HomeMy WebLinkAbout63-178CITY OF SANTA ANA
RESOLUTION NO.._~J..-.~.7.~
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA
ANA, CALIFORNIA, AUTHORIZING THE ISSUANCE OF $2,000,000
WATER REVENUE BONDS OF SAID CITY AND PROVIDING THE
TERMS AND CONDITIONS FOR THE ISSUANCE OF SAID BONDS.
Whereas, pursuant to Ordinance No. NS-561, a special election was held in the City of
Santa Ana, for the purpose of submitting to the qualified voters of said city the proposition
of issuing water revenue bonds of said city in the amount of $6,950,000 pursuant to the charter
of said city and the Revenue Bond Law of 1941 (Chapter 6, Part 1, Division 2, Title 5 of the
Government Code of the State of California) for the following purpose, to wit:
The acquisition and construction of additions to the revenue producing water utility of
the City of Santa Ana (i.e. the water supply and distribution system) for which the property
to be acquired and the improvements or additions to be made to the equipment for such
revenue-producing utility shall consist of works and facilities for the production, storage,
transmission and distribution of water, including water storage reservoirs, water wells, pump-
ing and pressure regulating stations, water transmission and distribution mains, capacity
rights in works and facilities to be used jointly with other public corporations, facilities of
existing water companies; and for the foregoing appurtenances and appurtenant works, and
including the acquisition of all water rights, lands, easements, pipe, pumps, and other property
necessary therefor; the estimate of the cost of the foregoing purpose being $6,950,000; the
regulations and procedures for the sale and issuance of such bonds to be as set forth in the
Revenue Bond Law of 1941 (Chapter 6, Part 1, Division 2, Title 5 of the Government Code
of the State of California); and the provision to be made from the revenue of snch revenue-
producing utility for the payment of interest on, and retirement of, the bonds to be that
said bonds are secured by and are payable from all of the revenues of said utility as now or
hereafter constituted, all as more particularly set forth in said Revenue Bond Law of 1941.
and
WHEREAS, said proposition was approved by the votes of more than a majority of all the
voters voting on said proposition at said special election, and this city is now authorized to
issue said bonds as provided in said Charter and said Revenue Bond Law of 1941; and this City
has issued and sold $3,000,000 of said bonds designated 1962 Water Revenue Bonds, Series A; and
WHEREAS, this City Council deems it necessary to issue and sell at this time $2,000,000 of
said bonds as "Series B";
NOW, THEREFORE, the City Council DOES HEREBY RESOLVE, DETERMINE
AND ORDER as follows:
Section 1. Definitions. As used in this resolution, unless the context indicates otherwise, the
following terms shall have the following meanings:
(a) "City" means the City of Santa Ana, California.
(b) "City Council" or "Council" means the City Council of said City.
(c) "Director of Finance" means the Director of Finance of said City.
(d) "Clerk" means the Clerk of the Council of said City.
(e) "Revenue Bond Law" means the Revenue Bond Law of 1941 as cited in the recitals
hereof.
(f) "The bonds", "said bonds" or "this series" means the $2,000,000 bonds authorized
by this resolution.
(g) "Enterprise" means the enterprise defined in said Ordinance No. NS-561 calling said
election, as follows:
The entire waterworks system of the City of Santa Aha as said system now exists
together with all additions to be acquired, constructed and financed with funds derived
from the sale of the revenue bonds herein proposed to be issued, together with all im-
provements and extensions to said system later constructed or acquired.
(h) "Gross revenues of the enterprise" means all revenues (as defined in Section 54315
of the Government Code, which include ail charges received for, and all other income and
receipts derived by the city from the operation of the enterprise or arising from the enterprise)
received by the city from the services, facilities and ~vater sales of the enterprise, excepting
therefrom all reimbursement charges, connection charges, and deposits to secure service.
(i) "Necessary and reasonable maintenance and operation costs of the enterprise" means
the reasonable expenses of management, repair and other expenses necessary to maintain and
preserve the enterprise in good repair and working order, excluding depreciation and
obsolescence.
(j) "Net revenues of the enterprise" means the amount of the gross revenues of the
enterprise remaining after payment therefrom of the necessary and reasonable maintenance
and operation costs of the enterprise.
(k) "Maximum amount of annual debt service" shall be the maximum sum obtained
for any fiscal year thereafter by totaling the following:
(a) The principal amount of all outstanding bonds payable in such fiscal year;
(b) The amount of minimum term bond payments for all outstanding bonds required
to be made in such fiscal year together with the premium thereon, if any be payable; and
(c) The interest ~vhich would be due during such fiscal year on the aggregate princi-
pal amount of bonds which would be outstanding in such fiscal year if the bonds are
retired as scheduled, but deducting and excluding from such aggregate amount the amount
of bonds retired in advance of said schedule.
(1) "Parity Bonds" means revenue bonds (including further series of bonds of the issue
of which this series is a part) revenue notes or any other evidences of indebtedness which may
be authorized and/or issued for the acquisition, construction and financing of extensions of;
additions to, and improvements of the enterprise, payable out of the revenues derived from
the enterprise and which, as provided in this resolution, rank on a parity with the bonds of this
series.
(m) "Subsequent resolution" means any resolution of issuance for any parity bonds.
(n) "Resolution No. 62-92" means the resolution, adopted by the Council on May
18, 1962, authorizing the issuance of said Series A bonds.
(o) "Outstanding bonds" means all outstanding bonds of any series of bonds of the
issue of which this series is a part and any parity bonds.
(p) "Fiscal year" means the year period beginning on July Ist and ending on the next
following June 30th.
(q) "Authorized investments" means any negotiable direct obligations of the United
States, or any negotiable obligations for which the full faith and credit of the United States
are pledged for the payment of principal and interest, or any obligations issued by federal
land banks or federal intermediate credit banks established under the Federal Farm Loan Act,
as amended, bonds or debentures of the Federal Home Loan Bank Board or of any federal
home loan bank established under the Federal Home Loan Bank Act, obligations of the
Federal National Mortgage Association established under the National Housing Act, as
amended, and debentures and consolidated debentures issued by the Central Bank for Coopera-
tives and banks for cooperatives established under the Farm Credit Act of 1933, as amended.
Section 2. Equality of Bonds, Pledge o[ Revenues. Pursuant to the Revenue Bond Law of
1941 and this resolution, outstanding bonds shall rank on a parity and shall be equally secured
by a pledge, charge and lien upon the gross revenues of the enterprise without priority for number,
date of bonds, date of sale, date of execution, or date of delivery, and the payment of the interest
on and principal of outstanding bonds and any premiums upon the redemption of any thereof shall
be and are secured by an exclusive pledge, charge and lien upon the gross revenues of the
enterprise, and all of the gross revenues of the enterprise (including revenues of improvements
and extensions later constructed or acquired and revenues of existing systems, plants, works or
undertakings to be acquired, improved or extended or for the acquisition, improvement or
extension of which said bonds are to be issued) are hereby pledged, charged and assigned for the
security of outstanding bonds, and such gross revenues shall constitute a trust fund for the
security and payment of the interest on and principal of outstanding bonds and so long as
any of outstanding bonds or interest thereon are unpaid said gross revenues and interest thereon
shall not be used for any other purpose, except as permitted by this resolution and any subse-
quent resolution, and shall be held in trust for the benefit of the bondholders and shall be applied
pursuant to this resolution, or to this resolution as modified pursuant to provisions herein, and
any subsequent resolution.
Nothing in this resolution or in any subsequent resolution shall preclude: (a) the redemption
prior to maturity of any bonds subject to call and redemption and payment of said bonds from
proceeds of refunding bonds issued under said Revenue Bond Law of 1941 as the same now exists
or as hereafter amended, or under any other law of the State of California; (b) the issuance,
subject to the limitations in Covenant 11 in Section 12 hereof, of additional indebtedness evidenced
by revenue bonds, revenue notes or any other evidences of indebtedness payable out of the
revenues of the enterprise and ranking on a parity with said bonds.
Section 3. Amount, Issuance, Purpose and Nature of Bonds. That under and pursuant to said
Revenue Bond Law revenue bonds of the city in the amount of $2,000,000 shall be issued for the
purpose stated in the recitals hereof. Said revenue bonds shall be and are special obligations of the
city and shall be and are secured by a pledge of and lien upon, and shall be and are a charge upon,
and shall be and are payable as to the principal thereof and interest thereon and any premiums upon
the redemption of any thereof, solely from the gross revenues of the enterprise, such gross
revenues being hereby pledged, charged and assigned for the security of the bonds.
Section 4. No General City Liability. The general fund of the city is not liable for the
payment of the bonds or their interest, nor is the credit or taxing power of the city pledged for the
payment of the bonds or their interest. The holder of the bonds or coupons shall not compel the
exercise of the taxing power by the city or the forfeiture of any of its property. The principal of
and interest on the bonds and any premiums upon the redemption of any thereof are not a debt of
the city nor a legal or equitable pledge, charge, lien, or encumbrance, upon any of its property, or
upon any of its income, receipts, or revenues, except the gross revenues of the enterprise which
are, under the terms of this resolution and said Revenue Bond Law, pledged to the payment of
said bonds and interest.
Section 5. Description of Bonds. Said Bonds shall be in the principal sum of $2,000,000,
shall be all in the denomination of $5,000 each, or, if expressly so requested by the purchaser at
his option, all in the denomination of $1,000, and shall either be 400 in number, numbered B1 to
B400, inclusive, or 2000 in number numbered B1 to B2000, inclusive, depending upon the de-
nomination determined as above. Said bonds shall be designated 1962 WATER REVENUE
BONDS, SERIES B, shall be dated January 1, 1964, and shall he payable in consecutive numerical
order on July 1 in each year of maturity in the amounts for each of the several years as follows:
Maturity Years
~ Inclusive -- Amount l~ach Year
1965 ....................................................................................................................... $ 10,000
1966 ....................................................................................................................... 20,000
1967- 1968 ............................................................................................................ 30,000
1969 - 1970 ............................................................................................................ 40,000
1971 - 1975 ............................................................................................................ 50,000
1976 - 1980 ............................................................................................................ 60,000
1981 - 1984 ............................................................................................................ 70,000
1994 ....................................................................................................................... 1,000,000
The bonds maturing in the years 1965 to 1984, inclusive, are herein sometimes referred to as
"the serial bonds". The bonds maturing in the year 1994 are herein sometimes referred to as
"the term bonds".
Section 6. Interest. Said bonds shall bear interest at a rate or rates to be hereafter fixed by
resolution or resolutions, but not to exceed six per cent (6%) per annum, payable annually for the
first year and semiannually thereafter, on the 1st days of January and July of each year. Each bond
shall bear interest until the principal sum thereof has been paid, provided, however, that if at the
maturity date of any bond, or if the same is redeemable and has been duly called for redemption,
funds are available for the payment or redemption thereof in full accordance with the terms of this
resolution, said bonds shall then cease to bear interest. Said bonds and the interest thereon shall be
payable in lawful money of the United States of America at the office of the Director of Finance
of the City of Santa Aha, in said city, or, at the option of the holder, at any paying agent of the
city in Los Angeles or San Francisco, California, Chicago, Illinois, or in New York, New York.
Section 7. Execution of Bonds, The Mayor of the City and the Director of Finance of the
city are hereby authorized and directed to sign all of said bonds by their printed, lithographed or
engraved facsimile signatures, and the Clerk of the Council is hereby authorized and directed to
countersign said bonds and to affix thereto the corporate seal of the city, and the Director of
Finance of the city is hereby authorized and directed to sign the interest coupons of said bonds
by his printed, lithographed or engraved facsimile signature.
Section 8. Registration. Said bonds may be registered either as to principal only or as to both
principal and interest, and the form of registration of any registered bond may be discharged from
registration in the manner and with the effect set forth in the provisions for registration contained
in the form of bond set forth herein.
Section 9. Redemption of Bonds. The bonds maturing on or prior to July 1, 1984 are not
subject to call or redemption prior to maturity. The bonds maturing on July 1, 1994, are subject
to call and redemption, at the option of the city, on July 1, 1974, or on any interest payment
date thereafter prior to maturity, at a redemption price equal to the principal amount thereof plus
the following premiums (percentage of par value) if redeemed at the following times:
4
REDEMPTION DATES AND PREMIUMS
On or After And Prior to On or After And Prior to
July ! July ! Premium July 1 July I Premium
1974 1975 4% 1980 1981 1¼%
i975 1976 3~ 1981 1982 1
1976 1977 3 1982 1983 3~
1977 1978 2~ 1983 1984 ~
1978 1979 2 1984 1985 ~
1979 1980 1~ 1985 Maturity ~0~
All or any of the bonds subject to call may be called for redemption at any one time. If less than
ali of the bonds are redeemed at any one time, such bonds shall be redeemed only by lot. The inter-
est payment date on which bonds are to be presented for redemption is hereinafter sometimes
called the "redemption date."
(a) Notice of Redemption. Notice of the intended redemption shall be published by one inser-
tion in a newspaper of general circulation in the County of Orange, California, and in a financial
newspaper or journal of national circulation published in the City of New York, New York, said
publications to be at least 30 days but not more than 60 days prior to the redemption date. The
notice of redemption shall (a) state the redemption date; (b) state the redemption price; (c) state
the numbers and date of maturity of the bonds to be redeemed, provided, however, that whenever
any call includes all of the outstanding bonds subject to call the numbers of the bonds need not be
stated; (d) require that such bonds be surrendered with all interest coupons maturing subsequent
to the redemption date (except that no coupons need be surrendered on bonds registered as to
both principal and interest) at the office of the Director of Finance of the City of Santa Ana, in
said city, or, at the option of the holder, at any paying agent of the district in Los Angeles or San
Francisco, California, Chicago, Illinois, or in New York, New York; (e) require that bonds which
at the time of call are registered so as to be payable otherwise than to bearer shall be accompanied
by appropriate instruments of assignment duly executed in blank; and (f) give notice that further
interest on such bonds will not accrue after the designated redemption date.
The Director of Finance shall, on or before the date of publication of said notice of redemption,
mail a similar notice, postage prepaid to any person, firm or corporation that originally purchased
bonds from the city.
If any of the bonds designated for redemption shall be registered so as to be payable otherwise
than to bearer, the Director of Finance shall, on or before the date of publication of said notice
of redemption, mail a similar notice, postage prepaid, to the respective registered owners thereof
at the addresses appearing on the bond registry books.
The actual receipt by the holder of any bond (hereinafter referred to as "bondholder") of
notice of such redemption shall not be a condition precedent to redemption, and failure to receive
such notice shall not affect the validity of the proceedings for the redemption of such bonds or the
cessation of interest on the date fixed for redemption. The notice or notices required by this section
shall be given by the Director of Finance. A certificate by the Director of Finance that notice of
call and redemption has been given to original purchasers and to holders of registered bonds as
herein provided shall be conclusive as against ali parties, and no bondholder whose bond or
registered bond is called for redemption may object thereto or object to the cessation of interest
on the redemption date fixed by any claim or showing that he failed to actually receive such notice
of call and redemption.
(b) Redemption. Prior to the redemption date there must be set aside in the Retirement Fund
moneys for the purpose and sufficient to redeem, at the premiums payable as in this resolution pro-
vided, the bonds designated in such notice for redemption, Said moneys must be set aside in said
fund solely for that purpose and shall be applied on or after the redemption date to the payment
(principal and premium) of the bonds to be redeemed upon presentation and surrender of such
bonds and (except as to bonds registered as to both principal and interest) all interest coupons
maturing after the redemption date. Any interest coupon due on or prior to the redemption date
shall be paid from the Interest Fund upon presentation and surrender thereof. Any interest due
on or prior to the redemption date upon bonds registered as to both principal and interest shall
be paid from said Interest Fund. Each bond presented (if unregistered or registered as to principal
only) must have attached thereto or presented therewith all interest coupons maturing after the
redemption date.
(c) Effect of the Notice of Redemption. When notice of redemption has been given, and when
the amount necessary for the redemption of the bonds called for redemption (principal and
premium) is set aside for that purpose in the Retirement Fund, the bonds designated for redemp-
tion shall become due and payable on the date fixed for redemption thereof, and upon presentation
and surrender of said bonds and (except as to bonds registered as to both principal and interest)
all interest coupons maturing after the redemption date, at the place specified in the notice of
redemption, and, if any of said bonds be registered, upon the appropriate assignment thereof in
blank, such bonds shall be redeemed and paid at said redemption price out of the Retirement
Fund, and no interest will accrue on such bonds called for redemption or on any interest coupon
thereof after the redemption date specified in such notice, and the holders of said bonds so called
for redemption after such redemption date shall look for the payment of such bonds and the
premium thereon only to said Retirement Fund. All bonds redeemed and all interest coupons
thereof shall be cancelled forthwith by the Director of Finance and shall not be reissued.
All interest coupons pertaining to any redeemed bonds, which coupons have matured on or
prior to the time fixed for redemption, shall continue to be payable to the respective holders
thereof but without interest thereon. All unpaid interest payable at or prior to the date fixed for
redemption upon bonds registered in such manner that the interest is payable only to the registered
owners shall continue to be payable to the respective registered owners of such bonds, or their
order, but without interest thereon.
Section 10. Revenues and l~unds. Pursuant to Resolution No. 62-92 and under and pursuant
to said Revenue Bond Law there were created the following funds which are hereby expresssly
continued and shall be applied pursuant to this resolution and under and pursuant to said Revenue
Bond Law:
1. Water Revenue Bond Acquisition and Construction Fund (herein sometimes referred
to as "Construction Fund");
2. Water Revenue Fund (herein sometimes referred to as "Revenue Fund");
3. Water Revenue Bond Interest Fund (herein sometimes referred to as "Interest Fund");
4. Water Revenue Bond Retirement Fund (herein sometimes referred to as Retirement
Fund");
5. Water Revenue Bond Reserve Fund (herein sometimes referred to as "Reserve Fund");
6. Water Utility Fund (herein sometimes referred to as "Utility Fund");
(a) Disposition of Bond Proceeds. The proceeds of the sale of the bonds shall be placed by the
Director of Finance as follows:
1. The accrued interest, if any, shall be placed in the Interest Fund.
2. The balance in the Construction Fund.
The city may deposit money received from any source in the Construction Fund. The money
set aside and placed in the Construction Fund shall remain therein until from time to time ex-
pended for the purposes for which the bonds were issued. Money in the Construction Fund may
be invested in any authorized investments, provided that the maturity or maturities thereof shall
not be later than the date or dates on which money must be available to meet scheduled Construc-
tion Fund expenditures. If any sum remains in said Construction Fund after the full accomplish-
ment of the purposes for which the bonds were issued, it shall be transferred to and placed in the
Reserve Fund to the extent necessary at that time to bring the Reserve Fund up to an amount
equal to the maximum amount of annual debt service and, as to any remaining balance, to the
Revenue Fund.
(b) Revenue Fund. The Director of Finance shall, on or before the last business day of
each calendar month deposit the gross revenues of the enterprise in the Revenue Fund. The
Director of Finance shall transfer moneys from the Revenue Fund to the following funds in the
following order of priority.
(c) ~nterest Fund. On or before the last business day of each calendar month so long as any~
of the bonds are outstanding the Director of Finance shall set aside out of the Revenue Fund
into the Interest Fund, at least one-sixth (1/6th) of the interest which will become due and
payable on the outstanding bonds within the next ensuing six (6) months, except that for the
first year after the date of the bonds, commencing in the month of January, 1964, the monthly sum
transferred for interest shall include at least one-twelfth (1/12) of the interest which will become
due and payable on the bonds at the end of the first year. Such sums shall be so transferred that
at least the full amount required to pay the interest on said outstanding bonds shall be set aside
in the Interest Fund prior to the date the installment of interest becomes due.
Any amount required to be set aside, transferred to and placed in the Interest Fund may be
prepaid in whole or in part by being earlier set aside, transferred to and placed in the Interest
Fund, and in that event the monthly transfer which has been so prepaid need not be made at the
time appointed therefor. In any event prior to the due date of any installment of interest on out-
standing bonds all sums required for the payment thereof must be in the Interest Fund.
Money in the Interest Fund may be invested in any authorized investments, provided that
the maturity or maturities thereof shall no]t be later than the date or dates on which money must
be available in the Interest Fund.
The interest coupons shall recite that they are payable from the Revenue Fund, but said
coupons notwithstanding such recitaI shall be paid from the Interest Fund which is derived from
the Revenue Fund.
If after all of the outstanding bonds have been redeemed and cancelled or paid and cancelled
there are any moneys remaining in the Interest Fund said money shall be transferred to the
Revenue Fund; provided, however, that if said moneys are part of the proceeds of refunding
bonds said moneys shall be transferred to the fund or account created for the payment of the
principal of such refunding bonds.
(d) Retirement Fund. For the payment of the outstanding serial bonds on or before the last
business day of each calendar month so long as any of such bonds are outstanding the Director of
Finance shall set aside out of the Revenue Fund into the Retirement Fund, at least one-twelfth
(1/12) of the principal amount of such bonds which will mature and be payable within the next
ensuing twelve (12) months. Such sums shall be so transferred that at least the full amount
required to pay any maturity or installment of principal of such bonds shall be set aside in the
Retirement Fund prior to the date the installment of principal becomes due.
7
Any amount required to be set aside, transferred to and placed in the Retirement Fund may
be prepaid in whole or in part by being earlier set aside, transferred to and placed in the Retire-
ment Fund, and in that event the monthly transfer which has been so prepaid need not be made at
the time appointed therefor. In any event prior to the due date of any installment of principal on
such serial bonds ail sums required for the payment thereof must be in the Retirement Fund.
The bonds shall recite that they are payable from the Revenue Fund, but said bonds notwith-
standing such recital shall be paid from the Retirement Fund which is derived from the Revenue
Fund.
For the payment of the term bonds of this series on or before the last business day of each
calendar month, commencing in the month of July, 1984, there shall be transferred from the
Revenue Fund and set aside in the Retirement Fund an amount not less than the minimum amount
hereinafter specified. Such transfer shall in no event be less than the amounts (herein sometimes
referred to as "minimum term bond payments") which will be sufficient to call and redeem said
term bonds (including premiums, if any, thereon) in the following respective minimum principal
amounts on July 1 in each of the following years, to xvit:
Minimum Amount Minimum Amount
Year Each Year Year Each Year
1985 ............................ $ 80,000
1986 ............................ 80,000
1987 ............................ 90,000
1988 ............................ 90,000
1989 ............................ 100,000
1990 ............................ $100,1)00
1991 ............................ 100,000
1992 ............................ 110,000
1993 ............................ 120,000
1994 ............................ 130,000
The minimum term bond payment to be made on the last business day of each calendar month
as aforesaid shall be at least one-twelfth (1/12) of the amount needed in each year to call and
redeem the minimum amount of the term bonds according to the above table, it being the intent of
this provision that the respective minimum amounts necessary to call and redeem the term bonds
according to the above table (or to purchase all or any part of such bonds in lieu of call and
redemption prior to maturity) shall be transferred to the Retirement Fund prior to the redemp-
tion date. In the event that the transfer made for any month is less than the minimum term
bond payment for that month because of lack of funds or for any other reason the deficiency
shall be added to and become a part of the minimum term bond payment required for the
following month.
Except as hereinafter provided, moneys in the Retirement Fund set aside for the minimum
term bond payments shall be used solely for the purpose of purchasing and/or calling and re-
deeming said term bonds prior to maturity. Money in said fund in excess of that which has been
set aside for the purpose of redeeming bonds of this series which have been called prior to maturity
may be used to purchase from time to time on the open market any of the outstanding bonds of
this series subject to such call and redemption (irrespective of the number of such bonds), either
at public or private sale or otherwise, but the purchase price (including brokerage or other charges,
but excluding accrued interest) shall not exceed the redemption price thereof on the next interest
payment date.
If on May 15, 1985 or on any May 15th of any year thereafter, the Director of Finance
determines that there will be in the Retirement Fund an amount at least sufficient, including
premiums, if any, thereon to call $5,000 principal amount of the term bonds of this series or more,
the Director of Finance shall then call and redeem term bonds from minimum term bond payments
deposited in the Retirement Fund, together with the amount to be so deposited prior to the next
available July 1 redemption date, in the largest amount which can be redeemed with the money
to be available at said redemption date.
Money in the Retirement Fund may be invested in any authorized investments, provided
that the maturity or maturities thereof shall not be later than the date or dates on which money
must be available in the Retirement Fund for call or retirement of bonds.
If after all of the outstanding bonds have been redeemed and cancelled or paid and cancelled
there are any moneys remaining in the Retirement Fund said money shall be transferred to the
Revenue Fund; provided, however, that if said moneys are part of the proceeds of refunding
bonds said moneys shall be transferred to the fund or account created for the payment of the
principal of such refunding bonds.
Under this resolution and in the event any subsequent resolution provides for the issuance
of term bonds, the minimum term bond payments to be placed in the Retirement Fund for term
bonds of this series and for any outstanding term bonds shall rank on a parity with the minimum
term bond payments to be placed in the Retirement Fund for the redemption of the terms bonds
of Series B.
(e) Reserve Fund. From any available funds of the City including the Water Utility Fund
there shall be immediately placed in the Reserve Fund an amount, which together with the amount
therein, shall be an amount equal to the maximum amount of annual debt service as defined
herein, and thereafter there shall be maintained in said fund an amount equal to said maximum
amount of annual debt service. The Reserve Fund may be invested in any authorized investments,
provided that the maturity of said investment shall not be later than twelve years from the
date thereof.
Upon the sale of any parity bonds there shall be immediately placed in the Reserve Fund
from any available funds of the city including the Water Utility Fund an amount which will make
the Reserve Fund equal to the maximum amount of annual debt service and thereafter there shall
be maintained in said Reserve Fund an amount at least equal to said maximum amount of annual
debt service.
Moneys in the Reserve Fund shall be used solely for the purpose of paying the principal of
and interest on the outstanding bonds and for the redemption of the outstanding term bonds (in-
cluding premiums thereon) in the principal amounts provided herein in the event that the moneys
in the Interest Fund or the Retirement Fund are insufficient therefor and for that purpose the
Director of Finance shall withdraw and transfer moneys from the Reserve Fund to the appropriate
fund as the case may be. Whenever moneys are withdrawn from the Reserve Fund for the pur-
poses provided in this section an equal amount of money shall be placed in the Reserve Fund from
the first available moneys in the Revenue Fund. At least annually an amount in the Reserve Fund
in excess of the maximum amount of annual debt service shall be transferred to the Revenue
Fund. Money in the Reserve Fund may be used to pay the principal and/or interest on the last
maturity of the outstanding bonds.
(f) Water Utility Fund. All moneys remaining in the Revenue Fund on or before the last
business day of each month, after setting aside and transferring all the sums required to be set
aside and transferred by the preceding paragraphs of this section, shall be transferred to the Water
Utility Fund. The necessary and reasonable maintenance and operation costs of the enterprise
shall be paid from this fund and shall be separately accounted for as maintenance and operation
expenses.
(g) Surplus. After the above transfers and uses have been made and all other covenants of
the city contained herein have been duly performed moneys in the Water Utility Fund are
surplus and may be (i) used for extensions and betterments of the water system; (ii) invested
in any securities in which the city may invest funds subject to its control; (iii) transferred
to the Retirement Fund to be used for the redemption of any of said bonds which are subject
to call and redemption prior to maturity or to the purchase from time to time in the open market
9
of any outstanding bonds whether or not subject to call and redemption (irrespective of the
maturity or number of such bonds) at prices and in such manner, either at public or private
sale, or otherwise, as the city in its discretion may determine, but such purchase price (in-
cluding brokerage and other charges, but excluding accrued interest) shall not exceed t04%
of the principal amount or the redemption price of the outstanding term bonds on the next interest
payment date, or (iv) used for any lawful purpose of the city.
(h) Withdrawals. The Director of Finance shall not permit any withdrawal to be made by
the city of any moneys in any of the funds herein, if and when the city is in default hereunder.
(i) Security for Deposits. Ail moneys held by the Director of Finance shall be held in time or
demand deposits, and shall be secured at times by such obligations and to the extent required by
law, except to the extent that such moneys are invested as hereinbefore provided.
(j) Investments. Obligations purchased as an investment of money in any funds which are
herein authorized to be invested shall be deemed at all times to be a part of such funds and any
profit realized from investments shall be credited to such funds and any losses resulting from such
investments shall be credited to such funds and any losses resulting from such investment shall
be charged to such funds, and the interest accruing thereunder shall be credited to the Revenue
Fund except where expressly provided otherwise. The Director of Finance, shall sell at the best
price obtainable or present for redemption any obligations so purchased, whenever it may be
necessary to do so in order to provide moneys to meet any payment or transfer from such funds.
For the purpose of determining at any given time the balance in any such funds any such invest-
ments constituting a part of such funds shall be valued at the then estimated or appraised market
value of such investments.
Section 11. Warranty. The city shall preserve and protect the security of the bonds and
the rights of the bondholders and warrant and defend their rights against all claims and demands
of all persons.
Section 12. Covenants. So long as any of the bonds issued hereunder are outstanding and
unpaid, or so long as provision for the full payment and discharge thereof at maturity or upon
redemption thereof prior to maturity through the setting apart in the Retirement Fund to insure
the payment or redemption thereof of money sufficient for that purpose has not been made, the
city makes the following covenants with the bondholders under the provisions of the Revenue
Bond Law of 1941 (to be performed by the city or its proper officers, agents or employees) which
covenants are necessary, convenient and desirable to secure the bonds and tend to make them
more marketable; provided however, that said covenants do not require the city to expend any
funds other than the revenues received or receivable from the enterprise.
Covenant 1. Punctual Payment. The city covenants that it will duly and punctually pay or
cause to be paid the principal of and interest on every bond issued hereunder, together with the
premium thereon, if any be payable, on the date, at the place and in the manner mentioned in the
bonds and coupons and in accordance with this resolution, and that the payments into the Interest
Fund, the Retirement Fund and Reserve Fund will be made, all in strict conformity with the terms
of said bonds and of this resolution, and that it will faithfully observe and perform all of the
conditions, covenants and requirements of this resolution and all resolutions supplemental thereto
and of the bonds issued hereunder, and that time of such payment and performance is of the
essence of the city's contract with the bondholders.
Covenant 2. Discharge Claims. The city covenants that in order to fully preserve and protect
the priority and security of the bonds the city shall pay from the Revenue Fund and discharge
all lawful claims for labor, materials and supplies furnished for or in connection with the enterprise
10
which, if unpaid, may become a lien or charge upon the revenues prior or superior to the lien of
the bonds and impair the security of the bonds. The city shall also pay from the Revenue Fund
all taxes and assessments or other governmental charges lawfully levied or assessed upon or in
respect of the enterprise or upon any part thereof or upon any of the revenues therefrom.
Covenant 3. Commence Acquisition and Construction. As soon as funds are available therefor,
the city will commence the accomplishment of the purposes for which the bonds are issued and
will continue the same to completion with all practical dispatch and in an economical manner.
Covenant 4. Operate Enterprise in Efficient and Economical Manner. The city covenants
and agrees to operate the enterprise in an efficient and economical manner and to operate, maintain
and preserve the enterprise in good repair and working' order.
Covenant 5. Against Sale, Eminent Domain. The city covenants that the enterprise shall not
be mortgaged or otherwise encumbered, sold, leased, pledged, any charge placed thereon, or
disposed of as a whole or substantially as a whole unless such sale or other disposition be so
arranged as to provide for a continuance of payments into the Revenue Fund sufficient in amount
to permit payment therefrom of the principal of and interest on and premiums, if any, due upon
the cai1 and redemption thereof, of the bonds, payment of which is required to be made out of the
revenues ,of the enterprise, and also to provide for such payments into the funds as are required
under the terms of this resolution. The revenues from the enterprise or any other funds pledged
or otherwise made available to secure payment of the principal of and interest on the bonds shall
not be mortgaged, encumbered, sold, leased, pledged, any charge placed thereon, or disposed of
or used except as authorized by the terms of this resolution. The city further covenants that
it will not enter any agreement which impairs the operation of the enterprise or any part o{ it
necessary to secure adequate revenues to pay the principal and interest of the bonds or which
otherwise would impair the rights of the bondholders with respect to the revenues or the operation
of the enterprise. If any substantial part of the enterprise is sold the payment therefor shall either
be used for the acquisition and/or construction of improvements and extensions of the enterprise
or shall be placed in the appropriate funds and shall be used to pay or call and redeem outstanding
bonds iu the manner provided in this resolution and any subsequent resolution.
The city covenants that any amounts received as awards as a result of the taking of all or any
part of the enterprise by the lawful exercise o{ eminent domain, if and to the extent that such
right can be exercised against such property of the city, shall either be used {or the acquisition
and/or construction of improvements and extension of the enterprise or shall be placed in the
appropriate funds and shall be used to pay or call and redeem outstanding bonds in the manner
provided in this resolution and any subsequent resolution.
Covenant 6. Insurance. The city covenants that it shall at all times maintain with responsible
insurers all such insurance on the enterprise as is customarily maintained with respect to works
and properties of like character against accident to, loss of or damage to such works or properties.
If any useful part of the enterprise shall be damaged or destroyed, such part shall be restored to
use. The money collected from insurance against accident to or destruction of the physical enter-
prise shall be used for repairing or rebuilding the damaged or destroyed enterprise, and to the
extent not so applied, shall be applied to the retirement of outstanding and unredeemed bonds
issued for the enterprise and for such purpose paid into the appropriate funds.
The city shall also maintain with responsible insurers workmen's compensation insurance and
insurance against public liability and property damage to the extent reasonably necessary to
protect the city and the bondholders.
Covenant 7. Records and Accounts. The city covenants that it shall keep proper books of
record and accounts of the enterprise, separate from all other records and accounts, in which
11
complete and correct entries shall be made of all transactions relating to the enterprise. Said books
shall at all times be subject to the inspection of the holders of not less than t0% of the outstanding
bonds or their representatives authorized in writing.
The city covenants that it will cause the books and accounts of the enterprise to be audited
annually by an independent certified public accountant or firm of certified public accountants and
will make available for inspection by the bondholders at the office of the Director of Finance of
said city, a copy of the report of such accountant or accountants.
The city covenants that it will cause to be published annually, not more than 120 days after
the close of each fiscal year a summary statement showing the amount of gross revenues and
the amount of all other funds collected which are required to be pledged or otherwise made avail-
able as security for payment of principal of and interest on the bonds, the disbursements from
such revenues and other funds in reasonable detail, and a general statement of the financial and
physical condition of the enterprise. The city shall furnish a copy of the statement to any bond-
holder upon request.
Covenant 8. No Free Service. The city covenants that, except to the extent that the city is
required under agreements and/or contracts existing on the effective date of this resolution, no
water or other service from the enterprise may be furnished or rendered to the United States of
America, the State of California, the city, and municipal or public corporation or district or public
agency or any private corporation or person free, and that, except to the extent that the city is
required under agreements and/or contracts existing on the effective date of this resolution, no
such service shall be rendered to the United States of America, the State of California, the city,
any other municipal or public corporation or district or any private corporation or person at rates
lower than those charged other persons for similar service, except that charges to the city
for water used for street or sewer flushing and for fire hydrants may be made at rates lower than
those charged private persons, and all rates for service rendered to the city shall be a reasonable
charge for the service rendered. No building or other real property of the enterprise shall be
furnished free to the city, but the city shall pay into the Revenue Fund the reasonable rental
value of any property so used, and reasonable and proper charges for service rendered or quarters
furnished to the enterprise shall be paid to the city from the Revenue Fund. The city covenants
that it shall at all times during the period any of the bonds are outstanding maintain and enforce
valid regulations for the payment of bills for water service and that such regulations shall at all
times during such period provide that the city shall discontinue water service to any user whose
water bill has not been paid within the time fixed by said regulations.
Covenant 9. Rates and Charges. The city shall and hereby covenants that it shall prescribe,
revise and collect such charges for the services, facilities and water of the enterprise which, after
making allowances for contingencies and error in the estimates, shall be at least sufficient to pay
the following amounts in the order set forth:
(a) The interest on and principal or minimum term bond payments of the bonds as they
become due and payable;
(b) Ali payments required for compliance with this resolution including payments
required to be made into the Reserve Fund;
(c) All payments required to meet any other obligations of the city which are charges,
liens, encumbrances upon or payable from the revenues of the enterprise;
(d) All current expenses for the necessary and reasonable maintenance and operation
costs of the enterprise;
and the charges shall be so fixed that the net revenues shall be at least 1.25 times the amounts
payable under (a).
12
Covenant 10. No priority for Additional Bonds. The city covenants that no additional bonds
shall be issued pursuant to said Revenue Bond Law or any other law of the State of California
having any priority in payment of principal or interest out of the revenues of the enterprise over
the bonds hereby authorized to be issued and payable out of said revenues.
Covenant 11. Limits on Additional Debt. The city covenants that, except for bonds issued
to refund said bonds, no additional indebtedness evidenced by revenue bonds, revenue notes or any
other evidences of indebtedness payable out of the Revenue Fund and ranking on a parity with
these bonds shall be created or incurred unless:
First: That the principal of and interest on the bonds have been paid as the same have
become due; and that payments into the Retirement Fund and the Reserve Fund have been
made, all in conformity with this resolution, ~nd
Second: That the last maturity date of any parity bonds shall not be earlier than the
last maturity date of any bonds then outstanding and that any parity bonds shall mature on
July 1, and
Third: The net revenues of the enterprise, calculated on sound accounting principles,
as shown by the financial report of the Director of Finance for the latest fiscal year or by a
special financial report for the last completed 12 month period ended 60 days prior to the
adoption of the resolution of issuance for such additional indebtedness, plus, at the option
of the city, either or all of the items hereinafter in this Covenant 11 designated (a) and (b),;
shall have amounted to at least 1.25 times the maximum amount of annual debt service in
any fiscal year thereafter on all indebtedness to be outstanding immediately subsequent to
the incurring of such additional indebtedness.
For the purposes of this Covenant 11, the net revenues of the enterprise shall not include
any sum transferred from the Construction Fund under the provisions of Section 10(a) hereof.
The items either or all of which may be added to such net revenues for the purpose of applying
the restriction contained in this Covenant 11 are the following:
(a) An allowance for net revenues from any additions to or improvements or extensions of
the enterprise to be made with the proceeds of such additional indebtedness, and also for net
revenues from any such additions, improvements or extensions which have been made from moneys
from any source but which, during all or any part of such fiscal year or last completed 12 month
period, were not in service, alt in an amount equal to 75% of the estimated additional average
annual net revenues to be derived from such additions, improvements and extensions for the first
36 month period in which each addition, improvement or extension is respectively to be in opera-
tion, all as shown by the certificate or opinion of a qualified independent engineer employed by
the city.
(b) An allowance for earnings arising from any increase in the charges made for service from
the enterprise which has become effective prior to the incurring of such additional indebtedness
but which, during all or any part of such fiscal year or last completed 12 month period, was not
in effect, in an amount equal to 75% of the amount by which the net revenues would have been
increased if such increase in charges had been in effect during the whole of such fiscal year or last
completed 12 month period, as shown by the certificate or opinion of a qualified independent
engineer employed by the city.
Section 13. Lost, Stolen, Destroyed or Mutilated Bonds. In the event that any bond or any
interest coupon pertaining thereto is Iost, stolen, destroyed or mutilated, the city will cause to
be issued a new bond or coupon similar to the original to replace the same in such manner and
upon such reasonable terms and conditions, including the payment of costs and the posting of a
surety bond if the city deems such surety bond necessary, as may from time to time be determined
13
and prescribed by resolution. The city may authorize such new bond or coupon or coupons to be
signed and authenticated in such manner as it determines in said resolution.
Section 14. Cancellation of Bonds. All bonds and coupons surrendered to the Director of
Finance or any paying agent of the city for payment upon maturity or for redemption shall
upon payment therefor be cancelled immediately and in the case of any paying agent said coupon
shall be forthwith transmitted to the Director of Finance. Any bonds purchased by the city as
authorized herein together with all unpaid coupons pertaining thereto shall be cancelled forthwith
and shall not be reissued. All of the cancelled bonds and interest coupons shall remain in the
custody of the Director of Finance until destroyed pursuant to due authorization.
Section 15. Consent of Bondholders. The consents of bondholders provided for in this section
shall relate solely to the amendment, waiver or modification of the covenants specified in Section
12 hereof and shall not be effective to waive or modify any other provisions of this resolution or
any other proceedings for the issuance of said bonds. Any act relating to the amendment, waiver
or modification of any of the said covenants consented to by bondholders holding sixty-six per cent
(66%) in aggregate principal amount of the bonds then outstanding (exclusive of issuer-owned
bonds), shall be binding upon the holders of all of the bonds and interest coupons, whether such
coupons be attached to bonds or detached therefrom, and shall not be deemed an infringement
of any of the provisions of this resolution, whatever the character of such act may be, and may
be done and performed as fully and freely as if expressly permitted by the terms of this resolution,
and after such consent relating to such specified matters has been given, no bondholder or
holder of any interest coupon, whether attached to a bond or detached therefrom, shall have
any right or interest to object to such action or in any manner to question the propriety thereof'
or to enjoin or restrain the city or any officer thereof from taking any action pursuant thereto.
Bondholders may consent by affirmative vote at a bondholders' meeting or may consent in
writing without a meeting, all as hereinafter provided.
No such amendment, waiver or modification shall be made which will permit (a) a change in
the maturity or term of redemption of the principal of any bond or any installment of interest
thereon; (b) a reduction in the principal amount of or redemption price or redemption premium or
rate of interest upon any bond without the consent of the holder of such bond; or (c) a reduction
of the percentage of the principal amount of bonds the vote or consent of which is required to
effect any such amendment.
(a) Calling Bondholders' Meeting. If the city shall desire to obtain any such consent it
may call a meeting of bondholders, by resolution, for the purpose of considering the action,
the consent to which is desired.
(b) Notice of Meeting. Notice specifying the purpose, place, date and hour of such meet-
ing shall be published once in a financial newspaper or journal of national circulation pub-
lished in the City of New York, New York, not less than sixty (60) days and not more than
ninety (90) days prior to the date fixed for the meeting. Such notice shall set forth the nature
of the proposed action, consent to which is desired. If any of the bonds shall be so registered
as to be payable otherwise than to bearer, the Clerk shall, on or before the first publication
of such notice, mail a similar notice, postage prepaid, to the respective registered owners
thereof at their addresses appearing on the bond registry books. The place, date and hour
of holding such meeting and the date or dates of publishing and mailing such notice shall be
determined by the city, in its discretion.
The actual receipt by any bondholder of notice of any such meeting shall not be a
condition precedent to the holding of such meeting, and failure to receive such notice shall
not affect the validity of the proceedings thereat. A certificate by the Clerk, approved by
14
resolution of the City Council, that the meeting has been called and that notice thereof has
been given as herein provided shall be conclusive as against all parties and it shall not be
open to any bondholder to show that he failed to receive notice of such meeting.
(c) Voting Qualifications. Any bondholder may, prior to any such meeting, deliver his
bond or bonds to any agency designated by the city for that purpose, and shall thereupon
be entitled to receive an appropriate receipt for the bond or bonds so deposited, calling for
the redelivery of such bond or bonds at any time after the meeting. The Clerk shall prepare
and deliver to the chairman of the meeting a list of the names and addresses of the registered
owners of bonds, with a statement of the maturities and serial numbers of the bonds held
and deposited by each of such bondholders, and no bondholder shall be entitled to vote at such
meeting unless his name appears upon such list or unless he shall present his bond or bonds
at the meeting or a certificate of deposit thereof, satisfactory to the city, executed by a bank
or trust company. No bondholder shall be permitted to vote with respect to a larger aggregate
principal amount of bonds than is set against his name on such list, unless he shall produce
the bonds upon which he desires to vote, or a certificate of deposit thereof as above provided.
(d) Issuer-owned Bonds. The city covenants that it will present at the meeting a certifi-
cate, signed and verified by one member of the City Council and by the Director of Finance
stating the maturities and serial numbers of all bonds owned by, or held for account of the
city, directly or indirectly. No person shall be permitted at the meeting to vote or consent
with respect to any bond appearing upon such certificate, or any bond which it shall be
established at or prior to the meeting is owned by the city, directly or indirectly, and no such
bond (in this resolution referred to as "issuer-owned bond") shall be counted in determining
whether a quorum is present at the meeting.
(e) Quorum and Procedure. A representation of at least sixty-six per cent (66%) in
aggregate principal amount of the bonds then outstanding (exclusive of issuer-owned bonds)
shall be necessary to constitute a quorum at any meeting of bondholders, but less than a
quorum may adjourn the meeting from time to time, and the meeting may be held as so
adjourned ~vithout further notice, whether such adjournment shall have been had by a
quorum or by less than a quorum. The city shall, by an instrument in writing, appoint a
temporary chairman of the meeting, and the meeting shall be organized by the election of a
permanent chairman and a secretary. At any meeting each bondholder shall be entitled to
one vote for every $1,000 principal amount of bonds with respect to which he shall be entitled
to vote as aforesaid, and such vote may be given in person or by proxy duly appointed by
an instrument in writing presented at the meeting. The city, by its duly authorized repre-
sentative, may attend any meeting of the bondholders, but shall not be so required to do so.
(f) Vote Required. At any such meeting held as aforesaid there shall be submitted for
the consideration and action of the bondholders a statement of proposed action, consent to
which is desired, and if such action shall be consented to and approved by bondholders holding
at least sixty-six per cent (66%) in aggregate amount of the bonds then outstanding (exclusive
of issuer-owned bonds) the chairman and secretary of the meeting shall so certify in writing
to the city, and such certificate shall constitute complete evidence of consent of bondholders
under the provisions of this resolution. A certificate signed and verified by the chairman
and the secretary of any such meeting shall be conclusive evidence and the only competent
evidence of matters stated in such certificate relating to proceedings taken at such meeting.
(g) Written Consent of Bondholders. If the city shall desire to obtain any such consent
in writing, without a meeting of bondholders, the City Council thereof may, by resolution,
propose the action, to which consent is desired. A copy of such resolution, together with a
request to bondholders for their consent to the action proposed therein, shall be published
once in a financial newspaper or journal of national circulation published in the City of New
15
York, New York. If any of the bonds shall be so registered as to be payable otherwise than
to bearer, the Clerk shall, on or before the publication of such resolution and request, mail
a copy thereof to each registered owner at the address appearing on the bond registry books.
The actual receipt by any bondholder of such resolution and request shall not affect the
validity of the proceedings for the obtaining of such consent. A certificate by the Clerk, ap-
proved by resolution of the City Council of said city, that said resolution and request has been
published and mailed as herein provided shall be conclusive as against all parties, and it
shall not be open to any bondholder to show that he failed to receive such resolution and
consent.
Each written consent shall be accompanied by proof of ownership of the bonds for which
such consent is given. Proof of ownership shall be made in such manner as shall be prescribed
by the resolution proposing the action. Any such written consent shall be binding upon the
holder of the bonds giving such consent and on any subsequent holder (whether or not such
subsequent holder has notice thereof) unless such consent is revoked in writing by the holder
giving such consent or by the subsequent holder. To be effective, any revocation of consent
must be filed before the adoption of the resolution accepting consents as hereinafter provided.
After the holders of at least sixty-six per cent (66%) in aggregate principal amount of
the bonds then outstanding (exclusive of issuer-owned bonds) shall have consented in writing,
the City Council shall adopt a resolution accepting such consents and such resolution shall
constitute complete evidence of the consent of bondholders under this resolution.
(h) Publication of Consent. Notice specifying the amendment, waiver or modification
that has received the consent of bondholders as required by this section shall be published
once in a financial newspaper or journal of national circulation published in the City of New
York, New York, not less than sixty (60) days following the final action in the proceedings
for the obtaining of such consent. Said notice is only for the information of bondholders and
failure to publish such notice or any defect therein shall not affect the validity of the pro-
ceedings theretofore taken in the obtaining of such consent.
Section 16. Bond and Coupon Forms. Said bonds shall be payable to bearer, shall be issued
in negotiable form, and shall be negotiable, and the form of said bonds and interest coupons thereof
shall be substantially as follows:
UNITED STATES OF AMERICA
STATE OF CALIFORNIA
COUNTY OF ORANGE
CITY OF SANTA ANA
1962 WATER REVENUE BOND, SERIES B
No ......................... $ ........................
THE CITY OF SANTA ANA, a municipal corporation situated in the County of Orange,
State of California, FOR VALUE RECEIVED, hereby promises to pay, solely from the Revenue
Fund, as hereinafter provided, to the bearer, on July I,. ............... , upon presentation and surrender
of this bond, the sum of ............ THOUSAND DOLLARS, with interest thereon at the rate of ......
per annum, payable annually for the first year and semiannually thereafter on the first days of
January and July of each and every year from the date hereof until this bond is paid, upon
presentation and surrender of the respective interest coupons hereto attached; provided, however,
that if at the maturity date of this bond, or, if the same is redeemable and shall be duly called for
redemption, then at the date fixed for redemption, funds are available for the payment or redemp-
tion thereof, as provided in the resolution hereinafter mentioned, this bond shall then cease
16
to bear interest. Both principal and interest are payable in lawful money of the United States of
America at the office of the Director of Finance of the City of Santa Aha, in said city, or, at the
option of the holder hereof, at any paying agent of the city in Los Angeles or San Francisco,
California, Chicago, Illinois, or in New York, New York.
This is one of a duly authorized issue of bonds of the city designated "1962 Water Revenue
Bonds, Series B," hereinafter called "the bonds", all of which have been issued pursuant the
Charter of said city and to the Revenue Bond Law of 1941 (being Chapter 6, Part I, Division 2,
Title 5 of the Government Code of the State of California) for the purpose of the acquisition
and construction of a water system for said city and the creation of said issue and the terms and
conditions of the bonds are provided for by the resolution of the City Council of said city authoriz-
ing the bonds adopted ....................... , 19....., designated Resolution No ................. and this reference
incorporates said resolution and said Chapter 6 herein, and by acceptance hereof the holder of
this bond and the coupons hereto attached assents to said terms and conditions. Said resolution
is adopted under, and this bond and the interest coupons hereto attached are issued under and
are to be construed in accordance with the Charter of said city and the laws of the State of
California.
This bond and the interest hereon and any premium upon the redemption hereof are not a
debt of the City of Santa Ana, nor a legal or equitable pledge, charge, lien or encumbrance upon
any of its property or upon any of its income, receipts, or revenues except the gross revenues
of the enterprise (as defined in said resolution) pledged to its payment, and the principal of and
the interest on this bond and any premium upon the redemption hereof are payable solely from
the gross revenues of the enterprise pledged to its payment and said city is not obligated to pay
such principal, interest and premium except from said gross revenues. The Revenue Fund is
established under and pursuant to the Revenue Bond Law of 1941, and under the provisions of
said resolution authorizing the issuance of this bond the gross revenues received from the
enterprise are required to be deposited to the credit of said Revenue Fund and used only for the
purposes authorized by said resolution, including the payment of principal and interest of the issue
of bonds of which this is one.
By the terms of said Revenue Bond Law and by covenant expressed in said resolution, the
city is obligated to prescribe, revise and collect charges for the services, facilities and water of
the water system of the city such as to provide revenues sufficient to pay the interest on and
principal of the bonds as they become due and payable in addition to all other payments required
for compliance with said resolution and the necessary and reasonable maintenance and operation
costs of the water system, is prohibited from issuing bonds having any priority with respect to
payment from the gross revenues of the enterprise, and is subject to conditions with respect to
any sale of said water system. In the manner provided in the resolution, any or ail of the
obligations referred to in this paragraph and certain other obligations mentioned in said resolution
may be waived with the consent of the holders of 66% in aggregate principal amount of the
bonds then outstanding (exclusive of issuer-owned bonds).
This bond is callable and redeemable prior to maturity in accordance with the provisions for
redemption endorsed hereon.
This bond and the coupons hereto attached are negotiable instruments and shall be negotiable
by delivery. This bond may be registered as to principal only or as to both principal and interest,
in accordance with the provisions for registration endorsed hereon.
It is hereby certified and recited that any and all acts, conditions and things required to exist,
to happen and to be performed precedent to and in the incurring of the indebtedness evidenced
by this bond and in the issuance of this bond exist, have happened, and have been performed in
due time, form and manner as required by the Constitution and laws of the State of California
17
and the Charter of said city and that this bond, together with all other indebtedness of the city
pertaining to the aforesaid water system, is within every debt and other limit prescribed by the
Constitution and laws of the State of California.
IN WITNESS WHEREOF, said City of Santa Ana has caused this bond to be signed by the
Mayor and Director of Finance of said city by their facsimile signatures, countersigned by the
Clerk of the Council of said city, and sealed with the corporate seal of said city, and the interest
coupons hereto attached to be signed by the Director of Finance by his facsimile signature, and
has caused this bond to be dated the first day of January, 1964.
COUNTERSIGNED:
Mayor of the City of Santa Aha, California
Clerk of the Council of the City of
Santa Aha, California
(SEAL)
Director of Finance of the City of
Santa Aha, California
(COUPON FORM)
On the first day of .................... 19 ......
the CITY OF SANTA ANA, County of Orange, California will pay to the
bearer, at the office of the Director of Finance of the City of Santa Ana,
in said city, or, at the option of the holder hereof, at any paying agent of Coupon No.
the district in Los Angeles or San Francisco, California, or in Chicago, . ...........
Illinois or in New York, New York, out of the Revenue Fund of said
city and not out of any other fund or moneys of the city, the sum of $ ........................
in lawful money of the United States of America, being the interest then due
on
1962 WATER REVENUE BOND, SERIES B, No .....................
dated January 1, 1964, subject to the
provisions on the reverse hereof.
Director of Finance of said city.
On the reverse side of the coupon there shall be printed substantially the following:
(REVERSE OF COUPON)
If the bond to which this coupon is attached is redeemable and is duly called for
redemption on a date prior to the maturity date of this coupon, this coupon will be void.
PROVISIONS FOR REDEMPTION
Unless this bond matures on or prior to July 1, 1984, it is redeemable in the manner and
subject to the terms and provisions, and with the effect, set forth in the resolution referred to on
the face of this bond, at the option of the district, on July 1, 1974, or on any interest payment date
thereafter prior to maturity, upon at least 30 days' prior notice published in a newspaper circulated
in the County of Orange, California, and in a financial newspaper or journal of national circulation
published in the City of New York, New York, at a redemption price equal to the principal amount
thereof plus the following premium (percentage of par value) if redeemed at the following times:
18
REDEMPTION DATES AND PREMIUMS
On or After And Prior to On or After And Prior to
July 1 July 1 Premium July 1 July 1 Premium
1974 1975 4% 1980 1981 1
1975 1976 3~ 198t 1982 1
1976 1977 3 1982 1983
1977 1978 2~ 1983 1984
1978 1979 2 1984 1985
1979 1980 1~ 1985 Maturity ~0~
PROVISIONS FOR REGISTRATION
This bond may be registered in the name of any person as the registered owner hereof~
either as to principal only or as to both principal and interest, and, if registered in either of said
forms may be changed to registration in the other of said forms or discharged from registration.
Each registration, transfer after registration, change of form of registration, or discharge
from registration of this bond shall be entered by the Director of Finance in books kept by him
for the purpose and noted by him in the registration blank below. Registration as to principal
only shall not affect the negotiability by delivery of the coupons pertaining hereto. Upon registra-
tion as to both principal and interest, all unmatured coupons pertaining hereto shall be surrendered
to the Director of Finance and may be preserved.
So long as this bond is registered no transfer hereof shall be valid for any purpose unless
made by the registered owner and entered and noted as herein provided, and the principal hereof
and any redemption premium shall be payable only to the registered owner, or to his order.
Interest on this bond, if registered as to both principal and interest, shall be payable to the person
whose name appears upon the registry books as the registered owner hereof at the close of
business on the tenth day preceding the interest payment date, or to his order. If this bond is
registered as to both principal and interest and its registration is changed to registration as to
principal only, or if it is discharged from registration, there shall be attached hereto coupon~
representing interest hereon to become due thereafter to the date of maturity hereof. In lieu
thereof, and upon surrender and cancellation hereof, the Director of Finance in his discretion
may issue in exchange therefor a new bond, with such coupons attached, identical with this bond,
except for the previous notations on the registration blank hereon, and except that the signatures
on the new bond shall be those of the persons holding the offices at the time of affixing such
signatures. The issuance of any such new bond or new coupons shall be at the expense of the
registered owner.
Each discharge hereof from registration shall be effected by an entry on the registry books,
and a notation in the blank below, that this bond is payable to bearer, whereupon this bond shall
become an unregistered bearer instrument, negotiable by delivery as if it had never been registered.
Each request for registration, transfer, change or discharge must be in form satisfactory to the
Director of Finance and must be made in writing, signed by the registered owner, or by his agent
duly authorized in writing, or by the bearer, as the case may be.
Date of In Whose Name Manner of Signature of
Registration Registered Registration Director o! Finance
19
Section 17. Proceedings Constitute Contract. The provisions of this resolution and of the
resolutions providing for the sale of the bonds and awarding, the bonds and fixing the interest
rate or rates thereon shall constitute a contract between the city and the bondholders and the
provisions thereof shall be enforceable by any bondholder for the equal benefit and protection of
all bondholders similarly situated by mandamus, accounting', mandatory injunction or any other
suit, action or proceeding, at law or in equity that is now or may hereafter be authorized under
the laws of the State of California in any court of competent jurisdiction. Said contract is made
under and is to be construed in accordance with the laws of the State of California.
No remedy conferred hereby upon any bondholder is entitled to be exclusive of any other
remedy, but each such remedy is cumulative and in addition to every other remedy and may be
exercised without exhausting' and ~vithout regard to any other remedy conferred by the Revenue
Bond Law of 1941 or any other law of the State of California. No waiver of any default or breach
of duty or contract by any bondholder shall affect any subsequent default or breach of duty or
contract or shall impair any rights or remedies on said subsequent default or breach. No delay or
omission of any bondholder to exercise any right or power accruing, upon any default shall impair
any such rig.hr or power or shall be construed as a waiver of any such default or acquiescence
therein. Every substantive right and every remedy conferred upon the bondholders may be
enforced and exercised as often as may be deemed expedient. In case any suit, action or proceeding
to enforce any right or exercise any remedy shall be brought or taken and the bondholder shall
prevail, said bondholder shall be entitled to receive from the Revenue Fund reimbursement for
reasonable costs, expenses, outlays and attorney's fees and should said suit, action or proceeding.
be abandoned, or be determined adversely to the bondholders then, and in every such case, the
city and the bondholders shall be restored to their former positions, rights and remedies as if
such suit, action or proceeding, had not been brought or taken.
After the issuance and delivery of the bonds this resolution shall be irrepealable, but shall be
subject to modification to the extent and in the manner provided in Section 15 of this resolution,
but to no g.reater extent and in no other manner.
Section 18. Future Contracts. Nothing herein contained shall be deemed to restrict or
prohibit the city from making contracts or creating bonded or other indebtedness payable from
the general fund of the city or from taxes or any source other than the revenues of the enterprise
as defined herein, and from and after the sale of the bonds the general fund of the city shall not
include the revenues of the enterprise and no contract or other obligation payable from the
g.eneral fund of the city shall be payable from the revenues of the enterprise, except as provided
in Section 10(g.) hereof.
Section 19. Severability. If any covenant, ag.reement or provision, or any portion thereof,
contained in this resolution, or the application thereof to any person or circumstance, is held to
be unconstitutional, invalid or unenforceable, the remainder of this resolution and the application
of any such covenant, agreement or provision, or portion thereof, to other persons or circumstances,
shall be deemed severable and shall not be affected thereby, and this resolution and the bonds
issued pursuant hereto shall remain valid and the bondholders shall retail all valid rights and
benefits accorded to them under this resolution and the Constitution and laws of the State of
California and the Charter of said city.
Section 20. Effective Date. This resolution shall take effect upon adoption.
h 18th da o November 1
ADOPTED, SIGNED AND APPROVED t is ............ y f ................, ........... j., [9~._..
ATT~_~S,T · '
/s/ ~"~tl2aL.~9 '171 &~l~'~C~%*~ V¢~j~ffrgi"th~ City of g~'t~a';Ana, Califoh, nia
-Clerk of the CoUncil of said city
(SEAL)
2O
STATE OF CALIFORNIA
CITY OF SANTA ANAI ss.
COUNTY OF ORANGE
I, DORIS M. BROWN, Clerk of the Council of the City of Santa Aha, DO HEREBY
CERTIFY that the foregoing resolution was duly'adopted by the City Council of said city and
was approved by the Mayor of said City at an aAj~,~-~d-regular meeting of said City Council held
on the ...~.~O...... day of ....~..o.y..e...m..b_..e_r ............. , 1963, and that it was adopted by the following vote,
to wit:
(SEAL)
AYES: Hubbard~ Harvey~ Gilmore~ Schlueter
NOES: None
ABSENT: Hall
Clerk of tl~e~ Council of said City
STATE OF CALIFORNIA
CITY OF SANTA ANA[ ss.
COUNTY OF ORANGE J
I, DORIS M. BROWN, Clerk of the Council of the City of Santa Ana, DO HEREBY
CERTIFY that the above and foregoing is a full, true and correct copy of Resolution No...6.3-..%.78
and that the same has not been amended or repealed.
Date ......~ .o..v..e..~....e.r.....i.5. ................. 1963.
(SEAL)
Clerk of the Council of said City
21