Loading...
HomeMy WebLinkAbout1980-075 CRA RESOLUTION NO. 80-75 A RESOLUTION OF THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF SANTA ANA AUTHORIZING THE ISSUANCE OF RESIDENTIAL MORTGAGE REVENUE BONDS FOR THE PURPOSE OF PURCHASING MORTGAGE LOANS TO PROVIDE FINANCING FOR A RESIDENTIAL CONSTRUCTION PROJECT RESOLVED, by the Community Redevelopment Agency of the City of Santa Ana, that: WHEREAS, the legislature of the State of California has authorized redevelopment agencies to purchase long-term, low-interest loans to finance new residential construction within redevelopment project areas in order to encourage investment within and to upgrade such redevelopment project areas and has authorized redevelopment agencies to issue bonds to finance the purchase of such loans; WHEREAS, the Commun ity Redevelopment Agency of the City of Santa Ana hereby determines to provide for the issuance of Residential Mortgage Revenue Bonds for the purpose of purchasing Mortgage Loans to provide Financing for Residential Construction within the City of Santa Ana Community Redevelopment Project Area in order to encourage investment within and to upgrade such Redevelopment Project Area; WHEREAS, all acts, conditions and things required by law to exist, happen and be performed precedent to and in connect i on wi th the issuance of the Bonds exist, have happened and have been performed in regular and due time, form and manner as required by law, and this Agency is now duly empowered to issue the Bonds; NOW, THEREFORE, IT IS ORDERED, as follows: . . , . I . t . . . , . I . t . ARTICLE I DEFINITIONS AND SECURITY 101. Definitions. The terms defined in this Section shall, for all purposes of this Resolution, have the following meanings, unless the context otherwise requires: Accountant's Certificate means an opinion signed by an Independent certified publ ic accountant (who may be the accountant or a member of the firm of accountants who regularly audits the books and accounts of the Agency) from time to time selected by the Agency, except that any Asset Coverage Test Certificate shall be signed by a nationally recognized firm of Certified Public Accountants. ߣl means Chapter 8 of Part 1, corrmencing with Section 33750 of Division 24 of the Health and Safety Code of the State of California, designated "Redevelopment Construction Loans", as the Act now exists and as it may be hereafter amended. Aqency means the Community Redevelopment Agency of the City of Santa Ana, City of Santa Ana, California, a public body, corporate and politic, duly organized and existing under and by virtue of the laws of the State of California; Asset Accumulation Fund means the Fund by that name established hereunder. Asset Coverage Tes t means that the sum of (i) the outstanding principal amount of Mortgage Loans and (ii) all amounts held in any Mortgage Loan Purchase Account, Princi pa 1 Account, Debt Service Reserve Fund, Mortgage Reserve Fund and Asset Accumulation Fund equals the sum of (x) the principal amount of Bonds then Outstanding plus (y) $230,000; provided, however, that the outstanding principal amount of any Mortgage Loan with respect to which any installment payment of principal and interest is then more than sixty (60) days delinquent shall not be included in (i) above and provided further, that Permitted Investments held in the Debt Service Reserve Fund shall be valued at the lower of cost or market. Asset Coveraqe Tes t Certificate means an Accountant's Certifi cate setting forth as of the date thereof or as of a date not more than 15 days prior to the date thereof (i) the outstanding principal amount of all Mortgage Loans (excluding the outstanding principal amount of any Mortgage Loan with respect to which any installment payment of principal and interest is IOOre than sixty (60) days delinquent), (ii) all Permitted Investments projected to be held in the Mortgage Loan Purchase Account, Principal Account, Debt Service Reserve Fund, Mortgage Reserve Fund, and Asset Accumulation Fund (valued in the case of amounts held in the Debt Service Reserve Fund at the lower of cost or market) and (iii) the then outstanding principal amount of Bonds and stating whether the Asset Coverage Test has been met and, if the Asset 2 Coverage Test has been met, setting forth the principal amount of Bonds projected to be redeemed from amounts projected to be held in the Asset Accumulation Fund and in the Debt Service Reserve Fund and Mortgage Reserve Fund by reason of a reduct ion in the Debt Service Reserve Requ irement and Mortgage Reserve Requirement on the next succeeding Interest Payment Date in order to maintain compl iance with the Asset Coverage Test and the amount whi ch may be made available to the Agency for any lawful purpose free of the lien of the Resolution, on the next succeeding Interest Payment Date. Au~horized Ne~sp~~ means a financial paper, or a newspaper of general circu ation in t e lty of Los Angeles, California, and The Daily Bond Buyer or other financial paper or newspaper circulated in the Borough of Manhattan, City and State of New York, each of which is published at least once a day for at least five (5) days (other than legal holidays) in each calendar week, and is printed in the English language, Authorized Officer means the Chairman, Executive Director or Secretary or any other officer or employee of the Agency authorized by resolution of the Agency to perform the act or sign the document in question. Bond or Bonds means the "Community Redevelopment Agency of the City of Santa Ana, Residential Mortgage Revenue Bonds, Issue of 1980", authorized by, and at any time outstanding pursuant to, this Resolution and bearing such further designation as is set forth in the Supplemental Resolution relating to such Bonds. hereunder. Bond Proceeds Fund means the Fund by that name which is established 80nd Register means the books kept hereunder by the Trustee for registration and transfer of the Bonds. 80nd Year means the twelve (12) month period commencing on June 2 of each year and ending on June 1 of the following year, or such other period as may be specified in a Supplemental Resolution. Bondholder or Holder of Bonds, or any similar term, means: (i) any person who shall be the holder of any Outstanding bearer Bond, or (ii) the registered owner or h is duly authorized attorney, trus tee, representat ive or assigns of any Outstanding Bond which shall at the 'time be registered so as to be payable other than to bearer. For the purpose of 80ndho1ders I voting rights or consent, Bonds owned by the Agency shall not be counted. Certificate of the Agency, Statement of the Agency, Written Request of the Agency and Written Consent of the Agency mean, respectively, a written certificate, statement, request or consent signed in the name of the Agency by an Author ized Offi cer for such purpose, with the seal of the Agency affi xed. Any such instrument and supporting opinions or representations, if any, may, but need not, be combined in a single instrument with any other instrument, opinion or representaion, and the two or more so combined shall be read and construed as a single instrument. 3 . . , . , . , . . ~ , . t . , , ",.-"...-_v -,'-,-"'" Certificate of Pledged Revenues means an Offic~r's Certificate showing as of any particular date: (1) For the current and each future Bond Year the arrount of scheduled or estimated amount of Revenues to be received in each such Bond Year and the Debt Service for each such Bond Year with respect to all Bonds to be Outstanding immediately after the issuance of the Certificate; (2) I n each such Bond Year, the di fference between (i) the Debt Service referred to in (1) above, and (ii) the Revenues referred to in (1) above; (3) That (i) such scheduled and estimated Revenues and any other revenues, investment income or funds reasonably estimated by the Agency to be available for the payment of such Debt Service referred to in (1) above are in each such Bond Year in excess of such Debt Service for each such Bond Year, and (ii) the remaining balance of such scheduled and estimated Revenues and other revenues, investment income or other funds available to pay budgeted or estimated Operating Expenses in each such Bond Year will be sufficient to pay budgeted or estimated Operating Expenses for each such Bond Year, the payment of which is not otherwise provided for; and, (4) If applicable, a schedule of Permitted Investments purchased or to be purchased by or on behalf of the Agency for investment of moneys in the Debt Service Reserve Fund. City means the City of Santa Ana, a nunicipal corporation duly organized and existing under and' by virtue of the Constitution and laws of the State of California, or any body, authority, agency or other entity which shall hereafter succeed to the powers, duties and functions of the City. Commitment Contract means the Commitment Contract (and Reservation of Funds) by and among the Agency, the Trustee, the Qualified Mortgage Lender and each developer of each Project whereby the Agency commits funds to purchase and the developer and Qualified Mortgage Lender agree to provide Mortgage Loans for purchase by the Trustee on behalf of the Agency. Condominium Project means the entire parcel of real property divided, or to be divided, pursuant to Section 1350, et seq., of the Civil Code of the State, into condominium Residences (as a condominium is defined in Section 783 of the Civil Code of the State), including all structures thereon. Costs of Issuance means items of expense payable or reimbursable directly or indirectly by the Agency and related to the authorization, sale, issuance and delivery of Bonds, which items of expense shall include but not be limited to, printing costs, costs of reproducing and binding documents, filing and recording fees, initial fees and charges of the Trustee and any Paying Agents, Bond discounts, legal fees and charges, bond counsel fees, special tax counsel fees, professional consultant's fees, costs of bond 4 ratings, fees and charges for execution, transportation and safekeeping of Bonds, costs of insurance, including the initial annual premium for Special Hazard Insurance, the setup and initial Residential Mortgage Financing Program expenses of the Agency, costs and expenses of refunding and other costs, charges and fees in connection with the foregoing. Coupon Bonds means those 80nds which are negotiable in form, payable to bearer w1th negotiable coupons. Debt Service means the sums obtained for any Bond Year after the computation 1S made, by totaling the following for each such Bond Year: (1) The Principal Installment payable in such Bond Year; and (2) The Interest Installments payable in such Bond Year on the aggregate principal amount of Bonds which would be Outstanding in such Bond Year if the Bonds Outstanding on the date of such computation were to mature or be redeemed in accordance with the maturity schedule or schedules for Outstanding Serial Bonds and the schedule or schedules of Sinking Fund Installments for Outstanding Term Bonds. At the time and for the purpose of making such computation, the amount of Term Bonds already retired in advance of the above mentioned schedule or schedules shall be deducted from the remaining amounts thereof in accordance with the reduction in Sinking Fund Installments made pursuant to Section 409 hereof. Debt Service Reserve Fund means the Fund by that name established hereunder. Debt Service Reserve Serial Bonds means $1,070,000 principal amount of Serial Bonds maturlng July 1, 20l2, Wh1Ch principal amount represents a principal amount of 80nds issued initially to partially fund the Debt Service Reserve Requirement. Debt Service Reserve Requirement means an amount which is not less than the Max1mum Annual Uebt Serv1ce scheduled to be paid on Bonds then outstanding. Defaulted Mortgage Loan means any Mortgage Loan described in an Officer's Certificate and stated to be in default in accordance with its terms or any Mortgage Loan not so described in an Officer's Certificate on which scheduled payments are sixty (60) days in arrears or in arrears for such other period which shall constitute a default as provided in the regulations of the Mortgage I nsurer or the terms of the Mortgage Insurance pol icy app 1 icab le to such Mortgage Loan. Depos itory means any bank or trus t company selected by the Agency and approved in writing by the Trustee as a depository of moneys and securities held under the provisions of the Resolution, and may include the Trustee and any Paying Agent. 5 . ~ , . f . , , . . . . . . Escrow Payments means all payments made in order to obtain or maintain Mortgage Insurance, including payments for any federal program intended to assist in providing insured Mortgage Loans, and Hazard Insurance and any payments required to be made with respect to Res idence and Mortgage Loans for taxes or other governmental charges or other similar charges payable by a Mortgagor customarily required and permitted by law to be escrowed. Federal Securities means direct and general obligations of the United States of Amenca. Financing means the lending of moneys or any other thing of value for the purpose of facilitating Residential Construction pursuant to the Act and includes the purchasing of Mortgage Loans made by Qualified Mortgage Lenders to purchasers of newly constructed Residences. Fiscal Year means any twelve (12) consecutive calendar months commencing with the first day of July and ending on the last day of the following June, Fully Registered 80nds means those 80nds which are payable to the registered owner, negotiable only by proper transfer of registration, Fund or Account means a Fund or Account established by or pursuant to this Resolution. Hazard Insurance means insurance issued by a person qual ified to issue such insurance in this State, which insurance shall be Dwelling Building Special Form all risk policy, or equivalent, with an inflation coverage endorsement and with an earthquake pol icy or endorsement (if commercially available) carried by the Mortgagor on a Residence to insure such Residence against all perils, except generally flood, mudslide, building collapse, war risk and nuclear risk. Hazard Insurance shall be carried by the owner of the Residence or, in the case of a Condominium Project, by the Association of Owners of the Condominium Project. Such Hazard Insurance shall be in an amount at least equal to ninety percent (90%) of the insurable value based upon replacement cost of such Residence or Condominium Project, and such earthquake policy or endorsement to be in an amount which is not less than one hundred percent (100%) of the unpaid principal balance of the Mortgagor's Mortgage Loan, subject to a deductible of five percent (5%) per occurrence. Independent when used with terms defining any professional, means any person or firm, respectively, appointed by the Agency in such capacity, and who, or each of whom, has a favorable reputation in the field in which his opinion or certificate will be given, and: 6 (1) Is in fact independent and not under domination of the Agency; and (2) Does not have any substantial indirect, with the Agency; and (3) Is not connected with the Agency as an officer or employee of the Agency, but who may be regularly retained to make reports to the Agency. interest, direct or Interest Account means the Accoun t by that name established hereunder. Interest Installment means, as of the date of calculation, the amount equal to unpaid interest then due, if any, plus an amount which will on the next succeeding Interest Payment Date be equal to the interest to become due on the Bonds on such next succeeding Interest Payment Date. Interest shall be calculated on the basis of a 3D-day month, 36D-day year for all purposes of this Resolution and any Supplemental Resolution. Interest Payment Date means January 1 and July 1 of any year in which the Bonds are Outstanding, commencing July 1,1981, or such other date as may be specified in a Supplemental Resolution. Interest Requ irement means the respect ive amounts of Revenues to be transferred by the Trustee from the Revenue Fund to the Interest Account monthly, on or before the first day of each calendar month commencing six (6) months prior to the next succeeding Interest Payment Date, such amount to be equal to one-sixth (1/6th) of the Interest Installment payable on the next succeeding Interest Payment Date after crediting to such Interest Installment any moneys in the Interest Account as of the time of the transfer of the initial one-sixth (1/6th) amount of such Interest Installment. I ssuance Expense Account means the Account by that name established hereunder. Issue Date means with respect to Bonds, the date of the coupon 80nds specified and determined in accordance with Articles II and III. Law means the Community Redevelopment Law (Part I, commencing with section 33000, of Division 24 of the Health and Safety Code of the State), as now enacted and as hereafter amended. Maximum Annual Debt Service means the largest amount of Debt Service for any Bond Year after the computation is made. Mortgage means a deed of trust or other instrument which constitutes a lien under applicable law of the State on real property improved by a Residence financed directly or indirectly from the proceeds of the 80nds 7 . . . . . . . . . . . . ,:,'~~"'-- and located within the Redevelopment Project Area, together with a promissory note or similar interest-bearing obligation, secured by such lien, Mortgage Insurance means insurance issued by a Mortgage Insurer insuring or guaranteeing, in whole or in part, principal and interest payments on a Mortgage Loan and, unless otherwise specifically permitted, means solely Private Mortgage Insurance. Mortgage Insurance, Insurance Proceeds the proceeds Mortgage of means Mortgage Insurer means any person licensed to insure ITIJrtgages in the State approved by the Agency and qualified to provide insurance on mortgages purchased by FNMA or FHLMC and, in addition, to qualify for participation in the Agency's Residential Mortgage Financing Program, 'a private ITIJrtgage insurance company must be recognized by Standard & Poor's Corporation as a company whose Private Mortgage Insurance may elevate the credit rating of securities secured by a pool of conventional single-family mortgages to a security rated AA. Mortgage Loan means indebtedness evidenced by a promissory note or similar interest bearing obligation made by a Mortgagor for the purpose of Financing a Residence and secured by a Mortgage, the payment of' which is insured by Mortgage Insurance. Mortgage Loan Purchase Account means the Account by that name which is established hereunder. Mortgage Loan Purchase Agreement means the agreement between the Agency, the Trustee and a Qualified Mortgage Lender relating to the originating, funding and purchasing of Mortgage Loans. Mortgage Reserve Fund means established hereunder. the fund by that name wh i ch is Mortgage Reserve Requirement means an alTlJunt equal to two percent (2%) of the aggregate unpaid principal amount of the outstanding Mortgage Loans held by the Trustee at the time of calculation but until July 1, 1983, or such earlier date as all Mortgage Loans intended to be purchased with ITIJneys in the Mortgage Loan Purchase Account have been purchased by the Trustee not less than $198,000 and, thereafter, not less than $99,000, or such other amount as may be specified in a Supplemental Resolution. Mortgagor means the obligor under a Mortgage Loan who qualifies as a Participating Party under the Act. Officer's Certificate means a certificate of the Agency signed by an Authorized Officer and filed with the Trustee. 8 Operating Expenses means the Agency's expenses of carrying out and admin istering the Res identia 1 Mortgage Financing Program, and shall incl ude, without 1 imiting the general ity of the foregoing: admin istrative expenses, legal, accounting and consultant's services and expenses, fees and expenses of the Trustee and any Paying Agent, payments to pension, retirement, health and hospitalization funds, insurance costs,. including the cost of Special Hazard Insurance, and any other expenses required or permitted to be paid by the Agency under the provisions of the Act or this Resolution or any lawful authority. Operating Fund means the Fund by that name established hereunder. Qpinion of Counsel means a written opinion of an attorney (who may be counsel for the Agency or its bond counsel). Any Opinion of Counsel may be based upon information which is in the possession of the Agency, upon a certificate of opinion of, or representation by, an officer or officers of the Agency, unless such Counsel knows, or in the exercise of reasonable care should know, that the certificate or opinion or representation with respect to the matters upon which the opinion may be based is erroneous. Outstandinq, when used with reference to Bonds and as of any particular date, means all Bonds theretofore and thereupon issued and delivered except: (i) any 80nd cancelled by the Trustee or any Paying Agent, at or before said date; (ii) any Bond for the payment or redemption of which either (a) money, equal to the principal amount or Redemption Price thereof, ., as the case may be, with interest to the date of maturity or Redemption Date, or (b) Federal Securities or moneys, or both, as described and required under the provisions Ì)f Article XIV, shall have theretofore been deposited with the Trustee in trust (whether upon or prior to the maturity or redemption date of such Bond) and, except in the case of a Bond to be paid at maturity, of which notice or redemption shall have been given or provided for to the satisfaction of the Trustee in accordance with Article IV; and (iii) any Bond in lieu of or in substitution for which another 80nd shall have been del ivered pursuant to this Resolution. Participatinq Party means any person, corporation, partnership, firm or other entity or group of entities requiring Financing for Residential Construction pursuant to the provisions of the Act. No elective officer of the State or any of its political subdivisions or employee of any redevelopment agency shall be eligible to be a Participating Party. Payi.nq Aqent means any paying agent appointed by the Agency pursuant to a Supplemental Resolution to provide a place of payment of Bonds and coupons. Permitted Encumbrances means those liens, restrictions, easements, encroachments or rights which are customarily waived by prudent lending in stituti on s and the exi s tence of wh i ch will not prevent the conveyance of good title to a Mortgaged Residence if a claim for Mortgage Insurance Benefits with respect thereto shall thereafter be made by the Trustee or a Servicer on beh a 1f of the Agen cy . 9 . . . . . . . . . . . . Permitted Investments means any of the following which at the time are legal investments for the Agency under the laws of the State, and to the extent provi ded by 1 aw, for the moneys hel d hereunder then proposed to be invested therein: (i) time or demand deposits in, or other banking arrangements with the Trustee, or any bank or trust company having capital and surpl us aggregating not less than $50,000,000 and authorized to accept depos its of pub l ic funds, wh i ch are secured at all times by bonds or other obligations which are authorized by law as security for public deposits, of a market value at least equal to the amount required by law; and/or (ii) Federal Securities, and/or repurchase agreements secured by Federal Securities. Prepayment means any amount rece ived or recovered wh i ch reduces or el iminates the principal aIOOunt of any Mortgage Loan other than scheduled amortization payments of the principal amount of any suc.h Mortgage Loan, including any Prepayment penalty, fee, premium or other such additional charge, less the amount retained by any Servicer of such Mortgage Loan as additional compensation on account of such Prepayment. hereunder. Principal Account means the Account by that name establ ished Principal Installment means, with respect to any particular Principal Installment Date, an amount equal to the sum of (i) the principal amount of Outstanding Serial Bonds payable on such Principal Installment Date as determined by the Supplemental Resolution, and (ii) the principal amount of a Sinking Fund Installment with respect to all Outstanding 1!,!rm Bonds payable on such Principal Installment Date or within such Bond Year as determined by the Supplemental Resolution. Principal Installment Date means July 1 of any year, commencing July 1, 1982, in whi ch Bonds are Outstanding, or such other date as may be specified in a Supplemental Resolution. Princi pa 1 Offi ce, when used with respect to the Trustee or any Paying Agent, means the principal or corporate trust or head or principal trust office of such Trustee or Paying Agent situated in the city in which such Trus tee or Paying Agent is described as being located. Principal Requirement means, as of the date of calculation and with respect to the Bonds Outstanding on said date of calculation, the amount of money, to be determined colTl11encing twelve (12) months prior to the next Principal Installment Date (which amount shall be revised accordingly if Outstanding 80nds shall thereafter be redeemed prior to the next Principal Installment Date), and which amount shall be equal to the unpaid Principal Installment or Installments then due, if any, plus the Principal Installment to become due on the Bonds on the next succeeding Principal Installment Date, and one-twelfth (1/12th) of the amount so determined shall be deposited monthly by the Trustee into the Principal Account. 10 Private Mortgage Insurance means Mortgage Insurance issued in accordance with the further requirements to be contained in a Supplemental Resolution. Proje<¿{ means the Residences being financed directly or indirectly with the procee s of the Bonds, namely the Santa Ana Intown Hous ing One Condominiums, such Condominium Project consisting of approximately 318 single-family residential units located on the northwest corner of Van Ness and First Streets. Qualified Mortgage lender means a mortgage lender, which is a Federal Housing Administration and Veteran's Administration approved mortgagee and a Federal Home loan Mortgage Corporation or Federal National Mortgage Association approved seller and servicer and which is authorized by the Agency to cb bus iness with the Agency and to aid in Financing pursuant to the Act on behalf of the Agency, for which service the Qualified Mortgage lender will be reasonably compensated. Such Qualified Mortgage lender shall be a State or National Bank, Federal or State-chartered savings and loan association, or trust company or mortgage banker which is capable of providing service or otherwise aiding in the Financing. authorized by the Act. As provided in the Act, nothing in any other provision of State law shall prevent such a lender from serving as a Qualified Mortgage lender pursuant to the Act. Redemption Date means the Interest Payment Date upon which Bonds which are called for redemption prior to maturity are to be presented for such 'redemption and for payment of the Redemption Price. Redemption Fund means the Fund by that name established hereunder. Redemption Price means, with respect to any Bond or portion thereof, the principal amount of such Bond or portion thereof, plus the applicable premium, if any, payable upon redemption thereof, as provided in any Supplemental Resolution. Redevelopment Project Area means the City of Santa Ana Community Redevelopment Project Area, the Redevelopment Plan for which was approved by the City Council pursuant to Ordinance No. 1173, adopted on July 2, 1973, as amended. Requisition means a written order directing the Trustee to pay money from one of the Funds or Accounts es tab 1 i shed by or pursuant to th is Resolution, duly executed by an Authorized Officer. Residence means real property improved with a residential structure and located within the Project. Res identia 1 Constructi on means the construction of new Res idences meeting the requirements of the Agency's redevelopment plan for the Redevelopment Project Area and of applicable local, State and Federal 11 . . . . . . . . . . . . '.,m"".,."" 'Þ"-" ...., standards for residential construction, including any higher standards adopted by the Agency for the Redevelopment Project Area or !ís part of the redevelopment program. Residential Mortgage Financing Program means any act or thing done by the Agency, the Trustee, and any Qualified Mortgage Lender and Servicer under the Resolution for the Purposes of encouraging investment within and upgrading of the Redevelopment Project Area in accordance with the redevelopment plan for the Redevelopment Project Area by providing permanent Financing for Residential Construction through the purchase of Mortgage Loans with the proceeds of Bonds. Resolution means this Resolution, as from time to time amended or supplemented by any Supplemental Resolution in accordance with the terms hereof. Revenues means all payments, proceeds, charges, rents and all interest and other income derived in cash by the Trustee or a Servicer by or for the account of the Agency from or related to the Residential Mortgage Financing Program, including without limiting the generality of the foregoing, scheduled amortization payments of prinicpal of and interest on Mortgage Loans and Prepayments, the proceeds of sale of Mortgage Loans, the proceeds of sale of Residences upon Foreclosure of Defaulted Mortgage Loans (net of amounts requ ired to be paid to Mortgagors or other owners, of Res i dences), Mortgage I nsurance Proceeds, the proceeds of Haz ard I nsurance and Speci a 1 Hazard Insurance (net of amounts appl ied to restore a mortgaged Residence), interest earned or income derived from Permitted Investments, and including moneys depos i ted in any Fund or Account estab 1 i shed for the benefit of the Bonds (including undisbursed Bond proceeds) or to provide for the principal for, and interest of the Bonds, but excluding Servicer's fees, Escrow Payments and any fee charged by the Agency for participation in the Residential Mortgage Financing Program, and including such other moneys as the Agency may solely in its discretion make avail able therefor. Rules' and Regulations means those rules and regulations adopted by the Agency in connection with its Residential Mortgage Financing Program. Secretary means the Secretary of the Agency. Sellers' Guide means the Sellers' Guide (being a supplement to the Mortgage Loan Purchase Agreement), approved as of July 1, 1980, as now or hereafter amended, containing further criteria for the origination of Mortgage Loans by aQua 1 i fi ed Mortgage Lender for sal e to the Trus tee on beh alf of the Agency. Serial Bonds means Bonds so des ignated in the Supplemental Resolution, which are stated to be payable by their terms in more than two (2) consecutive annual installments. 12 Servicer means any Qualified Mortgage Lender who shall, pursuant to a Servicing Agreement with the Agency and the Trustee, agree to service Mortgage loans. Servicers' Guide means the Servicers' Guide (being a supplement to the Servicing Agreement), approved as of July 1, 1980, as now or hereafter amended, containing further criteria for the servicing of Mortgage Loans by a Servicer. ~rvicinq A~ree~ent means a contractual agreement by and among the Agency, the Trustee and a ervicer for the servicing of Mortgage Loans by the Servicer. Sinkinq Fund Installment means, with respect to any particular Principal Installment Date, the amount of money required by or pursuant to the Supplemental Resolution to be paid by the Agency on such Principal Installment Date toward the retirement of Term Bonds either prior to their stated maturity or on the date of their stated maturity. Special Hazard Insurance means insurance, commonly referred to as "Difference in Conditions" insurance, which shall protect from losses on Residences caused by hazards, such as flood, mudslide and building collapse not covered by Hazard Insurance, and losses resulting from the application of a coinsurance clause in the Hazard Insurance policies. Such Special Hazard Insurance shall be carried by the Agency, with the premiums payable from the Dperating Fund (except that the initial annual premium shall be paid from the Issuance Expense Account), and shall insure each Residence and Condominium -,Project and sha'll be'in the greater of an amount at least equal to two percent (2%) of the original principal amount of all Mortgage Loans purchased by the Agency or twice the original .principal amount of the largest Mortgage Loan purchased by the Trustee on behalf of the Agency. State means the State of California, and, when requires, i~es any agency or instrumentality thereof. Statement of Representation and Warranty means the statement which the Qualified Mortgage Lender shall del iver to the Trustee prior to the disbursement of money to purchase Mortgage Loans, all in accordance with the provisions of the applicable Mortgage Loan Purchase Agreement. the context Supplemental Resolution means any resolution supplemental to or amendatory of this Resolution at any time in full force and effect which has been duly adopted by the Agency pursuant to the laws of the State, but only if and to the extent that such Supplemental Resolution is specifically authorized hereunder. Term Bonds means 80nds so des ignated in the Resolution, stated to be payable by their terms on one date. Supplemental 13 . . . . . . . . . . . . Trustee means Security Pacific National 8ank appointed to act as Trustee hereunder, and its successor or successors and any ottl'er bank or trust company or national banking association at any time substituted in its place pursuant to th is Resol ution. United States means the United States of America. Sometimes herein the words "Federal" or "Federal Government" are used as synonyms, and, when. the context requires, such terms include any agency or instrumentality thereof. Words of the masculine gender include the feminine and neuter genders, Words importing the singular number include the plural number and vice versa. Words importing persons shall include corporations associations, including public entities, as well as natural persons. and The terms "hereby", "hereof", "hereto", "herein", "hereunder", and any similar terms, as used in this Resolution, refer to this Resolution. 102. Security and Nature of Bonds. The Bonds shall be and are special obligations of the Agency and, subject to the right of the Agency to apply moneys as herein provided, are hereby secured by an irrevocable first lien and pledge of the Mortgage Loans and Revenues, and are payable as to principal; Redemption Price, if any, and interest from the Revenues of the Agency as herein defined. The Bonds are not a debt of the City, the State or any of its political subdivisions, and neither the City, the State, nor any of its political subdivisions is 1 iable thereon, nor in any event shall the Bonds be payable out of the funds or properties other than all or any part of the Revenues of the Agency as in this Resolution set forth. The Bonds do not constitute an indebtedness with in the mean ing of any constitutional or statutory debt limitation or restriction. Neither the members of the Agency nor any persons executing the Bonds shall be liable personally on the 80nds or subject to any personal liability or accountability by reason of the issuance thereof. The Bonds sh all be and are equally secured by such irrevocab le first lien and pledge of the Mortgage Loans and Revenues as herein provided, without priority for number, date of exécution, or date of delivery, except as expressly provided herein. The validity of the Bonds is not and shall not be dependent upon the performance of anyone of his obligation relative to the Residential Mortgage Financing Program. Nothing in this Resolution shall preclude: (i) the payment of the Bonds from the proceeds of refunding bonds, refunding notes or other such obligations issued pursuant to Article XIV or otherwise; or (ii) the payment of the Bonds from any legally available funds of the Agency. Nothing in this Resolution shall prevent the Agency from making, at its sole discretion, 14 advances of its OiIn funds hOilsoever derived to any of the uses and purposes mentioned in this Resolution. . . . . . . 15 . . . . . . ARTICLE II THE BONDS 201. Authorization. Bonds of the Agency are hereby authorized to be issued under and subject to the terms of this Resolution for the purpose of purchasing Mortgage Loans to provide Financing for Residential Construction as authorized by the Act, including the payment of Costs of Issuance. The Bonds are in the amount of $30,000,000 and shall be designated as "Corrmmity Redevelopment Agency of the City of Santa Ana, Residential Mortgage Revenue Bonds, Issue of 19BO"; provided, however, that the first such series of bonds shall be issued in the amount of $11,500,000 and shall be designated as "Comllllnity Redevelopment Agency of the City of Santa Ana, Residential Mortgage Revenue Bonds, Issue of 1980, Series A", The Bonds may be issued and sold in such amounts at such time as shall be established by the Agency, by a Supplemental Resolution and such Supplemental Resolution shall set forth the items hereinafter required and any other additional information herein , elsewhere authorized Or required, or necessary to identify more fully the Bonds. 202. Date of Bonds. Each Bond shall be dated as 'of, and bear interest from, its Issue Date, except as otherwise provided in Section 205 in the case of Fully Registered Bonds. 203. Interest Payment Dates. Interest Payment Dates. 204. prin~i~al I~stall~t Date. The Bonds shall mature from time to time on Principa nsta lment Dates not exceeding fifty (50) years from their respective Issue Dates as shall be specified in the Supplemental Resolution. Interest on the Bonds shall be payable on 205. Medium of Payment; Form and Date. (A) The Bonds shall be payable, with respect to interest, principal and Redemption Price, in lawful money of the United States of America which at the time of payment is legal tender for the payment of public and private debts. (B) The Bonds shall be issued in the form of coupon Bonds, or in the form of Fully Registered Bonds without coupons, or in both such forms, such forms to be specifically provided for in the Supplemental Resolution. (C) The Issue Date of the coupon 80nds shall be as of the date specified in the Supplemental Resolution. Coupon 80nds shall bear interest from the ir date, payable in accordance with, and upon surrender of, the appurtenant interest coupons as they severally mature. Fully Registered 80nds issued prior to the first Interest Payment Date thereof shall be dated as of the Issue Date specified in the Supplemental Resolution. Fully Registered Bonds issued on or subsequent to the first Interest Payment Date thereof shall be dated as of the Interest Payment Date immediately preceding the date of delivery thereof, unless such date of delivery shall be an Inte'rest Payment Date, in which case they shall be dated as of such date of del ivery; provided, however, that if, as shown by records of the Trustee, interest on Bonds shall 16 be in default, then Fully Registered Bonds issued in 1 ieu of Bonds surrendered for transfer or exchange shall be dated as of the date to which interest has been paid in full on the Bonds surrendered. 206. Legends. The Bonds may contain or have endorsed thereon such provisions, specifications and descriptive words, not inconsistent with the provisions of this Resolution, as may be necessary or desirable to comply with custom, or otherwise, as may be determined by the Agency prior to the del ivery thereof. 207. Execution and Authentication. (A) The Bonds shall be executed in the name of the Agency by the manual or facsimile signature of its Chairman or its Vice Chairman and its corporate seal (or a facsimile thereof) shall be thereunto affixed, imprinted, engraved, or otherwise reproduced, and attested by the manual or facsimile signature of its Secretary. In case anyone or more of the officers who shall have signed or sealed any of the 80nds shall cease to be such officer before the Bonds so signed and sealed shall have been actually del ivered, such Bonds may, nevertheless, be del ivered as herein provided, and may be issued as if the persons who signed or sealed su ch 80nds had not çeased to hold such offices. Any Bond may be signed and sealed on behalf of the Agency by such persons as at the actual time of the execut i on of such Bond shall be dul y authorized or hold the proper office in the Agency, although at the Issue Date of the Bonds such persons may not have been so authorized or have held such office. (B) The coupons attached to a coupon Bond shall be signed by the facs imil e signa ture of the Secretary of the Agency or in such other manner as may be required by 1 aw and the Agency may adopt and use for that purpose the facsimile signature of any person or persons who shall have been Secretary of the Agency at any time on or after the Issue Date of any such Bond, notwithstanding that such person may not have been such Secretary at the Issue Date of any such Bond or may have ceased to be such Secretary at the time when any such Bond shall be actually delivered. (C) Only Bonds authenticated by the endorsement thereon of a certificate substantially in the form to be set forth in the Supplemental Resolution and executed. by a duly authorized officer of the Trustee shall be val i d and become ob 1 i ga tory for any purpose under, be secured by, and be entitled to the benefits of, this Resolution; and every such certificate of the Trustee upon any Bond purporting to be secured hereby shall be conclusive evidence that the Bond so authenticated has been duly issued hereunder and that the Holder is entitled to the benefit of the trust hereby created. Before authenticating and del ivering any coupon Bond hereunder, the Trustee shall remove and cancel any coupons thereon then matured except coupons in default. 208. Interchangeability of Bonds. Coupon Bonds, upon surrender thereof at the Principal Office of the Trustee with all unmatured coupons attached 17 . . . . . . . . . . . . (together wi th any matured coupons in defaultapperta in ing thereto), may, at the option of the Holder thereof, be exchanged for an "equal aggregate principal amount of Fully Registered Bonds of the same maturity of any of the authorized denominations. Fully Registered Bonds, upon surrender thereof at the Principal Office of the Trustee with a written instrument of transfer satisfactory to the Trustee, duly executed by the registered owner or his attorney duly authorized in writing, may, at the option of the registered owner thereof, be exchanged for an equal aggregate principal amount of coupon Bonds of the same maturity or maturities with appropriate coupons attached. 209. Negotiability, Transfer and Registry. All the Bonds issued under this Resolution shall be negotiable subject to the provisions for registration and transfer contained in this Resolution and in the Bonds. So long as any of the Bonds remain Outstanding, the Agency shall make all necessary provisions to permit the exchange of Bonds at the Principal Office of the Trustee. 210. Transfer of Coupon Bonds. The Trustee and any Paying Agent may treat the bearer of any coupon as the absol ute owner thereof, whether such coupon shall be overdue or not, for the purpose of receiving payment thereof and for all other purposes whatsoever, and may treat the bearer of any coupon Bond as the absolute owner of such Bond, whether such Bond shall be overdue or not, for the purpose of 'receiving payment of the principal, or Redemption Price thereof and for' all other purposes whatsoever, and neither the Agency, nor the Trustee nor any Paying Agent shall be affected by any notice to the contrary. The Agency agrees to indemnify and save the Trustee and each Paying Agent harmless from and against any and all loss, cost, charge, expense, judgment or liability, including costs and expenses of litigation and attorneys' fees, incurred by the Trustee and each Paying Agent, acting in good faith and without gross negligence hereunder, in so treating such bearer. 211. Transfer of Fully Registered Bonds. (A) Each Fully Registered Bond shall be transferable only upon the Bond Register of the Trustee, which shall be kept for such purpose at the Principal Office of the Trustee, by the registered owner thereof in person or by his attorney duly authorized in writing, upon surrender thereof, together with a written instrument of transfer satisfactory to the Trustee duly executed by the registered owner or his duly authorized attorney. Upon the transfer of any such Fully Registered Bond, the Trustee shall issue in the name of the transferee a new Fully Registered Bond or Bonds or, at the option of the transferee, coupon Bonds, with appropriate coupons attached, of the same aggregate principal amount and maturity as the surrendered Bonds. (B) The Trustee may deem and treat the person in whose name any Outstanding Fully Registered 8ond shall be registered upon the Bond Register of the Trus tee as the absolute owner of such Bond, whether such Bond shall be overdue or not, for the purpose of receiving payment of, or on account of, the principal of, or Redemption Price, if any, and interest on such Bond and for 18 all other purposes, and all such payments so made to any such registered owner or upon his order shall be val id and effectual to satisfy and discharge the 1 iability upon such Bond to the extent of the sum or sums so paid, and neither the Agency nor the Trustee shall be affected by any notice to the contrary. The Agency agrees to indemnify and save the Trustee harmless from and against any and all loss, cost, charge, e'xpense, judgment or liability, including costs and expenses of litigation and attorneys' fees, incurred by it, acting in good faith and without gross negligence hereunder, in so treating such registered owner. 212. Regulations with Respect to Exchanges and Transfers. In all cases in which the privilege of exchanging bonds or transferring Fully Registered Bonds is exercised, the Agency shall execute and the Trustee shall authenticate and deliver Bonds in accordance with the provisions of this Resolution. All Fully Registered Bonds surrendered in any such exchanges or transfers shall forthwith be cancelled by the Trustee. All coupon Bonds and the coupons apperta in ing to such Bonds surrendered in any such exchanges or transfers shall be retained in the possession of the Trustee for the purpose of reissuance upon subsequent exchanges and the Trustee, prior to the reissuance of any such Bond shall detach therefrom and cancel all matured coupons. For every such exchange or transfer of Bonds, .whether temporary or definitive, the Trustee may make a charge sufficient to reimburse it or the Agency for any tax, fee or other governmental charge, other than one imposed by the Agency, required to be pai d with respect to such exchange or transfer, which sum or sums shall be paid by the person requesting such exchange or transfer as a condition precedent to the exercise of the privilege of making such exchange or transfer. Notwithstanding any other provision of this Resolution, the cost of preparing each new coupon Bond or Fully Registered Bond with respect to. the first exchange or transfer, and any other expenses of .-the Agency or the Trustee incurred in connection therewith (except any applicable tax, fee or other governmental charge, other than one imposed by the Agency) shall be paid by the Trustee on behalf of the Agency either from the Issuance Expense Account or from the Operating Fund. Notwithstanding any other provision of this Resolution, the cost of preparing each new coupon Bond or Fully Registered Bond upon the first exchange or transfer, and any other expenses of the Agency or the Trustee incurred in connection therewith (except any applicable tax, fee or other governmental charge), shall be paid by the Agency and, upon any subsequent exchange or transfer, by the Bondholder. The Trustee shall not be obliged to. make any such exchange or transfer of Bonds during the fifteen (15) days next preceding an Interest Payment Oate or, in the case of any proposed redemption of the 80nds, next preceding the date of the first publication of notice of such redemption. 213. Bond Register. The Trustee shall keep or cause to be kept at its Principal Office a Bond Register, which shall at all times be open to inspection by the Agency; and, upon presentation for such purpose, the Trustee shall, under such reasonable regulations as it may prescribe, register or transfer or cause to be registered or transferred, on the Bond Register, Bonds as hereinbefore provided. 19 . . . . . . . . . . . . Bonds 2i~~~ed Te:;:dO:rarlh ~~n~~~Ol ~i~~~nkjre:earf:iifra fry t~:s~:Ji~,Jti~~p~~~~~' f~~~ exchangeable for definitive Bonds when ready for delivery. The temporary Bonds may be printed, lithographed or typewritten, shall be of such denominations as may be determined by the Agency, shall be without coupons and may contain such reference to any of the provisions of this Resolution and any Supplemental Resolution as may be appropriate. Every temporary Bond shall be executed by the Agency and be issued by the Trustee upon the same conditions and in substantially the same manner as definitive Fully Registered Bonds. If the Agency issues temporary Bonds, it shall execute and furnish definitive Bonds without delay and, thereupon, the. temporary Bonds shall be surrendered for cancellation at the Principal Office of the Trustee and the Trustee shall deliver in exchange for such temporary Bonds an equal aggregate principal amount of either definitive coupon Bonds or dèfinitive Fully Registered Bonds without coupons, or both, of authorized denominations of the same interest rate or rates and maturity or maturities. Until so exchanged, the temporary Bonds shall be entitled to the same benefits under this Resolution as definitive Bonds del ivered pursuant hereto. 215. Bonds Mutilated, Lost, Destroyed or Stolen. If any Bond shall become rrutilated, the Agency, at the expense of the Bondholder, shall execute, and the Trus tee sh all thereupon del iver, a new Bond of 1 ike tenor and number (having annexed appropriate coupons corresponding to those, if any, annexed to the mutilated Bond) in exchange and substitution for the Bond so mutilated, but only upon surrender to the Trustee of the Bond so rrutilated together, in the case of coupon Bonds, with any unpaid coupons appertaining thereto. Every mutilated Bond so surrendered to the Trustee shall be cancelled by it and redelivered to, or upon the order of, the Agency. If any Bond shall be lost, destroyed or stolen, evidence of such loss, pestruction or theft may be submitted to the Agency and the Trustee, and, if such evidence be satisfactory to both and, if any indemnity satisfactory to them both shall be given, the Agency, at .the expense of the Bondholder, shall execute, and the Trustee shall thereupon deliver, a new Bond of like tenor and numbered as the Trustee shall determine (having annexed appropriate coupons corresponding to those, if any, annexed to the lost, destroyed or stolen Bond) in lieu of and in substitution for the Bond so lost, destroyed or stolen. The Trustee may require payment of an appropriate fee for each new Bond issued under this Section and of the expenses which may be incurred by the Agency and the Trustee in the premises. Any Bond or coupon issued under the provisions of this Section in lieu of any Bond or coupon mutilated or alleged to be lost, destroyed or stolen shall be equally and proportionately entitled to the benefits of this Resolution with all other 80nds and coupons secured by this Resolution. Neither the Agency nor the Trustee nor any Paying Agent shall be required to treat both the original Bond and any duplicate Bond as being Outstanding for the purpose of determining the principal amount of Bonds which may be issued hereunder or for the purpose of determining any percentage of Bonds Outstanding hereunder, but both the original and duplicate Bond shall be treated as one and the same. 20 ART! ClE I II PROCEEDINGS FOR THE ISSUANCE OF BONDS 301. Supplemental Resolution. Whenever the Agency shall determine to issue the Bonds, it shall adopt a Supplemental Resolution determining that the issuance of Bonds is necessary, as below stated, specifying the principal amount of such Bonds and prescribing the terms and conditions of such Bonds and the Funds and Accounts (if the same are not prescribed herein and are not inconsistent herewith) to be established for the security and payment therefor. 302. Provisions for Issuance of Bonds. The Supplemental Resolution shall contain a determination or ratification of a previous determination by the Agency that the principal amount of such Bonds is necessary for the purpose of purchasing Mortgage loans to provide Financing for the Residential Mortgage Financing Program for. the Projects, and shall, in addition to provisions elsewhere herein authorized or required, specify: issued; (1) The purpose or purposes for which such Bonds are being Bonds; (2) The authorized principal amount and denominations of such (3) The form or forms, title and designation of, and the manner of numbering and lettering, such Bonds; (4) The portion of the Bonds which are Term Bonds (if any) and the portion of the same which are Serial Bonds (if any); (5) The date or dates of maturity of such 80nds, and the Issue Date of such Bonds; (6) The amount and Principal Installment Date of each Principal Installment for Serial 80nds, if any, and for Term Bonds, if any, required by such Supplemental Resolution to be paid by the Agency for the retirement of any of such Bonds; (7) The Paying Agent or Paying Agents appointed by such Supplemental Resolution for such Bonds and place or places of payment; (8) The rate or rates of interest, or the manner of determining such rate or rates of interest, on such Bonds and the Interest Payment Dates of such Bonds; (9) The Redemption Prices applicable to such Bonds; (10) The manner in which such Bonds are to be sold and provisions for the sale thereof; 21 . . . . . . . . . . . . (11 ) to Article V; (12) The amount, if any, necessary for deposit in the Debt Serv i ce Reserve Fund; The designation of any Accounts to be established pursuant (13) The amount, if any, necessary for deposit in the Mortgage Reserve Fund; and (14) Any other provisions deemed advisable by the Agency, not in conflict with or in substitution for the provisions of this Resolution. suPPle;~~tal I~~~~~~~i:~~ ~~~ i~~~s o:a~nb~s. exer.:ut::d t::i~r a~~ho~:~:i;o~f b~h: Agency, and delivered by the Trustee to the purchasers thereof upon compliance by the Agency with the requirements, if any, set forth in such Supplemental Resolution and with the requirements of Section 304. 304. Conditions Precedent to Delivery of Bonds. The Trustee shall del iver to the purchasers thereof any Bonds authorized to be issued pursuant to this Resolution and a Supplemental Resolution, but only upon receipt of the following: (1) A copy of this Resolution and Supplemental Resolution, each certi fied by an Author ized Offi cer; (2) An Opinion of Counselor bond counsel, as the case may be, stating (i) that in the opinion of such counsel the Resolution and Supplemental Resolution have been duly adopted by the Agency and the Supplemental Resolution contains the provisions required by this Resolution; (ii) that the Resolution and the Supplemental Resolution are valid and binding upon the Agency and are enforceable in accordance with their terms; (iii) that the Resolution and the Supplemental Resolution create a valid pledge of that which the Resolution and the Supplemental Resolution purport to pledge, subject to the provisions of this Resolution and the Supplemental Resolution; provided, however, that the Opinion of Counsel may be qualified to the extent that the enforceability of the Resolution and the Supplemental Resolution may be limited by bankruptcy, insolvency and other laws affecting the rights of creditors generally; (iv) that the Trustee is duly authorized by the Agency to del iver Bonds as identified and described in the Supplemental Resolution; and (v) that the principal amount of Bonds to be issued and then Outstanding will not exceed any limit imposed by law; (3) An Officer's Certificate stating that the Agency is not, at the time of issuance of such Bonds, in default hereunder, directing the Trustee to del iver such Bonds as authorized, and'stating the amounts to be deposited in the various applicable Funds and Accounts; (4) A Certificate of Pledged Revenues, giving effect to the issuance of such Bonds, together with an Accountant's Certificate containing a 22 verification of the arithmetical computations and demonstrations set forth in the Certificate of Pledged Revenues; (5) Such further documents and moneys as are required by the provisions of Article X or the Supplemental Resolution; (6) An Officer's Certificate that, upon the issuance of. the proposed Bonds, the amount credited to the Debt Service Reserve Fund will be equal to or in excess of the Debt Service Reserve Requirement; and (7) An Officer's Certificate establishing or confirming the exceptions and conditions and the aggregate limit of liability of Special Hazard Insurance. 305, Additional Bonds. The Agency may not issue other series of bonds other than the Residential Mortgage Revenue Bonds, Issue of 1980, Series A, authorized herein, payable from Revenues or secured by the Mortgage Loans. 306. Validity of Bonds. The validity of the authorization and issuance of any of the Bonds shall not be dependent on or affected in any way by (a) any proceedings taken by the Agency or its agents in connection with purchasing Mortgage Loans to provide Financing for Residential Construction and otherwise carrying out the purpose and intent of the Residential Mortgage Financing Program and the Act, or (b) any contracts made by the Agency or its agents in connection therewith, or (c) the failure to complete any particular undertaking or any part thereof commenced pursuant to the Act. 23 . . . . . . . . . . . . ARTICLE IV REDEMPTION OF BONDS 401. Privilege of Redemption and Redemption Price. (A) The Bonds shall be subject to redemption prior to maturity at the times, at the Redemption Prices provided in a Supplemental Resolution, plus accrued interest to the Redemption Date, and upon the terms provided be1CYt1. (1) The Bonds are subject to special mandatory redemption in whole or in part at any time on and after one (1) year from the Issue Date of the Bonds from and to the extent that there are funds in the Mortgage Loan Purchase Account which are not used to purchase Mortgage Loans within a period which terminates one (1) year from the Issue Date of the Bonds or such other date as may be directed in the Supplemental Resolution. (2) The Bonds are subject to special mandatory redemption in whole or in part on any Interest Payment Date from and to the extent there are funds in the Asset Accumulation Fund to be applied to special mandatory redemption as provided in Section 607. (3) Term Bonds are- subject to mandatory redemption in part on each Principal Installment Date from Sinking Fund Installments in the arrounts and in the years specified in the Supplemental Resolution. (4) The Bonds may be subject to optional redemption at the direction of the Agency in whole but not in part on any Interest Payment Date as shall be provided in the Supplemental Resolution. (B) In the event the Bonds are to be redeemed in part, the Bonds shall be selected and redeemed on a reasonably proportionate basis from among all the then outstanding maturities of the Bonds, such basis to be determined and effectuated as nearly as practicable by the Trustee by selecting from each such maturity an arrount equal to the result obtained by multiplying the total amount of moneys to be available to redeem 8onds on the Redemption Date by the ratio which the principal arrount of all 80nds Outstanding in each such maturity (including Sinking Fund Installments as the maturities for Term Bonds) bears to the principal arrount of all Outstanding Bonds, provided that Bonds shall be redeemed only in multiples of five thousand dollars ($5,000). Any arrount in excess of the five thousand dollar ($5,000) multiple remaining after such redemption shall be applied by the Trustee to the next succeeding redemption of Bonds. (C) Except as provided in Section 401(A)(2), no Bonds shall be redeemed pursuant to this Article IV unless there shall be available for deposit in the Redemption Fund at the time of such redemption rroneys in an amount of not less than Twenty-Five Thousand Dollars ($25,000). 24 402. Optional Redemption at the Election or Oirection of the Agency. In the case of any redemption of Bonds at the election or direction of the Agency, the Agency shall give written notice to the Trustee of its election or direction so to redeem, of the Redemption Date, of the Bonds, and of the principal amounts of the 8onds of each maturity to be redeemed, subject to the limitations with respect thereto contained in this Article IV. Such notice shall be given not more than sixty (60) days nor less than thirty (30) days prior to the Redemption Date or such shorter period as shall be acceptable to the Trustee. In the event notice of redemption shall have been given as provided in Section 405, there shall be credited to the Redemption Fund prior to publication an amount which, in addition to other moneys, if any, available or to be available therefor shall be sufficient to redeem on the Redemption Date at the Redemption Price thereof, plus interest accrued and unpaid to the Redemption Date (which interest shall be transferred from the Interest Account to the Redemption Fund), all of the Bonds to be redeemed. 403. Mandatory Redemption Otherwise Than at Agency's Election or Direction. Whenever, by the terms of this Resolution, the Trustee is required or authorized to redeem Bonds otherwise than at the election or direction of the Agency, the Trustee shan select the Bonds to be redeemed, give the notice of redemption and pay from moneys available therefor the Redemption Price thereof, plus interest accrued and unpaid to the Redemption Date, to the Trustee, if appropriate, and to the appropriate Paying Agents in accordance with the terms of this Article IV. 404. Selection of Bonds of like Maturity for Redemption. If less than all of the Bonds maturing in any particular Bond Year are to be called for redempt ion, the specifi c Bonds or porti ons of Bon ds to be so redeemed shall be selected by the Trustee by lot; provided, however, that the portion of any Fully Registered Bond of a denomination larger than the minimum denomination of Bonds ($5,000) may be redeemed in the principal amount of such minimum denomination or any whole rrultiple thereof, and that for purposes of selection and redemption, any such Fully Registered Bond of a denomination larger than such minimum denomination shall be considered to be that number of separate Bonds of such minimum denomination which is obtained by dividing the principal amount of such Fully Registered Bond by such minimum denomination. 405. Notice of Redemption. When the Trustee shall receive notice pursuant to Section 402, from the Agency of its election or direction to redeem Bonds, or when redemption of Bonds is authorized or required pursuant to Section 403, the Trustee shall give notice, in the name of the Agency, of the redemption of such Bonds. Such notice shall specify: (i) the maturities of the Bonds to be redeemed, (ii) the Redemption Date, (iii) the Redemption Price, (iv) the place or places where the Redemption Price will be payable, (v) if less than all of the Bonds of any maturity are to be redeemed, the letters and numbers or other distinguishing marks of such Bonds so to be redeemed, and (vi) in the case of Fully Registered Bonds to be redeemed in part only, such notice shall also specify the Fully Registered Bond numbers and the respective portions of the principal amounts thereof to be redeemed. 25 . e' . . . . . . . . . . Such notice shall further state that on the,. Redemption Date there shall become due and payable upon each Bond to be redeemed the Redemption p'l'i ce thereof, or the Redemption Price of the specified portions of the principal thereof in the case of Fully Regis tered Bonds to be redeemed in part only, together wi th interest accrued to the Redemption Date, and that from and after such date interest thereon shall cease to accrue and be payable. Such notice shall be given (i) by publication at least once in an Authorized Newspaper, the first of such publications to be not more than sixty (60) days prior to the Redemption Date and the last of such publications to be not less than thirty (30) days prior to such date, (ii) by filing copies of such notice with any Paying Agents at the time of first publication, and (iii) by mailing, postage prepaid, not more than sixty (60) days nor less than thirty (30) days prior to the Redemption Date, copies thereof to the owners of any Registered Bonds whose Bonds, or portions thereof are to be redeemed, to the Holders of any coupon Bonds to be redeemed who have filed their names and addresses arid numbers of Bonds with the Trustee for such purpose and to the initial purchasers of the Bonds. Such mailings shall not be a condition precedent to such redemption and failure so to mail any such notice shall not affect the val idity of the proceedings for the redemption of the Bonds. If Fully Registered Bonds constitute all of the Bonds then to be redeemed, it shall be sufficient notice of any redemption of such Bonds in whole or in part that notice thereof stating the Redemption Date and the Redemption Price be mailed, postage prepaid, not more than sixty (60) days nor less than thirty (30) days prior to such Redemption Date to the registered owners of such Bonds. 406. Redemption Fund. Prior to the publication as above required, there shall be available for credit to the Redemption Fund moneys for the purpose and sufficient to redeem, on the Redemption Date, the Bonds designated in such notice of redemption. Said moneys must be set aside in the Redemption Fund solely for that purpose and shall be applied on or after the Redemption Date to the payment of the Bonds to be redeemed upon presentation and surrender of such Bonds together with (except as to Fully Registered Bonds) all interest coupons appertaining thereto maturing after the Redemption Date. 407. Partial Redemption of Fully Registered Bonds. Upon surrender of any Fully Registered Bond redeemed in part only, the Trustee shall execute and authenticate and del iver to the registered owner thereof, at the expense of the Agency, a new Bond or 80nds of authorized denomination equal in aggregate principal amount to the unredeemed portion of the Fully, Registered Bond surrendered and of the same interest 'rate or rates and same maturity or maturities, which new Bond or Bonds may be, at the option of the registered owner, either coupon 80nds with all unmatured coupons appertaining thereto or Fully Registered Bonds, or in part coupon Bonds and the balance in Fully Registered Bonds. The registered owner of any Fully Registered Bond may, in 1 ieu of surrendering such Bond for a new Bond, endorse on the reverse of such Fully Registered Bond a notation of such partial redemption, in such form as may be satisfactory to the Agency and the Trustee and under such conditions as the Trustee may approve. 26 408. Payment of Redeemed Bonds. Notice having been given as aforesaid, and the rroneys for the payment of the Redemption Price and interest to the Redemption Date having been credited to the Redemption Fund, the Bonds or portions thereof so called for redemption shall become due and payable on the Redemption Date at the Redemption Price, plus interest accrued and unpaid to the Redemption Date, and, upon presentation and surrender thereof at the office or offices specified in such notice, together with, in the case of coupon Bonds, all appurtenant coupons maturing subsequent to the Redemption Date, such Bonds or portions thereof shall be paid at the Redemption Price, plus interest accrued and unpaid to the Redemption Date not represented by coupons for matured interest installments. All interest installments represented by coupons which shall have matured on or prior to the Redemption Date shall continue to be payable to the bearers of such coupons from the appropriate Fund or Account other than the Redemption Fund. If, on the Redemption Date, moneys for the redemption of all the Bonds or portions thereof to be redeemed, together with interest to the Redemption Date, shall be held by the Trustee or any Paying Agent so as to be available therefor on said Redemption Date, and, if notice of redemption shall have been given as aforesaid, then, from and after the Redemption Date, interest on the Bonds or portions thereof so called for redemption shall cease to accrue and become payable, and the coupons appertaining thereto maturing subsequent to the Redemption Date shall be void. If said moneys shall not be so available on the Redemption Date, such Bonds or portions thereof shall continue to bear interest until paid at the same rates as they would have borne had they not been called for redemption. 409. Redeemed Bonds as Satisfaction of Sinking Fund Installments. Each annual Sinking Fund Installment WhlCh shall have been establ ished pursuant to the Supplemental Resolution for Term Bonds shall be reduced by the amount obtained by multiplying the principal amount of Term Bonds called for redemption otherwise than by reason of the application of Sinking Fund Installments, by the ratio which each such annual Sinking Fund Installment bears to the total of all annual Sinking Fund Installments established for all Term Bonds then Outstanding hereunder; provided that, to the extent that an annual Sinking Fund Installment shall be, by reason of any such reduction, in excess of a multiple of five thousand dollars ($5,000) at the time of application of such Annual Sinking Fund Installment to the call and redemption of Term Bonds, the excess shall be applied to the next succeeding annual Sinking Fund Installment and shall be then used to call and redeem Term Bonds. 27 . . . . . . . , . . . . ARTICLE V ESTABLISHMENT OF FUNDS AND APPLICATION OF BOND PROCEEDS SOl. General. (A) As provided in Section 102, the Revenues are pledged to the payment of the principal of, Redemption Price, if any, and interest on the Bonds in accordance with their terms and the provisions of this Resolution. (B) All such Revenues shall immediately be subject to the lien of the pledge without any physical delivery thereof or further act, and the lien of the pledge shall be valid and binding as against all parties having claims of any kind in tort, contract or otherwise against the Agency~ irrespective of whether such parties have noti ce thereof. 502. Funds and Accounts. (A) The Agency hereby establishes the following Funds and Accounts within said Funds: (1) Bond Proceeds Fund (a) I ss uan ce Expense Account - (b) Mortgage Loan Purchase Account - (c) Temporary Accounts - as necessary (2) Revenue Fund (a) Interest Account (b) Principal Account (3) Mortgage Reserve Fund (4) Debt Service Reserve Fund (5) Operating Fund (6) Asset Accumulation Fund (7) Redemption Fund (B) Each of the above designated Funds and Accounts shall be established and held by the Trustee for the benefit of the Bonds. 28 503. Disposition of Bond Proceeds and Other Funds. (A) The Trustee shall establish within the Bond Proceeds Fund: for the Bonds; (1) a separate Account designated "Issuance Expense Account" (2) a separate Account designated "Mortgage Loan Purchase Account" for the Bonds; and (3) such other Accounts as may be required pursuant to the provisions of the Supplemental Resolution. (B) Upon delivery of the Bonds, the Trustee shall deposit the proceeds thereof into the Bond Proceeds Fund and shall then transfer such proceeds (along with any other rroneys as provi ded herein or in the Supplemental Resolution) to the appropriate Fund or Account. (C) Upon delivery of the Bonds, the Trustee shall transfer to the Interest Account the amounts paid, if any, as accrued interest from the Issue Date to the date of del ivery thereof pl us such additional, if any, amounts as shall be specified in the Supplemental Resolution. (D) Upon delivery of the Bonds, the Trustee -shall transfer into the Issuance Expense Account the amount of moneys specified in an Officer's Certificate delivered to the Trustee prior to the delivery of the Bonds. "The Trustee shall from time to time payout moneys transferred to an I ssuance Expense Account, free and cl ear of any 1 ien or pledge created by this Resolution, for the purpose of paying in the manner herein authorized any Costs of Issuance of the Bonds for which such Account was established, upon receipt by the Trustee of a Requisition and Officer's Certificate stating that the amount to be paid from such Issuance Expense Account pursuant to such Requisition and Officer's Certificate is a proper charge thereon. Upon receipt of each such Requisition and Officer's Certificate, the Trustee shall del iver to or upon the order of the Agency a check or draft drawn upon such I ssuance Expense Account for the payment of each item. Upon receipt of an Officer's Certificate stating that all Costs of Issuance of the Bonds have been paid, the Trustee shall transfer any moneys remaining in sùch Issuance Expense Account to the Mortgage Loan Purchase Account established for such Bonds. (E) Upon the del ivery of the Bonds, there shall be transferred by the Trustee from the proceeds of such Bonds, or otherwise, to the Mortgage Reserve Fund, the sum of money, if any, specified in the Supplemental Resolution, together with such other moneys as shall be set forth therein. (F) Upon the del ivery of the Bonds, there shall be transferred by the Trustee from the proceeds of such Bonds, or otherwise, the sum of money, if any, specified in the Supplemental Resolution, necessary to establish the 29 . . . . . . '8 8 8 . . 8 ""F'.",,-,',,: amount in the Debt Service Reserve Fund at the Debt Service Reserve Requirement. . .,' (G) Upon the delivery of the Bonds, there shall be transferred by the Trustee (together with any other moneys as provided in a Supplemental Resolution) to the Operating Fund, the arrount, if any, specified in the Officer's Certificate delivered to the Trustee prior to the delivery of the Bonds. (H) Upon the delivery of the Bonds, there shall be transferred by the Trustee for deposit into the Mortgage Loan Purchase Account established for such Bonds the amount of Bond Proceeds remain ing after mak ing the above transfers. Except as may be otherwise provided in the Supplemental Resolution, amounts in the Mortgage Loan Purchase Account shall be expended and applied only to payments in the following order of priority: (1) For the purchase of Mortgage Loans in accor'CIance with Article VIII. Except as otherwise provided in this Resolution for transfers to other Funds and Accounts, moneys in the Mortgage Loan Purchase Account shall be used solely for the purchase of Mortgage Loans. Prior to the purchase of any Mortgage Loan, the Trustee shall review the documents delivered to it under Section 801(C) to determine if they conform on their face to the requirements set forth in Section B01(B) and in Section 8Ol(C). So long as the Trustee shall have no actual knowledge to the contrary, the Trus tee shall not be ob 1 i ga ted to determine whether (i) such Mortgage Loan conforms to any other criterion of eligibility, whether set forth in this Resolution, the Mortgage Loan Purchase Agreement, the Mortgage Loan Purchase Agreement Supplement, or elsewhere, (ii) the issuer of any policy of insurance is reputable or qualified to issue such policy, or (iii) any policy of Hazard Insurance is sufficient in form or arrount; (2) For deposit in the Principal Account, in such amounts, if any, as may be necessary to meet the Principal Installments of the Bonds, but only during the period which terminates three (3) years from the Issue Date of the Bonds or such other date as may be directed in the Supplemental Resolution; and (3) If, by March 1, 1982, the'Trustee has been unable to assure itself that it is able to invest moneys in the Mortgage Loan Purchase Account at an investment rate equal to or in excess of the then average coupon interest rate of the 80nds, such moneys shall be deposited no later than March 1, 1982, in the Redemption Fund to be applied as provided in Article IV. Subject to the provisions of the immediately succeeding subsection (4), so long as the Trustee is thereafter able to continue to invest moneys in the Mortgage Loan Purchase Account at the required interest rate, then moneys therein may be appl ied to the purchase of Mortgage Loans pursuant to the following subparagraph (4); 30 (4) The Agency reserves the right to determine that any interest payment date after March 1, 1982, rather than March 1, 1982, shall be the date upon which Bond proceeds in the Mortgage Loan Purchase Account shall be so transferred and applied to the redemption of the Bonds, such determination to be based upon (i) the fact that 85% of the original Bond proceeds deposited in the Mortgage Loan Purchase Account have been applied to the purchase of Mortgage Loans and (ii) the Agency has obtained a nationally recognized Bond or Tax Counsel's Opinion that the determination to extend the date will not cause the Bonds to be arbitrage bonds within the meaning of Section lO3(c) of the Internal Revenue Code of 1954, as amended, and the regulations promulgated thereunder. The Agency's determination as to whether or not it may so extend, and shall so extend, the date, shall be set forth in an Officer's Certificate and a Certificate of Pledged Revenues delivered to the Trustee on or before January 1, 1981, or such later date as shall be acceptable to the Trustee, setting forth a reinvestment interest rate for funds within the Mortgage Loan Purchase Account at least equal to the effective coupon interest rate of the Bonds. 31 . . . . . . . . . . . . ARTICLE VI APPLICATIONS OF REVENUES AND OTHER MONEYS 601. Revenue Fund. (A) Unless otherwise herein provided to the contrary, the Agency shall cause all Revenues (except for that portion paid as accrued interest on the purchase of Mortgage Loans, which shall be credited to the Mortgage Loan Purchase Account), when received, to be deposited promptly on or before the twentieth (20th) day of each IOOnth with the Trustee to the credit of the Revenue Fund. (B) Upon receipt of Revenues and on or before the first day of each month the Trustee shall payor deposit the Revenues received during such IOOnth into the Funds and Accounts as hereinafter set forth in this Article. 602. Interest Account. (A) Corrrnencing July 1, 1981, the Trustee shall IOOnthly deposit the Interest Requirement into the Interest Account from the amount of moneys in the Revenue Fund. Prior to July 1,1981, being the first Interest Payment Date, the Trustee shall transfer Revenues, when available and to the extent necessary, from the Revenue Fund to the Interest Fund to pay the interest payable on the first Interest Payment Date. (B) On each Interest Payment Date the Trustee shall pay from moneys depos i ted into the Interest Account any amounts requ ired by it and the Paying Agents for the payment of the Interest Installment due on such Interest Payment Date, and, on any Redemption Date the amounts required for the payment of accrued interest on Bonds then to be redeemed, unless the payment of such accrued interest shall be otherwise provided for, and such moneys shall be applied by the Trustee and the Paying Agents to such payments. 603. Principal Account. (A) The Principal Requirement shall then be deposited monthly by the Trustee into the Principal Account. (8) On each Principal Installment Date the Trustee shall pay from moneys deposited into the Principal Account such sums as it and the Paying Agents may need to pay the alOOunts required for the payment of principal due on such Principal Installment Date and such amounts shall be appl ied by the Trustee and Paying Agents to such payments. (C) As soon as practicable after the sixtieth (60th) day but not less than the thirtieth (30th) day preceding the Redemption Date applicable to any Sinking Fund Installment, the Trustee shall proceed to call for redemption pursuant to Article IV hereof on the Redemption Date, Bonds of the maturity or 32 maturities for wh ich such Sink ing Fund Installment was estab lished in such amount as shall be necessary to retire the principal amount specified for such Sinking Fund Installment. The Trustee shall pay from the Principal Account to the Redemption Fund and then from the Redemption Fund to Uself and the appropriate Paying Agents, the amount required for the Redemption Price of the Term Bonds so called for redemption, together with interest to be paid from moneys in the Interest Account, and such amount shall be app1 ied by the Trus tee and Paying Agents to such redemption. 604. Mortgage Reserve Fund. (A) The Trustee shall at any time and from time to time next deposit moneys monthly into the Mortgage Reserve Fund if required, until the amount on deposit therein is equal to the Mortgage Reserve Requirement. (B) Moneys in the Mortgage Reserve Fund shall be withdrawn and transferred by the Trustee for the following purposes in the following order or priority: (1) If at any time any interest on Bonds or principal or Redemption Price of Bonds or any Sinking Fund Installment has become due and payment thereof in full has not been made or provided for and moneys therefor are not available in the Interest Account, Principal Account or Asset AccuTIX./1ation Fund, as the case may be, on each Interest Payment Date and each Principal Installment Date for any of the 80nds Outstanding, the Trustee shall forthwith withdraw from the Mortgage Reserve Fund an amount not exceeding the amount required to provide for such payment in full and apply the amounts so withdrawn to such payments; and (2) At any time, to the Agency or to any person named in a Requisition filed with the Trustee any amount stated in an Officer's ,Certificate to be needed and not otherwise available for the payment of costs and expenses necessarily incurred, or to be incurred within one (1) year from the date of the Requisition, for the maintenance and preservation of the value of Residences and Mortgage Loans, including but not limited to, real property taxes, insurance, foreclosure fees, appraisal and legal fees, repairs, maintenance, utilities and improvements necessary for sale of a Residence. (C) Moneys in excess of the Mortgage Reserve Requirement, if any, shall be transferred by the Trustee to the Revenue Fund one (1) day after the end of each 80nd Year, beginning July 1, 1981, or such earlier date as Mortgage Loans to be purchased wi th the proceeds of the Bonds have been so purchased. (D) Any provision of this Resolution to the contrary notwithstanding, any amounts repaid to the Agency for advances made pursuant to subsection B of this Section shall, when received by the Agency, be paid by the Agency to the Trustee and be deposited in to the Mortgage Reserve Fund. 33 . . . . . . . . . . . . ..",....""",..,_. --, 605. Debt Service Reserve Fund. (A) Following the deposits set forth above. moneys shall be transferred monthly by the Trustee to the Debt Service Reserve Fund. if such deposits are necessary to restore the balance in such Fund to the Debt Service Reserve Requirement. (8) If at any time any interest on the 80nds or principal or Redemption Price of Bonds or any Sinking Fund Installment has become due and payment thereof in full has not been made or provided for and moneys therefor are not available in the Interest Account or the Principal Account and both the Asset Accumulation Fund and the Mortgage Reserve Fund have been exhausted. the Trustee shall forthwith withdraw from the Debt Service Reserve Fund an amount not exceeding the alOOunt required to provide for such payment in full and apply the amounts so withdrawn to such payment. (C) Any amount in the Debt Service Reserve Fund in excess of the Debt Service Reserve Requirement and which the Trustee is then unable to invest at an interest rate equal to or in excess of the then average coupon interest rate of the Bonds shall be transferred to the Revenue Fund at the end of each 80nd Year. 606. Operating Fund. On the first day of each calendar month commencing on the flrst day of the month next succeeding the purchase of the first Mortgage Loan by the Trustee. and after any IOOneys therein have been applied. the Trustee shall transfer from the Revenue Fund to the Operating Fund $500.00, plus an amount equal to one-twelfth (1/12th) ~f (i) the cost of the annual premium for Special Hazard Insurance (based on the previous year's annual premium or as otherwise specified to the Trustee in an Officer's Certificate) plus (ii) any amounts theretofore advanced by the Agency from the Operating Fund to pay premiums on Hazard Insurance pursuant to Section 907. until the amounts so advanced have been fully repaid; provided, however. that the Trustee shall not liquidate any Permitted Investments to finance such transfer, but shall postpone such transfer until other Pledged Revenues become available therefor. 607. Asset Accumulation Fund. (A) Following the deposits set forth above. moneys in the Revenue Fund shall be deposited monthly by the Trustee into the Asset Accumulation Fund. (8) Moneys deposited into the Asset Accumulation Fund shall be transferred by the Trustee in the following order of priority: (1) the following order: To make up any deficiency in the Funds and Accounts in FIRST: Interest Account SECOND: Principal Account 34 THIRD: Mortgage Reserve Fund FOURTH: Debt Service Reserve Fund FIFTH: Operating Fund (2) After the foregoing transfers and if the Asset Coverage Test has not been met then moneys in the Asset Accumulation Fund shall be applied to the special mandatory redemption of Bonds in accordance with Article IV. (3) The fact that the Asset Coverage Test has been met and, if applicable, continues to be met shall be established by an Asset Coverage Test Certificate del ivered by the Agency to the Trustee. In the absence of such an Asset Coverage Test Certificate having been so del ivered to the Trustee, the Trustee shall conclusively presume that the Asset Coverage Test has not been met. (4) Dn any I nteres t Payment Date after the Asset Coverage Test has initially been met, as established by an Asset Coverage Test Certificate, moneys in the Asset Accumulation Fund shall continue to be appl ied to such special mandatory redemption of Bonds to the extent necessary to enable the Agency to continue to meet the Asset Coverage Test. (5) On any Interest Payment Date after the Asset Coverage Test has been met, any amounts remaining in the Asset Accumulation Fund in excess of amounts required to be appl ied to maintain the Asset Coverage Test shall, at the option of the Agency, be either applied to the special mandatory redemption of Bonds pursuant to the provisions' of Article IV or shall be transferred by the Trustee to the Agency free and cl ear of the 1 ien of th is Resolution for use by the Agency for any 1 awful purpose. At any time and from time to time, the amount of any such excess shall be established by an Asset Coverage Test Certificate delivered to the Trus,tee, together with an Officer's Certificate directing the application of any such excess. (6) Subject to Section 401 (c), moneys in the Asset AccUlrulation Fund shall be disbursed by the Trustee on every Interest Payment Date, commencing July 1, 19B1, all in accordance with the foregoing provis ions. 60B. Sale of Mortgage Loans. On or after July 1, 1990, or such other date as may be specified in a Supplemental Resolution, the Agency may, at its option, direct the Trustee to redeem the Bonds in whole, but not in part, pursuant to optional redemption and to apply moneys in the Debt Service Reserve Fund, the Mortgage Reserve Fund and such other funds and accounts held by the Trustee and available therefor, which together with any other money held by the Trustee available therefor (including moneys received by the Trustee from the sale of Mortgage Loans) will be sufficient to pay the principal or Redemption Price of and interest on the Bonds being paid or redeemed. 35 . . . . . . I . . . . . . "P "~--,"."~,". ARTICLE Vn . SECURITY FOR DEPOSITS AND INVESTMENT OF FUNDS 701. Moneys Deposited to be Held in Trust. All moneys held by the Trustee and any Paying Agent under the provisions of this Resolution shall be held in trust and applied only in accordance with the provisions of this Resolution and the Supplemental Resolution and shall not be subject to 1 ien or attachment by any creditor of the Agency other than the 1 ien described in Section 906(0) and the lien of the Holders of the Bonds issued pursuant to and secured by this Resolution and the Supplemental Resolution. 702. Security for Deposits. All moneys held hereunder by the Trustee and any Paying Agent shall be held in time or demand deposits and shall be continuously and fully secured at all times by such obligations and to the fullest extent as shall be required by law for public deposits, except to the extent that moneys are invested as hereinafter provided. 703. Investment of Funds and Accounts. (A) Moneys held in any Fund or Account created hereunder shall be invested with reasonable diligence by the Trustee in Permitted Investments to the extent permitted by law for public funds (or held or deposited pursuant to Section 702 hereof) in such a manner as, in the opinion of the Trustee, will maximize investment returns; provided, however, that the Agency may direct the Trustee as to specific Permitted Investments by an Officer's Certificate, subject to any limitations contained in this Resolution or the Supplemental Resolution. The maturity or redemption date of such deposits or Permitted Investments shall coincide as nearly as practicable with the time at which moneys in the Funds or Accounts will be required for the purposes set forth in this Resolution or in the Supplemental Resolution. (B) Permitted Investments, purchased as an investment of moneys in any Fund or Account held by the Trustee, shall be deemed at all times to be a part of such Fund or Account unti 1 such amount is transferred in accordance with this Resolution or the Supplemental Resolution. (C) In computing the amount in any Fund or Account held by the Trustee, obligations purchased as an investment of moneys therein shall be valued at the actual cost thereof, provided that the Debt Service Reserve Fund shall be valued at the lower of the cost or market price thereof on the date of computation, exclusive of accrued interest, for purposes of the Asset Coverage Test. (D) The Trustee shall sell at the best pric~ reasonably obtainable, or present for redemption, any Permitted InvestmentS whenever it shall be necessary in order to provide moneys to meet any payment or transfer from the Fund or Account for whi ch such inves tment was made. 36 704. Debt Service Reserve Fund Investment Restrictions, Moneys in the Debt Service Reserve Fund shall be invested in Permitted Investments maturing up to but not beyond the year of final maturity of the Bonds. 705. Mort a e Mortgage Reserve un Permitted Investments of inves tment. 706. Transfer to Revenue Fund. Unless otherwise herein or in the Supplemental Resolution provided to the contrary, the interest earned or other income derived from the investment or deposit of moneys in any Fund or Account held by the Trustee shall be transferred by the Trustee upon receipt thereof to the Revenue Fun d. Investments of moneys in the Mortgage Loan Purchase Account shall be scheduled as set forth in an Officer's Certificate so that the investments will mature in accordance with the projected schedule of need of such moneys. Income or interest earned by, or increment to, moneys in the Mortgage Loan Purchase Account shall from time to time as received be transferred by the Trus tee to the Revenue Fund. 37 . . . . . . . . . . . . ARTICLE VIII PROGRAM COVENANTS AND OTHER COVENANTS OF THE AGENCY 801. Program Covenants. (A) The Agency shall from time to time, with all practical dispatch and in a sound and economical manner consistent in all respects with the Act and with the provis ions of th is Resol ution and the Supplemental Resolution, use and apply the proceeds of the Bonds which are depos ited in a Mortgage Loan Purchase Account to purchase Mortgage Loans to carry out the Residential Mortgage Financing Program, and shall do all such acts and things necessary to receive and collect or cause to be received and collected Revenues, as may be consistent with sound banking practices and principles and shall diligently enforce, and take all steps, actions and proceedings reasonably necessary in the judgment of the Agency for the enforcement of all terms, covenants and conditions of Mortgage Loans. (B) No amounts which have been deposited in a Mortgage Loan Purchase Account shall be used to purchase any Mortgage Loan unless either: (i)(a) the effective yield to the Agency on the Mortgage Loan to be so purchased equals or exceeds the interest rate for Mortgage Loans as set forth in the Mortgage Loan Purchase Agreement, and (b) the Mortgage Loan to be so purchased shall have a final maturity date no later than the final Principal Installment Date of the Bonds issued to establish the Mortgage Loan Purchase Account from wh ich the Mortgage Loan is to be purchased, or (i i) there is del ivered to the Trus tee an appropriate Certi fi cate of Pledged Revenues, together with the Requisition for the purchase of such a Mortgage Loan. (C) The Trustee is hereby authorized and directed to disburse funds to purchase Mortgage Loans: (1) Upon receipt of a Statement of Representation and Warranty from the Qualified Mortgage Lender that all documents relating to the Mortgage Loan, as described in subsections (D) and (E) of this Section B01, meet the requirements of this Resolution, that the applicable escrow is ready to close and, as evidenced by such Statement, the Mortgage Loan meets the requirements of subsection (B) of this Section 801. The Qualified Mortgage Lender shall include in such Statement the representations and warranties required by the Mortgage Loan Purchase Agreement and the Qualified Mortgage Lender shall restate its agreement to repurchase such Mortgage Loan as provided therein. The Qualified Mortgage Lender shall also represent that the title company is prepared to issue its Mortgagee title insurance policy. Finally, the Qualified Mortgage Lender shall request the Trustee to disburse funds to the title company to purchase the Mortgage Loan upon receipt by the Trustee of the appropriate Requisition of the Agency and upon request for funds by the escrow company, all as required by the Mortgage Loan Purchase Agreement. 38 (2) Upon receipt of the Statement of Representation and Warranty described in subsection (1) above, the Trustee shall review such Statement and verify that such Statement conforms with the requirements of subsection (1). Upon completion of such verification to the satisfaction of the Trustee and if the Trustee shall have received the appropriate Requisition from the Agency and shall have received the appropriate request for funds from the escrCIN company, the Trustee shall disburse funds to the title company to purchase the applicable Mortgage Loan. It is understood that, upon the last to occur of the requirements contained in the preceding sentence, it will require the Trustee three (3) business days to complete the transfer of funds to the title company. (3) The applicable Mortgage Loan Purchase Agreement requires that upon closing of the escrow and disbursement of funds by the escrow company and del ivery by the escrow company of the documents described in subsections (1) and (2), to the Qualified Mortgage Lender, the Qualified Mortgage Lender shall irrwnediately deliver such documents to the Trustee. Upon receipt of such documents by the Trustee, the Trustee shall review such documents and verify that such documents conform on their face to the requirements set forth in subsections (B), (0) and (E) of this Section 801. The Trustee shall have ten (10) days within which to complete such verification to the satisfaction of the Trustee. If the Trustee shall not be satisfied that all such requirements have been met (and the defect is not corrected by the Qualified Mortgage Lender), then the Qualified Mortgage Lender shall repurchase such Mortgage Loan as provided in the Mortgage Loan Purchase Agreement. (0) Subject to the authorization and direction contained in subsection (C) of this Section 801, prior to the purchase of the first Mortgage Loan secured by a Residence located within a particular Condominium Project, the Trustee shall have received a copy of the declaration of covenants, conditions and restrictions applicable to such Condominium Project whereby the homeowner's association is obligated to obtain and continue in effect a policy of Hazard Insurance, together with a copy of policy of Hazard Insurance insuring the Condominium Project containing a provision that said policy shall not be canceled or terminated, or permitted to expire by its terms, without ten (10) days prior written notice, the Trustee, the Agency and the Servicer shall take such action as deemed appropriate to cause such policy of Hazard Insurance not to be canceled, terminated or permitted to expire and the Trustee shall" to the extent authorized by Requisition of the Agency, cause any premiums to be advanced and pa i d by the Agency with moneys in the Operating Fund, and, if there shall be no available moneys in the Operating Fund, then with moneys in the Mortgage Reserve Fund. Subject to the authorization and direction contained in subsection (C) of this Section 801, prior to the purchase of the first Mortgage Loan secured by a Residence located within a particular Condominium Project, the Trustee shall have received with respect to such Condominium Project: 39 . . . . . . . . . . . . "fI"'-""'o"'I"';;', (1) An attorney's opinion to .,be. ,addressed to the Agency stating that such Condomin ium Project is in compl iance with Federal Helme Loan Mortgage Corporation ("FHLMC") requirements regarding covenants, conditions and restrictions for condominiums, the form of such opinion to be substantially as attached to the Mortgage Loan Purchase Agreement; (2) A copy of a final Subdivision Report for the Condominium Project issued by the Department of Real Estate of the State of California; and, prior to funding a Mortgage Loan, the Trustee shall have received with respect to the Residence securing repayment of such Mortgage Loan: . (a) A certificate of occupancy or its equivalent issued by the City verifying that the Condominium Project within which such Residence is located has been finally inspected by the City and is released for occupancy; and (b) A certificate from the Developer of the Condominium Project setting forth the then replacement cost of construction of the Residence. (E) With respect to the purchase of Mortgage Loans, upon receipt by the Trustee of all documentation required to be delivered by the applicable Mortgage Loan Purchase Agreement, including: (1) A Requisition identifying (i) the Mortgagor, the Mortgage and the Residence subject to the lien of the Mortgage, (ii) the amount of such payment, (iii) the Qualified Mortgage Lender to whom payment'is to be made for the purchase of the Mortgage Loan pursuant to a Mortgage Loan Purchase Agreement, (iv) statement of compliance with the covenants contained in subsection (N) of this Section 801, (v) the estimated date on which such payment is to be made, which date shall be the next to the last business day of the week; and (vi) the date on which such payment is to be made; (2) The original promissory note secured by the lien of the Mortgage identified in the Requis ition, duly executed by the Mortgagor and endorsed by the Qualified Mortgage Lender to the Trustee, on behalf of the Agency, together with a copy of such Mortgage, and a duly acknowledged assignment of such Mortgage executed by the Qualified Mortgage Lender to the Trustee, on behalf of the Agency, such Mortgage and assignment to be either (i) duly certified, as true and correct copi es and sett ing forth the respective recording dates and instrument numbers, by the office of the County Recorder of the County of Orange, California, or by the escrow company handling the sales escrow for the applicable Residence, or (ii) accompanied by irrevocable instructions of the Qualified Mortgage Lender authorizing the Trustee so to record the assignment upon payment to the Qualified Mortgage Lender of the purchase price of the Mortgage Loan; (3) A Mortgage Insurance certificate duly endorsed and in the usual form stating that the Mortgage Loan is, or a firm coTTl11itment in the usual form assuring that payment of the Mortgage Loan will be, insured or guaranteed, in whole or in part, by a Mortgage Insurer and naming the Trustee as beneficiary of such Mortgage Insurance; 40 (4) A current American Land Title Association Mortgage title insurance pol icy, contain ing unmodified endorsements 100, and 116 (with respect to single-family residences) or 116.2 (with respect to condominium units), duly assigned to the Trustee by the terms of such policy or by endorsement of the title insurance company, or the irrevocable agreement of the title company to so endorse such assignment for the benefit of the Trustee, on behalf of the Agency, insuring title to the mortgaged Residence as being vested in the Mortgagor and insuring that the lien of the Mortgage is subject only to Permitted Encumbrances, and issued in the face alIDunt of the Mortgage Loan by a title insurance company approved by FHLMC and qualified to do business in this State, or, in lieu of the foregoing described policy of Mortgage title insurance, a preliminary title report and irrevocable instructions from the Qualified Mortgage Lender to the escrow company not to close the Mortgage Loan with the Mortgagor until such title insurance company is able to and will issue the foregoing described policy of Mortgage title insurance, duly assigned by the terms of such policy or by endorsement of the title insurance company; the Qual ified Mortgage Lender shall instruct the escrow company to cause the original Mortgage Title insurance policy to be delivered, when available, timely to the Trustee; and (5) A copy of the Hazard Insurance policy, or an appropriate endorsement or binder of such Hazard Insurance, on the Residence subject to the 1 ien of the Mortgage, insuring the Trustee, the Agency and any other parties in interest as their interests may appear; - the Trustee shall pay and disburse from such Mortgage Loan Purchase Account on such date to the Qual ified Mortgage Lender identified in the Requis ition the amount set forth in the Requisition. The Agency shall keep and maintain accurate records of all such Mortgage Loan purchases, including therein a copy of all such Requisitions, a description of the Mortgage Loans purchased pursuant thereto, the purchase pri ce of such Mortgage Loans and the Qual ified Mortgage Lenders from whom such Mortgage Loans were purchased. The Trustee shall give notice of any such purchase of any Mortgage Loan to the Mortgage Insurer if required by applicable regulations of the Mortgage Insurer or by the terms of the Mortgage Insurance pol icy, and to such other persons as may be entitled to such noti ce by 1 aw or by the terms of the Mortgage, within thirty (30) days of the purchase. (F) No Mortgage Loan shall be purchased under this Resolution unless it shall have been finally endorsed for Mortgage Insurance or a firm commitment for such endorsement shall have been obtained and such Mortgage Loan and Mortgage Insurance shall further comply with any limitations specified in the Supplemental Resolution. (G) The Agency shall require Qual ified Mortgage Lenders and Servicers to comply with all rules and regulations of the Mortgage Insurer issuing Mortgage Insurance for the applicable Mortgage Loan and shall further 41 . . . . . . . . . . . . "",'N""',""" require that Qualified Mortgage Lenders and Servicers hold ,the Agency, the Trustee and the Bondholders harmless for non-compliance with' such rules and regulations. (H) All servicing Agreements entered into pursuant to this Resolution shall provide that: (1) In the event that a Mortgage Loan becomes a Defaulted, Mortgage Loan, the Servicer shall certify to the Trustee the identification number of such Defaulted Mortgage Loan and the principal aroount then due on the Mortgage Loan. (2) The Trustee shall, upon receipt of an Officer 's Certificate so directing, execute and deliver an assignment for collection to the'Servicer of the Defaulted Mortgage Loan, duly recorded ~n the office Of the County Recorder of the County of Orange, together with the original promissory note of the Mortgagor, the deed of trust or other lien instrument evidencing the 1 ien of the Mortgage and the Mortgage Insurance certificate. The Servicer, at the direction of the Agency, and upon receipt of said documents from the Trustee, shall diligently take all steps, actions and proceedings necessary to assign such Defaulted Mortgage Loan to the Mortgage Insurer thereof or, if such assignment is not permitted, to foreclose the lien of the Mortgage, and, upon such assignment or foreclosure, collect the insurance or guaranty applicable to the Defaulted Mortgage Loan. The Servicer may, with the approval of the Agency and the Trustee, grant forbearance as appropriate under applicable rules and regulations of the Mortgage Insurer. (3) If a Servicer disposes of a Defaulted Mortgage Loan or a Mortgaged Residence securing such Defaulted Mortgage Loan, the proceeds paid to the Trustee upon such disposal shall be not less than total aroount of the then unpaid principal balance, together with all delinquent interest accrued thereon. (4) If the Mortgage Insurer shall pay the insurance or guaranty applicable to the Defaulted Mortgage Loan, but shall determine not to accept an assignment of the Mortgage Loan, then the Servicer shall liquidate such Mortgage Loan (or, if applicable, the mortgaged Residence) at the best price reasonably obtainable and shall deliver the proceeds of liquidation (less the Servicer's necessary expenses) to the Trustee. (5) The Servicer shall regularly bill for and collect all payments due on the Mortgage Loan and shall deposit all Escrow Payments in an escrow payment fund, retain its servicing fees, and pay the balance of such payments to the Trustee for deposit in the Revenue Fund. (6) All Servicing Agreements shall require the Servicer to del iver the proceeds of any Prepayment, any Prepayment penalties, the proceeds of Mortgage Insurance or foreclosure or sale of the roortgaged Residence or liquidation of a Mortgage Loan or the net proceeds of any Hazard Insurance or Special Hazard Insurance, to the extent such proceeds are in excess of 42 $2,500.00, promptly on the next business day following the date of receipt to the Trustee, together with a written statement setting forth the exact amount of any such proceeds to be credited to the pr inci pa 1 amount of a Mortgage Loan, prov i ded that, if the Servi cer or its parent does not have a Standard & Poor's Corporation rating of "BBB" or better, then the Servicer shall be required to deposit all Revenues daily with the Trustee, unless the Servicer shall agree to deposit all Revenues daily into an account insured to the extent of $100,000 by the Federal Deposit Insurance Corporation or by the Federal Savings and Loan Insurance Corporation and the Servicer shall further agree that at no time shall Revenues in such account exceed $100,000. (I) The proceeds of Mortgage Insuran ce or foreclosure or sale of the mortgaged Residence or liquidation of a Mortgage Loan or the net proceeds of Hazard Insurance or Special Hazard Insurance paid to the Trustee shall be deposited in the Revenue Fund, except that for the period terminating three (3) years from the Issue Date of the 80nds, such proceeds may be deposited in the Mortgage Loan Purchase Account established for the Bonds, (J) Upon receipt of an Officer's Certificate from the Agency requesting such action, the Trustee, on behalf of the Agency, may at any time sell, assign or otherwise dispose of one or more Mortgage Loans: (1) To provide funds to purchase one or more Mortgage Loans which will provide an increased return to the Agency, provided that no such sale, assignment or disposal shall be made without the Agency first obtaining an Opinion of Counsel to the effect that any such increased return will not cause the Bonds to be arbitrage bonds pursuant to Section 103(c) of the Internal Revenue Code of 1954, as arœnded; and, provided further, that the Agency sh all first del iver an appropr ia te Certifi ca te of Pledged Revenues to the Trustee; and (2) If, after giving effect thereto, funds available in all Funds and Accounts (other than the Operating Fund and the Redemption Fund) will permit the defeasance of all Outstanding Bonds pursuant to Article XIV, as demonstrated by an Accountant's Certificate del ivered to the Trustee prior to any such sale, assignrœnt or disposition. (K) As of every April 1 and October 1, commencing October 1, 1980, or such later dates as shall be acceptable to the Trustee, the Agency will furnish the Trustee with an Asset Coverage Test Certificate. The Trustee shall be entitled to rely on Asset Coverage Test Certificates for the purpose of making redemptions of Bonds and releasing amounts in the Asset Accumulation Fund to the Agency for any lawful purpose, free of the lien of this Resolution. (L) Nothing in this Resolution shall be construed to prohibit the Trus tee from caus ing aqua 1 ified Mortgage Lender to repurchase a Mortgage Loan in accordance with the applicable Mortgage Loan Purchase Agreement. The proceeds of any such repurchase shall be depos ited by the Trustee in the Mortgage Loan Purchase Account. 43 . . . . . . . . . . . . ""Ii'¡1\r:'~'""T. , (M) The Agency covenants that it will not purchase Mortgage Loans secured by Residences unless either (i) such Residences are substantially similar in design to Residences described in plans and specifications in existence prior to April 25, 1979, for Residences or (ii) the Agency has received a legal opinion rendered by a nationally recognized municipal bond law firm that the Trustee may purchase a Mortgage Loan secured by a Residence which is not substantially similar in design to plans and specifications in existence prior to April 25, 1979, and such purchase will not adversely affect the Federal income tax exemption of the Bonds under any pending or enacted federal legislation. The Agency also covenants that it shall confirm to the Trustee, in the Requisition provided for in subsection (E) of this Section 801, that either (i) or (ii) applies with respect to any Mortgage Loan to be purchased by the Trustee on behalf of the Agency. The Agency further covenants that it will cause its staff, including its redevelopment consultant, diligently to perform the covenants contained in th is Section. 802. Trustee's Quarterly Reports. The Trustee shall provide the Agency with quarterly reports commencing with the period ending three (3) months after the Issue Date of the Bonds, and continuing for as long as there are moneys in any Funds and Accounts, setting forth all receipts paid into and all disbursements made from such Funds and Accounts pursuant to the provisions of this Resolution. Such reports shall be mailed by the Trustee to the Agency. 803. Pa)111ent of Revenues. The Agency shall promptlrpay any and all Revenues received by it to the Trustee for deposit and application in accordance with the provisons hereof. B04. Extension of Pa)111ent of Bonds and Coupons. The Agency shall not directly or indirectly extend or assent to the extens ion of the maturity of any of the Bonds or the time of pa)111ent of any of the coupons or cl aims for interest by the purchase or funding of such Bonds, coupons or claims for interest or by any other arrangerœnt, and in case the maturity of any of the Bonds or the time for pa)111ent of any such coupons or claims for interest shall be extended, such Bonds, coupons or claims for interest shall not be entitled in case of any default under this Resolution to the benefit of this Resolution or to any pa)111ent out of any of the Funds or Accounts (except Funds or Accounts held in trust for the pa)111ent of particular bonds, coupons or claims for interest pursuant to this Resolution) held by the Trustee or any Paying Agent, except subject to the prior payment of the principal of all Outstandin9 Bonds the maturity of which has not been extended and of s~ch portion of the accrued interest on Outstanding 80nds as shall not be represented by such extended coupons or claims for interests. Nothing herein shall be deemed to limit the right of the Agency to issue refunding Bonds and such issuance shall not be deerœd to constitute an extension of maturity of Bonds. 805. Further Assurances. At any and all times the Agency shall, so far it may be authorized or permitted by law, pass, make, do, execute, as 44 acknowledge and del iver, all and every such further resolutions, acts, deeds conveyances, assignments, transfers, and assurances as may be necessary or desirable for the better assuring, conveying, granting, assigning, confirming and effecting all and singular the rights, Revenues, Mortgage Loans, Funds and Accounts and other rroneys, securities, funds and property hereby pledged or assigned or intended so to be, or which the Agency may hereafter become bound to pledge or assign. B06. Power to Issue Bonds and Make Pledges. The Agency is duly authorized pursuant to law to authorize and issue the Bonds and to adopt this Resolution and to pledge the Revenues, Mortgage Loans and Funds and Accounts purported to be pledged by th is Resolution in the manner and to the extent provided in this Resolution. The Revenues, Mortgage Loans and Funds and Accounts so pledged are and will be free and clear of any pledge, lien, charge or encumbrance thereon or with respect thereto prior to, or of equal rank, with, the pledge created by this Resolution, except for the liens in favor of the Trustee and Paying Agents provided in Article IX hereof and further subject to the right of the Agency to apply moneys as herein provided, and all corporate action on the part of the Agency to that end has been duly and validly taken. The Bonds and the provisions of this Resolution are and will be the valid and legally enforceable obligations of the Agency in accordance with their terms and the terms of this Resolution. The Agency shall at all times, to the extent permitted by law, defend, preserve and protect the pledge of the Revenues, Mortgage Loans and Funds and Accounts under this Resolution and all the rights of the Bondholders under this Resolution against all claims and demands of all persons whomsoever, provided, however, that nothing in this Resolution contained shall be deemed to require the Agency to expend moneys other than the moneys which are subject to the lien upon the Revenues created by this Resolution. 807. Accounts and Reports. (A) The Agency shall keep or cause to be kept proper books of record and accounts in which complete and correct entries shall be made of its transactions relating to all Mortgage Loans, Revenues, and all Funds and Accounts, which shall at all reasonable times be subject to the inspection of the Trustee and the holders of an aggregate of not less than five percent (5%) in principal amount of the 8onds then Outstanding or their representatives duly authorized in writing. (B) The Agency shall annually, within one hundred and twenty (120) days after the close of each Fiscal Year, file with the Trustee a copy of an annual report regarding the Residential Mortgage Financing Program (hereinafter in this subsection referred to as the "Program") for such Fiscal Year, accompanied by an Accountant's Certificate containing the Accountant's opinion that the annual report has been prepared in accordance with generally accepted auditing standards and accounting principles, such annual report to set forth in complete and reasonable detail the following matters relating to the Program: (i) the operation and accomplishrænts of the Program; (ii) receipts and expenditures of the Program during such Fiscal Year in accordance 45 . . . . . . . . . . . . ".'O'.^""",._¡, .;,"">""'".~,""'" with the categories or classifications establ ished by the Agency for its operating and capital outlay purposes; (iii) the assets and li'âbilities of the Program at the end of such Fiscal Year, including a schedule of its Mortgage Loans and the status of the Funds and Accounts established by this Resolution and the Supplemental Resolution; and (iv) a schedule of its Bonds Outstanding at the end of such Fiscal Year, together with a statement of the amounts paid, redeemed and issued during such Fiscal Year. A copy of each such annual report and the Accountant's Certificate shall be mailed by the Agency to the Trustee and to each Bondholder who shall have filed his name and address with the Agency for such purpose. (C) The Agency shall maintain a record of the monthly payments to be remitted to the Trustee by each Servicer and shall reconcile monthly the scheduled amount with the amount actually remitted, all based on data to be provided by the Servicers pursuant to Servicing Agreements, and shall provide a copy of such record to the Trustee. 808. Personnel and Servicing of Mortgage Loans. The Agency shall at all times appomt, retaln and employ competent supervisory personnel for the purpose of carrying out the Residential Mortgage Financing Program and shall establish and enforce reasonable rules, regulations and standards for the construction and compl etion of all Res identia 1 Construction covered by said Program and for servicing Mortgage Loans. All persons employed by the Agency shall be qualified for their respective positions. Nothing herein shall mean or be deemed to be a prohibition against the Agency's contracting for all or any part of such services. 809. Premiums on Special Hazard Insurance. The Agency shall timely deliver a Requisition to the Trustee for payment of the annual premiums on Special Hazard Insurance and on Hazard Insurance, not otherwise paid, from moneys in the Operating Fund, except that the first annual premium on Special Hazard Insurance shall be paid from the Issuance Expense Account. In the event that the company issuing the Special Hazard Insurance policy shall cease to be licensed in the State, the Trustee is to exercise its best reasonable efforts to obtain a comparable replacement policy with total coverage equal to the then existing coverage of the Special Hazard Insurance policy. 810. Waiver of Laws. The Agency shall not at any time insist upon or plead in any manner whatsoever, or claim or take the benefit or advantage of any stay or extension of law now or at any time hereafter in force which may affect the covenants and agreements contained in this Resolution or in any Supplemental Resolution or in the Bonds, and all benefits or advantage of any such law or laws is hereby expressly waived by the Agency. 811. Compl iance with Conditions Precedent. Upon the Issue Date of any of the Bonds, all conditions, acts and things required by law or by the 'Resolution or Supplemental Resolution to exist, to have happened or to have been performed precedent to or in the issuance of such Bonds shall exist, have happened and have been performed, and such Bonds, together with all other indebtedness of the Agency, shall be within every debt and other limit prescribed by law. 46 812. Creation of Liens. The Agency shall not issue any Bonds or other evidences of indebtedness, other than the Bonds authorized herein and secured by a pledge of the Revenues and the Mortgage Loans under this Resolution, and shall not create or cause to be created any 1 ien or charge on the Revenues and the Mortgage Loans superior to the liens created by this Resolution; provided, however, that nothing in this Resolution shall prevent the Agency from issuing evi dences of indebtedness secured by a pledge of Revenues and the Mortgage Loans to be in full force and effect after such date as the pl edge of such Revenues and moneys shall be discharged and satisfied as provided in Article XIV, or from issuing notes or bonds (whether or not under other resolutions in order to fund the Residential Mortgage Financing program or other programs of the Agency) of the Agency secured by assets and revenues of the Agency other than the Revenues and Mortgage Loans. 47 . . . . . . r . . . . . . ARTICLE IX THE TRUSTEE AND PAYING AGENTS 901. Trustee Appointment and Acceptance of Duties. The Agency hereby appoints Security Pacific National Bank, Los Angeles, California, as Trustee under this Resolution. The Trustee shall signify its acceptance of the duties and obligations imposed upon it by this Resolution by a written instrument of acceptance depos ited with the Agency or by the execution of th is Resol ution. The property, rights, powers and duties of the Trustee under this Resolution are hereby vested in said Trustee in trust for the Bondholders. The Trustee (and any successor Trustee) shall have a capital and surplus aggregating at least fifty million dollars ($50,000,000) and the Trustee (and any successor trustee) shall have a department which is an approved FHA and VA mortgagee and which is either an FNMA or FHLMC approved seller/servicer. 902. Paying Agents. The Agency shall appoint one or more Paying Agents and for the Bonds prior to the delivery of such Bonds, and may at any time or from time to time by Supplemental Resolution appoint one or more other Paying Agents for such Bonds. Each Paying Agent shall be a bank, trust company or national banking association, having a capital and surplus aggregating at least Fifty Million Dollars ($50,000,000). Each Paying Agent shall signify its acceptance of the duties and obligation imposed upon it by this Resolution and by a Supplemental Resolution by executing and del ivering to the Agency and the Trustee a written acceptance thereof. In addition to its duties relating to the payment of the Bonds at the Principal Office of the Trustee, the Trustee may be appointed and may act as a Paying Agent in other cities in the Sta te. 903, Responsibilities of Trustee and Paying Agents. The recitals of fact herein and 1n the Bonds contained shall be taken as the statements of the Agency and neither the Trustee nor any Paying Agent assumes any responsibility for the correctness of the same. Neither the Trustee nor any Paying Agent shall be deemed to make any representations as to the validity or sufficiency of this Resolution, any Supplemental Resolution or of any Bonds or coupons or in respect of the security afforded by this Resolution, and neither the Trustee nor any Paying Agent shall incur any responsibility or duty with respect to the issuance of the Bonds for value or the application of any moneys paid to the Agency. Neither the Trustee nor any Paying Agent shall be under any obligation or duty to perform any act which would involve it in any expense or liability or to institute or defend any suit in respect hereof, or to advance any of its own rroneys, unless properly indemnified to its satisfaction. Neither the Trustee nor any Paying Agent shall be liable in connection with the performance of its duties hereunder except for its own gross negligence or willful default. Neither the Trustee nor any Paying Agent shall be under any responsibility or duty with respect to the application of any moneys paid to anyone of the others. The immunities, exemptions and indemnifications from liability of the Trustee under this Resolution shall 48 extend to its directors, officers, employees and agents. The Trustee shall not be responsible for the validity, execution by other parties thereto, or sufficiency of this Resolution, and any Corrrnitment Contract (and Reservation of Funds) or any Mortgage Loan Purchase Agreement, the Mortgage Loan Purchase Agreement Supplement, the Servicing Agreement Supplement or the Bonds. The Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Resolution and no implied covenants or obligations shall be read into this Resolution against the Trustee. In case an Event of Default has occurred and has not been cured, the Trustee shall exercise such of the rights and pCMers vested in it by this Resolution, and use the same degree of care and sk ill in their exercise, as a prudent investor woul d exercise or use under the circumstances in the conduct of such investor's CMn affairs. The Trustee shall not be personally liable with respect to (i) an error of judgment made in good faith by a responsible officer (as defined in section 805) of the Trustee unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts, or (ii) any action taken, suffered or omitted to be taken by it in good faith, in accordance with the direction of Holders of not less than 25% in principal amount of the Outstanding Bonds, relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this Agreement. 904. Funds Held in Trust. All moneys held by the Trustee at any time pursuant to the terms of this Resolution and the Supplemental Resolution shall be and hereby are assigned, transferred and set over unto such Trustee in trust for the purposes and under the terms and conditions of this Resolution. 905. Evidence on Which Trustee May Act. The Trustee and any Paying Agent shall be protected in acting upon any notice, resolution, request, consent, order, certificate, report, opinion, bond, or other paper or document believed in good faith by it to be genuine, and to have been signed or presented by the proper party or parties. The Trustee and any Paying Agent may consult with counsel, who mayor may not be of counsel to the Agency or to the Trustee, and an opinion of counsel shall be full and complete authorization and protection in respect of any action taken, or suffered or omitted by it under this Resolution in good faith and in accordance with such opinion of counsel. Whenever the Trustee or any Paying Agent shall deem it necessary or desirable that a matter be proved or establ ished prior to taking or suffering any action under this Resolution, such matter (unless other evidence in respect thereof be therein specifically prescribed) may be deemed to be conclusively proved and established by an Officer's Certificate, and such Officer's Certificate shall be full authority for any action taken or suffered in good faith under the provisions of this Resolution upon the faith thereof, but in its discretion the Trus tee or any Paying Agent may in 1 ieu thereof accept other evidence of such fact or matter or may require such further or additional evidence as it may deem desirable. 49 . . . . . . . . . . . . '..~_c """f'~"*"'c</" Except as otherwise expressly provided in this Resolution, any request, order, notice or other direction required or permitted fo be furnished pursuant to any provision hereof by the Agency to the Trustee or any Paying Agent shall be sufficiently executed in the name of the Agency by an Authorized ,Officer. Anything herein to the contrary notwithstanding, whenever it is provided that the Trustee shall take any action, including the giving of any notice, or refrain from taking any action upon the happening or continuation of a specified event or upon the fulfillment of any condition or upon the request of the Holders, the Trustee shall have no liability for failure to take such action or for failure to refrain from taking such action unless and until a responsible officer of the Trustee, who is a responsible officer at the Principal Office, has actual knowledge of such event or continuation thereof or the fulfillment of such condition or shall have received such request. , Responsible officer means, in the case of the Trustee, the chairman or vice chairman of the executive corrrnittee of the board of directors or trustees, the president, any vice president, the secretary, the treasurer, any trust officer, any executive or senior or second or assistant vice president, or any other officer or assistant officer customarily performing functions s imil ar to those performed by the persons who at the time shall be such officers, or to whom any corporate trust matter is referred because of his knowledge of and familairity with the particular subject. ,The Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder, either directly or by or through agents or attorneys, and the Trustee shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder. 906. Compensation and Expenses. Subject to the provisions of any contract between the Agency and the Trustee: (A) The Agency shall authorize by Requisition the payment from the Operating Fund to the Trustee and to each Paying Agent from time to time reasonable compensation for all services rendered under this Resolution, and also all reasonable expenses incurred in and about the performance of their powers and duties under this Resolution and all other applicable documents. (8) The Agency further covenants and agrees to indemn ify and save the Trustee and each Paying Agent harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise and performance of its powers and duties hereunder, including the costs and expenses of defending against any claim of liability, including attorneys' fees, and which are not due to the Trustee's or any Paying Agent's own gross negligence pursuant to 906(B). (C) The Agency further covenants and agrees to advance to the Trustee and each Paying Agent, from amounts available therefor in the Operating Fund or the Mortgage Reserve Fund, all armunts requested as costs and expenses of such defense. 50 (D) The Trustee and each Paying Agent shall have alien for its compensation and expenses as in this Section 906 provided, which lien shall be prior and superior to the lien of the Holders of the Bonds. 907. Permitted Acts and Functions. The Trustee and any Paying Agent may buy, own, hold and sell any Bonds, coupons or notes of the Agency, whether heretofore or hereafter issued or created; and may engage or be interested in any financial or other transaction with the Agency, with 1 ike effect and with the same rights it would have if it were not such Trustee or Paying Agent. The Trustee and any Paying Agent may act as Depository for, and permit any of its officers or directors to act as a member of, or in any other capacity with respect to, any committee formed to protect the rights of Bondholders or to effect or aid in any reorgan ization growing out of the enforcement of the Bonds or this Resolution whether or not any such committee shall represent the Holders of a majority in principal alrount of the Bonds then Outstanding. 908. Eligibility for Appointment as Trustee. The Trustee shall at all times be a corporati on organ ized and do ing bus iness under the 1 aws of the United States or the State of California, authorized under such laws to exercise corporate trust powers, having a combined capital and s))rplus of at least Fifty Million Dollars ($50,000,000), subject to supervision or examination by Federal or State authority and having its Principal Office and place of business in the State. If such corporation publishes reports of its condition at least annually, pursuant to law or to the requirements of the Agency supervising or examining authority, then, for the purposes of this Section, the combined capital and surplus of such corporation shall be deemed to be i ts comb ined capital and surplus as set forth in its mos t recent report of condition so published. In case at any time the Trustee shall cease to be eligible in accordance with the provisions of this Section, the Trustee shall resign immediately in the manner and with the effect below specified. 909. Resignation and Removal; Appointment of Successor Trustee. (A) The Trustee, or any trustee hereafter appointed, may at any time resign by giving written notice of resignation to the Agency, Upon receiving such notice of resignation, the Agency shall promptly appoint a successor trustee to exercise the duties of Trustee. Such successor trustee shall be appointed by written instrument, in duplicate, executed by order of the Agency and signed by an Authorized Officer, one copy of which instrument shall be delivered to the resigning Trustee and one (1) copy to the successor trustee. If no successor trustee shall have been so appointed and have accepted appointment within thirty (30) days after the resignation, the resigning Trustee may petition any court of competent jurisdiction for the appointment of a successor trustee, or any Bondholder who has been a bona fide Holder of a Bond or Bonds for at least six (6) months may, on behalf of himself and all others similarly situated, petition any such court for the appointment of a successor trustee. Such court may thereupon, after such notice, if any, as it may deem proper, appoint a successor trustee. 51 . . . . . . . . . . . . ',?'\)I¡"","""" ~Y'J""'" ,,', w" (B) In case at any time any of the following shall occur: (a) The Trustee shall cease to be eligible and shall fail to resign after written request therefor by the Agency or by any such Bondholder; or (b) The Trustee shall become incapable of acting, or shall be adjudged a bankrupt or insolvent, or a receiver of the Trustee or of its property shall be appointed, or any public officer shall take charge or control of the Trus tee or of its property of affairs for the purpose of rehabilitation, conservation or liquidation; then, in any such case, the Agency may remove the Trustee and appoint a successor trustee to exercise the duties of Trustee. Such removal and appointment shall be made by written instrument, in duplicate, executed by order of the Agency, one copy of which instrument shall be del ivered to the Trustee so removed and.-one copy to the successor trustee. In addition, any Bondholder who has been a bona fide Holder of a Bond or Bonds for at least six (6) months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor trustee. Such court may thereupon, after such notice, if any, as it may deem proper and prescribe, remove the Trustee and appoint a successor trustee, (C) The Agency may appoint the Treasurer of the Agency to exercise the duties of the Trustee if (a) The Trustee or any successor trustee cannot legally perform the duties required hereunder because of the occurreAce,of either of the following, subsequent to the effective date of this Resolution: (i) the enactment of any constitutional provision, or any law, rule or regulation of any governmental agency having jurisdiction thereof, or (ii) any judicial decision, whether or not involving this Resolution, which is applicable to this Resolution and the trusteeship created hereunder; or (b) The services of the Trustee or any successor trustee cannot be obtained at a reasonable cost. Such reasonable, cost shall be determined by comparing like costs charged by financial institutions similarly situated in the United States performing duties of a comparable nature. (0) The Holders of a majority in aggregate principal amount of the Bonds at the time Outstanding may at any time remove the Trustee and appoint a successor trustee; provided, however: (a) this Resolution; and Such successor shall be eligible for appointment under , (b) That, if the Agency objects to the successor trustee, it may appoint a successor trustee to exercise the duties of Trustee provided that such successor shall be eligible for appointment under this Resolution. 52 (E) Any resignation or removal of the Trustee and appointment of a successor trustee pursuant to any of the provisions of this Section shall become effective upon notice of or acceptance of appointment by the successor trustee as provided below. 910. Acceptance of Appointment of Successor Trustee. Any successor trustee appointed, as above provided, shall execute, acknowledge and deliver to the Agency to all Paying Agents and to its predecessor trustee an instrument accepting such appointment hereunder and expressly stating that it fully satisfies the requirements for trustee as provided by this Resolution, and upon the resignation or removal of the predecessor trustee shall become effective and such successor trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, duties and obligations of its predecessor hereunder, with like effect as if originally named as trustee herein; but, nevertheless, on the written request of the Agency or of the successor trustee, the trustee ceasing to act shall, upon payment of its charges then unpaid, execute, acknowledge and deliver an instrument transferring to such successor trustee all the rights and powers of the trustee ceasing to act. Upon request of any such suècessor trustee, the Agency shall execute any and all instruments in writing for more fully and certainly vesting in and confirming to such successor trustee all such rights and powers. Any trustee ceasing to act shall, nevertheless, retain a lien upon all property or funds held or collected by such trustee to secure any amounts then due it and all such other rights provided for in Section 906. The trustee ceasing to act shall upon such vesting thereafter be fully relieved and discharged of and from all further liability or responsibility either to the Agency or to the Holders of the then Outstanding Bonds except to the extent of liability, if any, arising prior to such vesting in the successor trustee. No successor trustee shall be appointed under the provisions of this Resolution or be substituted for the present Trustee hereunder or for any successor of the present Trustee hereunder unless the Commissioner of Corporations of the State of California shall have been notified in writing of such proposed appointment or substitution and shall not have disapproved thereof within a period of fifteen (15) days after the giving of such notice, 911. Merger or Consol idation of Trustee. Any corporation into which the Trustee may be merged or with whlch lt may be consolidated, or any corporation resulting from any merger or consol idation to which the Trustee shall be a party, or any corporation succeeding to the corporate trust business of the Trustee shall be the successor trustee hereunder, provided such corporation shall be eligible hereunder, without the execution or filing of any paper or any further act on the part of any of the parties hereto, anyth ing herein to the contrary notwiths tanding. 912. Requirements as to Trus tee I s Records. The records of the Trus tee pertaining to the 80nds and to the Trustee hereunder shall be available to and open for reason ab 1 e inspect ion dur ing bus iness hours at all times by the 53 . . . . . . r . . . . . . -..1/ o""WiI&Y,,^' '~'t""'""""-,,,. Agency and any other public body, agency or conmission having jurisdiction in the premises, and the Trustee shall retain in its possessiðh all financial statements furnished to it pursuant to this Resolution. 913. Resignation or Removal of Paying Agents and Appointment of Successors. Any Paying Agent may at any time resign and be discharged of the duties and obligations created by this Resolution by giving at least sixty (60) days' written notice to the Agency and the Trustee. Any Paying Agent may be removed at any time by an instrument filed with such Paying Agent and the Trustee and signed by an Authorized Officer. Any successor Paying Agent shall be appointed by the Agency and shall be a bank or trust company organized under the laws of any state of the United States or a national banking association and willing and able to accept the office of Paying Agent on reasonable and customary terms and authorized by law to perform all the duties imposed upon it by this Resolution. In the event of the resignation or rerooval of any Paying Agent, such Paying Agent shall pay over, assign and deliver any moneys held by it to its successor, or if there be no successor then appointed, to the Trustee until such successor be appointed. 54 ARTICLE X SUPPLEMENTAL RESOLUTIONS 1001. Adoption and Filing. The Agency may, without the consent of the Holders of the Bonds, adopt at any time or from time to time Supplemental Resolutions, in addition to the Supplemental Resolution described in Section 301, for anyone or more of the following purposes, and any such Supplemental Resolution (other than pursuant to Section 301) shall become effective in accordance with its terms and upon filing with the Trustee of a copy thereof certified by an Authorized Officer together with the appropriate certificates and other documents required by this Resolution. (1) To add add i tiona 1 covenants and agreements of the Agency for the purpose of further securing the payment of the 8onds, provided such additional covenants and agreements are not contrary to or inconsistent with the covenants and agreements of the Agency contained in this Resolution; (2) To prescribe further limitations and restrictions upon the issuance of Bonds and the incurring of indebtedness by the Agency which are not contrary to or inconsistent with the limitations and restrictions thereon theretofore in effect; (3) To surrender any right, power or privilege reserved to or ,conferred upon the Agency by the terms of this Resolution; (4) To confirm as further assurance any pledge of the Revenues created by the provisions of this Resolution; or (5) With the consent of the Trustee, to cure any ambiguity or defect or inconsistent provision in this Resolution or to insert such' provisions clarifying matters or questions arising under this Resolution as are necessary or desirable in the event any such modifications are not contrary to or inconsistent with this Resolution as theretofore in effect. 1002. Supplemental Resolutions Effective with Consent of Bondholders. The provisions of this Resolution may be modified at any time or from time to time by a Supplemental Resolution, subject to the consent of Bondholders in accordance with and subject to the provisions of Article XI hereof, such Supplemental Resolution to become effective upon the filing with the Trustee of a copy thereof certified by an Authorized Officer. 1003. General Provisions Relating to Supplemental Resolutions. This Resolution shall not be modlfled or. amended ln any respect except in accordance with and subject to the provisions of this Article X and Article XI. Nothing contained in this Article X or Article XI shall affect or limit the right or obligation of the Agency to adopt, make, do, execute or deliver any Resolution, act or other instrument pursuant to the provisions of Section 805 or the ri ght or ob 1 i gat ion of the Agency to execute and del iver to the 55 . . . . . . . . . . . . .",,~,"""N"" ",","""""",",., Trustee or any Paying Agent any instrument elsewhere in this Resolution provided or permitted to be delivered to the Trustee or any Parin~ Agent. A copy of every Supplemental Resolution adopted by the Agency when filed with the Trustee shall be accompanied by an Opinion of Counsel stating that such Supplemental Resolution has been duly and lawfully adopted in accordance with the provisions of this Resolution, is authorized or permitted by this Resolution and is valid and binding upon the Agency and enforceable in accordance with its terms. ' The Trustee is hereby authorized to accept del ivery of a certified copy of any Supplemental Resolution permitted or authorized pursuant to the provisions of this Resolution and to make all further agreements and stipulations which may be contained therein, and, in taking such action, the Trustee shall be fully protected in relying on an Opinion of Counsel that such Supplemental Resolution is authorized or permitted by the provision of this Resolution. No Supplemental Resolution or other document may change, amend or modifying any of the rights or 'obligations of the Trustee or any Paying Agent without the prior written consent of the Trustee or Paying Agent affected thereby. 56 ARTICLE XI AMENDMENTS TO RESOLUTION 1101. Powers of Amendment. Any modification or amendment of this Resolution and of the rights and obligations of the Agency and of the Holders of the Bonds and coupons thereunder, in any particular, may be made by a Supplemental Resolution, with the written consent given as hereinafter provided, (i) of the Holders of at least two-thirds (213) in principal amount of the Bonds Outstanding at the time such consent is given; provided, however, that if such modification or amendment will, by its terms, not take effect so long as any Bonds of any specified maturity remain Outstanding, the consent of the Holders of such Bonds shall not be required and such Bonds shall not be deemed to be Outstanding for the purpose of any calculation of Outstanding Bonds under this Section. No such modification or amendment shall permit a change in the terms of redemption or maturity of the principal of any Outstanding Bond or of any installment of interest thereon or a reduction in the principal amount or the Redemption Price thereof or in the rate of interest thereon without the consent of the Holder of such Bonds, or shall reduce the percentages or otherwise affect the classes of Bonds the consent of the holders of which is required to effect any such modification or amendment. The Trustee may in its discretion determine whether or not, in accordance with the foregoing provisions, Bonds of any particular maturity would be affected by any modification or amendment of this Resolution, and any such determination shall be binding and conclusive on the Agency and all Holders of Bonds. The Trustee may receive an Opinion of Counsel as conclusive evidence as to whether Bonds of any particular maturity would be so affected by any such modifications or amendment of this Resolution. 1102. Consent of Bondholders. The Agency may at any time adopt a Supplemental Resolution making a modification or amendment permitted by the. provision of Section 1101 to take effect when and as provided in this Section. A copy of such Supplemental Resolution (or brief summary thereof or reference thereto in form approved by the Trustee) and a request to the Bondholders for their consent thereto in form satisfactory to the Trustee shall be mailed by the Agency to all Bondholders and shall 'be published at least once a week for two (2) successive weeks (but failure to mail such copy and request shall not affect the val idity of the Supplemental Resolution when consented to as in this Section provided). Such Supplemental Resolution shall not be effective unless and until (i) there shall have been filed with the Trustee (a) the written consent of Holders of the percentages of Outstanding 80nds specified in Section 1101 and (b) an Opinion of Counsel stating that such Supplemental Resolution has been duly and lawfully adopted and filed by the Agency in accordance with the provisions of this Resolution, is authorized or permitted by this Resolution and is valid and binding upon the Agency and enforceab 1e in accordance with its terms, and (i i) a not i ce shall have been published as hereinafter in this Section 1102 provided. Each such consent shall be effective only if accompanied by proof of the holding, at the date of such consent, of the Bonds with respect to which such consent is given, which 57 . . . . . . r-- - - ---,--- . . . . . . ""'""'»""""'¥<' ,.¡,':""M"1J<'ff' proof shall be such as is permitted by this Article. A certificate or certificates by the Trustee filed with the Trustee that it has examined such proof and that such proof is sufficient in accordance with tHis Article shall be conclusive that the consents have been given by the Holders of the Bonds described in such certificate or certificates of the Trustee. Any such consent shall be binding upon the Holder of the Bonds giving such consent and, anything in this Article to the contrary notwithstanding, upon any subsequent Holder of such Bonds and of any Bonds issued in exchange therefor (whether or not such subsequent Holder thereof has notice thereof), unless such consent is revoked in writing by the Holder of such Bonds giving such consent or a subsequent Holder thereof by filing with the Trus tee pr ior to the time when the written statement of the Trustee hereinafter in this Section 1102 provided for is filed, such revocation and, if such Bonds are transferable by delivery, proof that such Bonds are held by the signer of such revocation in the manner permitted by th is Article. The fact that a consent has not been revoked may likewise be proved by a certificate of the Trustee filed with the Trustee to the effect that no revocation thereof is on file with the Trustee, At any time after the Holders of the required percentages of Bonds shall have filed their consents to the Supplemental Resolution, the Trustee shall make and file with the Agency and the Trustee a written statement that the Hol ders of such required percentages of Bonds have filed such consents, Such written statement shall be conclusive that such consents have been so filed. At any time thereafter, notice, stating in substance that the Supplemental Resolution (which may be referred to as a Supplemental Resolution adopted by the Agency on a stated date, a copy of which is on file with the Trustee) has been consented to by the Holders of the required percentages of Bonds and that the Supplemental Resolution will be effective as provided in this Section 1102, may be given to Bondholders by the Agency by mail ingk such notice to Bondholders (but failure to mail such notice shall not prevent such Supplemental Resolution from becoming effective and binding as in this Section 1l02 provided) and by publ ishing the same at least once not more than ninety (90) days after the Holders of the required percentages of Bonds shall have. filed their consents to the Supplemental Resolution and the written statement of the Trustee hereinabove provided for is filed. The Agency shall file with the Trustee proof of the publication of such notice, and, if the same shall have been mailed to Bondholders, of the mailing thereof. A transcript, cons is ting of the papers required or permitted by th i s Sect ion 1l02 to be filed with the Trustee, shall be proof of the matters therein stated. Such Supplemental Resolution making such amendment or modification shall be deemed conclusively binding upon the Agency, the Trustee, each Paying Agent and the Holders of all Bonds and coupons at the expiration of thirty (30) days after the filing with the Trustee of the proof of the first publication of such last mentioned notice, except in the event of a final decree of a court of competent jurisdiction setting aside such Supplemental Resolution in a legal action or equitable proceeding for such purpose commenced within such thirty (30) day period; provided, however, that the Agency, the Trustee and any Paying Agent during such thirty (30) day period and any such further period during which any such action or proceeding may be pending shall be entitled in their absolute discretion to take such action, or to refrain from taking such action, with respect to such Supplemental Resolution as they may deem expedient. 58 1103. Approval by Counsel. The Trustee shall be entitled to receive, and shall be fully protected in relying upon, an Opinion of Counsel as conclusive evidence that any such proposed Supplemental Resolution complies with the provisions of this Resolution, and that it is proper for the Trustee, under the provisions of this Article, to join in the execution of such Supplemental Resolution. 1104. Modifications by Unanimous Consent. The terms. and provisions of this Resolution and the rights and obligations of the Agency and of the Holders of the Bonds and coupons thereunder may be modified or amended in any respect upon the adoption and filing with the Trustee by the Agency of Supplemental Resolution and the consent of the Holders of all of the Bonds then Outstanding, such consent to be given as provided in Section 1102, except that no notice to Bondholders either by mailing or publication shall be required. 1105. Mailing and Publication. (A) Any provision. in this Article for the mailing of a notice or other document to Bondholders shall be fully complied with if it is mailed postage prepaid only (i) to each registered owner of Bonds then Outstanding at his address, if any, appearing upon the Bond Register kept by the Trustee; (ii) to each Holder of any Bond payable to bearer who shall have filed with the Trustee within two (2) years preceding such mailing an address for . notices; and (iii) to the Trustee. (B) Any provision in this Article for publication of a notice or other matter shall require the publication thereof only in any Authorized Newspaper. 1106. Exclusion of Bonds. Bonds owned or held by or for the account of . the Agency shall not be deemed Outstanding for the purpose of consent or other action or any calculation of Outstanding Bonds provided for in this Article, and the Agency shall not be entitled with respect to such Bonds to give any consent or take any other action provided for in this Article. At the time of any consent or other action taken under this Article, the Agency shall furnish the Trustee a certificate of an Authorized Officer, upon which the Trustee may rely, describing all Bonds so to be excluded. 1107. Notation on Bonds. Bonds del ivered after the effective date of any action taken as in Article X or this Article provided may, and, if the Trustee so determines, shall, bear a notation by endorsement or otherwise in form approved by the Agency and the Trustee as to such action, and in that case, upon demand of the Holder of any Bond Outstanding .at such effective date and upon presentation of said 80nd for the purpose at the Principal Office of the Trustee, suitable notation shall be made on such Bond by the Trustee as to any such action. If the Agency or the Trustee shall so determine, new Bonds so modified as in the opinion of the Trustee and the Agency to conform to such action shall be prepared and delivered, and upon demand of the Holder of any 59 . . . . . . r . . . . . . ".,."""""""".,,", '"",'1"",,>- Bond then Outstanding shall be exchanged, without cost to such Bondholder, for Bonds of the same maturity then Outstanding, upon surrender of such Bonds with all unpaid coupons, if any, appertaining thereto. ' ;r 60 ARTICLE XII DEFAULTS AND REMEDIES 1201. Events of Default. declared an "Event of Default": Each of the following events is hereby (1) if a payment of a Principal Installment on, or the Redemption Price of, any Bond is not made when and as the same shall become due, whether at maturity or upon call for redemption, or otherwise; or (2) if a payment of interest on any Bond is not made when and as the same shall become due; or (3) if the Agency shall fail or refuse to comply with the provisions of the Act, or shall default in the performance or observance of any other of the covenants, agreements, or conditions on its part in this Resolution, any Supplemental Resolution, or in the Bonds contained, and such default shall continue for a period of ninety (90) days after written notice thereof by the Trustee; or (4) if the Agency shall file a petition or answer seeking reorganization or arrangement under the federal bankruptcy laws or any other applicable law of the United States of America, or if a court of competent jurisdiction shall approve a petition, filed with or without the consent of the Agency, seek ing reorganization under the federal bankruptcy laws or any other applicable law of the United States of America, or if, under the provis ions of any other law for the rel ief or aid of debtors, any court of competent jurisdiction shall assume custody or control of the Agency or of the whole or any substantial part of its property; provided, however, that an Event of Default under subsection (3) above shall not be deemed to exist under. the provisions of this Article upon the failure of any Servicer to enforce any obligation undertaken by a Mortgagor pursuant to the provisions of the Mortgage Loan, including the mak ing of the repayments required pursuant to such Mortgage Loan, so long as the Agency shall be provided with money sources, other than withdrawals from or reimbursements of the Debt Service Reserve Fund and Mortgage Reserve Fund, sufficient in amount to pay the principal of, interest and Sinking Fund Installments on all 80nds as the same shall become due during the period for which the Servicer shall be permitted to abstain from enforcing the obligations of Mortgagors under the applicable Mortgage Loans. 1202. Remedies. Upon the happening and continuance of any Event of Default specified in Section 1201, then, and in each case, the Trustee may proceed, and upon the written request of the Holders of not less than twenty-five percent (25%) in principal amount of the Outstanding Bonds shall proceed, in its own name, to protect and enforce the rights and the rights of the Holders of the Bonds by such of the following remedies, as the Trustee, being adv ised by counsel, shall deem mos t effectual to protect and enforce such rights: 61 1 . . . . . . r . I . , I -,._~ .-,- (1) by suit, action or proceeding to enforce all rights of the Holders of the Bonds, including the right to require Servicers to collect repayments required pursuant to the Mortgage Loans being šerviced by them adequate to carry out the covenants and agreements contained in this Resolution and the right to require the Agency to perform its duties under the Act; (2) by bringing suit upon the Bonds; (3) by action or suit, require the Agency to account as if it were the trustee of an express trust for the Holders of the Bonds; and (4) by action or suit, enjoin any acts or things which may be unlawful or in violation of the rights of the Holders of the Bonds or to compel the Agency or any Qualified Mortgage Lender or Servicer to perform their respective duties under this Resolution and any Commitment Contract (and Reservation of Funds), Mortgage Loan Purchase Agreement or Servicing Agreement. 1203. Priority of Payments After Default. In the event that the funds held by the Trustee and Paying Agents shall be insufficient for the payment of interest and Principal Installments or Redemption Price then due on the Bonds, such funds (other than funds held for the payment or redemption of particular Bonds or coupons which have theretofore become due at maturity or by call for redemption) and any other moneys received or collected by the Trustee acting pursuant to this Resolution and this Article XII, after making provision for the payment of any expenses necessary in the opinion of the Trustee to protect the interests of the Holders of the Bon~s, and for the payment of the charges, expenses and liabilities incurred and advances made by the- Trustee in the performance of its duties under this 'Resolution or any other applicable document, shall be applied as follows: (1) Unless the principal of all the Bonds shall have become due and payable, First: To the payment to the persons entitled thereto of all Interest Installments then due in order of the maturity of such Installments, and, if the amount available shall not be sufficient to pay in full any Installment, then to the payment thereof ratably, according to the amounts due on such Installment, to the persons entitled thereto, without any discrimination or preference; and Second: To the payment to the persons entitled thereto of the unpaid Principal Installment or Redemption Price of any 80nds, which shall become due, whether at maturity or by call for redemption, in the order of their due dates and, if the amounts available shall not be sufficient to pay in full all the 80nds due on any date, then to the payment thereof ratably, according to the amounts of principal or Redemption Price due on such date, to the persons entitled thereto, without any discrimination or preference; 62 (2) If the principal of all of the Bonds shall have become due and payable, to the payment of the principal and interest then due and unpaid upon the Bonds without preference or priority of principal over interest or interest over principal, or of any installment of interest over any other installment of interest, or of any Bond over any other Bond, ratably, according to the amounts due respectively for principal and interest, to the persons entitled thereto without any discrimination or preference except as to any difference in the respective rates of interest specified in the Bonds and coupons. Whenever moneys are to be applied by the Trustee pursuant to the provisions of this Section, such moneys shall be applied by the Trustee at such times, and from time to time, as the Trustee in its sole discretion shall determine, having due regard to the amount of such moneys available for application and the likelihood of additional money becoming available for such application in the future; the deposit of such moneys with the Paying Agents, or otherwise setting aside such moneys in trust for the proper purpose, shall constitute proper application by the Trustee; and the Trustee shall incur no liability whatsoever to the Agency, to any Bondholder, or to any other person for any delay in applying any such moneys, so long as the Trustee acts with reasonable diligence, having due regard for the circumstances, and ultimately applies the same in accordance with such provisions of this Resolution as may be applicable at the time of application by the Trustee. Whenever the Trustee shall exercise such discretion in applying such moneys, it shall fix the date (which shall be an Interest Payment Date unless the Trustee shall deem another date more suitable) upon which such application is to be made and, upon such date, interest on the amounts of principal to be paid on such date shall cease to accrue. The Trustee shall give such notice as it may deem appropriate for the fixing of any such date. The Trustee shall not be required to make payment to the Holder of any unpaid coupon or any Bond unless. such coupon or such Bond shall be presented to the Trustee for appropriate endorsement or for cancellation, if fully paid. 1204. Termination of Proceedings. In case any proceeding taken by the Trustee on account of any Event of Default shall have been discontinued or abandoned for any reason, then, in every such case, the Agency, the Trustee and the Holders of the Bonds shall be restored to their former positions and rights hereunder, respectively, and all rights, remedies, powers and duties of the Trustee shall continue as though no such proceeding had been taken. 1205. Bondholders' Direction of Proceedings. Anything in this Resolution to the contrary notwithstanding, the Holders of a majority in principal amount of the Bonds then Outstanding shall have the rights, by an ins trument or concurrent instruments in wr it ing executed and delivered to the Trustee, to direct the method of conducting all remedial proceedings to be taken by the Trustee hereunder; provided that such direction shall not be otherwise than in accordance with law or the provisions of this Resolution, and that the Trustee shall have the right to decline to follow any such direction which in the opinion of the Trustee would be prejudicial to Holders of Bonds not parties to such direction. 63 l I . I . t I . . . , I - 1206. Limitations on Rights of Bondholders. (A) . No Holder of any Bond shall have any right to institute any suit, action or other proceeding hereunder, or for the protection or enforcement of any right herein granted or any right granted under law unless such Holder shall have given to the Trustee written notice of the Event of Default or breach of duty on account of which such suit, action or proceeding is to be taken, and unless the Holders of not less than twenty-five percent (25%) in principal amount of the Bonds then Outstanding shall have made written request to the Trustee after the right to exercise such powers or right of action, as the case may be, shall have accrued, and shall have afforded the Trustee a reasonable opportunity either to proceed to exercise the powers herein granted or granted under law or to institute such action, suit or proceeding in its name and unless, also, there shall have been offered to the Trustee reasonable security and indemnity against the costs, expenses and liabilities to be incurred therein or thereby, and the Trustee shall have refused or neglected to comply with such request within a reasonable time; and such notification, request and offer of indemnity are hereby declared in every such case, at the option of the Trustee, to be conditions precedent to the execution of the powers under this Resolution or for any other remedy hereunder or under law. It is understood and intended that no one or more Holders of the Bonds hereby secured shall have any right in any manner whatever by his or their action to affect, disturb or prejudice the security of this Resolution, or to enforce any right hereunder or under law with respect to the Bonds or this Resolution, except in the manner herein provided, and that all proceedings shall be instituted" had and maintained in the manner herein provided and for the benefit of all Holders of Outstanding Bonds and coupons. (B) Anything to the contrary notwithstanding contained in this Section 1206, or any other provision of this Resolution, each Holder of any Bond by h is acceptance thereof shall be deemed to have agreed that any court in its discretion may require, in any suit for the enforcement of any right or remedy under this Resolution or any Supplemental Resolution, or in any suit against the Trustee for any action taken or omitted by it as Trustee, the filing by any party litigant in such suit of an undertaking to pay the reasonable costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys' fees, against any party litigant in any such suit, having due regard to the merits and good faith of the claims or defenses made by such litigant; but the provisions of this subsection B shall not apply to any suit instituted by the Trustee, to any suit instituted by any Bondholder, or group of 80ndho1ders, holding at least twenty-five percent (25%) in principal amount of the 80nds Outstanding, or to any suit instituted by any 80ndholder for the enforcement of the payment of the Principal Installment or Redemption Price of or interest on any Bond on or after the respective due date thereof expressed in such Bond. 1207. Possession of Bond by Trustee Not Required. All rights of action under this Resolution or under any of the 80nds, enforceable by the Trustee, 64 may be enforced by it without the possession of any of the Bonds or the coupons appertaining thereto or the production thereof on the trial or other proceeding relative thereto, and any such suit, action or proceeding instituted by the Trustee shall be brought in its name and for the benefit of all of the Holders of the Bonds and coupons, subject to the provisions of this Resolution. 1208. Remedies Not Exclusive. No remedy herein conferred upon or reserved to the Trustee or to Holders of the Bonds is intended to be exclusive of any other remedy or remedi es, and each and every such remedy shall be cumulative and shall be in addition to any other remedy given hereunder or now or hereafter existing at law or in equity or by statute. 1209. No Waiver of Default. No delay or omission of the Trustee or of any Holder of the Bonds to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver of any such default or an acquiescence therein; and every power and remedy given by this Resolution to the Trustee and the Holders of the Bonds, respectively, may be exercised from time to time and as often as may be deemed expedient. 1210. Notice of Event of Default. The Trustee shall give to the Bondholders notice of each Event of Default hereunder known to the Trustee with in ninety (90) days after actua 1 knowl edge of the occurrence thereof, unless such Event of Default shall have been remedied or cured before the giving of such notice; provided that, except in the case of default in the payment of the principal,- Redemption Price, if any, or interest on any of the Bonds, the Trustee shall be protected in withholding such notice if and so . long as the board of directors, the executive committee, or a trust committee of directors or responsible officers of the Trustee in good faith determines that the withholding of such notice is in the interests of the Bondholders, Each such notice thereof shall be mailed: (1) to all registered Holders of Bonds, as the names and addresses of such Holders appear upon the Bond Register as,kept by the Trustee; (2) to such Holders of Bonds as have filed their names and addresses with the Trustee for that purpose; and (3) to the Agency. 65 ~ . . . , I r . - . , I ART! CLE XI II EXECUTION OF INSTRUMENTS BY BONOHOLOERS AND PROOFS OF OWNERSHIP OF BONDS 1301. Evidence of Signatures of Bondholders and Ownership of Bonds. Any request, direction, consent, revocation of consent, or other instrument in writing required or permitted by this Resolution to be signed or executed by Bondholders may be in any number of concurrent instruments of similar tenor, and may be signed or executed by such Bondholders in person or by their attorneys or agents appointed by an instrument in writing for that purpose or, in the case of coupon Bonds, by any bank, trust company or other Depository of such Bonds. Proof of the execution of any such instrument, or of any instrument appointing any such attorney or agent, and of the holding and ownership of Bonds shall be sufficient for any purpose oj;c this Resolution (except as otherwise herein provided), if made in the following manner: (l) The fact and date of the execution by any Bondholder or his attorney or agent of any such instrument and of any instrument appointing any such attorney or agent may be proved by del ivery of a certificate, which need not be acknowledged or verified, of an officer of any bank, trust company, or other Depository, or of any notary public, or other officer authorized to take acknow1 edgments. Where any such ins trument i s executed by an offi cer of a corporation or association or a mamber of a partnership, on behalf of such corporation, association or partnership, such certificate shall also constitute sufficient proof of his authority to execute such instrument; (2) The fact of the holding of coupon Bonds by any Bondholder and the amount and the numbers of such Bonds and the date of his holding the same (unless such Bonds be registered) may be proved by a certificate executed by an officer of any bank, trust company, or other Depository, if such certificate shall be deemed by the Trustee to be satisfactory, showing that at the date therein mentioned such person had on deposit with or exhibited to such bank, trust company, or other Depository the Bonds described in such certificate. The Trustee may conclusively assume that such ownership continues until written notice of the contrary is served upon the Trustee. The ownership of Fully Registered Bonds shall be proved by the Bond Register held by the Trustee under the provisions of this Resolution. Nothing contained in this Article shall be construed as limiting the Trus tee to such proof, it being intended that the Trus tee may accept any other evidence of the matters herein stated which may seem sufficient. Any request or consent of the Ho1 der of any Bond shall bind every future Holder of the same Bond in respect of anything done or suffered to be done by the Agency, the Trustee or any Paying Agent in pursuance of such request or consent. 66 ARTICLE XIV DEFEASANCE 1401. Defeasance. (A) Subject to the provisions of subsection D of this Section 1401, if the Agency shall payor cause to be paid, or there shall otherwise be paid, to the Holders of the Bonds then Outstanding, the principal of, Redemption Price, if any, and interest to become due thereon, at the times and in the manner stipulated therein and in this Resolution, or there shall otherwise be paid or shall have caused to be paid, or there shall have been made provision to pay upon maturity or upon redemption prior to maturity, to the Holders of the Bonds then Outstanding, the principal of or Redemption Price, if any, and interest to become due thereon, on all Bonds then Outstanding, through setting aside trust funds or setting apart in a special trust fund or special trust account created pursuant to this Resolution or otherwise, or through the irrevocable segregation for the purpose in some other trust fund or trust account with the Trustee or another trustee, fiscal agent or otherwise, moneys or Federal Securities, or both, sufficient ,therefor, including, but not limited to, interest to be earned on Federal Securities, then the lien of this Resolution, including, without limitation, the pledge of the Revenues, the covenants, agreements and other obligations of the Agency to the Bondholders, and all other rights granted hereby, shall thereupon cease, terminate and become void and be discharged and satisfied, and the principal of, Redemption Price, if any, and interest on the Bonds shall no longer be deemed to be Outstanding and unpaid; provided, however, that nothing in this Resolution shall require the deposit of more than such Federal Securities as may be sufficient, taking into account both the principal amount of such Federal Securities and the interest to become due thereon, to implement any refunding of the Bonds. (8) Then, in such event, the Trustee shall, upon request of the Agency, execute and del iver to the Agency all such instruments as may be desirable to evidence such release and discharge and execute and deliver to the Servicer thereof assignments (which assignments shall be received by the Servicer as trustee of the Agency) of any Mortgage Loans held by the Trustee under this Resolution, and the Trustee and the Paying Agent shall pay over or deliver to the Agency all moneys or securities held by them pursuant to this Resolution which are not required for the payment or redemption of Bonds or coupons not theretofore surrendered for such payment or redemption. (C) In case any of the Bonds are to be redeemed on any date prior to their maturity, the Agency shall have given to the Trustee in form satisfactory to it, irrevocable instructions to publish, as provided in Article IV of this Resolution, notice of redemption on said date of such Bonds, In the event that said Bonds are not by their terms subject to redemption within the next succeeding sixty (60) days, the Agency shall have 67 . ' . . . ~ I ,..... . . . ~ -t given the Trustee the irrevocabl~ instructi.ons to publ ish the notice required by the preceding paragraph and, also, in form satisfactory to it, irrevocable instructions to publish, as soon as practicable, at least twice, at an interval of not less than seven (7) days between publications, in an Authorized Newspaper, a notice to the Holders of such Bonds and coupons that the deposit required by subsection A of this Section has been made and that said Bonds and coupons are deemed to have been paid in accordance with subsection A of this Section and stating such maturity or Redemption Date upon which moneys are to be available for the payment of the principal of, Redemption Price, if any, and interest on said Bonds, as the case may be. . (D) Anything in this Resolution to the contrary notwithstanding, but subject to the right of the Trustee to require the Agency to furnish an approving opinion of counsel acceptable to the Trustee, any moneys held by the Trustee or Paying Agents in trust for the payment and discharge of any of the Bonds or coupons which remain unclaimed for four (4) years after the date when such Bonds have become due and payable, either at their stated maturity dates or by call for earlier redemption, if such moneys were held by the Trustee or Paying Agents at such date, or for four (4) years after the date of deposit of such moneys if deposited with the Trustee or Paying Agents after the said date when such Bonds became due and payable, shall, at the written request of the Agency, be repaid by the Trustee or Paying Agents to the Agency, free from trust, and the Trustee or Paying Agents shall thereupon be released and discharged with respect thereto and the Bondholders shall look only to the Agency for the payment of such Bonds and coupons; provided, however, that before being required to make any such payment to the Agency, the Trustee or Paying Agent shall, at the expense of the Agency, cause to be published at least twice, at an interval of not less than seven ~7) days between publications, in an Authorized Newspaper, a notice that said moneys remain unclaimed and that, after a date named in said notice, which date shall be not less than thirty (30) days after the date of the first publication of such notice, the balance of such moneys then unclaimed will be returned to the Agency. 68 ARTICLE XV MISCELLANEOUS 1501. Preservation and Inspection of Oocuments. All documents received by the Trustee or any Paying Agent under the provisions of this Resolution or any Supplemental Resolution, shall be retained in its possession and shall be subject at all reasonable times to the inspection of the Agency, the Trustee, or any Paying Agent, and, upon written request of not less than five percent (5%) in principal amount of the Holders of the Outstanding Bonds, Bondholders and their agent and representatives, any of whom may make copies thereof. 1502. Destruction .0fBondsand Coupons. Any Bonds purchased or redeemed by the Trustee under this Resolution shall be cancelled by the Trustee. Whenever in this Resolution provision is made for the cancellation by the Trustee and the delivery to the Agency of any Bonds or any coupons, including 80nds cancelled under the first sentence of this Section, the Trustee may, upon request of the Agency (evidenced by an Officer's Certificate), in 1 ieu of such cancellation and del ivery, destroy such Bonds and coupons (in the presence of an officer of the Agency, if the Agency shall so require) and deliver a .certificate of such destruction to the Agency. 1503. Parties of Interest. Nothing in this Resolution or in any Supplemental Resolution adopted pursuant to the provisions hereof, expressed or implied, is intended to or shall be construed to confer upon or to give any person or party other than the Agency, Trustee, Paying Agents and the Holders of the Bonds and coupons appertaining thereto any rights, remedies or claims under or by reason of this Resolution, any Supplemental Resolution or any covenants, stipulations, premises, agreements or obligations thereof; and all covenants, stipulations, promises, agreements and obligations in this Resolution or any Supplemental Resolution contained by or on behalf of the Agency sh all be for the sole and exc 1 us ive benefit of the Agency, Trus tee and Paying Agents and the Holders from time to time of the Bonds and the coupons appertaining thereto. 1504. No Recourse Under Resolution or on Bonds. All covenants, stipulations, promises, agreements and obligations of the Agency contained in this Resolution and in any Supplemental Resolution shall be deemed to be the covenants, stipulations, promises, agreements and obligations of the Agency and not of any member, offi cer or employee of the Agency in his indi v i dua 1 capacity, and no recourse shall be had for the payment of the principal or Redemption Price of or interest on the 80nds or for any claim based thereon or on this Resolution and any Supplemental Resolution against any member, officer or employee of the Agency or any person executing the Bonds. 1505. Survival of Covenants. The obligation of the Agency under Section 905 shall survive payment and cancellation of the Bonds and defeasance pursuant to Section 1401. 69 . . . -- t- , . ~ . ~ . 1506. Headings. Any headings preceding the text of the several Articles and Sections hereof and any table of contents shall be solely for conven ience or reference and shall not affect the mean ing or construct ion of this Resolution. 1507. Conflict. All resolutions or parts of resolutions or other proceedings of the Agency in conflict herewith shall be and the same are repealed insofar as such conflict exists. 1508. L iab il ityof Agency Limited to Revenues. Notwithstanding anything contained in this Resolution, the Agency shall not be required to advance any moneys derived from any source of income other than the Revenues for the payment of the principal of or interest on or Redemption Price of the Bonds or for the payments of the costs and expenses of the Res i denti al Mortgage Financing Program. Nevertheless, the Agency may, but shall not be required to, advance for any of the purposes hereof any other funds of the Agency which may be made available to it for such purposes. 1509. Successor to Agency. All of the covenants, stipulations, promises, agreements and obligations contained in this Resolution and in any Supplemental Resolution by or on behalf. of or for the benefit of the Agency shall bind or inure to the benefit of the successor or successors of the Agency, from time to time, and to any officer, board, corporation, commission, authority, àgency or instrumentality to whom or to which any power or duty affecting such covenants, stipulations, promises, agreements and obligations shall be transferred by or in accordance with law. 1510. Notice, Any notice, demand, direction, request or other instrument autiiõr1žëd or required by this Resolution to be given to or filed with the Agency or the Trustee shall be deemed to have been sufficiently given or filed for all purposes of this Resolution if and when delivered to or sent by certified mail, return receipt requested, to the Agency and the Trustee at their respective addresses to be specified in a supplemental Resolution. 1511. Proceedings Constitute Contract. After the issuance and delivery of the Bonds, this Resolution and any Supplemental Resolution shall be considered to be a' contract with the Holders of the Bonds, but shall be subject to modification or amendment to the extent and in the manner provided in this Resolution, but to no greater extent and in no other manner. CUSIP identification numbers may be imprinteD on the Bonds, but such numbers shall not constitute a part of the contract evidenced by the Bonds and no liability shall hereafter attach to the Agency or any of the officers or agents thereof because of or on account of said numbers. Any error or omission with respect to said numbers shall not constitute cause for refusal by the purchaser to accept delivery of and pay for the 80nds. 1512. Severability. In case anyone or more of the provisions of this Resolution or of the 80nds or coupons shall for any reason be held to be illegal or invalid, such illegality or invalidity shall not affect any other 70 III"'" , 1 1 - -- provision of this Resolution or of said Bonds or coupons, but this Resolution and said Bonds and coupons shall be construed and enforced as if such illegal or invalid provisions had not been contained therein. 1513. Validity of Multiple Copies. This Resolution may be executed in multiple counterparts, each of which shall be regarded for all purposes as an original; and such counterparts shall constitute but one and the same instrument. 1514. Effective Date. This Resolution shall take effect upon adoption. ADOPTED AND APPROVED this 1st day of July, 1980, by the following vote: AYES: Members: James E. Ward, Gordon Bricken, Robert W. Luxembourger, A1 Serrato, Daniel E. Griset, Harry K. Yamamoto NOES: ABSENT: Members: J. Ogden Markel Members: None ATTEST: fJ:~(Ä~ Se etary 0 t e ommun 1 ty Redeve lopment Agency of the City of Santa Ana The duties and obligations herein imposed upon the Trustee and the provisions hereof relating to the Trus tee are agreed to an d accepted: SECURITY PAC~ BANK ~~ - By Authorlzed Officer TRUSTE E Dated: July 2 2/, 1980 71