HomeMy WebLinkAbout74-0755/6/74
CITY OF SANTA ANA
RESOLUTION NO. 74-75
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA
ANA, CALIFORNIA, AUTHORIZING THE ISSUANCE OF $1,950,000
WATER REVENUE BONDS OF SAID CITY AND PROVIDING THE
TERMS AND CONDITIONS FOR THE ISSUANCE OF SAID BONDS.
WHEREAS, pursuant to Ordinance No. NS-561, a special election was held in the City of Santa Aha,
for the purpose of submitting to the qualified voters of said city the proposition of issuing water revenue
bonds of said city in the amount of $6,950,000 pursuant to the charter of said city and the Revenue
Bond Law of 1941 (Chapter 6, Part 1, Division 2, Title 5 of the Government Code of the State of
California) for the following purpose, to wit:
The acquisition and construction of additions to the revenue producing water utility of the
City of Santa Ana (i.e. the water supply and distribution system) for which the property to be
acquired and the improvements or additions to be made to the equipment for such revenue-
producing utility shall consist of works and facilities for the production, storage, transmission
and distribution of water, including water storage reservoirs, water wells, pumping and pressure
regulating stations, water transmission and distribution mains, capacity rights in works and facilities
to be used jointly with other public corporations, facilities of existing water companies; and for the
foregoing appurtenances and appurtenant works, and including the acquisition of all water rights,
lands, easements, pipe, pumps, and other property necessary therefor; the estimate of the cost of
the foregoing purpose being $6,950,000; the regulations and procedures for the sale and issuance
of such bonds to be as set forth in the Revenue Bond Law of 1941 (Chapter 6, Part 1, Division 2,
Title 5 of the Government Code of the State of California); and the provision to be made from the
revenue of such revenue-producing utility for the payment of interest on, and retirement of, the
bonds to be that said bonds are secured by and are payable from all of the revenues of said utility
as now or hereafter constituted, all as more particularly set forth in said Revenue Bond Law of 1941;
and
WHEREAS, said proposition was approved by the votes of more than a majority of all the voters
voting on said proposition at said special election, and this City is now authorized to issue said bonds
as provided in said Charter and said Revenue Bond Law of 1941; and this City has issued and sold
$3,000,000 of said bonds designated 1962 Water Revenue Bonds, Series A, and $2,000,000 of said
bonds designated 1962 Water Revenue Bonds, Series B; and
WHEREAS, this City Council deems it necessary to issxte and sell at this time $1,950,000 water
revenue bonds as "Series C"; and
WHEREAS, this City Council desires to utilize the provisions of Article 8, Chapter 3, Part 1,
Division 2, Title 5 (commencing with Section 53540) of the Government Code of the State of California
in lieu of issuing the remaining unissued portion of said authorized bonds;
NOW, THEREFORE, the City Council of the City of Santa Ana, California, DOES HEREBY
RESOLVE, DETERMINE AND ORDER as follows:
Section 1. Definitions. As used in this resolution, unless the context indicates otherwise, the
following terms shall have the following meanings:
(a) "City" means the City of Santa Aha, California.
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(h) "City Council" or "Council" means the City Council of said City
(c) "Director of Finance" means the Director of Finance of said City.
(d) "Clerk" means thc Clerk of the Council of said City.
(e) "Revenue Bond Law" means the Revenue Bond Law of 1941 as cited in the recitals hereof.
(f) "The bunds", "said bonds" or "this series" means the $1,950,000 bonds authorized by
this resolution.
(g) "Enterprise" means the enterprise defined in said Ordinance No. NS-561 calling said
election, as follows:
The entire waterworks system of the City of Santa Ann as said system now exists together
with all additions to be acquired, constructed and financed with funds derived from the sale
of the revenue bonds herein proposed to be issued, together with all improvements and
extensions to said system later constructed or acquired.
(h) "Gross revenues of the enterprise" means all revenues (as defined in Section 54315
of the Government Code, which include all charges received for, and all other income and receipts
derived by the city from the operation of the enterprise or arising from the enterprise) received by
the city from the services, facilities and water sales of the enterprise, excepting therefrom all
reimbursement charges, connection charges, and deposits to secure service.
(i) "Necessary and reasonable maintenance and operation costs of the enterprise" means the
reasonable expenses of management, repair and other expenses necessary to maintain and preserve
the enterprise in good repair and working order, excluding depreciation and obsolescence.
(j) "Net revenues of the enterprise" means the amount of the gross revenues of the enterprise
remaining after payment therefrom of the necessary and reasonable maintenance and operation
costs of the enterprise.
(k) "Maximum amount of annual debt service" shall be the maximum sum obtained for any
fiscal year thereafter by totaling the following:
(a) The principal amount of all outstanding bonds payable in such fiscal year;
(b) The amount of minimum term bond payments for all outstanding bonds required
to be made in such fiscal year together with the premium thereon, if any be payable; and
(c) The interest which would be due during such fiscal year on the aggregate principal
amount of bonds which would be outstanding in such fiscal year if the bonds are retired as
scheduled, but deducting and excluding from such aggregate amount the amount of bonds
retired in advance of said schedule.
(1) "Parity Bonds" means revenue bonds, revenue notes or any other evidences of indebtedness
which may be authorized and/or issued for the acquisition, construction and financing of extensions
of, additions to, and improvements of the enterprise, payable out of the revenues derived from the
enterprise and which, as provided in this resolution, rank on a parity with the bonds of this series.
(m) "Subsequent resolution" means any resolution of issuance for any parity bonds.
(n) "Resolution No. 62-92" means the resolution adopted by the Council on May 18, 1962,
authorizing the issuance of Series A bonds.
(o) "Resolution No. 63-178" means the resolution adopted by the Council on November 18,
1963 authorizing the issuance of Series B bonds.
(p) "Outstanding bonds" means all outstanding bonds of any series of bonds of the issue
of which this series is a part and any parity bonds.
(q) "Fiscal year" means the year period beginning on July 1st and ending on the next
following June 30th.
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(r) "Authorized investments" means any negotiable direct obligations of the United States,
or any negotiable obligations for which the full faith and credit of the United States are pledged for
the payment of principal and interest, or any obligations issued by federal land banks or federal
intermediate credit banks established under the Federal Farm Loan Act, as amended, bonds or
debentures of the Federal Home Loan Bank Board or of any federal home loan bank established
under the Federal Home Loan Bank Act, obligations of the Federal National Mortgage Association
established under the National Housing Act, as amended, and debentures and consolidated debentures
issued by the Central Bank for Cooperatives and banks for cooperatives established under the Farm
Credit Act of 1933, as amended.
Section 2. Eqnality of Bonds, Pledge of Revenues. Pursuant to the Revenue Bond Law and this
resolution, outstanding bonds shah rank on a parity and shall be equally secured by a pledge, charge and
lien upon the gross revenues of the enterprise without priority for number, date of bonds, date of sale,
date of execution, or date of delivery, and the payment of the interest on and principal of outstanding
bonds and any premiums upon the redemption of any thereof shall be and are secured by an exclusive
pledge, charge and lien upon the gross revenues of the enterprise, and all of the gross revenues of the
enterprise (including revenues of improvements and extensions later constructed or acquired and revenues
of existing systems, plants, works or undertakings to be acquired, improved or extended or for the acquisi-
tion, improvement or extension of which said bonds are to be issued) are hereby pledged, charged
assigned for the security of outstanding bonds, and such gross revenues shall constitute a trust fund for the
security and payment of the interest on and principal of outstanding bonds and so long as any of
outstanding bonds or interest thereon are unpaid said gross revenues and interest thereon shall not be used
for any other purpose, except as permitted by this resolution and any subsequent resolution, and shall
be held in trust for the benefit of the bondholders and shall be applied pursuant to this resolution, or to
this resolution as modified pursuant to provisions herein, and any subsequent resolution.
Nothing in this resolution or in any subsequent resolution shall preclude: (a) the redemption
prior to maturity of any bonds subject to call and redemption and payment of said bonds from proceeds
of refunding bonds issued under the Revenue Bond Law as the same now exists or as hereafter amended,
or under any other law of the State of California; (b) the issuance, subject to the limitations in Covenant
11 in Section 12 hereof, of additional indebtedness evidenced by revenue bonds, revenue notes or any
other evidences of indebtedness payable out of the revenues of the enterprise and ranking on a parity with
said bonds.
Section 3. Amount, Issuance, Purpose and Nature of Bonds. Under and pursuant to the Revenue
Bond Law and Article 8, Chapter 3, Part 1, Division 2, Title 5 of the Government Code, revenue bonds
of the City in the amount of $1,950,000 shall be issued for the purpose stated in the recitals hereof. Said
revenue bonds shall be and are special obligations of the city and shall be and are secured by a pledge
of and lien upon, and shall be and are a charge upon, and shall be and are payable as to the principal
thereof and interest thereon and any premiums upon the redemption of any thereof, solely from the
gross revenues of the enterprise, such gross revenues being hereby pledged, charged and assigned for
the security of the bonds. Upon the issuance of said bonds, the unissued balance of the bonds authorized
at the election referred to in the recitals hereof shall be canceled and shall not be issued.
Section 4. No General City Liability. The general fund of the City is not liable for the payment
of the bonds or their interest, nor is the credit or taxing power of the City pledged for the payment
of the bonds or their interest. The holder of the bonds or coupons shall not compel the exercise of the
taxing power by the city or the forfeiture of any of its property. The principal of and interest on the
bonds and any premiums upon the redemption of any thereof are are not a debt of the city nor a legal or
equitable pledge, charge, lien, or encumbrance, upon any of its property, or upon any of its income,
receipts, or revenues, except the gross revenues of the enterprise which are, under the terms of this
resolution and said Revenue Bond Law, pledged to the payment of said bonds and interest.
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Section 5. Description o! Bonds. Said bonds shall be in the principal sum of $1,950,000. The
bonds may be initially issued in the form of bearer bonds in the denomination of $5,000 each, or in fully
registered form in denominations of $5,000 each or any multiple thereof. The bearer bonds shall be
numbered C1 to C390, inclusive. Said bonds shall be designated 1962 WATER REVENUE BONDS,
SERIES C, shall be dated July 1, 1974, and shall be payable in consecutive numerical order on July
1 in each year of maturity in the amounts for each of the several years as follows:
Principal Principal
Year Amount Year Amount
1975 .................................... $ 40,000
1976 .................................... 40,000
1977 .................................... 40,000
1978 .................................... 40,000
1979 ................................... 40,000
1980 ................................... 40,000
1981 ................................... 40,000
1982 .................................. 40,000
1983 .................................... $ 40,000
1984 .................................... 40,000
1985 ................................. 40,000
1986 .................................... 50,000
1987 .................................... 50,000
1988 .................................... 50,000
1989 ................................... 50,000
1999 .......................... 1,310,000
The bonds maturing in the years 1975 to 1989, inclusive, are herein sometimes referred to as
"serial bonds". The bonds maturing in the year 1999 are herein sometimes referred to as "term bonds".
Section 6. Interest, Said bonds shall bear interest at a rate or rates to be hereafter fixed by
resolution or resolutions, but not to exceed seven per cent (7%) per annum, payable semiannually on the
1st days of January and July of each year. Each bond shall bear interest until the principal sum thereof
has been paid, provided, however, that if at the maturity date of any bond, or if the same is redeemable
and has been duly called for redemption, funds are available for the payment or redemption thereof in
full accordance with the terms of this resolution, said bonds shall then cease to bear interest. Said bonds
and the interest thereon shall be payable in lawful money of the United States of America at the office
of the Director of Finance of the City of Santa Aha, in said city, or, at the option of the holder, at any
paying agent of the City in Los Angeles or San Francisco, California, Chicago, Illinois, or New York,
New York.
Section 7. Execution of Bonds. The Mayor of the City and the Director of Finance of the City
are hereby authorized and directed to sign all of said bonds by their printed, lithographed or engraved
facsimile signatures, and the Clerk of the Council is hereby authorized and directed to countersign said
bonds and to affix thereto the corporate seal of the city, and the Director of Finance of the city is hereby
authorized and directed to sign the interest coupons of said bonds by his printed, llthographed or engraved
facsimile signature.
Section 8. Registration. Bearer bonds may be registered ouly by exchange for fully registered
bonds of the same interest rate and maturity. Fully registered bonds may be exchanged in whole for
bearer bonds or in part for bearer bonds and in part for fully registered bonds. Transfer of ownemhip of
fully registered bonds shall be made by exchanging the same for new fully registered bonds. All of such
exchanges shall be made in such manner and upon such reasonable terms and conditions as may from
time to time be determined and prescribed by the City; provided, however, no such exchange shall be made
between the fifteenth day preceding any interest payment date and such interest payment date. Such
exchanges shall be free of any costs or charges to the person, firm or corporation requesting such exchange,
except for any tax or governmental charge that may be imposed thereon.
The Director of Finance will keep sufficient books for the registration and transfer of the bonds, as
hereinbefore provided.
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Section 9. Redemption of Bonds. The bonds maturing on or prior to July 1, 1984 are not subject
to call or redemption prior to maturity. The bonds maturing on or after July 1, 1985, are subject to call
and redemption, at the option of the city, on July 1, 1984, or on any interest payment date thereafter
prior to maturity, at a redemption price equal to the principal amount thereof plus a premium equal to
one-quarter of one percent for each year or portion of a year from the redemption date to the maturity
date thereof. All or any of the bonds subject to call may be called for redemption at any one time.
If less than all of the bonds are redeemed at any one time, such bonds shall be redeemed in inverse
order of maturity and by lot within a maturity. The interest payment date on which bonds are to be
presented for redemption is herein sometimes called the "redemption date."
Upon surrender of any fully registered bond redeemed in part only, the City shall execute and
deliver to the registered owner thereof, at the expense of the City, a new bond or bonds of authorized
denominations equal in aggregate principal amount to the unredeemed portion of the bond surrendered
and of the same interest rate and maturity, which new bond or bonds may be, at the option of the
registered owner, either in bearer or fully registered form. The registered owner of any fully registered
bond may, in lieu of surrendering such bond, endorse on the reverse of such bond a notation of such
partial redemption, in such form as may be satisfactory to the City and under such conditions as the
City may approve. Such partial redemption shall be valid upon payment of the amount thereby required
to be paid to such registered owner, and the City shall be released and discharged from all liability to
the extent of such payment, irrespective of whether such endorsement shall or shall not have been made
upon the reverse of such fully registered bond by such registered owner and irrespective of any error or
omission in such endorsement.
(a) Notiee of Redemption. Notice of the intended redemption shall be published by one insertion
in a newspaper of general circulation in the County of Orange, California, and in a financial newspaper
or journal of national cimulation published in the City of New York, New York, said publications to
be at least 30 days but not more than 60 days prior to the redemption date. The notice of redemption
shall (a) state the redemption date; (b) state the redemption price; (c) state the numbers and dates
of maturity of the bonds to be redeemed, provided, however, that whenever any call includes all of the
outstanding bonds of any maturity the numbers of the bonds need not be stated; (d) require that such
bonds be surrendered with all interest coupons maturing subsequent to the redemption date at the
office of the Director of Finance of the City of Santa Aha, in said City, or, at the option of the holder,
at any paying agent of the City in Los Angeles or San Francisco, California, Chicago, Illinois, or in
New York, New York; (e) state, as to any fully registered bonds redeemed impart only, the registered
bond numbers and the principal portion thereof to be redeemed; and (f) give notice that further
interest on such bonds will not accrue after the designated redemption date.
The Director of Finance shall, on or before the date of publication of said notice of redemption,
mail a similar notice, postage prepaid to the person, firm or corporation that originally purchased the
bonds from the City.
If any of the bonds designated for redemption shall be fully registered bonds, the Director of
Finance shall, on or before the date of publication of said notice of redemption, mail a similar notice,
postage prepaid, to the respective registered owners thereof at the addresses appearing on the bond
registry books. If all of the bonds designated for redemption shall be fully registered bonds, the
requirement for publication of notice as prescribed in this subparagraph (a), may be waived at the
option of the Director of Finance.
The actual receipt by the holder of any bond (hereinafter referred to as "bondholder") of notice
of such redemption shall not be a condition precedent to redemption, and failure to receive such notice
shall not affect the validity of the proceedings for the redemption of such bonds or the cessation of
interest on the date fixed for redemption. The notice or notices required by this section shall be given
by the Director of Finance. A certificate by the Director of Finance that notice of call and redemption
has been given to original purchasers and to holders of fully registered bonds as herein provided shall
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be conclusive as against all parties, and no bondholder whose bond is called for redemption may
object thereto or object to the cessation of interest on the redemption date fixed by any claim or
showing that he failed to receive such notice of call and redemption.
(b) Redemption. Prior to the redemption date there must be set aside in the Retirement Fund
moneys for the purpose and sufficient to redeem, at the premiums payable as in this resolution pro-
vided, the bonds designated in such notice for redemption. Said moneys must be set aside in said
fund solely for that purpose and shall be applied on or after the redemption date to the payment
(principal and premium) of the bonds to be redeemed upon presentation and surrender of such bonds
and (except as to fully registered bonds) all interest coupons maturing after the redemption date. Any
interest coupon due on or prior to the redemption date shall be paid from the Interest Fund upon
presentation and surrender thereof. Any interest due on or prior to the redemption date upon fully
registered bonds shall be paid from said Interest Fund. Each bearer bond presented must have attached
thereto or presented therewith all interest coupons maturing after the redemption date.
(c) Effect ot the Notice ot Redemption. When notice of redemption has been given, and when
the amount necessary for the redemption of the bonds called for redemption (principal and premium)
is set aside for that purpose in the Retirement Fund, the bonds designated for redemption shall become
due and payable on the date fixed for redemption thereof, and upon presentation and surrender of said
bonds and (except as to fully registered bonds) all interest coupons maturing after the redemption date,
at the place specified in the notice of redemption, such bonds shall be redeemed and paid at said
redemption price out of the Retirement Fund, and no interest will accrue on such bonds called for
redemption or on any interest coupon thereof after the redemption date specified in such notice, and the
holders of said bonds so called for redemption after such redemption date shall look for the payment of
such bonds and the premium thereon only to said Retirement Fund. All bonds redeemed and all interest
coupons thereof shall be cancelled forthwith by the Director of Finance and shall not be reissued.
All interest coupons pertaining to any redeemed bonds, which coupons have matured on or prior
to the time fixed for redemption, shall continue to be payable to the respective holders thereof but without
interest thereon. All unpaid interest payable at or prior to the date fixed for redemption upon bonds
registered in such manner that the interest is payable only to the registered owners shall continue to be
payable to the respective registered owners of such bonds, or their order, but without interest thereon.
Section 10. Revenues and Funds. Pursuant to Resolution No. 62-92 and under and pursuant
to said Revenue Bond Law there were created the following funds which are hereby expressly continued
and shall be applied pursuant to this resolution and under and pursuant to said Revenue Bond Law:
1. Water Revenue Bond Acquisition and Construction Fund ("Construction Fund");
2. Water Revenue Fund ("Revenue Fund");
3. Water Revenue Bond Imerest Fund ("Interest Fund");
4. Water Revenue Bond Retirement Fund ("Retirement Fund");
5. Water Revenue Bond Reserve Fund ("Reserve Fund");
6. Water Utility Fund ("Utility Fund");
(a)
Director
Disposition of Bond Proceeds. The proceeds of the sale of the bonds shall be placed by the
of Finance as follows:
1. The premium and accrued interest, if any, shall be placed in the Interest Fund.
2. The balance shall be placed in the Construction Fund.
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The City may deposit money received from any source in the Construction Fund. The money
set aside and placed in the Construction Fund shall remain therein until from time to time expended
for the purposes for which the bonds were issued. Money in the Construction Fund may be invested in
any authorized investments, provided that the maturity or maturities thereof shall not be later than
the date or dates on which money must be available to meet scheduled Construction Fund expenditures.
If any sum remains in said Construction Fund after the full accomplishment of the purposes for which
the bonds were issued, it shall be transferred to and placed in the Reserve Fund to the extent necessary
at that time to bring the Reserve Fund up to an amount equal to the maximum amount of annual debt
service and, as to any remaining balance, to the Revenue Fund.
(b) Revenue Fund. The Director of Finance shall, on or before the last business day of each
calendar month deposit the gross revenues of the enterprise in the Revenue Fund. The Director of Finance
shall transfer moneys from the Revenue Fund to the following funds in the following order of priority.
(c) Interest Fund. On or before the last business day of each calendar month so long as any of
the bonds are outstanding the Director of Finance shall set aside out of the Revenue Fund into the Interest
Fund, at least one-sixth (1/6th) of the interest which will become due and payable on the outstanding
bonds of this series within the next ensuing six (6) months. Such sums shall be so transferred that at
least the full mount required to pay the interest on said outstanding bonds shall be set aside in the
Interest Fund prior lo the date the installment of interest becomes due.
Any amount required to be set aside, transferred to and placed in the Interest Fund may be prepaid
in whole or in part by being earlier set aside, transferred to and placed in the Interest Fund, and in that
event the monthly transfer which has been so prepaid need not be made at the time appointed therefor.
In any event prior to the due date of any installment of interest on outstanding bonds all stuns required for
the payment thereof must be in the Interest Fund.
Money in the Interest Fund may be invested in any authorized investments, provided that the
maturity or maturities thereof shall not be later than the date or dates on which money must be available
in the Interest Fund.
The interest coupons shall recite that they are payable from the Revenue Fund, but said coupons
notwithstanding such recital shall be paid from the Interest Fund which is derived from the Revenue Fund.
If after all of the outstanding bonds have been redeemed and cancelled or paid and cancelled there
are any moneys remaining in the Interest Fund said moneys shall be transferred to the Revenue Fund;
provided, however, that if said moneys are part of the proceeds of refunding bonds said moneys
shall be transferred to the fund or account created for the payment of the principal of such refunding bonds.
(d) Retirement Fund. For the payment of the outstanding serial bends of this series on or before
the last business day of each calendar month so long as any of such bonds are outstanding the Director of
Finance shall set aside out of the Revenue Fund into the Retirement Fund, at least one-twelfth (1/12) of
the principal amount of such bonds which will mature and be payable within the next ensuing twelve (12)
months. Such sums shall be so transferred that at least the full amount required to pay any maturity
or installment of principal of such bonds shall be set aside in the Retirement Fund prior to the date the
installment of principal becomes due.
Amy amount required to be set aside, trt/nsferred to and placed in the Retirement Fund may be
prepaid in whole or in part by being earlier set aside, transferred-to and placed in the Retirement Fund,
and in that event the monthly transfer which has been so prepaid need not be made at the time appointed
therefor. In any event prior to the due date of any installment of principal on such serial bonds all sums
required for the payment thereof must be in the Retirement Fund.
The bonds shall recite that they are payable from the Revenue Fund, but said bonds notwithstanding
such recital shall be paid from the Retirement Fund which is derived from the Revenue Fund.
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For the payment of the term bonds of this series, there shall be transferred as provided hereinafter
from the Revenue Fund and set aside in the Retirement Fund an amount not less than the minimam
amount hereinafter specified. Such transfer shall in no event be less than the amount (herein sometimes
referred to as "minimum term bond payments") which will be sufficient to call and redeem said term
bonds (including premiums, if any, thereon) in the following respective minimum principal amounts
on July 1 in each of the following years, to wit:
Minimum Amount Minimum Amount
Year Each Year Year Each Year
1990 ........................................ $ 50,000
1991 ...................................... 50,000
1992 ........................................ 50,000
1993 ........................................ 50,000
1994 ........................................ 50,000
1995 ........................................ $190,000
1996 ..................................... 200,000
1997 ........................................ 210,000
1998 ....................................... 220,000
1999 ........................................ 240,000
On the last business day of each calendar momh, commencing in the month of July 1989, the
Director of Finance shall set aside out of the Revenue Fund into the Retirement Fund at least one-twelfth
(I/12) of the amount needed to call and redeem the minimum amount of the term bonds within the
next ensuing 12 months as provided in the above table, it being the intent of this provision that the
respective minimum amounts necessary to call and redeem the term bonds according to the above
table (or to purchase all or any part of such bonds in lieu of call and redemption prior to maturity) shall
be transferred to the Retirement Fund prior to the redemption date. In the event that the transfer made
for any month is less than the minimum term bond payment for that month because of lack of funds or
for any other reason the deficiency shall be added to and become a part of the minimum term bond
payment required for the following month.
Except as hereinafter provided, moneys in the Retirement Fund set aside for the minimum term
bond payments shall be used solely for the purpose of purchasing and/or calling and redeeming said
term bonds prior to maturity. Money in said fund in excess of that which has been set aside for the
purpose of redeeming bonds of this series which have been called prior to maturity may be used to
purchase from time to time on the open market any of the outstanding bonds of this series subject to such
call and redemption (irrespective of the number of such bonds), either at public or private sale or other-
wise, but the purchase price (including brokerage or other charges, but excluding accrued interest) shall
not exceed the redemption price thereof on the next interest payment date.
If on May 15, 1990 or on any May 15th of any year thereafter, the Director of Finance determines
that there will be in the Retirement Fund an amount at least sufficient, including premiums, if any,
thereon to call $5,000 principal amount of the term bonds of this series or more, the Director of Finance
shall then call and redeem term bonds from minimum term bond payments deposited in the Retirement
Fund, together with the amount to be so deposited prior to the next available July 1 redemption date, in
the largest amount which can be redeemed with the money to be available at said redemption date.
Moneys in the Retirement Fund may be invested in any authorized investments, provided that the
maturity or maturities thereof shall not be later than the date or dates on which money must be available
in the Retirement Fund for call or retirement of bonds.
If after all of the outstanding bonds have been redeemed and cancelled or paid and cancelled
there are any moneys remaining in the Retirement Fund said moneys shall be transferred to the Revenue
Fund; provided, however, that if said moneys are part of the proceeds of refunding bonds said moneys
shall be transferred to the fund or account created for the payment of the principal of such refunding bonds.
Under this resolution and in the event any subsequent resolution provides for the issuance of term
bonds, the minimum term bond payments to be placed in the Retirement Fund for term bonds of this
series and for any outstanding term bonds shall rank on a parity with the minimum term bond payments
to be placed in the Retirement Fund for the redemption of the term bonds of Series C.
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(e) Reserve Fund. From any available funds of the City including the Utility Fund there shall
be immediately placed in the Reserve Fund an amount, which together with the amount therein, shall
be an amount equal to the maximum amount of annual debt service as defined herein, and thereafter
there shall be maintained in said fund an amount equal to said maximum amount of annual debt
service. Moneys in the Reserve Fund may be invested in any authorized investments, provided that the
maturity of said investment shall not be later than twelve years from the date thereof.
Upon the sale of any parity bonds there shall be immediately placed in the Reserve Fund from
any available funds of the City including the Utility Fund an amount which will make the Reserve
Fund equal to the maximum amount of annual debt service and thereafter there shall be maintained
in said Reserve Fund an amount at least equal to said maximum amount of annual debt service.
Moneys in the Reserve Fund shall be used solely for the purpose of paying the principal of and
interest on the outstanding bonds and for the redemption of the outstanding term bonds (including
premiums thereon) in the principal amounts provided herein in the event that the moneys in the
Interest Fund or the Retirement Fund are insufficient therefor and for that purpose the Director of
Finance shah withdraw and transfer moneys from the Reserve Fund to the appropriate fund as the
case may be. Whenever moneys are withdrawn from the Reserve Fund for the purposes provided
in this section an equal amount of money shall be placed in the Reserve Fund from the first available
moneys in the Revenue Fund. At least annually any amount in the Reserve Fund in excess of the
maximum amount of annual debt service shall be transferred to the Revenue Fund. Money in the
Reserve Fund may be used to pay the principal and/or interest on the last maturity of the outstanding
bonds.
(f) Utility Fund. All moneys remaining in the Revenue Fund on or before the last business day
of each month, after setting aside and transferring all the sums required to be set aside and transferred
by the preceding paragraphs of this section and by tl~ analogous provisions of Resolution N~>. 62-92
and Resolution No. 63-178, shall be transferred to Iae Utility Fund. The necessary and reasonable
maintenance and operation costs of the enterprise shal be paid from this fund and shall be separately
accounted for as maintenance and operation expens~
(g) Surplus. After the above transfers and uses ave been made and all other covenants of the
City contained herein have been duly performed mon :ys in the Utility Fund are surplus and may be
(i) used for extensions and betterments of the water s3 stem; (ii) invested in any securities in which the
City may invest funds subject to its control; (iii) trans erred to the Retirement Fund to be used for the
redemption of any of said bonds which are subject to call and redemption prior to maturity or to the
purchase from time to time in the open market of any outstanding bonds whether or not subject
to call and redemption (irrespective of the maturity o~: number of such bonds) at prices and in such
manner, either at public or private sale, or otherwise, as the City in its discretion may determine, but
' such purchase price (including brokerage and other charges, but excluding accrued interest) shall not
exceed 104% of the principal amount or the redemptiotl price of the outstanding term bonds on the next
interest payment date, whichever is less; or (iv) used for any lawful purpose of the City.
(h) Withdrawals. The Director of Finance shall not permit any withdrawal to be made by the
City of any moneys in any of the funds herein, if and when the City is in default hereunder.
(i) Security for Deposits. All moneys held by the Director of Finance shall be held in time or
demand deposits, and shall be secured at times by such obligations and to the extent required by law,
except to the extent that such moneys are invested as hereinbefore provided.
(j) Investments. Obligations purchased as an investment of money in any funds which are herein
authorized to be invested shall be deemed at all times tb be a part of such funds and any profit realized
from investments shall be credited to such funds and any losses resulting from such investment shall
be charged to such funds, and the interest accruing thereunder shall be credited to the Revenue Fund
5/6/74
except where expressly provided otherwise. The Director of Finance shall sell at the best price obtainable
or present for redemption any obligations so purchased, whenever it may be necessary to do so in order
to provide moneys to meet any payment or transfer from such funds. For the purpose of determining
at any given time the balance in any such funds any such investments constituting a part of such funds
shall be valued at the then estimated or appraised market value of such investments.
Section 11. Warranty. The City shall preserve and protect the security of the bonds and the rights
of the bondholders and warrant and defend their rights against all claims and demands of all persons.
Section 12. Covenants. So long as any of the bonds issued hereunder are outstanding and unpaid,
or so long as provision for the full payment and discharge thereof at maturity or upon redemption thereof
prior to maturity through the setting apart in the Retiarement Fund to insure the payment or redemption
thereof of money sufficient for that purpose has not been made, the City makes the following covenants
with the bondholders under the provisions of the Revenue Bond Law of 1941 (to be performed by the
City or its proper officers, agents or employees) which covenants are necessary, convenient and desirable
to secure the bonds and tend to make them more marketable; provided however, that said covenants do
not require the City to expend any funds other than the revenues received or receivable from the enterprise.
Covenant 1. Punctual Payment. The City covenants that it will duly and punctually pay or cause
to be paid the principal of and interest on every bond issued hereunder, together with the premium thereon,
if any be payable, on the date, at the place and in thei manner mentioned in the bonds and coupons and
in accordance with this resolution, and that the payn~ents into the Interest Fund, the Retirement Fund
and Reserve Fund will be made, all in strict conformity with the terms of said bonds and of this resolution,
and that it will faithfully observe and perform all of ihe conditions, covenants and requirements of this
resolution and all resolutions supplemental thereto a~d of the bonds issued hereunder, and that time
of such payment and performance is of the essence of the City's contract with the bondholders.
Covenant 2. Discharge Claims. The City covegants that in order to fully preserve and protect
the priority and security of the bonds the City shall pay from the Revenue Fund and discharge all
lawful claims for labor, materials and supplies fur~ished for or in connection with the enterprise
which, if unpaid, may become a lien or charge upon the revenues prior or superior to the lien of the
bonds and impair the security of the bonds. The City shall also pay from the Revenue Fund all taxes
and assessments or other governmental charges lawfully levied or assessed upon or in respect of the
enterprise or upon any part thereof or upon any of the revenues therefrom.
Covenant 3. Commence Acquisition and Construction. As soon as funds are available therefor,
the City will commence the accomplishment of the purposes for which the bonds are issued and will
continue the same to completion with all practical dispatch and in an economical manner.
Covenant 4. Operate Enterprise in Efficient and Economical Manner. The City covenants and
agrees to operate the enterprise in an efficient and economical manner and to operate, maintain and
preserve the enterprise in good repair and working order.
Covenant 5. Against Sale, Eminent Domain. The City covenants that the enterprise shall not be
mortgaged or otherwise encumbered, sold, leased, pledged, any charge placed thereon, or disposed of as
a whole or substantially as a whole unless such sale or other disposition be so arranged as to provide for a
cnntinuanee of payments into the Revenue Fund sufficient in amount to permit payment therefrom of the
principal of and interest on and premiums, if any, due upon the call and redemption thereof, of the bonds,
payment of which is required to be made out of the revenues of the enterprise, and also to provide for
such payments into the funds as are required under the terms of this resolution. The revenues from the
enterprise or any other funds pledged or otherwise made available to secure payment of the principal of
I0
5/6/?~
and interest on the bonds shall not be mortgaged, encumbered, sold, leased, pledged, any charge placed
thereon, or disposed of or used except as authorized by the terms of this resolution. The City further
covenants that it will not enter any agreement which impairs the operation of the enterprise or any part
of it necessary to secure adequate revenues to pay the principal and interest of the bonds or which
otherwise would impair the rights of the bondholders with respect to the revenues or the operation
of the enterprise. If any substantial part of the enterprise is sold the payment therefor shall either
be used for the acquisition and/or construction of improvements and extensions of the enterprise
or shall be placed in the appropriate funds and shall be used to pay or call and redeem outstanding
bonds in the manner provided in this resolution and any subsequent resolution.
The City covenants that any amounts received as awards as a result of the taking of all or any
part of the enterprise by the lawful exercise of eminent domain, if and to the extent that such right can
be exercised against such property of the City, shall either be used for the acquisition and/or construction
of improvements and extension of the enterprise or shall be placed in the appropriate funds and shall be
used to pay or call and redeem outstanding bonds in the manner provided in this resolution and any
subsequent resolution.
Covenant 6. Insurance. The City covenants that it shall at all times maintain with responsible
insurers all such insurance on the enterprise as is customarily maintained with respect to works and
properties of like character against accident to, loss of or damage to such works or properties. If any
useful part of the enterprise shall be damaged or destroyed, such part shall be restored to use. The
money collected from insurance against accident to or destruction of the physical enterprise shall be
used for repairing or rebuilding the damaged or destroyed enterprise, and to the extent not so applied,
shall be applied to the retirement of outstanding and unredeemed bonds issued for the enterprise and for
such purpose paid into the appropriate funds.
The City shall also maintain with responsible insurers workmen's compensation insurance and
insurance against public liability and property damage to the extent reasonably necessary to protect the
City and the bondholders.
Covenant 7. Records and Accounts, The City covenants that it shall keep proper books of
record and accounts of the enterprise, separate from all other records and accounts, in which
complete and correct entries shall be made of all transactions relating to the enterprise. Said books
shall at all times be subject to the inspection of the holders of not less than 10% of the outstanding
bonds or their representatives authorized in writing.
The City covenants that it will cause the books and accounts of the enterprise to be audited
annually by an independent certified public accountant or firm of certified public accountants and will
make available for inspection by the bondholders at the office of the Director of Finance of said City,
a copy of the report of such accountant or accountants.
The City covenants that it will cause to be published annually, not more than 120 days after the
close of each fiscal year a summary statement showing the amount of gross revenues and the amount
of all other funds collected which are required to be pledged or otherwise made available as security
for payment of principal of and interest on the bonds, the disbursements from such revenues and other
funds in reasonable detail, and a general statement of the financial and physical condition of the enterprise.
The City shall furnish a copy of the statement to any bondholder upon request.
Covenant 8, No l~Yee Service. The City covenants that, except to the extent that the City is
required under agreements and/or contracts existing on the effective date of this resolution, no water
or other service from the enterprise may be furnished or rendered to the United States of America, the
State of California, the City, any municipal or public corporation or district or public agency or any
private corporation or person free, and that, except to the extent that the City is required under agreements
11
5/6/74
and/or contracts existing on the effective date of this resolution, no such service shall be rendered to the
United States of America, the State of California, the City, any other municipal or public corporation
or district or any private corporation or person at rates lower than those charged other persons for
similar service, except that charges to the City for water used for street or sewer fiushing and for fire
hydrants may be made at rates lower than those charged private persons, and all rates for service
rendered to the City shall be a reasonable charge for the service rendered. No building or other real
property of the enterprise shall be furnished free to the City, but the City shall pay into the Revenue
Fund the reasonable rental value of any property so used, and reasonable and proper charges for service
rendered or quarters furnished to the enterprise shall be paid to the City from the Revenue Fund. The
City covenants that it shall at all times during the period any of the bonds are outstanding maintain and
enforce valid regulations for the payment of bills for water service and that such regulations shall at all
times during such period provide that the City shall discontinue water service to any user whose water
bill has not been paid within the time fixed by said regulations.
Covenant 9. Rates and Charges. The City shall and hereby covenants that it shall prescribe,
revise and collect such charges for the services, facilities and water of the enterprise which, after making
allowances for contingencies and error in the estimates, shall be at least sufficient to pay the following
amounts in the order set forth:
(a) The interest on and principal or minimum term bond payments of the bonds as they
become due and payable;
(b) All payments required for compliance with this resolution including payments required
to be made into the Reserve Fund;
(c) All payments required to meet any other obligations of the City which are charges, liens,
encumbrances upon or payable from the revenues of the enterprise;
(d) All current expenses for the necessary and reasonable maintenance and operation costs
of the enterprise;
and the charges shall be so fixed that the net revenues shall be at least 1.25 times the amounts payable
under (a).
Covenant 10. No Priority for Additional Bonds. The City covenants that no additional bonds
shall be issued pursuant to said Revenue Bond Law or any other law of the State of California having any
priority in payment of principal or interest out of the revenues of the enterprise over the bonds hereby
authorized to be issued and payable out of said revenues.
Covenant 11. Limits on Additional Debt. The City covenants that, except for bonds issued to
refund said bonds, no additional indebtedness evidenced by revenue bonds, revenue notes or any other
evidences of indebtedness payable out of the Revenue Fund and ranking on a parity with these bonds
shall be created or incurred unless:
First: The principal of and interest on the bonds have been paid as the same have become due;
and that payments into the Interest Fund, Retirement Fund and the Reserve Fund have been
made, all in conformity with this resolution, and
Second: The last maturity date of any parity bonds shall not be earlier than the last maturity
date of any bonds then outstanding and that any parity bonds shall mature on July 1, and
Third: The net revenues of the enterprise, calculated on sound accounting principles, as
shown by the financial report of the Director of Finance for the latest fiscal year or by a special
financial report for the last completed 12 month period ended 60 days prior to the adoption of the
resolution of issuance for such additional indebtedness, plus, at the option of the City, either or all
12
5/6/74
of the items hereinafter in this Covenant 11 designated (a) and (b), shall have amounted to at
least 1.25 times the maximum amount of annual debt service in any fiscal year thereafter on all
indebtedness to be outstanding immediately subsequent to the incurring of such additional indebted-
ness.
For the purposes of this Covenant 11, the net revenues of the enterprise shall not include any sum
transferred from the Construction Fund under the provisions of Section 10(a) hereof. The items either
or all of which may be added to such net revenues for the purpose of applying the restriction contained in
this Covenant 11 are the following:
(a) An allowance for net revenues from any additions to or improvements or extensions of
the enterprise to be made with the proceeds of such additional indebtedness, and also for net
revenues from any such additions, improvements or extensions which have been made from moneys
from any source but which, during all or any part of such fiscal year or last completed 12 month
period, were not in service, all in an amount equal to 75% of the estimated additional average
annual net revenues to be derived from such additions, improvements and extensions for the first
36 month period in which each addition, improvement or extension is respectively to be in operation,
all as shown by the certificate or opinion of a qualified independent engineer employed by the City.
(b) An allowance for earnings arising from any increase in the charges made for service from
the enterprise which has become effective prior to the incurring of such additional indebtedness
but which, during all or any part of such fiscal year or last completed 12 month period, was not
in effect, in an amount equal to 75% of the amount by which the net revenues would have been
increased if such increase in charges had been in effect during the whole of such fiscal year or last
completed 12 month period, as shown by the certificate or opinion of a qualified independent
engineer employed by the City.
Section 13. Lost, Stolen, Desh'oyed or Mutilated Bonds. In the event that any bond or any
interest coupon pertaining thereto is lost, stolen, destroyed or mutilated, the City will cause to be
issued a new bond or coupon similar to the original to replace the same in such manner and upon such
reasonable terms and conditions, including the payment of costs and the posting of a surety bond if
the City deems such surety bond necessary, as may from time to time be determined and prescribed by
resolution. The City may authorize such new bond or coupon or coupons to be signed and authenticated
in such manner as it determines in said resolution.
Section 14. Cancellation of Bonds. All bonds and coupons surrendered to the Director of Finance
or any paying agent of the City for payment upon maturity or for redemption shall upon payment therefor
be cancelled immediately and in the case of any paying agent said coupon shall be forthwith transmitted
to the Director of Finance. Any bonds purchased by the City as authorized herein together with all
unpaid coupons pertaining thereto shall be cancelled forthwith and shall not be reissued. All of the
cancelled bonds and interest coupons shall remain in the custody of the Director of Finance until
destroyed pursuant to due authorization.
Section 15. Consent of Bondholders. The consents of bondholders provided for in this section
shall relate solely to the amendment, waiver or modification of the covenants specified in Section 12
hereof and shall not be effective to waive or modify any other provisions of this resolution or any
other proceedings for the issuance of said bonds. Any act relating to the amendment, waiver or
modification of any of the said covenants consented to by bondholders holding sixty-six per cent (66%)
in aggregate principal amount of the bonds then outstanding (exclusive of issuer-owned bonds), shall
be binding upon the holders of all of the bonds and interest coupons, whether such coupons be attached
to bonds or detached therefrom, and shall not be deemed an infringement of any of the provisions
of this resolution, whatever the character of such act may be, and may be done and performed as fully
and freely as if expressly permitted by the terms of this resolution, and after such consent relating to
13
5/6774
such specified matters has been given, no bondholder or holder of any interest coupon, whether attached
to a bond or detached therefrom, shall have any right or interest to object to such action or in any
manner to question the propriety thereof or to enjoin or restrain the City or any officer thereof
from taking any action pursuant thereto.
Bondholders may consent by affirmative vote at a bondholders' meeting or may consent in writing
withom a meeting, all as hereinafter provided.
No such amendment, waiver or modification shall be made which will permit (a) a change in
the maturity or term of redemption of the principal of any bond or any installment of interest thereon;
(b) a reduction in the principal amount of or redemption price or redemption premium or rate of
interest upon any bond without the consent of the holder of such bond; or (c) a reduction of the
percentage of the principal amount of bonds the vote or consent of which is required to effect any
such amendment.
(a) Calling Bondholders' Meeting. If the City shall desire to obtain any such consent it may call
a meeting of bondholders, by resolution, for the purpose of considering the action, the consent to which
is desired.
(b) Notice of Meeting. Notice specifying the purpose, place, date and hour of such meeting
shall be published once in a financial newspaper or journal of national circulation published in the City
of New York, New York, not less than sixty (60) days and not more than ninety (90) days prior to the
date fixed for the meeting. Such notice shall set forth the nature of the proposed action, consent to
which is desired. If any of the bonds shall be so registered as to be payable otherwise than to bearer,
the Clerk shall, on or before the first publication of such notice, mail a similar notice, postage prepaid,
to the respective registered owners thereof at their addresses appearing on the bond registry books. The
place, date and hour of holding such meeting and the date or dates of publishing and mailing such notice
shall be determined by the City, in its discretion.
The actual receipt by any bondholder of notice of any such meeting shall not be a condition precedent
to the holding of such meeting, and failure to receive such notice shall not affect the validity of the
proceedings thereat. A certificate by the Clerk, approved by resolution of the City Council, that the
meeting has been called and that notice thereof has been given as herein provided shall be conclusive
as against all parties and it shall not be open to any bondholder to show that he failed to receive notice
of such meeting.
(c) Voting Qualifications. Any bondholder may, prior to any such meeting, deliver his bond or
bonds to any agency designated by the City for that purpose, and shall thereupon be entitled to receive
an appropriate receipt for the bond or bonds so deposited, calling for the redelivery of such bond or bonds
at any time after the meeting. The Clerk shall prepare and deliver to the chairman of the meeting a list
of the names and addresses of the registered owners of bonds, with a statement of the maturities and serial
numbers of the bonds held and deposited by each of such bondholders, and no bondholder shall be
entitled to vote at such meeting unless his name appears upon such list or unless he shall present his
bond or bonds at the meeting or a certificate of deposit thereof, satisfactory to the City, executed by a
bank or trust company, No bondholder shall be permitted to vote with respect to a larger aggregate
principal amount of bonds than is set against his name on such list, unless he shall produce the bonds
upon which he desires to vote, or a certificate of deposit thereof as above provided.
(d) Issuer-owned Bonds. The City covenants that it will present at the meeting a certificate, signed
and verified by one member of the City Council and by the Director of Finance stating the maturities
and serial numbers of all bonds owned by, or held for account of the City, directly or indirectly. No person
shall be permitted at the meeting to vote or consent with respect to any bond appearing upon such
certificate, or any bond which it shall be established at or prior to the meeting is owned by the City,
14
516174
directly or indirectly, and no such bond (in this resolution referred to as "issuer-owned bond") shall
be counted in determining whether a quorum is present at the meeting.
(e) Quorum and Procedure. A representation of at least sixty-six per cent (66%) in aggregate
principal amount of the bonds then outstanding (exclusive of issuer-owned bonds) shall be necessary
to constitute a quorum at any meeting of bondholders, but less than a quorum may adjourn the meeting
from time to time, and the meeting may be held as so adjourned without further notice, whether such
adjournment shall have been had by a quorum or by less than a quorum. The City shall, by an instrument
in writing, appoint a temporary chairman of the meeting, and the meeting shall be organized by the
election of a permanent chairman and a secretary. At any meeting each bondholder shall be entitled to
one vote for every $I,000 principal amount of bonds with respect to which he shall be entitled to vote
as aforesaid, and such vote may be given in person or by proxy duly appointed by an instrument in
writing presented at the meeting. The City, by its duly authorized representative, may attend any meeting
of the bondholders, but shall not be so required to do so.
(f) Vote Required. At any such meeting held as aforesaid there shall be submitted for the considera-
tion and action of the bondholders a statement of proposed action, consent to which is desired, and if
such action shall be consented to and approved by bondholders holding at least sixty-six per cent
(66%) in aggregate amount of the bonds then outstanding (exclusive of issuer-owned bonds) the
chairman and secretary of the meeting shall so certify in writing to the City, and such certificate shall
constitute complete evidence of consent of bondholders under the provisions of this resolution. A
certificate signed and verified by the chairman and the secretary of any such meeting shall be conclusive
evidence and the only competent evidence of matters stated in such certificate relating to proceedings
taken at such meeting.
(g) Written Consent of Bondholders. If the City shall desire to obtain any such consent in writing,
without a meeting of bondholders, the City Council thereof may, by resolution, propose the action to
which consent is desired. A copy of such resolution, together with a request to bondholders for their
consent to the action proposed therein, shall be published once in a financial newspaper or journal of
national circulation published in the City of New York, New York. If any of the bonds shall be so.
registered as to he payable otherwise than to bearer, the Clerk shall, on or before the publication of such
resolution and request, mail a copy thereof to each registered owner at the address appearing on the
bond registry books.
The actual receipt by any bondholder of such resolution and request shall not affect the validity
of the proceedings for the obtaining of such consent. A certificate by the Clerk, approved by resolmion
of the City Council of said city, that said resolution and request has been published and mailed as herein
provided shall be conclusive as against all parties, and it shall not be open to any bondholder to show
that he failed to receive such resolution and consent.
Each written consent shall be accompanied by proof of ownership of the bonds for which such
consent is given. Proof of ownership shall be made in such manner as shall be prescribed by the resolution
proposing the action. Any such written consent shall be binding upon the holder of the bonds giving
such consent and on any subsequent holder (whether or not such subsequent holder has notice thereof)
unless such consent is revoked in writing by the holder giving such consent or by the subsequent holder.
To be effective, any revocation of consent must be filed before the adoption of the resolution accepting
consents as hereinafter provided.
After the holders of at least sixty-six per cent (66%) in aggregate principal amount of the bonds
then outstanding (exclusive of issuer-owned bonds) shall have consented in writing, the City Council
shah adopt a resolution accepting such consents and such resolution shall constitute complete evidence
of the consent of bondholders under this resolution.
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(h) Publication of Consent. Notice specifying the amendment, waiver or modification that has
received the consent of bondholders as required by this section shall be published once in a financial
newspaper or journal of national circulation published in the City of New York, New York, not less than
sixty (60) days following the final action in the proceedings for the obtaining of such consent. Said
notice is only for the information of bondholders and failure to publish such notice or any defect therein
shall not affect the validity of the proceedings theretofore taken in the obtaining of such consent.
Section 16. Bond and Coupon Forms. The form of bearer bond and coupon and the form of fully
registered bond shall be substantially as follows:
[FORM OF BEARER BOND]
UNITED STATES OF AMERICA
STATE OF CALIFORNIA
COUNTY OF ORANGE
CITY OF SANTA ANA
1962 WATER REVENUE BOND, SERIES C
THE CITY OF SANTA ANA, a municipal corporation situated in the County of Orange, State of
California, FOR VALUE RECEIVED, hereby promises to pay, solely from the Revenue Fund, as
hereinafter provided, to the bearer, on July 1, _ ....... , upon presentation and surrender of this bond, the
sum of ................ THOUSAND DOLLARS, with interest thereon at the rate of ...... % per annum, payable
semiannually on the first days of January and July of each and every year from the date hereof until this
bond is paid, upon presentation and surrender of the respective interest coupons hereto attached; provided,
however, that if at the maturity date of this bond, or, if the same is redeemable and shall be duly cailed for
redemption, then at the date fixed for redemption, funds are available for the payment or redemption
thereof, as provided in the resolution hereinafter mentioned, this bond shall then cease to bear interest.
Both principal and interest are payable in lawful money of the United States of America at the office of
the Director of Finance of the City of Santa Aha, in said city, or, at the option of the holder hereof, at any
paying agent of the city in Los Angeles or San Francisco, California, Chicago, Illinois, or in New York,
New York.
This is one of a duly authorized issue of bonds of the city designated "1962 Water Revenue Bonds,
Series C", hereinafter called "the bonds", all of which have been issued pursuant to the Charter of said
city, the Revenue Bond Law of 1941 (Chapter 6, Part 1, Division 2, Title 5 of the Government Code of
the State of California) and Article 8, Chapter 3, Part 1, Division 2, Title 5 of said Government Code for
the purpose of the acquisition and construction of a water system for said city and the creation of said
issue and the terms and conditions of the bonds are provided for by the resolution of the City Council of
said city authorizing the bonds adopted May 6, 1974, designated Resolution No ................. and this
reference incorporates said resolution and said laws herein, and by acceptance hereof the holder of this
bond and the coupons hereto attached assents to said terms and conditions. Said resolution is adopted
under, and this bond and the interest coupons hereto attached are issued under and are to be construed in
accordance with the Charter of said city and the laws of the State of California.
This bond and the interest hereon and any premium upon the redemption hereof are not a .debt
of the City of Santa Aha, nor a legal or equitable pledge, charge, lien or encumbrance upon any of its
property or upon any of its income, receipts, or revenues except the gross revenues of the enterprise (as
defined in said resolution) pledged to its payment, and the principal of and the interest on this bond and
any premium upon the redemption hereof am payable solely from the gross revenues of the enterprise
pledged to its payment and said city is not obligated to pay such principal, interest and premium except
16
516174
from said gross revenues. The Revenue Fund is established under and pursuant to the Revenue Bond
Law of 1941, and under the provisions of said resolution authorizing the issuance of this bond the gross
revenues received from the enterprise are required to be deposited to the credit of said Revenue Fund and
used only for the purposes authorized by said resolution, including the payment of principal and interest
of the issue of bonds of which this is one.
By the terms of said Revenue Bond Law and by covenant expressed in said resolution, the city is
obligated to prescribe, revise and collect charges for the services, facilities and water of the water system
of the city such as to provide revenues sufficient to pay the interest on and principal of the bonds as they
become due and payable in addition to all other payments required for compliance with said resolution
and the necessary and reasonable maintenance and operation costs of the water system, is prohibited from
issuing bonds having any priority with respect to payment from the gross revenues of the enterprise, and
is subject to conditions with respect to any sale of said water system. In the manner provided in the
resolution, any or all of the obligations referred to in this paragraph and certain other obligations
mentioned in said resolution may be waived with the consent of the holders of 66% in aggregate principal
mount of the bonds then outstanding (exclusive of issuer-owned bonds).
This bond is callable and redeemable prior to maturity in accordance with the provisions for
redemption endorsed hereon.
This bond and the coupons hereto attached are negotiable instruments and shall be negotiable by
delivery. This bond may be registered, in accordance with said resolution, by being exchanged for a fully
registered bond of the same series, interest rate and maturity, in such manner and upon such reasonable
terms and conditions as may from time to time be determined and prescribed by the city; provided,
however, no such exchange shall be made between the fifteenth day preceding any interest payment date
and such interest payment date. Such exchange shall be free of any costs or charges to the person, firm
or corporation requesting such exchange, except for any tax or governmental charge that may be imposed
thereon.
It is hereby certified and recited that any and all acts, conditions and things required to exist,
to happen and to be performed precedent to and in the incurring of the indebtedness evidenced by this
bond and in the issuance of this bond exist, have happened, and have been performed in due time, form
and manner as required by the Constitution and laws of the State of California and the Charter of said
city and that this bond, together with all other indebtedness of the City pertaining to the aforesaid water
system, is within every debt and other limit prescribed by the Constitution and laws of the State of
California.
IN WITNESS WHEREOF, said City of Sama Ana has caused this bond to be signed by the Mayor
and Director of Finance of said city by their facsimile signatures, countersigned by the Clerk of the
Council of said city, and sealed with the corporate seal of said city, and the interest coupons hereto
attached to be signed by the Director of Finance by his facsimile signature, and has caused this bond
to be dated the first day of July, 1974.
COUNTERSIGNED:
Mayor of the City of Sama Ana, California
Director of Finance of the City of
Santa Aha, California
Clerk of the Council of the City of
Santa Ana, California
(SEAL)
17
5~6/74
(FORM OF COUPON)
On the first day of .................... 19
the CITY OF SANTA ANA, County of Orange, California will pay to the bearer, at
the office of the Director of Finance of the City of Sama Aha, in said city, or, at the
option of the holder hereof, at any paying agent of the city in Los Angeles or San Coupon No.
Francisco, California, or in Chicago, Illinois or in New York, New York, out of the ................
Revenue Fund of said city and not out of any other fund or moneys of the city, the
sum shown hereon in lawful money of the United States of America, being the interest $ ....................
then due on
1962 WATER REVENUE BOND, SERIES C, No .................
dated July 1, 1974, subject to the
provisions on the reverse hereof·
Director of Finance of said City.
On the reverse side of the coupon there shall be printed substantially the following:
(REVERSE OF COUPON)
If the bond to which this coupon is attached is redeemable and is duly called for redemption
on a date prior to the maturity date of this coupon, this coupon will be void.
(REVERSE OF BEARER AND FULLY REGISTERED BONDS)
PROVISIONS FOR REDEMPTION
Unless this bond matures on or prior to July 1, 1984, it is redeemable in the manner and subject
to the terms and provisions, and with the effect, set forth in the resolution referred to on the face
of this bond, at the option of the city, on July 1, 1984, or on any interest payment date thereafter prior
to maturity, upon at least 30 days' prior notice published in a newspaper circulated in the County of
Orange, California, and in a financial newspaper or journal of national circulation published in the City
of New York, New York, at a redemption price equal to the principal amount thereof plus a premium
equal to one-quarter of one percent of said principal amount for each year or portion of a year between
· the redemption date and the maturity date hereof.
[FORM OF FULLY REGISTERED BOND]
Fully Registered Bond
No. R ............................
Bearer Bond Nos .........................................................................................................................................
UNITED STATES OF AMERICA
STATE OF CALIFORNIA
COUNTY OF ORANGE
CITY OF SANTA ANA
1962 WATER REVENUE BOND, SERIES C
THE CITY OF SANTA ANA, a municipal corporation situated in the County of Orange, State
of California, FOR VALUE RECEIVED, hereby promises to pay, solely from the Revenue Fund,
516174
as hereinafter provided, to ........................................ , or registered assigns, on July 1,. ....... , upon presenta-
tion and surrender of this bond, the sum of ................ THOUSAND DOLLARS, with interest thereon at
the rate of ......qb per annum, payable semiannually on the first days of January and July of each and every
year from ............................ until this bond is paid; provided, however, that if at the maturity date of this
bond, or, if the same is redeemable and shall be duly called for redemption, then at the date fixed
for redemption, funds are available for the payment or redemption thereof, as provided in the resolution
hereinafter mentioned, this bond shall then cease to bear interest. Both principal and interest are payable
in lawful money of the United States of America at the office of the Director of Finance of the City
of Santa Ana, in said city, or, at the option of the holder hereof, at any paying agent of the city in Los
Angeles or San Francisco, California, Chicago, Illinois, or in New York, New York.
This is one of a duly authorized issue of bonds of the city designated "1962 Water Revenue Bonds,
Series C", hereinafter called "the bonds", all of which have been issued pursuant to the Charter of said
city, the Revenue Bond Law of 1941 (Chapter 6, Part 1, Division 2, Title 5 of the Government Code
of the State of California) and Article 8, Chapter 3, Part I, Division 2, Title 5 of said Government Code
for the purpose of the acquisition and construction of a water system for said city and the creation of
said issue and the terms and conditions of the bonds are provided for by the resolution of the City Council
of said city authorizing the bonds adopted May 6, 1974, designated Resolution No ................. and this
reference incorporates said resolution and said laws herein, and by acceptance hereof the holder of this
bond and the coupons hereto attached assents to said terms and conditions. Said resolution is adopted
under, and this bond and the interest coupons hereto attached are issued under and are to be construed
in accordance with the Charter of said city and the laws of the State of California.
This bond and the interest hereon and any premium upon the redemption hereof are not a debt
of the City of Santa Aha, nor a legal or equitable pledge, charge, lien or encumbrance upon any of its
property or upon any of its income, receipts, or revenues except the gross revenues of the enterprise
(as defined in said resolution) pledged to its payment, and the principal of and the interest on this bond
and any premium upon the redemption hereof are payable solely from the gross revenues of the enterprise
pledged to its payment and said city is not obligated to pay such principal, interest and premium except
from said gross revenues. The Revenue Fund is established under and pursuant to the Revenue Bond
Law of 1941, and under the provisions of said resolution authorizing the issuance of this bond the gross
revenues received from the enterprise are required to be deposited to the credit of said Revenue Fund
and used only for the purposes authorized by said resolution, including the payment of principal and
interest of the issue of bonds of which this is one.
By the terms of said Revenue Bond Law and by covenant expressed in said resolution, the city
is obligated to prescribe, revise and collect charges for the services, facilities and water of the water
system of the city such as to provide revenues sufficient to pay the interest on and principal of the bonds
as they become due and payable in addition to all other payments required for compliance with said
resolution and the necessary and reasonable maintenance and operation costs of the water system, is
prohibited from issuing bonds having any priority with respect to payment from the gross revenues
of the enterprise, and is subject to conditions with respect to any sale of said water system. In the manner
provided in the resolution, any or all of the obligations referred to in this paragraph and certain other
obligations mentioned in said resolution may be waived with the consent of the holders of 66% in
aggregate principal amount of the bonds then outstanding (exclusive of issuer-owned bonds).
This bond is callable and redeemable prior to maturity in accordance with the provisions for redemp-
tion endorsed hereon.
This bond is issued in fully registered form and is non-negotiable. This bond may be exchanged
for a like aggregate principal amount of bearer bonds of the same series, interest rate and maturity bearing
all unmatured coupons or for a like aggregate principal amount of fully registered bonds of other
authorized denominations of the same series, interest rate and maturity and bearer bonds bearing all
19
5/6/74
unmatured coupons may be exchanged for a like aggregate principal amount of fully registered bonds of
authorized denominations of the same series, interest rate and maturity.
This bond is transferable by the registered owner hereof, in person or by his attorney duly authorized
in writing, at the office of the Director of Finance of the City of Santa Ana, California, in said city,
but only in the manner provided in said resolution, and upon surrender of this bond. Upon such transfer
a new registered bond of authorized denomination for the same aggregate principal amount of the same~
series, interest rate and maturity will be issued to the transferee in exchange herefor.
The city may treat the registered owner hereof as the absolute owner hereof for all purposes, and the
city shall not be affected by any notice to the contrary.
It is hereby certified and recited that any and all acts, conditions and things required to exist, to
happen and to be performed precedent to and in the incurring of the indebtedness evidenced by this
bond and in the issuance of this bond exist, have happened, and have been performed in due time, form
and manner as required by the Constitution and laws of the State of California and the Charter of said
city and that this bond, together with all other indebtedness of the city pertaining to the aforesaid water
system, is within every debt and other limit prescribed by the Constitution and laws of the State of
California.
IN WITNESS WHEREOF, said City of Santa Aha has caused this bond to be signed by the Mayor
and Director of Finance of said city by their facsimile signatures, countersigned by the Clerk of the
Council of said city, and sealed with the corporate seal of said city, and the interest coupons hereto
attached to be signed by the Director of Finance by his facsimile signature, and has caused this bond to
be dated the first day of July, 1974.
COUNTERSIGNED:
Mayor of the City of Santa Ana, California
Director of Finance of the City of
Santa Ana, California
Clerk of the Council of the City of
Santa Ana, California
(SEAL)
[FORM OF ENDORSEMENT ON FULLY REGISTERED BONDS]
This registered bond, issued in fully registered form without coupons, is issued in lieu of or
in exchange for bearer bond(s) of this same series, interest rate and maturity of the denomination of
$5,000 and bearing the bearer bond numbers shown on the face hereof, each not contemporaneously
outstanding, aggregating the face value hereof; and such bearer bonds have been reserved and will be
issued in exchange for this bond in the manner, with the effect and under the terms and conditions
stated on the face of the bond and in the resolution referred to therein.
'l
2O
516174
[FORM OF ASSIGNMENT]
For value received ...................................................................................... hereby sells, assigns
and transfers unto ................................................................................................................................
the within-mentioned Bond and hereby irrevocably constitutes and appoints ......................................
............................................................................................................................................... attorney,
to transfer the same on the books of the Auditor with full power of substitution in the premises.
Dated: .......................................................................
NOTE: The signature to this Assignment must correspond with the name as written on the face of the
within bond in every particular, without alteration or enlargement or any change whatsoever.
Section 17. Proceedings Constitute Contract. The provisions of this resolution and of the resolu-
tions providing for the sale' of the bonds and awarding the bonds and fixing the interest ra~ or rates
thereon shall constitute a contract between the City and the bondholders and the provisions thereof
shall be enforceable by any bondholder for the equal benefit and protection of all bondholders similarly~':
situated by mandamus, accounting, mandatory injunction or any other suit, action or proceeding at law
or in equity that is now or may hereafter be authorized under the laws of the State of California in any
court of competent jurisdiction. Said contract is made under and is to be construed in accordance with
the laws of the State of California.
No remedy conferred hereby upon any bondholder is entitled to be exclusive of any other remedy~
but each such remedy is cumulative and in addition to every other remedy and may be exer(tsed without'
exhausting and without regard to any other remedy conferred by the Revenue Bond Law of 1941 or any
other law of the State of California. No waiver of any default or breach of duty or contract by any
bondholder shall affect any subsequent default or breach of duty or contract or shall impair any rights or
remedies on said subsequent default or breach. No delay or omission of any bondholder to exercise any
right or power accruing upon any default shall impair any such right or power or shall be construed as a
waiver of any such default or acquiescence therein. Every substantive right and every remedy conferred
upon the bondholders may be enforced and exercised as often as may be deemed expedient. In case any
suit, action or proceeding to enforce any right or exercise any remedy shall be brought or taken and the
bondholder shall prevail, said bondholder shall be entitled to receive from the Revenue Fund reimburse-
ment for reasonable costs, expenses, outlays and attorney's fees and should said suit, action or proceeding
be abandoned, or be determined adversely to the bondholders then, and in every such case, the City
and the bondholders shall be restored to their former positions, rights and remedies as if such suit, action '~
or proceeding had not been brought or taken.
After the issuance and delivery of the bonds this resolution shall be irrepealable, but shall be subject
to modification to the extent and in the manner provided in Section 15 of this resolution, but to no
greater extent and in no other manner.
Section 18. Future Contracts. Nothing herein contained shall be deemed to restrict or prohibit
the City from making contracts or creating bonded or other indebtedness payable from the general fund
of the City or from taxes or any source other than the revenues of the enterprise as defined herein, and
from and after the sale of the bonds the general fund of the City shall not include the revenues of the
enterprise and no contract or other obligation payable from the general fund of the City shall be payable
from the revenues of the enterprise, except as provided in Section 10(g) hereof.
21
Section 19. Severability. If any covenant, agreement or provision, or any portion thereof, con-
tained in this resolution, or the application thereof to any person or circumstance, is held to be
unconstitutional, invalid or unenforceable, the remainder of this resolution and the application of any
such covenant, agreement or provision, or portion thereof, to other persons or circumstances, shall be
deemed severable and shall not be affected thereby, and this resolution and the bonds issued pursu?nt
hereto shall remain valid and the bondholders shall retain all valid rights and benefits accorded to tl~am
under this resolution and the Constitution and laws of the State of California and the Charter of said City~
Section 20. Effective Date. This resolution shall take effect upon adoption.
6th - May , 19_7...4.
ADOPTED, SIGNED AND APPROVED this ........ nay of ........................
ATTEST:
Clerk of the Council of said City
(SEAL)
STATE OF CALIFORNIA )
COUNTY OF ORANGE )
CITY OF SANTA ANA )
SS :
I, FLORENCE I. MALONE, do hereby certify that I am the
Clerk of the Council of the City of Santa Ana; that the fore-i ~ i
going Resolution was introduced to said Council at its
regular meeting held on the 6th day of May ,
1974, and was at said meeting passed and adopted by the
following vote, to wit:
AYES, COUNCILMEN:
NOES, COUNCILMEN:
Griset, Yamamoto, Markel, Garthe,.
Patterson, Evans, Ward
None
ABSENT, COUNCILMEN: None
S ~ WITHEI~7~/~ORNEY
City of Santa Aha M F-4773