net contract, and the City shall pay absolutely net during the term hereof the 2013 Installment Sale Payments and all other payments required hereunder, free of any deductions and without abatement, diminution or set -off whatsoever. Section 8.09. California Law. This 2013 Installment Sale Agreement shall be construed and governed in accordance with the laws of the State of California. Section 8.10. Indemnification. The City shall, to the full extent then permitted by law, indemnify, protect, hold harmless, save and keep harmless the Corporation and its directors, officers and employees and the Trustee and its directors, officers and employees from and against any and all liability, obligations, losses, claims and damages whatsoever, regardless of the cause thereof, and expenses in connection therewith, including, without limitation, counsel fees and expenses, penalties and interest arising out of or as the result of the acquisition, construction, installation and use of the Project and each portion thereof or any accident in connection with the operation, use, condition or possession of the Project or any portion thereof resulting in damage to property or injury to or death to any person including, without limitation, any claim alleging latent and other defects, whether or not discoverable by the City or the Corporation; any claim for patent, trademark or copyright infringement; and any claim arising out of strict liability in tort. The indemnification arising under this Section shall continue in full force and effect notwithstanding the full payment of all obligations hereunder or the termination hereof for any reason. The City agrees not to withhold or abate any portion of the payments required pursuant hereto by reason of any defects, malfunctions, breakdowns or infirmities of the Project. The City and the Corporation mutually agree to promptly give notice to each other of any claim or liability hereby indemnified against following either's learning thereof. Section 8.11. Funds. Any fund required to be established and maintained herein by the City may be established and maintained in the accounting records of the City either as an account or a fund, and may, for the purpose of such accounting records, any audits thereof and any reports or statements with respect thereto, be treated either as an account or a fund; but all such records with respect to any such fund shall at all times be maintained in accordance with sound accounting practice and with due regard for the protection of the security of the Certificates and the rights of the owners of such Certificates. Section 8.12. Notices; Authorized City Representative. All written notices to be given hereunder shall be given by mail to the party entitled thereto at its address set forth below, or at such other address as such party may provide to the other party in writing from time to time, namely: to the City: City of Bakersfield, California 24 4824 - 2424 - 8082.8 C1��AKe9, y .r U 1600 Truxtun Avenue Bakersfield, CA 93301 to the Corporation: Bakersfield Public Benefit Corporation 1600 Truxtun Avenue Bakersfield, CA 93301 Attention: President/Executive Manager City Authorized Representatives: TITLE: (a) Mayor; (b) City Manager; and (c) Finance Director. Section 8.13. Effective Date. This 2013 Installment Sale Agreement shall become effective upon its execution and delivery, and shall terminate when the Purchase Price shall have been fully paid (or provision for the payment thereof shall have been made pursuant to Article VII). Section 8.14. Execution in Counterparts. This 2013 Installment Sale Agreement may be executed in several counterparts, each of which shall be deemed an original, and all of which shall constitute but one and the same instrument. [Remainder of page intentionally left blank] 25 4824 - 2424 - 8082.8 �6 A xz-9� r r, ORIGINA( IN WITNESS WHEREOF, the parties hereto have executed and attested this 2013 Installment Sale Agreement by their officers thereunto duly authorized as of the day and year first written above. CITY OF BAKERSFIELD, CALIFORNIA [Name], Mayor APPROVED AS TO FORM: IIn [Name], City Attorney APPROVED AS TO CONTENT AND COUNTERSIGNED: an [Name], Finance Director BAKERSFIELD PUBLIC BENEFIT CORPORATION By: Authorized Signatory 26 4824 - 2424 - 8082.8 T t- v (:-D ORIGINAL 2013 INSTALLMENT SALE PAYMENTS SCHEDULE Payment Date 4824 - 2424 - 8082.8 Total 2013 Principal Installment Sale Interest Installment Installment Payments s n, U � ORIGINAL EXHIBIT B DESCRIPTION OF PROJECT Any costs related to design, right -of -way, new construction, re- construction, resurfacing, repair or maintenance work on any city roadway, bike lane, bike path, or pedestrian path within the City right of way. Additionally, any costs related to design, right -of -way, construction or any other improvements related to any bridge, road widening or freeway facility in the greater Bakersfield area which is a component or project segment of the Thomas Roads Improvement Program. 4824 - 2424 - 8082.8 r 0 o ORIGINAL