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Home My WebLink AboutINDENTURE OF TRUST 11-20-95INDENTURE OF TRUST by and between the TUSTIN PUBLIC FINANCING AUTHORITY and STATE STREET BANK AND TRUST COMPANY OF CALIFORNIA, N.A., as Trustee Dated as of 1, 1995 RELATING TO $ TUSTIN PUBLIC FINANCING AUTHORITY REVENUE BONDS (TUSTIN RANCH), SERrES A Section 1.01. Section 1.02. Section 1.03. Section 2.01. Section 2.02. Section 2.03. Section 2.04. Section 2.05. Section 2.06. Section 2.07. Section 2.08. Section 2.09. Section 3.01. Section 3.02. Section 3.03. Section 3.04. Section 3.05. Section 3.06. Section 3.07. Section 4.01. Section 4.02. Section 4.03. Section 4.04. Section 4.05. Section 4.05. TABLE OF CONTENTS ARTICLE I DEFINITIONS Definitions ................................................. . ................ 3 Interpretation ................................................................................................... 10 Indenture Constitutes Contract ...... ....................... 10 ARTICLE H THE BONDS Authorization of Bonds ................................................................................... 12 Terms of Series A Bonds ................................................................................ 12 Transfer and Exchange of Bonds .................................................................... 13 Registration Books .......................................................................................... 13 Execution of Bonds ......................................................................................... 13 Authentication of Bonds ................................................................................. 14 Temporary Bonds .................................................................................. 14 Bonds Mutilated, Lost, Destroyed or Stolen ................................................ '... 14 Book-Entry Series A Bonds ............................................................................ 15 ARTICLE III ISSUANCE OF SERIES A BONDS; APPLICATION OF PROCEEDS; ACQUISITION OF ASSESSMENT BONDS; ADDITIONAL BONDS Issuance of Series A Bonds ............................................................................. 17 Application of Proceeds of the Series A Bonds .............................................. 17 Costs of Issuance Fund ................................................................................... 17 Program Fund .................................................................................................. 17 Issuance of Additional Series of Bonds ........................................................... 18 Proceedings for the Issuance of Additional Series of Bonds .......................... 19 Additional Bonds ............................................................................................ 20 ARTICLE IV REDEMPTION OF BONDS Redemption ...................................................................................................... 21 Notice of Redemption ..................................................................................... 22 Selection of Bonds for Redemption ................................................................ 22 Partial Redemption of Bonds .......................................................................... 22 Effect of Notice of Redemption ...................................................................... 22 Effect of Notice 'of Redemption .................................... 22 -i- Section Section Section Section Section Section Section Section Section Section Section Section Section Section Section Section Section Section Section Section Section Section Section Section Section Section Section Section Section Section Section Section 5.01. 5.02. 5.03. 5.04. 5.05. 5.06. 5.07. 5.08. 5.09. 6.01. 6.02. 6.03. 6.04. 6.05. 6.06. 6.07. 6.08. 6.09. 6.10. 6.11. 6.11. 7.01. 7.02. 7.03. 7.04. 7.05. 7.06. 7.07. 7.08. 7.09. 7.10. 7.11. ARTICLE V SECURITY OF BONDS INVESTMENTS Pledge And Assignment .................................................................................. 24 Application of Revenue Fund ........................................................... .............. 24 Application of Interest Account ...................................................................... 25 Application of Principal Account .............................. ~ .................................... 25 Application of Reserve Account .............................................. , ...................... 25 Application of Redemption Account .............................................................. 25 Application of Surplus Account ...................................................................... 25 Administrative Costs Account ........................................................................ 26 Investment of Moneys ..................................................................................... 26 ARTICLE VI PARTICULAR COVENANTS Punctual Payment ..... ~ .................................................... ; ................................. 28 Extension of Payment of Bonds ...................................................................... 28 Against Encumbrances ...................................................................... .' ............. 28 Power to Issue Bonds and Make Pledge and Assignment .............................. 28 Accounting Records and Financial Statements ............................ . ................... 28 Waiver of Laws ............................................................................................... 28 Collection of Revenues ...................................... ~ ...... , ..................................... 29 Disposition of Assessment Bonds ................................................................... 29 Amendment of Assessment Bonds ................................................................. 29 Tax Covenants ................................................................................................. 29 Continuing Disclosure. ' ........................................................................ 29 Further Assurances .......................................................................................... 30 ARTICLE VH EVENTS OF DEFAULT AND REMEDIES OF BOND OWNERS Events of Default ........................ . .................................................................... 31 Remedies Under Assessment Bonds ............................................................... 31 Other Remedies of Bond Owners ................................................................... 31 Application of Revenues and Other Funds After Default ............................... 32 Trustee to Represent Bond Owners ................................................................ 32 Bond Owners' Direction of Proceedings ........................................................ 33 Limitation on Bond Owners' Right to Sue ....................................... · .............. 33 Absolute Obligation of Authority ................................................................... 33 Termination of Proceedings ............................................................................ 33 Remedies Not Exclusive ................................................................................. 34 No Waiver of Default ...................................................................................... 34 ARTICLE VHI THE TRUSTEE Section 8.01. Section 8.02. Section 8.03. Section 8.04. Section 8.05. Section 8.06. Duties and Liabilities of Trustee ..................................................................... 35 Merger or Consolidation ........................................... i ..................................... 36 Liability of Trustee .......................................................................................... 36 Right to Rely on Documents ........................................................................... 37 Preservation and Inspection of Documents ..................................................... 37 Compensation and Indemnification .............................................................. :. 37 ARTICLE IX MODIFICATION OR AMENDMENT Section 9.01. Section 9.02. Section 9.03. Section 9.04. Amendments Permitted ................................................................................... 39 Effect of Supplemental Indenture ................................................................... 40 Endorsement of Bonds .................................................................................... 40 Amendment of Particular Bonds ..................................................................... 40 ARTICLE X DEFEASANCE Section 10.01. Discharge of Indenture ................................................................................. 41 Section 10.02. Discharge of Liability on Bonds .................................................................. 41 Section 10.03. Deposit of Money or Securities with Trustee ................................................. 42 Section 10.04. Payment of Bonds After Discharge of Indenture ......................................... 42 ARTICLE XI MISCELLANEOUS Section 11.01. Section 11.02. Section 11.03. Section 11.04. Section 11.05. Section 11.06. Section 11.07. Section 11.08. Section 11.09. Section 11.10. Section 11.11. Section 11.12. Section 11.13. Section 11.14. Section 11.15. Liability of Authority Limited to Revenues ................................................. 43 Successor Is Deemed Included in All References to Predecessor ...............43 Limitation of Rights to Parties and Bond Owners ....................................... 43 Waiver of Notice ........................................................................................... 43 Destruction of Bonds ................. .................................................................. 43 Severability of Invalid Provisions ................................................................ 43 Notices ......................................................................................................... 44 Evidence of Rights of Bond Owners ............................................................. 44 Disqualified Bonds .......................... , ............................................................ 44 Money Held for Particular Bonds. ............................................................... 45 Funds and Accounts .................................................................... ~ ................ 45 Payment on Non-Business Days .................................................................. 45 Waiver of Personal Liability ............... · ......................................................... 45 Execution in Several Counterparts ..................................................... , ......... 45 Governing Laws ............................................................................................ 45 EXHIBIT A - Form of Series A Bond .................................................................................. A-1 -iii- INDENTURE OF TRUST THIS INDENTURE OF TRUST (this "IndentUre'') dated as of 1, 1995, is by and between the TUSTIN PUBLIC FINANCING AUTHORITY, a joint exercise of powers authority organized and existing under and by virtue of the laws of the State of California (the "Authority"), and STATE STREET BANK AND TRUST COMPANY OF CALIFORNIA, N.A.,.~ a national banking association organized and existing under and by virtue of the laws of the- United States of America, as trustee (the 'q'rustee"). WITNESSETH: WHEREAS, the Authority is a joint exercise of powers authority duly organized and existing under the provisions of Articles 1 through 4 (commencing with Section 6500) of Chapter 5 of Division 7 of Title 1 of the Government Code of the State of California (the "Act"), and is authorized pursuant to Article 4 of the Act (the '"Bond Law") to borrow money for the purpose of financing the acquisition of bonds, notes and other obligations to provide financing or refinancing for public capital improvements of local agencies within the State of California; WHEREAS, the City of Tusfin (the "City") is issuing $ principal amount of its Limited Obligation Improvement Bonds, Reassessment District No. 95-1 (Tusfin Ranch) (the "Assessment Bonds (95-1)") under a Fiscal Agent Agreement, dated as of 1, 1995, by and between the City and State Street Bank and Trust Company of California, N.A., as fiscal agent; WHEREAS, the Authority has entered into an agreement with the City to acquire the Assessment Bonds (95-1); WHEREAS, the Authority has determined at this time to issue its Revenue Bonds (Tustin Ranch), Series A (the "Series A Bonds"), in the aggregate principal amount of $ , all pursuant to and secured by this Indenture in the manner provided herein, for the purpose of providing the funds required to acquire the Assessment Bonds (95-1); WHEREAS, in order to provide the funds required to acquire certain other fixed rate assessment bonds of the City (such other bonds, together with the Assessment Bonds (95-1), the "Assessment Bonds") the Authority may issue, pursuant to this Indenture, additional bonds on a parity with the Series A Bonds (such additional bonds, together with the Series A Bonds, the "Bonds"); WHEREAS, the Bonds are to be secured by a pledge of and first lien on the revenues to be derived from the Assessment Bonds; WHEREAS, in order to provide for the authentication and delivery of the Bonds, to establish and declare the terms and conditions upon which the Bonds are to be issued and to secure the payment of the principal thereof and interest thereon, the Authority has authorized the execution and delivery of this Indenture; WHEREAS, the Authority has determined that all acts and proceedings required by law necessary to make the Bonds, when executed by the Authority, authenticated and delivered by the Trustee, and duly issued, the valid, binding and legal special obligations of the Authority, and to constitute this Indenture a valid and binding agreement for the uses and purposes herein set forth in accordance with its terms, have been done and taken, and the execution and delivery of the Indenture have been in all respects duly authorized; -1- NOW, THEREFORE, THIS INDENTURE WITNESSETH, that in order to secure the payment of the principal of and the interest and premium, if any, on all Bonds at any time issued and outstanding under this Indenture, according to their tenor, and to secure the performance and observance of all the covenants and conditions therein and herein set forth, and to declare the terms and conditions upon and subject to which the Bonds are to be issued and received, and in consideration of the premises and of the mutual covenants herein contained and of the purchase and acceptance of the Bonds by the Owners thereof, and for other valuable considerations, the receipt whereof is hereby acknowledged, the Autho.rity does hereby covenant and agree with the Trustee, for the benefit of the respective Owners from time to time of the Bonds, as follows: -2- ARTICLE I DEFINITIONS; RULES OF INTERPRETATION Section 1.01. D_.e,f~aBJ.ti.9.~. Unless the context otherwise requires, the terms defined in this Section 1.01 shall, for all purposes of this Indenture and of any indenture supplemental hereto and of any certificate, opinion or other document herein mentioned, have the meanings herein specified, to be equally applicable to both the singular and plural forms of any of the terms herein defined. "Act" means Articles 1 through 4 (commencing with Section 6500) of Chapter 5, Division 7, Title 1 of the Government Code of the State of California. "Additional Bonds" means Bonds other than Series .A Bonds issued hereunder in accordance with the terms hereof and ranking on a parity with the Series A Bonds. "Administrative Costs" means the reasonable costs incurred to administer the Bonds, including the fees, costs and indemnifications due the Trustee or the City. "Administrative Costs Account" means the account by that name established and held by the Trustee pursuant to Section 5.02. "Assessment Bonds" means the Assessment Bonds (95-1) and any Assessment Bonds (95-2) acquired pursuant to Section 3.04. "Assessment Bonds (95-1)" means the City of Tustin Limited Obligation Improvement Bonds, Reassessment District No. 95-1 (Tustin Ranch), which are issued under and pursuant to the Fiscal Agent Agreement (95-1). "Assessment Bonds (95-2)" means the City of Tustin Limited Obligation Improvement Bonds, Reassessment District No. 95-2 (Tustin Ranch), which are issued under and pursuant to the Fiscal Agent Agreement (95-2) and which bear interest at a fixed rate. "Assessment Consultant" means Muni Financial Services, Inc. or any other consultant or fu'm of financial consultants appointed by the City and who or each of whom (a) is judged by the City to have experience with respect to the administration of assessment districts, (b)is in fact independent and not under the domination of the City., (c) does not have any substantial interest, direct or indirect, with the City, and (d) is not connected with the City as an officer or employee of the City, but who may be regularly retained to make reports to the City. "Authority" means the Tustin Public Financing Authority, a joint powers authority organized and existing under the Act. "Authorized Representative" means (a) with respect to the Authority, its President, Vice President or TreaSurer, or any other Person designated as an Authorized Representative of the Authority by a Written Certificate of the Authority fried with the City and the Trustee, (b) with respect to the City, its City Manager, Assistant City Manger or Finance Director, or any other Person designated as an Authorized Representative of the City in a Written Certificate of City fried with the Authority and the Trustee, and (c) with respect to the Trustee, the Senior Vice President, any Vice President, any Assistant Vice President or any Trust Officer of the Trustee, and when used with reference to any act or document also means any other Person authorized to perform such act or sign any document by or pursuant to a resolution of the Board of Directors of the Trustee or the by-laws of the Trustee. -3- "Beneficial Owner" means, whenever used with respect to a Series A Bond, the person whose name is recorded as the beneficial owner of such Series A Bond or a portion of such Series A Bond by a Participant on the records of such Participant or such person's subrogee. "Bonds" means the Tustin Public Financing Authority Revenue Bonds (Tustin Ranch) issued hereunder, and includes the Series A Bonds and any Additional Bonds. "Bond Counsel" means a firm of nationally recognized bond counsel selected by the City and acceptable to the Authority and the Trustee. "Bond Law" means the Marks-Roos Local Bond Pooling Act of 1985, constituting Article 4 of the Act (commencing with Section 6584), as amended from time to time. "Bond Year" means each twelve-month period beginning on September 3 in any year and extending to the next succeeding September 2, both dates inclusive; except that the first Bond Year shall begin on the Closing Date and end on September 2, 1996. "Book-Entry Bonds" means the Series A Bonds registered in the name of the nominee of DTC, or any successor securities depository for the Series A Bonds, as the registered owner thereof pursuant to the terms and provisions of Section 2.09. "Business Day" means a day which is not a Saturday, Sunday or legal holiday on which banking institutions in the State of California, or in any state in which the Office of the Trustee is located, are closed. "Cede & Co." means Cede & Co., the nominee of DTC,'and any successor nominee of DTC with respect to the Series A Bonds. "City" means the City of Tustin, and any successor thereto. "Closing Date" means the date on which the Series A Bonds are delivered to the Original Purchaser, being ,1995. "Code" means the Internal Revenue Code of 1986 as in effect on the date of issuance of the Series A Bonds or (except as otherwise referenced herein) as it may be amended to apply to obligations issued on the date of issuance of the Series A Bonds, together With applicable temporary and £mal regulations promulgated, and applicable official public guidance published, under the Code. "Continuing Disclosure Agreement" means the Continuing Disclosure Agreement, dated as of ,1995, by and between the City and the Trustee, as originally executed or as the same may from time to time be amended in accordance with the terms thereof. "Costs of Issuance" means, with respect to a Series of Bonds, all items of expense directly or indirectly payable by or reimbursable to the Authority relating to the authorization, issuance, sale and delivery of such Bonds, including but not limited to printing expenses, rating agency fees, filing and recording fees, initial fees, expenses and charges of the Trustee and its counsel, .including the Trustee's first annual administrative fee, fees, charges and disbursements of attorneys, f'mancial advisors, accounting f'u'ms, consultants and other professionals, fees and charges for preparation, execution and safekeeping of such Bonds and any other cost, charge or fee in connection with the original issuance of such Bonds. -4- "Costs of Issuance Fund" means the fund by that name established and held' by the Trustee pursuant to Section 3.03. "DTC" means The Depository Trust Company, a limited-purpose trust company organized under the laws of the State of New York, and its successors as securities depository for the Series A Bonds, inCluding any such successor appointed pursuant to Section 2.09. "Developed Property" means a parcel of real property on which a completed structure has been built, as evidenced by the issuance by the City of a certificate of occupancy for such structure. "Event of Default" means any of the events specified in Section 7.01. "Fair Market Value" means the price at which a willing buyer would purchase the investment from a willing seller in a bona fide, arm's length transaction (determined as of the date the contract to purchase or sell the investment becomes binding) if the investment is traded on an established securities market (within the meaning of section 1273 of the Code) and, otherwise, the term "Fair Market Value" means the acquisition price in a bona fide arm's length transaction (as referenced above) if (a) the investment is a certificate of deposit that is acquired in accordance with applicable regulations under the Code, (b) the investment is an agreement with specifically negotiated withdrawal or reinvestment provisions and a specifically negotiated interest rate (for example, a guaranteed investment contract, a forward supply contract or other investment agreement) that is acquired in accordance with applicable regulations under the Code, (c) the investment is a United States Treasury Security--State and Local Government Series that is acquired in accordance with applicable regulations of the United States Bureau of Public Debt, or (d) the investment is the Local Agency Investment Fund of the State of California but only if at all times during which the investment is held in such fund its yield is reasonably expected to be equal to or greater than the yield on a reasonably comparable direct obligation of the United States. "Federal Securities" means any of the following which at the time of investment'are~ legal investments under the laws of the State of California for the funds proposed to be invested therein: (a)direct general obligations of the United States of America (including obligations issued or held in book entry form on the books of the Department of the Treasury of the United States of America), and (b) obligations of any agency, department or instrumentality of the United States of America the timely payment of principal of and interest on which are fully guaranteed by the United States of America. "Fiscal Agent" means the entity acting as Fiscal Agent (95-1) and Fiscal Agent (95-2). ''Fiscal Agent (95-1)" means State Street Bank and Trust Company of California, N.A., as fiscal agent under Fiscal Agent Agreement (95-1), or any successor thereto as fiscal agent thereunder. "Fiscal Agent (95-2)" means State Street Bank and Trust Company of California, N.A., as fiscal agent under Fiscal Agent .Agreement (95-2), or any successor thereto as fiscal agent thereunder. "Fiscal Agent Agreement (95-1)" means the Fiscal Agent Agreement dated as of. 1, 1995, by and between the City and State Street Bank and Trust Company of' California, N.A., as fiscal agent, as originally executed or as the same may from time to time be amended or supplemented in accordance with the terms thereof. -5- "Fiscal Agent Agreement (95-2)" means the Fiscal Agent Agreement, dated as of 1, 1995, by and between the City and State Street Bank and Trust Company of California,, N.A., as fiscal agent, as originally executed or as the same may from time to time be amended or supplemented in accordance with the terms thereof. "Fiscal Agent Agreements" means, collectively, Fiscal Agent Agreement (95-1) and Fiscal Agent Agreement (95-2). "Fiscal Year" means the periOd beginning on July 1 of each year and ending on the next succeeding June 30, or any other twelve-month period hereafter selected and designated as the official fiscal year period of the Authority designated in a Written Certificate of the Authority delivered to the Trustee. "Fixed Rate Bond", when used with respect to Assessment Bonds (95-2), has the meaning ascribed thereto in the Fiscal Agent Agreement (95-2). "Group of Assessment Bonds (95-2)" means the group of Fixed Rate Bonds and Related Additional Bonds, if any, registered in the name of the Trustee, that have been designated, pursuant to Section 7.01(e) of the Fiscal Agent Agreement (95-2), to represent specified parcels of real property within the City's Reassessment District No. 95-2 (Tustin Ranch). "Indenture" means this Indenture, as originally executed or as it may from time to time be amended or supplemented by any Supplemental Indenture. "Independent Financial Consultant" means any financial consultant or firm of such financial consultants appointed by the Authority and who, or each of whom (a) is judged by the Authority to have experience with respect to the financing of public capital improvement projects, (b) is in fact 'independent and not under the domination of the Authority, (c) does not have any substantial interest, direct or indirect, with the Authority, other than as Original Purchaser, and (d) is not connected with the Authority as'an officer or ~mployee of the Authority, but who may be regularly retained to make reports to the Authority. "Information Services" means Financial Information, Inc.'s "Daily Called Bond Service", 30 Montgomery Street, 10th Floor, Jersey City, New Jersey 07302, Attention: Editor; Kenny Information Services' '"Called Bond Service," 65 Broadway, 16th Floor, New York, New York 10006; Moody's Investors Service "Municipal and Government," 5250 77 Center Drive, Suite 150, Charlotte, North Carolina 28217, Attention: Municipal News Reports; Standard & Poor's Corporation "Called Bond Record," 25 Broadway, 3rd Floor, New York, New York 10004; and, in accordance with then current guidelines of the Securities and Exchange Commission, such other addresses and/or such other services providing information with respect to called bonds as the Authority may designate in a Written Certificate of the Authority delivered to the Trustee. "Interest Account" means the account by that name established and held by the Trustee pursuant to Section 5.02. "Interest Payment Date" means March 2 and September 2 in each year, commencing March 2, 1996, so long as any Bonds remain Outstanding. "Moody's" means Moody's Investors Service, Inc., a corporation dUly organized and existing under and by virtue of the laws of the State of Delaware, and its successors and assigns, except that if such corporation shall be dissolved or liquidated or shall no longer perform the -6- functions of a securities rating agency, then the term "MOody's'' shall be deemed to refer to any other nationally recognized securities rating-agency selected by the Authority. "Office" means the principal corporate trust office of the Trustee in Los Angeles, California or such other office as may be specified to the Authority by the Trustee in writing. "Original Purchaser" means PaineWebber Incorporated, as the original purchaser of the Series A Bonds. "Outstanding," when used as of any particular time with reference to Bonds, means (subject to the provisions of Section 11.09) all Bonds theretofore, or thereupon being, authenticated and delivered by the Trustee under this Indenture except: (a) Bonds theretofore canceled by the Trustee or surrendered to the Trustee for cancellatiOn; (b) Bonds with respect to which all liability of the Authority shall have been discharged in accordance with Section 10.02, including Bonds (or portions of Bonds) disqualified under Section 11.09; and (c) Bonds for the transfer or exchange of or in lieu of or in substitution for which other Bonds shall have been authenticated and delivered by the Trustee pursuant to this Indenture. "Owner" or "Bond Owner," whenever used herein with respect to a Bond, means the Person in whose name the ownership of such Bond is registered on the Registration Books. "Participant" means any entity which is recognized as a participant by DTC in the book-entry system of maintaining records with respect to Book-Entry Bonds. "Participating Underwriter" has the meaning ascribed thereto in the Continuing Disclosure AgreemenL "Permitted Investments" means any of the following which at the time of investment are legal investments under the laws of the State of California for the moneys proposed to be invested therein but only to the extent that the same are acquired at Fair Market Value: , (a) Federal Securities; (b) any of the following direct or indirect obligations of the following agencies of the United States of America: (i) direct obligations of the Export- Import Bank; (ii) certificates of beneficial ownership issued by the Farmers Home Administration; (iii) participation certificates issued by the General Services Administration; (iv) mortgage-backed bonds or pass-through obligations issued and guaranteed by the Government National Mortgage Association, the Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation or the Federal Housing Administration; (v) project notes issued by the United States Department of Housing and Urban Development; and (vi) public housing notes and bonds guaranteed by the United States of America; (c) interest-bearing demand or time deposits (including certificates of deposi0 or deposit accounts in federal or state chartered savings and .loan associations or in federal or State of California banks (including the Trustee), provided that (i) the unsecured short-term obligations of such commercial bank or -7- savings and loan association shall be rated A1 or better by S&P, or (ii) such demand or time deposits shall be fully insured by the Federal Deposit Insurance Corporation; (d) commercial paper rated in the highest short-term rating category by S&P, issued by corporations which are organized and operating.within the United States of America, and which matures not more than 180 days following the date of investment therein; (e) bankers acceptances, consisting of bills of exchange or time drafts drawn on and accepted by a commercial bank whose short-term obligations are rated in the highest short-term rating category by S&P, which mature not more than 270 days following the date of investment therein; (f) obligations the interest on which is excludable from gross income pursuant to Section 103 of the Tax Code and which are rated A or better by S&P; (g) obligations issued by any corporation organized and operating within the United States of America having assets in excess of $500,000,000, which obligations are rated A or better by S&P; (h) money market funds which are rated Am or better by S&P; (i) any investment agreement which is approved in writing by S&P prior to the time of initial investment; and (,j) the Local Agency Investment Fund established pursuant to Section 16429.1 of the Government Code of the State of California to the extent the Trustee may deposit and withdraw funds directly, provided that the Trustee may restrict such investment if required to keep moneys available for the purposes of this Indenture. "Person" means an individual, corporation, finn, association, partnership, trust, or other legal entity or group of entities, including a governmental entlty or any agency or political subdivision thereof. "Principal Account" means the account by that name established and held by the Trustee pursuant to Section 5.02. "Principal Prepayments" means any amounts received by'the Trustee representing a redemption (other than a mandatory sinking fund redemption) of the Assessment Bonds pursuant to a Fiscal Agent Agreement, consisting of the principal amount of the Assessment Bonds being redeemed and the premium paid upon such redemption; but excluding the amount of regularly scheduled payments (including mandatory sinking fund payments) of principal of and interest on the Assessment Bonds paid concurrent therewith. "Program Fund" means the fund by that name established and held by the Trustee pursuant to Section 3.04. "Purchase' Agreement" means a Bond Purchase Agreement, by and between the City and the Authority, relating to the acquisition by the Trustee of Assessment Bonds (95-2), which Bond Purchase Agreement shall have substantially the same terms as the Purchase Agreement (95-1). -8- "Purchase Agreement (95-1)" .means the Bond Purchase Agreement, dated as of 1, 1995, by and between the City and the Authority, relating to the acquisition by the Authority of the Assessment Bonds (95-1). "Record Date" means (a) the 15th calendar day of the month preceding each Interest Payment Date, whether or not such day is a Business Day, and (b) any date established by the Trustee pursuant to Section 2.02(c) as a Record Date for the payment of defaulted interest on the: Bonds, if any. "Redemption Account" means the account by that name established and held bY the Trustee pursuant to Section 5.02. "Redemption Price" means the aggregate amount of principal of and premium, ff any, on the Bonds upon the redemption thereof pursuant hereto. "Registration Books" means the records maintained by the Trustee for the registration of ownership and registration of transfer of the Bonds pursuant to Section 2.04. "Related Additional Bonds", when used with respect to Assessment Bonds (95-2), has the meaning ascribed thereto in the Fiscal Agent Agreement (95-2). "Representation Letter" means the Letter of Representations from the Authority and the Trustee to DTC, or any successor securities depository for the Series A Bonds, in which the Authority and the Trustee make certain representations with respect to the Series A Bonds, the payment with respect thereto and delivery of notices with respect thereto. "Reserve Account" means the account by that name established and held by the Trustee pursuant to Section 5.02. "Reserve Requirement" means, as of the date of any calculation, [the lesser of (a) ten percent (10%) of the original aggregate principal amount of the Bonds, or (b) the maximum amount of principal of and interest on the Bonds coming due and payable in the current or any future Bond Year]. "Reserve Requirement (95-1)" has the meaning ascribed to Reserve Requirement in the Fiscal Agent Agreement (95-1). "Reserve Requirement (95-2)" has the meaning ascribed to Reserve Requirement in the Fiscal Agent Agreement (95-2). "Revenues" means, (a) all amounts derived from or with respect to the Assessment Bonds, including but not limited to all payments of principal thereof, premium, if any, and interest thereon, and (b) investment income with respect to any moneys held by the Trustee in the funds and accounts established hereunder. "S&P" means Standard & Poor's Ratings GroUp, a divisiOn of McGraw-Hill, Inc., a corporation duly organized and existing under and by virtue of the laws of the State of New York, and its successors and assigns, except that ff such entity shall be dissolved or liquidated or shall no longer perform the functions of a securities rating agency, then the term "S&P" shall be deemed to refer to any other nationally recognized securities rating agency selected by the Authority. "Securities Depositories" means The Depository Trust Company, 711 Stewart Avenue, Garden City, New York 11530, Fax-(516) 227-4039 or 4190; Midwest Securities Trust -9- Company, Capital Structures-Call Notification, 440 South LaSalle Street, Chicago, Illinois 60605, Fax-(312) 663-2343; Philadelphia Depository Trust Company, Reorganization Division, 1900 Market Street, Philadelphia, Pennsylvania 19103, Attention: Bond Department, Dex-(215) 496-5058; and, in accordance with then current guidelines of the Securities and Exchange Commission, such other addresses and/or such other securities depositories as the Authority may designate in a Written Certificate of the Authority delivered to the Trustee. "Series" means the initial series of Bonds executed, authenticated and delivered on the date of initial issuance of the Bonds and identified pursuant to this Indenture as the Series A Bonds, and any Additional Bonds issued pursuant to a Supplemental Indenture and identified as a separate Series of Bonds. "Series A Bonds" means the Tustin Public Financing Authority Revenue Bonds (Tustin Ranch), Series A issued hereunder. "Supplemental Indenture" means any indenture amendatory or supplemental to this Indenture, but only if and to the extent that such Supplemental Indenture is specifically authorized hereunder. "Surplus Account" means the account by that name established and held by the Trustee pursuant to Section 5.02. "Trustee" means State Street Bank and Trust Company of California, N.A., a national banking association organized and existing under the laws of the United States of America, or any success-or thereto as Trustee hereunder as provided in Section 8.01. "Undeveloped Property" means a parcel or real property on which no completed structure has been built. "Written Certificate" and "Written Request" of the Authority or the City mean, respectively, a written certificate or written request signed in the name of the Authority by its Authorized Representative or in the name of the City by its Authorized Representative. Any such certificate or request may, but need not, be combined in a single instrument with any other instrument, opinion or representation, and the two or more so combined shah be read and construed as a single instrument. Section 1.02. Interoretation. (a) Unless the context otherwise indicates, words expressed in the singular shall include the plural and vice versa and the use of the neuter, masculine, or feminine gender is for convenience only and shall be deemed to include the neuter, masculine or feminine gender, as appropriate. (b) Headings of articles and sections herein and the table of contents hereof are solely for convenience of reference, do not constitute a part hereof and shall not affect the meaning, construction for effect hereof. (c) All references herein to "Articles," "Sections" and other subdivisions are to the corresponding Articles, Sections or subdivisions of this Indenture; the words "herein," "hereof," "hereby," "hereunder" and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or subdivision hereof. Section 1.03. Indenture Constitutes Contract. In consideration of the purchase and acceptance of any and all of the Bonds issued hereunder by those who shall hold .the same from -10- time to time, this Indenture shall be deemed to be and shall constitute a contract among the Authority, the Trustee and the Owners of the Bonds. The pledge made in this Indenture and the provisions, covenants and agreements herein set forth to be performed by or on behalf of the Authority shall be for the equal benefit, protection and security of the Owners of any and all of the Bonds. All of the Bonds, without regard to the time or times of their issuance or maturity, shall be of equal rank without preference, priority or distinction of any of the Bonds over any other thereof, eXcept as expressly proVided in or permitted by this. Indenture. -11- ARTICLE H THE BONDS Section 2.01. Authorization of Bonds. The Authority hereby authorizes the issuance of the Bonds hereunder and under the Bond Law, whiCh shall constitute special obligations of the Authority payable solely from the Revenues and other amounts pledged hereunder, for the purpose of providing a portion of the moneys to finance the acquisition by the Authority of Assessment Bonds. The Bonds may consist of one or more Series of varying denominations, dates, maturities, interest rates and other provisions, all issued and to be issued pursuant to this Indenture and the Bond Law, subject to the provisions and conditions contained herein. The Bonds shah be designated generally as the "Tusfin Public Financing Authority Revenue Bonds (Tustin Ranch)", each Series thereof to bear such additional designation as may be necessary or appropriate to distinguish such Series from every other Series of Bonds. The aggregate principal amount of Bonds that may be issued and Outstanding under this IndentUre shall not exceed $. , except as may be otherwise provided in Section 2.08. Section 2.02. Terms of Series A Bonds. (a) An initial series of Bonds is hereby created and such Bonds are designated as the 'q~stin Public Financing Authority Revenue Bonds (Tustin Ranch), Series A". The aggregate principal amount of Series A Bonds that .may be issued and Outstanding under this Indenture shall not exceed $ , except as may be otherwise provided in Section 2.08. (b) The Series A Bonds shall be issued in fully registered form without coupons in denominations of $5,000 or any integral multiple thereof, so long as no Series A Bond shall have more than one maturity date. The Series A Bonds shall be dated as of ,1995, shall mature on September 2 in each'of the years and in the amounts, and shall bear interest (calculated on the basis of a 360-day year comprised of twelve 30-day months) at the rates, as follows: Maturity Date Principal Interest Maturity Date Principal Interest (September 2) Amount Rate (September 2) Amount Rate 1996 $ % 2005 1997 2006 1998 2007 1999 2008 2000 2009 2001 2010 2002 2011 2003 2012 2004 2013 $ % (c) Interest on the Series A Bonds shall be payable from the Interest Payment Date next preceding the date of authentication thereof unless (i) a Series A' Bond is authenticated on or before an Interest Payment Date and after the close of business on the preceding Record Date, in which event it shall bear interest from such Interest Payment Date, (ii) a Series A Bond is authenticated on or before the first Record Date, in which event interest thereon shall be payable from ,1995, or (iii) interest on any Series A Bond is in default as of the date of authentication thereof, in which event interest thereon shall be payable from the date to which interest has been paid in full, payable on each Interest Payment Date. Interest shall be paid on each Interest Payment Date to the Persons in whose names the ownership of the Series A Bonds · is registered on the Registration Books at the close of business on the immediately preceding Record Date, except as provided below. Interest on any Series A Bond which is not punctually -12- paid or duly provided for on any Interest Payment Date shall be payable to the Person in whose name the ownership of such Series A Bond is registered on the Registration Books at the close of business on a special Record Date to be established by the Trustee for the payment of such defaulted interest to~ be fixed by the Trustee, notice of which shall be given to such Owner not less than ten days prior to such special.Record Date. Interest shall be paid by check of the Trustee mailed by first class mail, postage prepaid, on each Interest Payment Date to the Series A Bond Owners at their respective addresses shown on the Registration Books as of the close of business on the preceding Record Date. (d) The principal of the Series A Bonds shall be payable in lawful money of the United States of America upon presentation and surrender thereof at the Office of the Trustee. Payment of principal of any Series A Bond shall be made only upon presentation and surrender of such Series A Bond at the Office of the Trustee. (e) The Series A Bonds shall be initially issued registered in the name of "Cede & Co.," as nominee of the Depository Trust Company, New York, New York, and shall be evidenced by one Series A Bond maturing on each maturity date, to be in denomination corresponding to the total principal designated to mature on such date. Registered ownership of the Series A Bonds, or any portion thereof, may not thereafter be transferred except as set forth in Section 2.09. (f) The Series A Bonds shall be subject to redemption as provided in Article IV. (g) The Series A Bonds shall be in substantially the form set forth in Exhibit A hereto, with appropriate or necessary insertions, omissions and variations as permitted or required hereby. Section 2.03. Transfer and Exchanee of Bonds. Any Bond may, in accordance with its,, terms, be transferred upon the Registration l~ooks by the Person in whose name it is registered, in person or by his duly authorized attorney, upon surrender of such Bond for cancellation, accompanied by delivery of a written instrument of transfer, duly executed in a form acceptable to the Trustee. Whenever any Bond or Bonds shall be surrendered for transfer, the Authority shall execute and the Trustee shall authenticate and shall deliver a new Bond or Bonds for a like aggregate principal amount of the same series and maturity, in any authorized denomination. The Trustee shall require the Bond Owner requesting such transfer to pay any tax or other governmental charge required to be paid with respect to such transfer. The Bonds may be exchanged at the Office of the Trustee for a like aggregate principal amount of Bonds of the same series and maturity, of other authorized denominations. The Trustee shall require the payment by the Bond Owner requesting such exchange of any tax or other governmental charge required to be paid with respect to such exchange. The Trustee shall not be obligated to make any transfer or exchange of Bonds pursuant to this Section 2.03 during the period established by the Trustee for the selection of Bonds for redemption, or with respect to any Bonds selected for redemption. Section 2.04. Reeistration Books. The Trustee will keep or cause to be kept, at the Office of the Trustee, sufficient records for the registration and transfer of ownership of the Bonds, which shall be Open to inspection during regular business hours and upon 24 hours notice by the Authority and the City; 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 such records, the ownership of the Bonds as hereinbefore provided. Section 2.05. Execution o~' Bonds. The Bonds shall be executed in the name and on behalf of the Authority with the facsimile signature of its Chairman (or any duly authorized -13- deputy to the Chairman) attested by the manual or facsimile signature of its Secretary. The A. , · ° . o · . uthonty s seal, ff any, or a facstmile thereof, may be reproduced, ~mpnnted or ~mpressed on the Bonds. The Bonds shall then be delivered to the Trustee for authentication by it. In case any of the officers who shall have signed or attested any of the Bonds shall cease to be such officer or officers of the Authority before the Bonds so signed or attested shall have been authenticated or delivered by the Trustee, or issued by the Authority, such Bonds may nevertheless be authenticated, delivered and issued and, upon such authentication, delivery and issue, shall be as binding upon the Authority as though those who signed and attested the same had continued to be such officers of the Authority, and also any Bonds may be signed and attested on behalf of the Authority by such Persons as at the actual date of execution of such Bonds shall be the proper officers of the Authority although at the nominal date of such Bonds any such Person shall not have been such officer of the Authority. Section 2.06. Authentication of Bonds. Only such of the Bonds as shall bear thereon a certificate of authentication substantially in the form set forth in Exhibit A hereto, manually executed by the Trustee, shall be valid or obligatory for any purpose or entitled to the benefits of this Indenture, and such certificate of or on behalf of the Trustee shall be conclusive evidence that the Bonds so authenticated have been duly executed, authenticated and delivered hereunder and are entitled to the benefits of this Indenture. Section 2.07. Temporary Bonds. The Bonds may be issued in temporary form exchangeable for definitive Bonds when ready for delivery. Any temporary Bonds may be printed, lithographed or typewritten, shall be of such authorized denominations as may be determined by the Authority, shall be in fully registered form without coupons and may contain such reference to any of the provisions of this Indenture as may be appropriate. Every temporary Bond shall be executed by the Authority and authenticated by the Trustee upon the same conditions and in substantially the same manner as the definitive Bonds. If the Authority issues temporary Bonds it will execute and deliver definitive Bonds as promptly thereafter as practicable, and thereupon the temporary Bonds may be surrendered, for cancellation, at the Office of the Trustee and .the Trustee shall authenticate and deliver in exchange for such temporary Bonds an equal aggregate principal amount of definitive Bonds of authorized denominations. Until so exchanged, the temporary Bonds shall be entitled to the same benefits under this Indenture as definitive Bonds authenticated and delivered hereunder. Section 2.08. Bonds Mutilated. Lost. Destroyed or Stolen. If any Bond shall become mutilated, the Authority, at the expense of the Owner of said Bond, shall execute, and the Trustee shall thereupon authenticate and deliver, a new Bond of like tenor and series in exchange and substitution for the Bond so mutilated, but only upon surrender to the Trustee of the Bond so mutilated. Every mutilated Bond so surrendered to the Trustee shall be canceled by it and delivered to, or upon the order of, the Authority. If any Bond shall be lost, destroyed or stolen, evidence of such loss, destruction or theft may be submitted to the Trustee and, if such evidence and indemnity satisfactory to the Trustee shall be given, the Authority, at the expense of the Owner, shall execute, and the Trustee shall thereupon authenticate and deliver, a new Bond of like tenor in lieu of and in replacement for the Bond so lost, destroyed or stolen (or if any such Bond shall have matured or shall be about to mature, instead of issuing a replacement Bond, the Trustee may pay the same without surrender thereof). The Authority may require payment by the Owner of a sum not exceeding the actual cost of preparing 'each replacement Bond issued under this Section and of the expenses whiCh may .be incurred by the Authority and the Trustee. Any Bond issued under the provisions of this Section in lieu of any Bond alleged to be lost, destroyed or stolen shall constitute an original additional contractual obligation on the pm.of the Authority whether or not the Bond so alleged to be lost, destroyed or stolen be at any time enforceable by anyone, and shall be entitled to the benefits of this Indenture with all other Bonds secured by this Indenture. -14- Section 2.09. Book-Entry Series A Bonds. (a) Except as provided in subparagraph (c) of this Section 2.09, the registertd Owner of all of the Series A Bonds shall be DTC and the Series A Bonds shall be registered in thenarae: o~Cede & Co., as nominee for DTC. Any additional Series of Bonds Under a Supplemental Indenture may also be registered, in the name of Cede.& Co., as nominee of DTC, as provided in such Supplemental Indenture. Notwithstanding anything to the contrary contained in this Indenture, payment of interest with respect to 'any Series A Bond registered as of each Record Date in the name of Cede & Co. shall be made by wire transfer of same-day funds to the account of Cede & Co. on the payment date for the Series A Bonds at the address indicated on the record date or special record date for Cede & Co. in the Registration Books or as otherwise provided in the Representation Letter. (b) The Series A Bonds shall be initially issued in the form of separate single fully registered Series A Bonds in the amount of each separate stated maturity of the Series A Bonds. Upon initial issuance, the ownership of such Series A Bonds shall be registered in the Registration Books in the name of Cede & Co., as nominee of DTC. The Trustee and the Authority may treat DTC (or its nominee) as to the sole and exclusive Owner of the Series A Bonds registered in its name for the purposes of payment of the principal, Redemption Price or interest with respect to the Series A Bonds, selecting the Series A Bonds or portions thereof to be redeemed, giving any notice permitted or required to be given to Owners of Series A Bonds under this Indenture, registering the transfer of Series A Bonds, obtaining any consent or other action to be taken by Owners of Series A Bonds and for all other purposes whatsoever,, and neither the Trustee nor the Authority shall be affected by any notice to the contrary. Neither the Trustee nor the Authority shall have any responsibility or .obligation to any Participant, any person claiming a beneficial ownership interest in the Series A Bonds under or through DTC or any Participant, or any other person which is not shown on the Registration Books as being an Owner, with respect to the accuracy of any records maintained by DTC or any Participant; the payment by DTC or any Participant of any amount in respect of the principal, Redemption Price or interest with respect to the Series A Bonds; any notice which is permitted or required to be given to Owners of Series A Bonds under this Indenture; the selection by DTC or any Participant of any person to receive payment in the event of a partial redemption of the Series A Bonds; or any consent given or other action taken by DTC as Owner of Series A Bonds. The Trustee shall pay all principal, premium, ff any, and interest with respect to the Series A Bonds, only to DTC, and all such payments shall be valid and effective to fully satisfy and discharge the Authority's obligations with respect to the principal, premium, if.any, and interest with respect to .the Series A Bonds to the extent of the sum or sums so paid. Except under the conditions of (c) below, no person other than DTC shall receive an executed Series A Bond for each separate stated maturity. Upon delivery by DTC to the Trustee of written notice to the effect that DTC has determined to substitute a new nominee in place of Cede & Co., and subject to the provisions herein with respect to record dates, the term "Cede & Co." in this Indenture shall refer to such new nominee of DTC. (c) In the event (i) DTC, including any successor as securities depository for the Series A Bonds, determines not to continue' to act as securities depository for the Series A Bonds,. or (ii) the Authority determines that the incumbent securities depository shall no longer so act, and delivers a written certificate to the Trustee to that effect, then the Authority will discontinue the book-entry system with the incumbent securities depository for the Series A Bonds. If the Authority determines to replace the incumbent securities depository for the Series A Bonds with another qualified securities depository, the Authority shall prepare or direct the preparation of a new single, separate fully registered Series A Bond for the aggregate outstanding principal amount of Series A Bonds of each maturity, registered in the name of such successor or substitute qualified securities depository, or its nominee, or make such other arrangement acceptable to the Authority, the Trustee and the successor securities depository for the Series A Bonds as are not inconsistent with the terms of this Indenture. If the Authority fails to identify another qualified successor securities depository of the Series A Bonds to replace the incumbent -15- secUrities depository, then the Series A Bonds shall no longer be restricted to being registered in the Registration Books in the name of the incumbent securities depository or its nominee, but shall be registered in whatever name or names the incumbent securities depository for the Series A Bonds, or its nominee, shall designate. In such event the Trustee shall authenticate and deliver a sufficient quantity of Series A Bonds as to carry out the transfers and exchanges provided in Sections 2.05, 2.07 and 2.08. All such Series A Bonds shall be in fully registered form in denominations authorized by this Indenture. (d) Notwithstanding any other provision of this Indenture to the contrary, so long as any Series A Bond is registered in the name of DTC, or its nominee, all payments with respect to the principal, premium, if any, and interest with respect to such Series A Bond and all notices with respect to such Series A Bond shall be made and given, respectively, as provided in the Representation Letter. (e) In connection with any notice or other communication to be provided to Owners of Book-Entry Bonds pursuant to this Indenture by the Authority or the Trustee with respect to any consent or other action to be taken by Owners, the Authority or the Trustee, as the case may be, shall establish a record date for such consent or other action and give DTC notice of such record date not less than 15 calendar days in advance of such record date to the extent possible. -16- ARTICLE III ISSUANCE OF SERIESA BONDS; APPLICATION OF PROCEEDS; ACQUISITION OF ASSESSMENT BONDS; ADDITIONAL BONDS Section 3.01. Issuance of Series A Bonds. Concurrent with the execution and delivery of this Indenture, the Authority shall execute and the Trustee shall authenticate the Series A Bonds and deliver the Series A Bonds to the Original Purchaser in the aggregate principal amount of $ · Section 3.02. Application of Proceeds of the Series A Bonds. On the Closing Date, the proceeds of sale of the Series A Bonds shall be paid to the Trustee and deposited by the Trustee as follows: (a) The Trustee shall deposit the amount of $ in the Reserve Account, constituting the full amount of the Reserve Requirement with respect to the Series A Bonds. (b) The Trustee shall deposit the amount of $. Program Fund, constituting the remainder of such proceeds. in the Section 3.03. Costs of Issuance Fund. There is hereby established a separate fund to be known as the "Costs of Issuance Fund", which shall be held by the Trustee in trust. In connection with the issuance of a Series of Additional Bonds, there shall be deposited in the Costs of Issuance Fund the amount, ff any, specified in the Supplemental Indenture pursuant to which such Additional Bonds are issued. The moneys in the Costs of Issuance Fund shah be used and withdrawn by the Trustee froTM time to time to pay the Costs of Issuance upon submission of a Written Request of the Authority stating (a) the Person to whOm payment is to be made, (b) the amount to be paid, (c) the purpose for which the obligation was incurred, (d) that such payment is a proper charge against the Costs of Issuance Fund, and (e) that such amounts have not been the subject of a prior disbursement from the Costs of Issuance Fund; in each case together with a statement or invoice for each amount requested thereunder. On such date or dates as may be specified in any Supplemental Indenture, all amounts remaining in the Costs of Issuance Fund shall be withdrawn therefrom by the Trustee and transferred to the Interest Account. Section 3.04. Pro_tram Fund. There is hereby established a separate fund to be known as the "Program Fund", which shall be held by the Trustee in trust. On the Closing Date there shall be deposited in the Program Fund the amount specified in Section 3.02(b). Additionally, in connection with the issuance of each Series of Additional Bonds, there shall be deposited in the Program Fund an amount sufficient to acquire the Assessment Bonds (95-2) being acquired in connection with the issuance of such Additional Bonds, as specified in the Supplemental Indenture pursuant to which such Additional Bonds are issued. On the Closing Date, the Trustee shall withdraw from the Program Fund the amount of $ and apply such amount to the purchase on such date of the Assessment Bonds (95-1), all pursuant to and in accordance with the provisions of the Purchase Agreement (95-1). In accordance with the Purchase Agreement (95-1), the ownership of the Assessment Bonds (95-1) shall be registered to the Trustee upon the acquisition thereof. On the date of issuance of each Series of Additional Bonds, the Trustee shall withdraw from the Program Fund the amount specified in the Supplemental Indenture pursuant to which -17- such Additional Bonds are issued and apply such amount to the purchase on such date of Assessment Bonds (95-2), all pursuant to and in accordance with the provisions of the Purchase Agreement pursuant to which such Assessment Bonds (95-2) are being purchased. The ownership of any Assessment Bonds (95-2) shall be registered to the Trustee upon the acquisition thereof. The Trustee shall credit all Assessment Bonds to the Program Fund and shall hold and administer the Program Fund so long as the Trustee is the registered owner of any Assessment Bond. Section 3.05. Issuance of Additional Series of Bon0~. In addition to the Series A Bonds, the Authority may, subject to the requirements of the Bond Law, by Supplemental Indenture establish one or more Series of Bonds payable from Revenues on a parity with the Series A Bonds and secured by a lien upon and pledge of Revenues equal to the lien and pledge securing the Series A Bonds, and the Authority may issue and the Trustee may authenticate and deliver Bonds of any Series so established, in such principal amount as shall be determined by the Authority in said Supplemental' Indenture, but only upon compliance by the Authority with the provisions of Section 3.06, and subject to the following specific conditions, which are hereby made conditions precedent to the issuance of any such additional Series of Bonds: (a) The Authority shall not be in default under this Indenture. (b) The Supplemental Indenture providing for the issuance of such additional Series of Bonds shall require that the Reserve Account be increased, if and to the extent necessary, forthwith upon the receipt of the proceeds of the sale of such additional Series of Bonds to an amount at least equal to the Reserve Requirement. Said deposit may be made from such proceeds or any other source, as 'provided in said Supplemental Indenture. (c) The Bonds of such additional Series shall be payable as to principal annually on September 2 of each year in which principal falls due. The Bonds of such additional Series shall be payable as to interest semiannually on March 2 and September 2 of each year excepting the first year, provided that the first installment of interest may be payable on either March 2 or September 2 and shall be for a period of not longer than twelve months and that the interest shall be payable thereafter semiannually on March 2 and September 2. (d) The Bonds of such additional Series shall be subject to mandatory redemption from Principal Prepayments received with respect to the Assessment Bonds (95-2) being acquired with the proceeds of such Bonds, or with respect to the Assessment Bonds (95-2) theretofore aCquired with the proceeds of Outstanding Bonds being refunded with the proceeds of the Bonds of such' additional Series, as applicable, on the dates on which and at the redemption prices at which such Assessment Bonds (95-2) may be optionally redeemed or mandatorily redeemed from prepayment of reassessments pursuant to the Fiscal Agent Agreement (95-2). (e) Unless such Series of Bonds is being issued solely to refund Outstanding Bonds, a portion of the proceeds of such Series of Bonds shall be applied to acquire Assessment Bonds (95-2) pursuant to a Purchase Agreement. (f) No default shall have occurred and be continuing under Fiscal Agent Agreement (95-2). -18- (g) The aggregate principal amount of Bonds issued hereunder shall not exceed any limitation imposed by law or by any Supplemental Indenture. Section 3.06. Proceedines for the Issuance of Additional Series of Bonds. Whenever the Authority shall determine to issue an additional Series of Bonds, the Authority shall execute a Supplemental Indenture providing for the issuance of such additional Series of Bonds, specifying the maximum principal amount of Bonds of such Series and prescribing the terms and conditions of such additional Series of Bonds. Such Supplemental Indenture shall prescribe the form or forms of Bonds of such additional Series and, subject to the provisions of Section 3.04, shall provide for the distinctive designation, denominations, methods of execution and numbering, dating, maturity dates, interest rates, interest payment, dates, provisions for redemption prior to maturity and methods and places of payment of principal and interest. The Authority may by.such Supplemental Indenture prescribe any other provisions respecting the Bonds of such Series not inconsistent with the terms of this Indenture, including registration, transfer and exchange provisions and provisions for the payment of principal and interest. Before such additional Series of Bonds shall be issued and delivered, the Authority shall file the following documents with the Trustee: (a) An opinion of Bond Counsel substantially to the effect that (i) that such Bond Counsel has examined the Supplemental Indenture and found it to be in compliance with the requirements of this Indenture, (ii)that the execution and delivery of the additional Series of Bonds has been duly authorized by the Authority, (iii)that said additional Series of Bonds, when duly executed by the Authority and authenticated and delivered by the Trustee, will be valid and binding special obligations of the Authority, payable from Revenues as provided herein, and (iv) that the issuance of said additional Series of Bonds, and the application of the proceeds thereof in accordance with the terms of the Supplemental Indenture pursuant to which said additional Series of Bonds is issued, will not adversely affect the exclusion from gross income of interest on the Outstanding Bonds. (b) been met. A Certificate of the Authority that the requirement of Section 3.05(a) has (c) A certification of the Fiscal Agent (95-2)that the requirement of Section 3.05(f) has been met. (d) A written report of an Independent Financial Consultant demonstrating that (i) the Revenues attributable to the Assessment Bonds (95-2) being acquired with the proceeds of such additional Series of Bonds, or attributable to the Assessment Bonds (95- 2) theretofore acquired with the proceeds of Outstanding Bonds being refunded with the proceeds of such additional Series of Bonds, as applicable, will be sufficient in time and amount to pay when due the principal of and interest and premium, if any, on the Bonds of such additional Series, (ii) upon the issuance of such additional Series of Bonds, the Revenues will be sufficient in time and amount to pay when due the principal of and interest and premium, ff any, on all Outstanding Bonds, (iii) upon the issuance of such additional Series of Bonds, the Revenues in each Bond Year will be at least equal to % of the principal of and interest and premium, if any, on all Outstanding Bonds scheduled to be paid in such Bond Year, (iv) upon the issuance of such additional Series of Bonds, not less than __% of the Revenues shall be generated from assessments levied -19- on Developed Property, and (v) upon the issuance of such additional Series of Bonds, no more than. % of the Revenues shall be generated from assessments levied on Undevelope'd Property owned by the largest assessee of assessments levied to pay the Assessment Bonds, or any affiliate thereof. (e) Said Supplemental Indenture, duly executed. Upon the delivery to the Trustee of the foregoing instruments, the Trustee shall authenticate and deliver said additional Series of Bonds, in the aggregate principal amount specified in such Supplemental Indenture, to, or upon the Written Request of, the Authority, when such additional Series of Bonds shall have been presented to it for that purpose. None of the limitations or restrictions on the issuance of additional Series of Bonds set forth in this Section shall be applicable to any additional Series of Bonds which-are to be issued solely for the purpose of refunding and retiring all of the Bonds issued hereunder and then Outstanding, and nothing in this Indenture contained shall limit the issuance of any additional Series of Bonds if, after the issuance and delivery of such additional Series of Bonds, none of the Bonds theretofore authorized hereunder will be Outstanding or the Authority shall have discharged the entire indebtedness on all Bonds Outstanding in one of the ways authorized by Article X. Section 3.07. Additional Bonds. So long as any of the Bonds remain Outstanding, the Authority will not issue any Additional Bonds or obligations payable from Revenues prior to or on a parity with the Bonds, except pursuant to Sections 3.05 and 3.06. -20- ARTICLE IV REDEMPTION OF BONDS Section 4.01. Re0¢mption. (a) Optional Redemption. The Series A Bonds maturing on or after September 2, 2005 shall be subject to optional redemption in whole, or in part among maturities on such basis as shall be designated by the Authority in a Written Certificate of the Authority fried with the Trustee, on any Interest Payment Date on or after September 2, 2004, at the following respective Redemption Prices (expressed as percentages of the principal amount of the Series A Bonds to be redeemed), plus accrued interest thereon to the date of redemption: Redemption Dates Redemption Price September 2, 2004 and March 2, 2005 September 2, 2005 and March 2, 2006 September 2, 2006 and thereafter 102% 101 100 The provisions of this subsection (a) shall not be applicable to circumstances under which the Series A Bonds are subject to mandatory redemption pursuant to the following subsection (b) of this Section. (b) Mandatory Redemption From Principal Prepayments. The Series A Bonds shah be subject to mandatory redemption, in whole, or in part among maturities on the same basis as the Assessment Bonds (95-1) are redeemed and by lot within a maturity, on any Interest Payment Date, from and to the extent of any Principal Prepayments with respect to the Assessment Bonds (95-1), at the following respective Redemption Prices (expressed as percentages of the principal amount of the Series A Bonds to be redeemed), plus accrued interest thereon to the date of redemption: Redemmion Dates Redemt~tion Price March 2, 1996 through March 2, 2004 September 2, 2004 and March 2, 2005 September 2, 2005 and March 2, 2006 September 2, 2006 and thereafter 103% 102 101 100 In the event that the Fiscal Agent (95-1) shah mail notice of the prepayment of any Assessment Bonds (95-1) which will produce Principal Prepayments, the Trustee shall concurrently mail notice of the redemption of a like aggregate principal amount of Series A Bonds pursuant to this subsection (b), such redemption to occur on the date fixed for such prepayment of the Assessment Bonds (95-1). The proceeds of any such prepayment of the Assessment Bonds (95-1) shall be applied by the Trustee to pay the Redemption Price of a like aggregate principal amount of the Series A Bonds pursuant to this subsection (b) on the date of such prepayment of the Assessment Bonds (95-1). For purposes of the selection of Series A Bonds for redemption pursuant to this subsection (b), the Series A Bonds shall be selected for redemption among maturities by the Authority (evidenced pursuant to a Written Certificate of the Authority delivered to the Trustee at least 60 days prior to the redemption date or such later date as shall be acceptable to the Trustee) on such basis that the remaining payments of principal and interest on the Assessment Bonds (95-1), together with other available Revenues attributable thereto, will be sufficient on a timely basis to pay debt service on the Series A Bonds, as shall be demonstrated in a report of an Independent Financial Consultant fried with the Trustee. -21- Section 4.02. Notice of Redemption. The Trustee on behalf and at the expense of the Authority shall mail (by first class mail) notice of any redemption to the respective Owners of any Bonds designated for redemption at their respective addresses appearing on the Registration Books, and to the Securities Depositories and to one or more Information Services, at least 30 but not more than sixty 60 days prior to the date fixed fOr redemption. Such notice shall state the date of the notice, the redemption date, the redemption place and the Redemption Price and shall 'designate the CUSIP numbers, the Bond numbers and the maturity or maturities (except in the event of redemption of all of the Bonds of such maturity or maturities in whole) of the Bonds to be redeemed, and shall require that such Bonds be then surrendered at the Office of the Trustee for redemption at the Redemption Price, giving notice also that further interest on such Bonds will not accrue from and after the date fixed for redemption. Neither the failure to receive any notice so mailed, nor any defect in such notice, shall affect the sufficiency of the proceedings for the redemption of the Bonds or the cessation of accrual of interest thereon from and after the date fixed for redemption. Section 4.03. Selection of Bonds for Redemptioo. Whenever provision is made in this Indenture for the redemption of less than all of the Bonds of a maturity, the Trustee shall select the Bonds to be redeemed from all Bonds not previously called for redemption, by lot in any manner which the Trustee in its sole discretion shall deem appropriate and fair. For purposes of such selection, all Bonds shall be deemed to be comprised of separate $5,000 denominations and such separate denominations shall be treated as separate Bonds which may be separately redeemed. Section 4.04. Partial Redemption of Bonds. Upon surrender of any Bonds redeemed in part only, the Authority shall execute and the Trustee shall authenticate and deliver to the Owner thereof, at the expense of the Authority, a new Bond or Bonds of authorized denominations equal in aggregate principal amount representing the unredeemed portion of the Bonds surrendered. Section 4.05. Effect of Notice of Redemptioo. Notice having been mailed as aforesaid, and moneys for the redemption (including the interest to the applicable date fixed for redemption and including any applicable premium), having been deposited in the Redemption Account or any of the accounts therein, the Bonds shall become due and payable on said date, and, upon presentation and surrender thereof at the Office of the Trustee, said Bonds shah be paid at the Redemption Price thereof, together with interest accrued and unpaid to said date. If, on said date fixed for redemption, moneys for the redemption of all the Bonds to be redeemed, together with interest to said date, shall be held by the Trustee so as to be available therefor on such date, and, ff notice of redemption thereof shall have been mailed as aforesaid and not canceled, then, from and after said date, interest on said Bonds shall cease to accrue and become payable. All moneys held by or on behalf of the Trustee for the redemption of Bonds shall be held in trust for the account of the Owners of the Bonds so to be redeemed. All Bonds paid at maturity or redeemed prior to maturity pursuant to the provisions hereof shall be canceled upon surrender thereof and the Trustee shall deliver a certificate of deStruction to the Authority. Section 4.05. Effect of Notice of Redemt)ti9~. Notice having been mailed as aforesaid, and moneys for the redemption (including the interest to the applicable date fixed for redemption and including any applicable premium), having been set aside in the Redemption Account or any of the accounts therein, the Bonds shall become due' and payable on said date, and, upon presentation and surrender thereof at the Office of the Trustee, said Bonds shall be paid at the Redemption Price thereof, together with interest accrued and unpaid to said date. -22- If, on said date fixed for redemption, moneys for the redemption of all the Bonds to be redeemed, together with interest to said date, shah be held by the Trustee so as to be available therefor on such date, and, if notice of redemption thereof shall have been mailed as aforesaid and not canceled., then, from and after said date, interest on said Bonds shall cease to accrue and become payable. All moneys held by or on behalf of the Trustee for the redemption of Bonds shall be held in trust for the account of the Owners of the Bonds so to be redeemed. All Bonds paid at maturity or redeemed prior to maturity pursuant to the provisions hereof shall be canceled upon surrender thereof and delivered to the Authority. -23- ARTICLE V SECURITY OF BONDS; FLOW OF FUNDS; INVESTMENTS Section 5.01. Pledge And Assignment; Revenue Fund_. (a) Subject only to the provisions of this Indenture permitting the application there6f for the purposes and on the terms and conditions set forth herein, all of the Revenues and any other amounts (including proceeds of the sale of the Bonds) held in any fund or account established pursuant to this Indenture are hereby pledged by the Authority to secure the payment of the principal of and interest on the Bonds in accordance with-their terms and the provisions of this Indenture. Said pledge shall constitute a fkst lien on and security interest in such assets. (b) The Authority hereby transfers in trust and assigns to the Trustee, for the benefit of the Owners from time to time of the Bonds, all of the Revenues and all of the right, title and interest of the Authority in the Assessment Bonds, if any. The Trustee shall be entitled to and shall collect and receive all of the Revenues, and any Revenues collected or received by the Authority shall be deemed to be held, and to have been collected or received, by the Authority and shall forthwith be paid by the Authority to the Trustee. The Trustee also shall be entitled to and may take all steps, actions and proceedings reasonably necessary in its judgment to enforce, either jointly with the Authority or separately, all of the rights of the Authority and all of the obligations of the City under and with respect to the Assessment Bonds. (c) All Revenues shall be promptly deposited by the Trustee upon receipt thereof in a special fund designated as the "Revenue Fund" which the Trustee shall establish, maintain and hold in trust. All Principal Prepayments received by the Trustee shall be deposited by the Trustee in the Redemption Account to be applied to the redemption of Bonds pursuant to the terms hereof. All Revenues deposited with the Trustee shall be held, disbursed, allocated and applied bY the Trustee only as provided in this Indenture. Section 5.02. Application of Revenue Fun,d. The Trustee shall transfer from the Revenue Fund and deposit into the following respective accounts within the Revenue Fund (each of which the Trustee shah establish and maintain in trust separate and distinct from the other funds and acdounts established hereunder), the following amounts at the following times in the · following order of priority, the requirements of each such account (including the making up of any deficiencies in any such account resulting from lack of Revenues sufficient to make any earlier required deposit) at the time of deposit to be satisfied before any transfer is made to any account subsequent in priority: (a) On each Interest Payment Date or redemption date, the Trustee shall deposit in the Interest Account an amount which, together with the amounts then on deposit therein, is required to Cause the aggregate amount on deposit in the Interest Account tO equal the amount then required to make any payment pursuant to Section 5.03. (b) On each September 2, commencing September 2, 1996, the Trustee shall deposit in the Principal Account an amount which, together with the amounts then on deposit therein, is required to cause the aggregate amount on deposit in the Principal Account to equal the aggregate amount of principal then coming due and payable on the Bonds. (c) On each Interest Payment Date, the Trustee shall deposit in the Reserve Account an amount, if any, which is required to cause the balance in the Reserve Account to equal the Reserve Requirement. -24- (d) Following the foregoing transfers on each September 2, the Trustee shall deposit in the Surplus Account all remaining mounts. Section 5.03. Application of Interest Account. Subject to the provisions of this Indenture, all amounts in the Interest Account shall be used and withdrawn by the Trustee solely for the purpose of paying interest on the Bonds as it shall become due and payable.' Any amounts on deposit in the Interest Account on any Interest Payment Date and not required to pay interest then due and payable on the Bonds shall be retained in the Interest Account and credited towards the payment of interest on the Bonds next coming due. Section 5.04. Application of Principal Account. Subject to the provisions of this Indenture, all amounts in the Principal Account shall be used and withdrawn by the Trustee solely to pay the principal of the Bonds upon the stated maturity thereof. Section 5.05. Annlication of Reserve Account. Amounts in the Reserve Account shall -- -- be used and withdrawn by the Trustee solely for the purpose of making transfers to the Interest Account and the Principal Account, in such order of priority, on any date which the principal of or interest on the Bonds becomes due and payable hereunder, in the event of any deficiency at any time in any of such accounts, or at any time for the retirement of all the Bonds then Outstanding. So long as no Event of Default shall have occurred and be continuing, any amount in the Reserve Account in excess of the Reserve Requirement on February 15 and August 15 of each year shall be withdrawn from the Reserve Account by the Trustee and deposited in the Interest Account. Amounts on deposit in the Reserve Account shall be withdrawn and applied by the Trustee to the final payment or payments of debt service on the Bonds. Section 5.06. Application of Redemption Account. Subject to the provisions of this Indenture, all amounts deposited in the Redemption Account shall be used and withdrawn by the Trustee solely for the purpose of redeeming Bonds in the manner and upon the terms and conditions set forth herein. Section 5.07. 'Application of Surplus Account. (a) Pursuant to the Fiscal Agent Agreement (95-1), the City will cause the Fiscal Agent (95-1) to deliver to the Trustee on July 1 of each year, a written notification stating (i) the amount of the' debt service payable on the Assessment Bonds (95-1) on the following September 2, (ii) the amount on deposit in the Redemption Fund established under Fiscal Agent Agreement (95-1) as of such July 1, and (iii) the amount, if any, by which the amount on deposit in the Reserve Fund established under Fiscal Agent Agreement (95-1) on such July 1 is less than the Reserve Requirement (95-1). Pursuant to the Fiscal Agent Agreement (95-2), the City will cause the Fiscal Agent (95-2) to deliver to the Trustee on July 1 of each year, a written notification stating, with respect to each Group of Assessment Bonds (95-2) (i) the amount of the debt service payable on such Group of Assessment Bonds (95-2) on the following September 2, (ii) the amount on deposit in the Redemption Account established for such Group of Assessment Bonds (95-2) under Fiscal Agent Agreement (95-2) as of such July 1, and (iii) the amount, if any, by which the amount on deposit in the Reserve Account established for such Group of Assessment Bonds (95-2) under Fiscal Agent Agreement (95-2) on such July 1 is less than the Reserve Requirement (95-2) therefor. (b) Upon receipt of such notifications, the Trustee shall provide cOpies thereof to the. Assessment Consultant. The Authority shall cause the Assessment Consultant to determine, based on the amount on deposit in the Surplus Fund as of such July 1 (i) the amount expected to be available to be transferred from the Surplus Fund by the Trustee to the Fiscal Agent (95-1) pursuant to the provision of this Section, (ii) the amount expected to be available to be transferred from the Surplus Fund by the Trustee to the Fiscal Agent (95-2) pursuant to the -25- provisions of this Section and the portion (as a percentage) thereof allocable to each' Group of Assessment Bonds (95-2), (iii) the portion (as a percentage) of the total amount expected to be available for such transfers that is to be transferred to Fiscal Agent (95-1), and (iv) the portion (as a percentage) of the total amount expected to be available for such transfers that is to be transferred to the Fiscal Agent (95-2). The Authority shall cause the Assessment Consultant to deliver to the Trustee, no later than July 10, a written notification setting forth such determinations. Based on such notification, the Trustee shall, no later than July 15 (i) deliver to the Fiscal Agent (95-1) a written notification stating the amount the Trustee expects to transfer from the Surplus Fund to the Fiscal Agent (95-1) on the following September 3, and (ii) deliver to the Fiscal Agent (95-2) a written notification stating the amount the Trustee expects to transfer from the Surplus Fund to the Fiscal Agent (95-2) on the following September 3 and the portion (as a percentage) thereof allocable to each Group of Assessment Bonds (95-2). (c) On or before August 31 of each year,' the Authority may, pursuant to a Written Request of the City, direct the Trustee to transfer, on the following September 3, from the Surplus Fund to the Administrative Costs Account an amount sufficient to pay Administrative Costs through the September 2 following such September 3. On September 1 of each year the Trustee shall deliver (A) to the Fiscal Agent (95-1) a written notification of the actual amount to be transferred to the Fiscal Agent (95-1) pursuant to clause (ii), below, and (B) to the Fiscal Agent (95-2) a written notification of the actual amount to be transferred to the Fiscal Agent (95- 2) pursuant to clause (ii), below. On September 3 of each year, amounts on deposit in the Surplus Account shall be applied as follows: (i) the amount, ff any, specified in the Written Request of the Authority received on or prior to the preceding August 31 shall be transferred to the Administrative Costs Account; and (ii) a portion of the remainder of'such amounts, based on the percentage determined pursuant to clause (iii) of subsection (b), above shall be transferred by the Trustee to the Fiscal Agent (95-1), and a portion of the remainder, based on the percentage determined pursuant to clause (iv) of subsection (b), above, shall be transferred to the Fiscal Agent (95-2). Section 5.08. Administrative Cost~ Account The moneys in the Administrative Costs Account shall be used and withdrawn by the Trustee from time to time to pay Administrative Costs upon submission of a Written Request of the Authority stating (a) the Person to whom payment is to be made, (b) the amount to be paid, (c) the purpose for which the obligation was incurred, (d) that such payment constitutes an Administrative Cost and is a proper charge against the Administrative Costs Account, and (e) that such amounts have not been the subject of a prior disbursement from the Administrative Costs Account; in each case together with a statement or invoice for each amount requested thereunder. Section 5.09. Investment of Moneys. Except as otherwise provided herein, all moneys in any of the funds or accounts established pursuant'to this Indenture shall be invested by the Trustee solely in Permitted Investments, as directed in writing by the Authority two Business Days prior to the making of such investment. All Permitted Investments shall be acquired subject to any restrictive instructions given to the Trustee pursuant to Section 6.10 and such additional limitations or requirements consistent with the foregoing as may be established by the Written Request of the Authority. Moneys in all funds and accounts shall be invested in Permitted Investments maturing not later than the date on which it is estimated that such moneys will be required for the purposes specified in this indenture; provided, however, that Permitted Investments in which moneys in the Reserve Account axe so invested shall mature no later than the earlier of five years from the date of investment or the final maturity date of the Bonds, and -26- provided, further, that if such Permitted Investments may be redeemed at par so as to be available on each Interest Payment Date, any amount in. the. Reserve Account may be invested in such redeemable Permitted Investments maturing on any date on or prior to the final maturity date of the Bonds. Absent timely written direction from the Authority, the Trustee shall invest any funds held by it in Permitted Investments described in clause (c) of the definition thereof. Subject to the provisions of Section 6.10, all interest, profits and other income received from the investment of moneys in any fund or account established pursuant to this Indenture shall be deposited in the Revenue Fund; provided, however, that all interest or gain from the investment of amounts in the Reserve Account shall be retained therein and, provided further, that before any such deposit shall be made, such interest, profits and other income shall be available for the payment of any rebate that may be owed under the Code, as specified in a Written Request of the Authority delivered to the Trustee. Permitted Investments acquired as an investment of moneys in any fund established under this Indenture shall be credited to such fund. Except as otherwise provided in the following sentence, all investments of amounts deposited in any fund or account created by or pursuant to this Indenture or otherwise containing gross proceeds of the Bonds (within the meaning of section 148 of the Code) shall be acquired, disposed of, and valued (as of the date that valuation is required by this Indenture or the Code) at Fair Market Value. Investments in funds or accounts (or portions thereof) that are subject to a yield restriction under applicable provisions of the Code shall be valued at their present value (within the meaning of section 148 of the Code). The Trustee may act as principal or agent in the making or disposing of any investment. Upon the Written Request of the Authority, the Trustee shall sell or present for redemption, any Permitted Investments so purchased whenever it shall be necessary to provide moneys to meet any required payment, transfer, withdrawal or disbursement from the fund to which such Permitted Investments is credited, and the Trustee shall not be liable or responsible for any loss resulting from any investment made or sold pursuant to this Section. For purposes of investment, the Trustee may commingle moneys in any of the funds and accounts established hereunder. -27- ARTICLE VI PARTICULAR COVENANTS Section 6.01. Punctual P~lym~nt. The Authority shall punctually pay or cause to be paid the principal, premium, if any and interest to become due in respect of all the Bonds, in strict conformity with the terms of the Bonds and of this Indenture, according to the true intent and meaning thereof, but only out of Revenues and other assets pledged for such payment as provided in this Indenture and received by the Authority or the Trustee. Section 6.02. Extension of Payment of Bonds. The Authority shall not directly or indirectly extend or assent to the extension of the maturity of any of the Bonds or the time of payment of any claims for interest by the purchase of such Bonds or by any other arrangement, and in case the maturity of any of the Bonds or the time of payment of any such claims for interest shall be extended, such Bonds or claims for interest shall not be entitled, in case of any default hereunder, to the benefits of this Indenture, except subject to the prior payment in full of the principal of all of the Bonds then Outstanding and of all claims for interest thereon which shall not have been so extended~ Nothing in this Section shall be deemed to limit the fight of the Authority to issue Bonds for the purpose of refunding any Outstanding Bonds, and such issuance shall not be deemed to constitute an extension of maturity of the Bonds. Section 6.03. Against Encumbrances. The Authority shall not create, or permit the creation of, any pledge, lien, charge or other encumbrance upon the Revenues and other assets pledged or assigned under this Indenture while any of the Bonds are Outstanding. Subject to this limitation, the Authority expressly reserves the right to enter into one or more other indentures for any of its corporate purposes, including other programs under the Bond Law, and reserves the right to issue other obligations for such purposes. Section 6.04. Power to Issue Bonds and Make Piedee and Assignment. The Authority is duly authorized pursuant to law to issue the Bonds an~ to enter into this Indenture and to pledge the Revenues and other assets purported to be pledged under this Indenture in the manner and to the extent provided in this Indenture. The Bonds and the provisions of this Indenture are and will be the legal, valid and binding special obligations of the Authority in accordance with their terms, and the Authority and the Trustee (subject to the provisions of Articles VII and VIII) shall at all times, to the extent permitted by law, defend, preserve and protect said pledge and assignment of Revenues and other assets and all the rights of the Bond Owners under this Indenture against all claims and demands of all Persons whomsoever. Section 6.05. Accounting Records and Financial Statement~. The Trustee shall at all times keep, or cause to be kept, proper books of record and account, prepared in accordance with trust industry standards, in which complete and accurate entries shall be made of all transactions relating to the proceeds of the Bonds, the Revenues, the Assessment Bonds and all funds and accounts established pursuant to this Indenture. Such books of record and account shall be available for inspection by the Authority and the City, during regular business hours and upon 24 hours' notice and under reasonable circumstances as agreed to by the Trustee. The Trustee shall deliver to the Authority a monthly accounting of the funds and accounts it holds under this Indenture; provided, however, that the Trustee shall not be obligated to deliver such accounting for any fund or account that has a balance of zero. Section 6.06. Waiver of Law~. The Authority 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 law now or at any time hereafter in force that may affect the covenants and agreements contained in -28- this Indenture or in the Bonds, and all benefit or advantage of any such law or laws is hereby expressly waived by the Authority to the extent permitted by law. Section 6.07. Collection of Revenues. The Trustee shall collect and cause to be paid to it all Revenues promptly as such Revenues become due and payable, and shall vigorously enforce and cause to be enforced all rights of the Trustee under and with respect to the Assessment Bonds. Section 6.08. Disx>osition of Assessment Bonds. The Trustee shall not sell or otherwise dispose of the Assessment Bonds, or any interest therein, unless either (a) there shall have occurred and be continuing an Event of Default hereunder, or (b) the proceeds derived by the Trustee from such sale or other disposition are sufficient to enable the Trustee to redeem or defease all of the Outstanding Bonds in accordance with the terms hereof. Section 6.09. Amendment of Assessment Bonds. Neither the Trustee nor the Authority shall consent or agree to consent to any amendment or modification of any Fiscal Agent Agreement or the Assessment Bonds, unless the Authority shall have obtained, and caused to be filed with the Trustee, (a) the report of an Independent Financial Consultant stating that such amendment or modification will not cause a reduction in the amount of Revenues required to pay debt service on the Bonds, and (b) an opinion of Bond Counsel stating that such amendment or modification will not materially adversely impair the interests of the Bond Owners hereunder, and will not cause interest on the Bonds to be includable in gross income of the Bond Owners for federal income tax purposes. Section 6.10. Tax Covenants. (a) Private Activity Bond Limitation. The Authority shall assure that the proceeds of the Series A Bonds are not so Used as to cause the Series A Bonds to satisfy the private business tests of Section 141(b) of the Code or the private loan £mancing test of Section 141(c) of the Code. (b) Rebate Requirement. The Authority shall take any and all actions necessary to assure compliance with section 148(f) of the Code, relating to the rebate of excess investment earnings, if any, to the federal government, to the extent that such section is applicable to the Series A Bonds. (c) Federal Guarantee Prohibition. The Authority shall not take any action or permit or suffer any action to be taken if the result of the same would be to cause any of the Series A Bonds to be "Federally guaranteed" within the meaning of Section 149(b) of the Code. (d) Maintenance of Tax-Exemption. The Authority shall take all actions necessary to assure the exclusion of interest on the Series A Bonds from gross income of the Owners of the Series A Bonds to the same extent as such interest is permitted to be excluded from gross income under the Code as in effect on the date of issuance of the Series A Bonds. (e) No Arbitrage. The Authority shall not take, or permit or Suffer to be taken by the Trustee or otherwise, any action with respect to the proceeds of the Series A Bonds which, if such action had been reasonably expected to have been taken, or had been deliberately and intentionally taken, on the date of issuance of the Series A Bonds would have caused the Series A Bonds to be "arbitrage bonds" within the meaning of section 148 of the Code. Section 6.11. Continuing Disclosure. Pursuant to the Continuing Disclosure Agreement, the City has undertaken all responsibility for compliance with continuing disclosure requirements with respect to the Series A Bonds, and the Authority shall have no liability to the holders of the Series A Bonds or any other person with respect to such disclosure matters. The Trustee hereby covenants and agrees that it will comply with and carry out all of the provisions -29- of the Continuing Disclosure Agreement. Notwithstanding any other provision of this Indenture, failure of the City or the Trustee to comply with the Continuing Disclosure Agreement shall not be considered an Event of Default, however, the Trustee may (and, at the written direction of any Participating Underwriter or the holders of at least 25% aggregate principal amount of Outstanding Series A Bonds, shall) or any holder or beneficial owner of the Series A Bonds may take such actions as may be necessary and appropriate to compel performance, including seeking mandate or specific performance by court order. Section 6.11. Further Assurances. The Authority will make, execute and deliVer any and all such further indentures, instruments and assurances as may be reasonably necessary or proper to carry out the intention or to facilitate the performance of this Indenture and for the better assuring and confirming unto the Owners of the Bonds of the rights and benefits provided in this Indenture. -30- ARTICLE VII EVENTS OF DEFAULT AND REMEDIES OF BOND OWNERS Section 7.01. Events of Default. The following events shall be Events of Default: (a) Failure to pay any installment of principal of any Bonds when and as the same shall become due and payable, whether at maturity as therein expressed, by proceedings for redemption, by acceleration, or otherwise. (b) Failure to pay any installment of interest on any Bonds when and as the same shall become due and payable. (c) Failure by the Authority to observe and perform any of the other covenants, agreements or conditions on its part in this Indenture or in the Bonds contained, if such failure shall have continued for a period of 60 days after written notice thereof, specifying such failure and requiring the same to be remedied, shall have been given to the Authority by the Trustee or the Owners of not less than 25% in aggregate principal amount of the Bonds at the time Outstanding; provided, however, if in the reasonable opinion of the Authority the failure stated in the notice can be corrected, but not within such 60 day period, such failure shall not constitute an Event of Default if corrective action is instituted by the. Authority within such 60 day period and the Authority shall thereafter diligently and in good faith cure such failure in a reasonable period of time. (d) The Authority shall commence a voluntary case under Title 11 of the United States Code or any substitute or successor statute. Section 7.02. Remedies Under Assessment Bonds. If any Event of Default shah occur under Section 7.01 then, and in each and every such case during the continuance of such Event of Default, the Trustee or the Owners of not less than a majority in aggregate principal amount of the Bonds at the time Outstanding may, upon notice in writing to the Authority, exercise any and all remedies available pursuant to law or granted with respect to the Assessment Bonds. Section 7.03. Other Remedies of Bond Owners. Subject to the provisions of Section 7.07, any Bond Owner shall have the right, for the equal benefit and protection of all Bond Owners similarly situated: (a) by mandamus, suit, action or proceeding, to compel the Authority and its members, officers, agents or employees to perform each and every term, provision and covenant contained in this Indenture and in the Bonds, and to require the carrying out of any or all such covenants and agreements of the Authority and the fulfillment of all duties imposed upon it by the Bond Law; (b) by suit, action or proceeding in equity, to enjoin any acts or things which are unlawful, or the violation of any of the Bond Owners' rights; or (c) upon the happening of any Event of Default, by suit, action or proceeding in any court of competent jurisdiction, to require the Authority and its members and employees to account as if it and they were the trustees of an express trust. -31- Section 7.04. Application of Revenues and Other Funds After Default. If an Event of Default shall occur and be continuing, all Revenues and any other funds then held or thereafter received by the Trustee under any of the provisions of this Indenture shall be applied by the Trustee as follows and in the following order: (a) To the payment of any expenses necessary in the opinion of the Trustee to protect the interests of the Owners of the Bonds and payment of reasonable fees, charges and expenses of the Trustee (including reasonable fees and disbursements of its counsel) incurred in and about the performance of its powers and duties under this Indenture; (b) To the payment of the principal of and interest then due with respect to the Bonds (upon presentation of the Bonds to be paid, and stamping thereon of the payment if only partially paid, or surrender thereof if fully paid) subject to the provisions of this Indenture, as follows: First: To the payment to the Persons entitled theretO of all installments of interest then due in the order of the maturity of such installments, and, if the amount available shall not be sufficient to pay in full any installment or installments maturing on the same date, then to the payment thereof ratably, according to the amounts due thereon, to the Persons entitled thereto, without any discrimination or preference; and ~: To the payment to the Persons entitled thereto of the unpaid principal of any Bonds which shall have become due, whether at maturity or by call for redemption, with interest on the overdue principal at the rate borne by the respective Bonds on the date of maturity or redemption, and, if the amount available shall not be sufficient to pay in full all the Bonds, together with such interest, then to the payment thereof ratably, according to the amounts of principal due on such date to the Persons entitled thereto, without any discrimination or preference. (c) Any remaining funds shall be transferred by the Trustee to the Revenue Fund. Section 7.05. Trustee to Reoresent Bond Owners. The Trustee is hereby irrevocably appointed (and the successive respec[ive Owners of the Bonds, by taking and holding the same, shall be conclusively deemed to have so appointed the Trustee) as trustee and true and lawful attorney-in-fact of the Owners of the Bonds for the purpose of exercising and prosecuting on their behalf such rights and remedies as may be available to the Owners under the provisions of the Bonds, this Indenture, the Bond Law and applicable provisions of any other law. Upon the occurrence and cOntinuance of an Event of Default or other occasion giving rise to a right in the Trustee to represent the Bond Owners, the .Trustee in its discretion may, and upon the written request of the Owners of a majority in aggregate principal amount of the Bonds then Outstanding, and upon being indemnified to its satisfaction therefor, shall, proceed to protect or enforce its rights or the rights of such Owners by such appropriate action, suit, mandamus or other proceedings as it shall deem most effectual to protect and enforce any such right, at law or in equity, either for the specific performance of any covenant or agreement contained herein, or in aid of the execution of any power herein granted, or for the enforcement of any other appropriate legal or equitable fight or remedy vested in the Trustee and such Owners under the Bonds, this Indenture, the Bond Law or any other law; and upon instituting such proceeding, the Trustee shall be entitled, as a matter of fight, to the appointment of a receiver of the Revenues and other assets pledged under this Indenture, pending such proceedings. All rights of action under this Indenture or the Bonds or otherwise may be prosecuted and enforced by the Trustee -32- without the possession of any of the BOnds or the production thereof in any proceeding relating thereto, and any such suit, action or proceeding instituted by the Trustee shall be brought in the name of the Trustee for the benefit and protection of the Owners of such Bonds, subject to the provisions of this Indenture. Section 7.06. Bond Owners' Direction of Proceedings. Anything in this indenture to. the contrary notwithstanding, the Owners of a majofi, ty in .aggregate principal amount of the Bonds then Outstanding shall have the fight, by an ~nstrument or concurrent instruments in writing executed and delivered to the Trustee, and upon indemnification of the Trustee to its reasonable satisfaction, to direct the method of conducting all remedial proceedings taken by the Trustee hereunder, provided that such direction shall not be otherwise than in accordance with law and the provisions of this Indenture, and that the Trustee shall have the fight to decline to follow any such direction which in the opinion of the Trustee would be unjustly prejudicial to Bond Owners not parties to such direction. Section 7.07. Limitation on Bond Owners' Right to Sue. No Owner of any Bonds shall have the right to institute any suit, action or proceeding at law or in equity, for the protection or enforcement of any right or remedy under this Indenture, the Bond Law or any other applicable law with respect to such Bonds, unless (a) such Owner shall have given to the Trustee written notice of the occurrence of an Event of Default, (b) the Owners of a majority in aggregate principal amount of the Bonds then Outstanding, shall have made written request upon the Trustee to exercise the powers hereinbefore granted or to institute such suit, action or proceeding in its own name, (c) such Owner or said Owners shall have tendered to the Trustee indemnity against the costs, expenses and liabilities to be incurred in compliance with such request, and (d) the Trustee shall have refused or omitted to comply with such request for a period of 60 days after such written request shall have been received by, and said tender of indemnity shall have been made to, the Trustee. Such notification, request, tender of indemnity and refusal or omission are hereby declared, in every case, to be conditions precedent to the exercise by any Owner of Bonds of any remedy hereunder or under law; it being understood and intended that no one or more Owners of Bonds shall have any right in any manner whatever by his or their action to affect, disturb or prejudice the security of this Indenture or the rights of any other Owners of Bonds, or to enforce any right under the Bonds, this Indenture, the Bond Law or other applicable law with respect to the Bonds, except in the manner herein provided, and that all proceedings at law or in equity to enforce any such right shall be instituted, had and maintained in the manner herein provided and for the benefit and protection of all Owners of the Outstanding Bonds, subject to the provisions of this Indenture. Section 7.08. Absolute Oblieation of Authority. Nothing in Section 7.07 or in any other provision of this Indenture or in [he Bonds contained shall affect or impair the obligation of the Authority, which is absolute and unconditional, to pay the principal of and interest .on the Bonds to the respective Owners of the Bonds at their respective dates of maturity, or upon call for redemption, as herein provided, but only out of the Revenues and other assets herein pledged therefor and received by the Authority or the Trustee, or affect or impair the right of such Owners, which is also absolute and unconditional, to enforce such payment by virtue of the contract embodied in the Bonds. Section 7.09. Termination of Proceedings. In case any proceedings taken by the Trustee or any one or more Bond Owners on account of any Event of Default shall have been discontinued or abandoned for any reason or shall have been determined adversely to the Trustee or the Bond Owners, then in every such case the Authority, the Trustee and the Bond Owners, subject to any determination in such proceedings, shall be restored to their former positions and rights hereunder, severally and respectively, and all rights, remedies, powers and duties of the -33- Authority, the Trustee and the Bond Owners shall continue as though no such proceedings had been taken. Section 7.10. Remedies Not Exclusive. No remedy herein conferred upon or reserved to the Trustee or to the Owners of the Bonds is intended to be exclusive of any other remedy or remedies, and each and every such remedy, to the extent permitted by law, shall be cumulative and in addition to any other remedy given hereunder or now or hereafter existing, at law or in equity or otherwise. Section 7.11. No Waiver of Default. No delay or omission of the Trustee or of any Owner of the Bonds to exercise any fight or power arising upon the occurrence of 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 Indenture to the Trustee or to the Owners of the Bonds may be exercised from time to time and as often as may be deemed expedient. -34- ARTICLE VHI THE TRUSTEE Section 8.01. Duties and Liabilities of Trustee. (a) Duties of Trustee Generally. The Trustee shall, prior to an Event of Default, and after the curing of all Events of Default which may have occurred, perform such duties and only such duties as are expressly and specifically set forth in this Indenture. The Trustee shall, during the existence of any Event of Default which has not been cured, exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs. (b) Removal of Trustee. The Authority may upon 30 days' prior written notice remove the Trustee at any time unless an Event of Default shall have occurred and then be continuing, and shall remove the Trustee if at any time requested to do so by an .instrument or concurrent instruments in writing signed by the Owners of not less than a majority in aggregate, principal amount of the Bonds then Outstanding (or their attorneys duly authorized in writing) or ff at any time the Trustee shall cease to be eligible in accordance with subsection (e) of this Section, or shall become incapable of acting, or shall be adjudged a bankrupt or insolvent, or a receiver of the Trustee or its property shall be appointed, or any public officer shall take control or charge of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, in each case by giving written notice of such removal to the Trustee and thereupon shall appoint a successor Trustee by an instrument in writing. (c) Resignation of Trustee. The Trustee may at any time'resign by giving written notice of such resignation by first class mail, postage prepaid, to the Authority, and to the Bond Owners notice of such resignation at the respective addresses shown on the Registration Books. Upon receiving such notice of resignation, the Authority shall promptly appoint a successor Trustee by an instrument in writing. The Trustee shall not be relieved of its duties until such successor Trustee has accepted appointment. (d) Appointment of Successor Trustee. Any removal or resignation of the Trustee and appointment of a successor Trustee shall become effective upon acceptance of appointment by the successor Trustee; provided, however, that under any circumstances the successor Trustee shall be qualified as provided in subsection (e) of this Section. If no qualified successor Trustee shall have been appointed and have accepted appointment within 45 days following giving notice of removal or notice of resignation as aforesaid, the resigning Trustee or any Bond Owner (on behalf of himself and all other Bond Owners) may petition any court of competent jurisdiction for the appointment of a successor Trustee, and such court may thereupon, after such notice, if any, as it may deem proper, appoint such successor Trustee. Any successor Trustee appointed under this Indenture shall signify its acceptance of such appointment by executing and delivering to the Authority and to its predecessor Trustee a written acceptance thereof, and to the predecessor.Trustee an instrument indemnifying the predecessor Trustee for any costs or claims arising during the time the successor Trustee serves as Trustee hereunder, 'and after payment by the Authority of all unpaid fees and expenses of the predecessor Trustee, the such successor Trustee, without any further act, deed or conveyance, shall become vested with all the moneys, estates, properties, rights, powers, trusts, duties and obligations of such predecessor Trustee, with like effect as if originally named Trustee herein; but, nevertheless at the Written Request of the Authority or the request of the successor Trustee, such predecessor Trustee shall execute and deliver any and all instruments of conveyance or further assurance and do such other things as may reasonably be required for more fully and certainly vesting in and confirming to such successor Trustee all the fight, title and 'interest of such predecessor Trustee in and to any property held by it under this Indenture and shall pay over, transfer, assign and deliver to the -35- successor Trustee any money or other property subject to the trUsts and conditions herein set forth. Upon request of the successor Trustee, the Authority shall execute and deliver any and all instruments as may be reasonably required for more fully and certainly vesting in and confirming to such successor Trustee all such moneys, estates, properties, rights, powers, trusts, duties and obligations. Upon acceptance of appointment by a successor Trustee as provided in this subsection, the Authority shall mail or cause the successor Trustee to mail, by first class mail postage prepaid, a notice of the succession of such Trustee to the trusts hereunder to each rating agency which then'maintains a rating on the Bonds and to the Bond Owners at the addresses shown on the Registration Books. ff the Authority fails to mail such notice within 15 days after acceptance of appointment by the successor Trustee, the successor Trustee shall cause such notice to be mailed at the expense of the Authority. (e) Fiscal Agent To Act As Trustee Hereunder. Notwithstanding anything herein to the contrary, so long as the Trustee shall be the owner of the Assessment Bonds, no entity shall be qualified to act as the Trustee (or to act as any successor Trustee) except the Fiscal Agent. Upon any resignation or removal of the Fiscal Agent in accordance with the Fiscal Agent Agreements, such event shall automatically cause the resignation or removal of the Trustee hereunder; and upon the appointment of a successor Fiscal Agent in accordance with the Fiscal Agent Agreements, such appointment shall automatically constitute the appointment of a successor Trustee hereunder. Under no circumstances shall the Trustee be removed or resign hereunder unless the Fiscal Agent shall be removed or resign as such under and pursuant to the Fiscal Agent Agreements. In the event that the Trustee shall no longer be the owner of the Assessment Bonds, the Trustee appointed under the provisions of this Section 8.01 in succession to the Trustee shall be a trust company or bank having the powers of a trust company, having (or ff such bank or trust company ~s a member of a bank holding company system, its parent bank holding company has) a combined capital and surplus of at least one hundred million dollars ($100,000,000), and subject to supervision or examination by federal or state agency. If such bank or trust company publishes a report of condition at least annually, pursuant to law or to the requirements of any supervising or examining agency above referred to, then for the purpose of this subsection the combined capital and surplus of such bank or trust company shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. In case at any time the Trustee shall cease to be eligible in accordance with the provisions of this subsection (e), the Trustee shall resign immediately in the manner and with the effect specified in this Section. Section 8.02. Merger or Consolidation.. Any bank or trust company into which the Trustee may be merged or converted or with which it may be consolidated or any bank or trust company resulting from any merger, conversion or consolidation to which it shall be a party or any bank or trust company to which the Trustee may sell or transfer all or substantially all of its corporate trust business, provided such bank or trust company shall be eligible under subsection (e) of Section 8.01 shall be the successor to such Trustee, without the execution or filing of any paper or any further act, anything herein to the contrary notwithstanding. Section 8.03. Liability_ of Trust¢~. (a) The recitals of facts herein and in the Bonds contained shall be taken as statements of the Authority, and the Trustee shall not assume responsibility for the correctness of the same, or make any representations as to the validity or sufficiency of this Indenture or of the Bonds or shall incur any responsibility in respect thereof, other than as expressly stated herein in connection with the respective duties or obligations herein or in the Bonds assigned to or imposed upon it. The Trustee shall, however, be responsible for its representations contained in its certificate of authentication on the Bonds. The Trustee makes no representations as to the validity or sufficiency of the Indenture or of any -36- Bonds, or in respect of the security afforded by the Indenture and the Trustee shall incur no responsibility in respect thereof. The Trustee shall be under no responsibility or duty with respect to: (i) the issuance of the Bonds for~vatue; (ii) the application of the proceeds thereof except to the extent that such proceeds are received by it in its capacity as Trustee; or (iii) the application of any moneys paid to the Authority or others in accordance with the Indenture except as the application of any moneys paid to it in its capacity as Trustee. The Trustee shall not be liable in connection with the performance of its duties hereunder, except for its own~ negligence or willful misconduct. The Trustee shall not be liable for any action taken or omitted by it in good faith and believed by it to be authorized or within the discretion or rights or powers conferred upon it by the Indenture. The Trustee may become the Owner of Bonds with the same rights it would have if it were not Trustee, and, to the extent permitted by law, 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 Bond Owners, whether or not such committee shall represent the Owners of a majority in aggregate principal amount of the Bonds then Outstanding. (b) The Trustee shall not be liable for any error of judgment made in good faith by a responsible officer, unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts. (c) The Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Owners of not less than a majority in aggregate principal amount of the Bonds at the time Outstanding 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 Indenture. Section 8.04. Right to Rely on Documents. The Trustee shall be protected in acting upon any notice, resolution, request, consent, order, certificate, report, opinion, bonds or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties. The Trustee may consult with counsel, who may be counsel of or to the Authority, with regard to legal questions, and the opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered by it hereunder in good faith and in accordance therewith; provided, however, the Trustee shall in no event delay any payment with respect to the Bonds in anticipation of any such opinion. Whenever in the administration of the trusts imposed upon it by this Indenture the Trustee shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering any action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by a Written Certificate of the Authority, and such Written Certificate shall be full warrant to the Trustee for any action taken or suffered in good faith under the provisions of this Indenture in reliance upon such Written Certificate, but in its discretion the Trustee may, in lieu thereof, accept other evidence of such matter or may require such additional evidence as it may deem reasonable. Section 8.05. Preservation and Inspection of Documents. All documents received by the Trustee under the provisions of this Indenture shall be retained in its possession and shall be subject during business hours and upon 24 hours' notice to the inspection of the Authority, the City and their agents and representatives duly authorized in writing. Section 8.06. Compensation and Indcmnification. In accordance with the Purchase -- Agreement (95-1), the City shall pay to the Trustee from time to time all reasonable compensation for all services rendered under this Indenture, and also all reasonable expenses, charges, legal and consulting fees and other disbursements and those of its attorneys, agents and employees, incurred in and about the performance of their powers and duties under this -37- Indenture. The City has further agreed in the Purchase Agreement (95-1) to indemnify and save the Trustee harmless against any liabilities which it may incur in the exercise and performance of its powers and duties hereunder and under any related documents, including the enforcement of any remedies and the defense of any suit, and which are not due to its negligence or its willful misconduct. The duty of the City to indemnify the Trustee shall survive the termination and discharge of this Indenture. · -38- ARTICLE IX MODIFICATION OR AMENDMENT Section 9.01. Amendments Permitted.' (a) This Indenture and the rights and obligations of the Authority, the Owners of the Bonds and the Trustee may be modified or amended from time to time and at any time by a Supplemental Indenture, which the Authority and the Trustee may enter into with the written consent of the Owners of a majority in aggregate principal amount of all Bonds then Outstanding, which shall have been filed with the Trustee. No such modification or amendment shall (i) extend the fixed maturity of any Bonds, or reduce the amount of principal thereof, or reduce the interest rate borne thereby, or extend the time of payment, without the consent of the Owner of each Bond so affected, or (ii) reduce the aforesaid percentage of Bonds the consent of the Owners of which is required to effect any such modification or amendment, or (iii) permit the creation of any lien on the Revenues and other assets pledged under this Indenture prior to or on a parity with the lien created by this Indenture or deprive the Owners of the Bonds of the lien created by this Indenture on such Revenues and other assets (except as expressly provided in this Indenture), without the consent of the Owners of all of the Bonds then Outstanding. It shall not be necessary for the consent of the Bond Owners to approve the particular form of any Supplemental Indenture, but it shall be sufficient if such consent shall approve the substance thereof. Promptly after the execution by the Authority and the Trustee of any Supplemental Indenture pursuant to this subsection (a), the Trustee shall mail a notice (the form of which shall be furnished to the Trustee by the Authority), by first class mail postage prepaid, setting forth in general terms the substance of such Supplemental Indenture, to the Owners of the Bonds at the respective addresses shown on the Registration Books. Any failure to give such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such Supplemental Indenture. This Indenture and the rights and obligations of the Authority, of the Trustee and the Owners of the Bonds may also be modified or amended from time to time and at any time by a Supplemental Indenture, which the Authority and the Trustee may enter into without the consent of any Bond Owners for any one or more of the following purposes: (i) to add to the covenants and agreements of the Authority in this Indenture contained other covenants and agreements thereafter to be observed, to pledge or assign additional security for the Bonds (or any portion thereof), or to surrender any right or power herein reserved to or conferred upon the Authority; (ii) to make such provisions for the purpose of curing any ambiguity, inconsistency or omission, or of curing or correcting any defective provision contained in this Indenture; (iii) to provide for the issuance of additional Series of Bonds, and to provide the terms and conditions under which such additional Series of Bonds may be issued, subject to and in accordance with the provisions of Article Iii; (iv) to modify, amend or supplement this Indenture in such manner as to permit the qualification hereof under the Trust Indenture Act of 1939, as amended, or any similar federal statute hereafter in effect, and to add such other terms, conditions and provisions as may be permitted by said act or similar federal statute; -39- (v) to modify, amend or supplement this Indenture in such manner as to cause interest on the Bonds to be excludable from gross income for purposes of federal income taxation by the United States of America; and (vi) in any other respect whatsoever as the Authority may deem necessary or desirable, provided that such modification or amendment does not materially adversely affect the interests of the Bond Owners hereunder, in the opinion of Bond Counsel filed with the Authority and the Trustee. Section 9.02. Effect of Supplemental In0¢nture. Upon the execution of any Supplemental Indenture pursuant to this Article, this Indenture shall be deemed to be modified and amended in accordance therewith, and the respective rights, duties and obligations under this Indenture of the Authority,. the Trustee and all Owners of Bonds Outstanding shall thereafter be determined, exercised and enforced hereunder subject in all respects to such modification and amendment, and all the terms and conditions of any such Supplemental Indenture shall be deemed to be part of the terms and conditions of this Indenture for any and all purposes. Section 9.03. Endorsement of Bonds; Preparation of New Bonds. Bonds delivered after the execution of any Supplemental Indenture pursuant to this Article may, and if the Authority so determines shall, bear a notation by endorsement or otherwise in form approved by the Authority and the Trustee as to any modification or amendment provided for in such Supplemental Indenture, and,'in that case, upon demand of the Owner of any Bonds Outstanding at the time of such execution and presentation of his Bonds for the purpose at the Office of the Trustee a suitable notation shall be made on such Bonds. If the Supplemental Indenture shall so provide, new Bonds so modified as to conform, in the opinion of the Authority and the Trustee, to any modification or amendment contained in such Supplemental Indenture, shall be prepared and executed by the Authority and authenticated by the Trustee, and upon demand of the Owners of any Bonds then Outstanding shall be exchanged at the Office of the Trustee, without cost to any Bond Owner, for Bonds then Outstanding, upon surrender for cancellation of such Bonds, in equal aggregate principal amount of the same interest rate and maturity. Section 9.04. Amendment. of Particular Bonds. The provisions of this Article shall not prevent any Bond Owner from accepting any amendment as to the particular Bonds held by such Owner. -40- ARTICLE X DEFEASANCE Section 10.01. Discharge of Indenture. The Bonds may be paid by the Authority in any of the following ways, provided that the Authority also pays or causes to be paid any other sums payable hereunder by the Authority: (a) by paying or causing to be paid the principal of and interest and premium, if any, on the Bonds, as and when the same become due and payable; (b) by depositing with the Trustee, in trust (pursuant to an escrow agreement), at or before maturity, money or securities in the necessary amount (as provided in Section 10.03) to pay or redeem all Bonds then Outstanding; or (c) by delivering to the Trustee, for cancellation by it, all of the Bonds then Outstanding. If the Authority shall also pay or cause to be paid all other sums payable hereunder by the Authority including without limitation any compensation due and owing the Trustee hereunder, then and in that case, at the election of the Authority (evidenced by a Written Certificate of the Authority, fried with the Trustee, signifying the intention of the Authority to discharge all such indebtedness and this Indenture), and notwithstanding that any Bonds shall not have been surrendered for payment, this Indenture and the pledge of Revenues and other assets made under this Indenture and all covenants, agreements and other obligations of the Authority under this Indenture shall cease, terminate, become void and be completely discharged and satisfied. In such event, upon the Written Request of the Authority, and upon receipt of a Written Certificate of an Authorized Representative of the Authority and an opinion of Bond Counsel acceptable to the Trustee, each to the effect that all conditions precedent herein provided for relating to the discharge and satisfaction of the obligations of the Authority have been satisfied, the Trustee shall cause an accounting for such period or periods as may be requested by the Authority to be prepared and filed with the Authority and shall execute and deliver to the Authority all such instruments as may be necessary or desirable to evidence such discharge and satisfaction, and the Trustee shall pay over, transfer, assign or deliver all moneys or securities or other property held by it pursuant to this Indenture, which are not required for the payment or redemption of Bonds not theretofore surrendered for such payment or redemption, to the Authority. Section 10.02. Discharge of Liability_ on Bonds. Upon the deposit with the Trustee, in trust, at or before maturity, of money or securities in the necessary amount (as provided in Section 10.03) to pay or redeem any or all Outstanding Bonds (whether upon or prior to the maturity or the redemption date of such Bonds), provided that, if such Bonds are to be redeemed prior to maturity, notice of such redemption shall have been given as provided in Article IV or provision satisfactory to the Trustee shall have been made for the giving of such notice, then all liability of the Authority in respect of such Bonds shall cease, terminate and be completely discharged, and the Owners thereof shall thereafter be entitled only to payment out of such money or securities deposited with the Trustee as aforesaid for their payment, subject, however, to the provisions of Section 10.04. The Authority may at any time surrender to the Trustee for cancellation by it any Bond's previously issued and delivered, which the Authority may have acquired in any manner whatsoever, and such Bonds, upon such surrender and cancellation, shall be deemed to be paid and retired. -41- Section 10.03. Deposit of Money or Securities with Trustee. Whenever in this Indenture it is provided or permitted that there be deposited with or held in trust by the Trustee money or securities in the necessary amount to pay or redeem any Bonds, the money or securities so to be deposited or held may include money or securities held by the Trustee in the funds and accounts established pursuant to this Indenture and shall be-- (a) Lawful money of the United States of America, in an amount equal to the principal amount of such Bonds and all unpaid interest thereon to maturity, except that, in the case of Bonds which are to be redeemed prior to maturity and in respect of which notice of such redemption shall have been given as provided in Article IV or provision satisfactory to the Trustee shall have been made for the giving of such notice, the amount to be deposited or held shall be the principal amount of such Bonds, premium, ff any, and all unpaid interest thereon to the redemption date; or (b) Non-callable Federal Securities described in clause (a) of the definition thereof, the principal of, and' interest on which when due, in the opinion or report of an independent accountant selected by the Authority, will provide money sufficient to pay the principal of, premium, if any, and all unpaid interest to maturity, or to the redemption date, as the case may be, on the Bonds to be paid or redeemed, as such principal and interest become due, provided that in the case of Bonds which are to be redeemed prior to the maturity thereof, notice of such redemption shall have been given as provided in Article IV or provision satisfactory to the Trustee shall have been made for the giving of such notice; provided, in each case, that the Trustee shall have been irrevocably instructed (by the .terms of this Indenture or by Written Request of the Authority) to apply such funds to the payment of such principal and interest with respeCt to such Bonds. Section 10.04. Payment of Bonds After Discharee of Indenture. Notwithstanding any provisions of this Indenttire, any moneys held by the T~stee in trust for the payment of the principal of, premium, if any, or interest on, any Bonds and remaining unclaimed for two years after the date of deposit of such moneys shall be repaid to the Authority free from the trusts created by this Indenture, and all liability of the Trustee with respect to such moneys shall thereupon cease; provided, however, that before the repayment of such moneys to the Authority as aforesaid, the Trustee may (at the cost of the Authority) first mail, by first class mail postage prepaid, to the Owners of Bonds which have not yet been paid, at the respective addresses shown on the Registration Books, a notice, in such form as may be deemed appropriate by the Trustee with respect to the Bonds so payable and not presented and with respect to the provisions relating to the repayment to the Authority of the moneys held for the payment thereof. -42- ARTICLE XI MISCELLANEOUS Section 11.01. Liability of Authority Limited to Revenues. Notwithstanding anything in this Indenture or in the Bonds contained, neither the Authority nor any member thereof shall be required to advance any moneys derived from any source other than the Revenues and other assets pledged under this Indenture for any of the purposes in this Indenture mentioned, whether for the payment of the principal of or interest on the Bonds or for any other purpose of this Indenture. Nevertheless, the Authority may, but shall not be required to, advance for any of the purposes hereof any funds of the Authority which may be made available to it for such purposes. Section 11.02. Successor Is Deemed Included in All References to Predecessor. Whenever in this Indenture either the Authority or the Trustee is named or referred to, such reference shall be deemed to include the successors or assigns thereof, and all the covenants and agreements in this Indenture contained by or on behalf of the Authority or the Trustee shall bind and inure to the benefit of the respective successors and assigns thereof whether so expressed or not. Section 11.03. Limitation of Rights to Parties and Bond Owner~. Nothing in this Indenture or in the Bonds expressed or implied is intended or shall be construed to give to any Person other than the Authority, the Trustee, the City and the Owners of the Bonds, any legal or equitable right, remedy or claim under or in respect of this Indenture or any covenant, condition or provision therein or herein contained; and all such covenants, conditions and provisions are and shall be held to be for the sole and exclusive benefit of the Authority, the Trustee, the City and the Owners of the Bonds. Section 11.04. Waiver of Notice: Reouirement of Mailed Notice. Whenever in this -- Indenture the giving of notice by mail or otherwise is required, the giving of such notice may be waived in writing by the Person entitled to receive such notice and in any such case the giving or receipt of such notice shall not be a condition precedent to the validity of any action taken in reliance upon such waiver. Whenever in this Indenture any notice shall be required to be given by mail, such requirement shall be.satisfied by the deposit of such notice in the United States mail, postage prepaid, by first class mail. Section 11.05. Destruction of Bonds. Whenever in this Indenture provision is made fOr the cancellation by the Trustee and the delivery to the Authority of any Bonds, the Trustee may, upon the Written Request of the Authority, in lieu of such cancellation and delivery, destroy such Bonds (in the presence of an officer of the Authority, if the Authority shall so require) as may be allowed by law, and deliver a certificate of such deslruction to the Authority. Section 11.06. Severability of Invalid Provisions. If any one or more of the provisions contained in this Indenture or in the Bonds shall for any reason be held to be invalid, illegal or unenforceable in any respect, then such provision or provisions shall be deemed severable from the remaining provisions contained in this Indenture and such invalidity, illegality or unenforceability shall not affect any other provision of this Indenture, .and this Indenture shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein. The Authority hereby declares that it would have entered into this Indenture and each and every other Section, paragraph, sentence, clause or phrase hereof and authOrized the issuance of the Bonds pursuant thereto irrespective of the fact that any one or more Sections, paragraphs, sentences, clauses or phrases of this Indenture may be held illegal, invalid or unenforceable. -43- Section 11.07. Notices. All notices or communications herein required or permitted to be given to the Authority or the Trustee shall be in writing and shall be deemed to have been sufficiently given or served for all purposes by being delivered or sent by telecopy or by being deposited, .postage prepaid, in a post office letter box, addressed as follows: If to the Authority: Tustin Public Financing Authority c/o City of Tustin 300 Centennial Way Tustin, California 92680 Attention: Finance Director ff to the Trustee: State Street Bank and Trust Company of California, N.A. 725 South Figueroa Street, Suite 3100 Los Angeles, California 90017 Attention: Corporate Trust Department Section 11.08. Evidence of Rights of Bond Owners. Any request, consent or other instrument required or permitted by this Indenture to be signed and executed by Bond Owners may be in any number of concUrrent instruments of substantially similar tenor and shall be signed or executed by such Bond Owners in Person or by an agent or agents duly appointed in writing. Proof of the execution of any such request, consent or other instrument or of a writing appointing any such agent, or of the holding by any Person of Bonds transferable by delivery, shall be sufficient for any purpose of this Indenture and shall be-conclusive in favor of the Trustee and the Authority if made in the manner provided in this Section. The fact and date of the execution by any Person of any such request, consent or other instrument or wri.ting may be proved by the certificate of any notary public or other officer of any jurisdiction, authorized by the laws thereof to take acknowledgments of deeds, certifying that the Person signing such request, consent or other instrument acknowledged to him the execution thereof, or by an affidavit of a witness of such execution duly sworn to before such notary public or other officer. The ownership of Bonds shall be proved by the Registration Books. Any request, consent, or other instrument or writing of the Owner of any Bond shall bind every future Owner of the same Bond and the Owner of every Bond issued in exchange therefor or in lieu thereof, in respect of anything done or suffered to be done by the Trustee or the Authority in accordance therewith or reliance thereon. Section 11.09. Disqualified Bonds. In determining whether the Owners of the requisite aggregate principal amount of Bonds have concurred in any demand, request, direction, consent or wmver under this Indenture, Bonds which are known by the Trustee to be owned or held by or for the account of the Authority or the City, or by any other obligor on the Bonds, or by any Person directly or indirectly controlling or controlled by, or under direct or indirect common control with, the Authority or the City or any other obligor on the Bonds, shall be disregarded and deemed, not to be Outstanding for the purpose of any such determination. Bonds so owned which have been pledged in good faith may be regarded as Outstanding for the purposes of this Section if the pledgee shall establish to the satisfaction of the Trustee the pledgee's right to vote such Bonds' and that the pledgee is not a Person directly or indirectly controlling or controlled by, or under direct or indirect common control with, the Authority or the City or any other obligor on the Bonds. In case of a dispute as to such right, any decision by the Trustee taken upon the advice of counsel shall be full protection to the Trustee. Section 11.10. Money Held for Particular Bonds. The money held by the Trustee for the payment of the interest, principal or premium due on any date with respect to particular Bonds (or portions of Bonds in the case of B0nds redeemed in part only) shall, on and after such date and pending such payment, be set aside on its books and held in trust by it for the Owners of the Bonds entitled thereto, subject, however, to the provisions of Section 10.04 but without any liability for interest thereon. Section 11.11. Funds and Accounts. Any fund or account required by this Indenture to be established and maintained by the Trustee may be established and maintained in the accounting records of the Trustee, either as a fund or an account, and may, for the purposes of such records, any audits thereof and any reports or statements with respect thereto, be treated either as a fund or as an account; but all such records with respect to all such funds and accounts shall at all times be maintained in accordance with industry standards to the extent practicable, and with due regard for the requirements of Section 6.05 and for the protection of the security of the Bonds and the rights of every Owner thereof. The Trustee may establish such funds and accounts as it deems necessary or appropriate to perform its obligations hereunder. Section 11.12. Payment on Non-Business Days. In the event any payment is required to be made hereunder on a day which is not a Business Day, such payment shall be made on the next succeeding Business Day with the same effect as if made on such non-Business Day. Section 11.13. Waiver of Personal Liability. No member, officer, agent or employee of the Authority shall be individually or personally liable for the payment of the principal of or premium or interest on the Bonds or be subject to any personal liability or accountability by reason of the issuance thereof; but nothing herein contained shall relieve any such member, officer, agent or employee from the performance of any official duty provided by law or by this Indenture. Section 11.14. Execution in Several Counterparts. This Indenture may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original; and all such counterparts, or as many of them as the Authority and the Trustee shall preserve undestroyed, shall together constitute but one and the same instrument. Section 11.15. Governine Laws. This Indenture shall be govemed by and construed in -- accordance with the laws of the State of California. -45- IN WITNESS WHEREOF, the Authority has caused this Indenture to be signed.in its name by its officer thereunto duly authorized, and the Trustee, in token of its acceptance of the trusts created hereunder, has caused this Indenture to be signed in its corporate name. by its officer thereunto duly authorized, all as of the day and year first above written. TUSTIN PUBLIC FINANCING AUTHORITY By: STATE STREET BANK AND TRUST COMPANY OF CALIFORNIA, N.A., as Trustee By: -46- EXHIBIT A FORM OF SERIES A BOND NO. ~ TUSTIN PUBLIC FINANCING AUTHORITY Revenue Bond (Tustin Ranch), Series A RATE OF INTEREST: MATURITY DATE: ORIGINAL ISSUE DATE: CUSIP: REGISTERED OWNER: PRINCIPAL AMOUNT: The TUSTIN PUBLIC FINANCING AUTHORITY, a joint powers authority organized and existing under the laws of the State of California (the "Authority"), for value received, hereby promises to pay (but only out of the Revenues and other moneys and securities hereinafter referred to) to the Registered Owner identified above or registered assigns (the "Registered Owner"), on the Maturity Date identified above or on any earlier redemption date, the Principal Amount identified above in lawful money of the United States of America; and to pay interest thereon at the Rate of Interest identified above in like lawful money from the date hereof, which date shall be the Interest Payment Date (as hereinafter defined) next preceding the date of authentication of this Bond (unless this Bond is authenticated on or before an Interest Payment Date and after the fifteenth calendar day of the month preceding such Interest Payment Date, in which event it shall bear interest from such. Interest Payment Date, or unless this Bond is authenticated on or prior to February 15, 1996, in which event it shall bear interest from the Original Issue Date identified above; provided, however, that fi, at the time of authentication of this Bond, interest is in default on this Bond, this Bond shall bear interest from the Interest Payment Date to which interest hereon has previously been paid or made available for payment), payable semiannually on March 2 and September 2 in each year, commencing March 2, 1996, (the "Interest Payment Dates") until payment of such Principal Amount in full. The Principal Amount hereof is payable upon surrender hereof upon maturity or earlier redemption at the principal corporate trust office (the '°I'mst Office") of State Street Bank and Trust Company of California, N.A., as trustee (the "Trustee"), in Los Angeles, California. Interest hereon is payable by check of the Trustee marled by first class mail on each Interest Payment Date to the Registered Owner hereof at the address of the Registered Owner as it appears on the Registration Books of the Trustee as of the close of business on the fifteenth calendar day of the month preceding such Interest Payment Date. A-1 REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS BOND SET FORTH ON THE REVERSE SIDE HEREOF AND SUCH PROVISIONS ARE HEREBY INCORPORATED BY REFERENCE AS IF FULLY SET FORTH IN THIS PLACE. It is hereby certified that all things, conditions and acts required to exist, to have happened and to have been performed precedent to and in the issuance of this Bond do exist, have happened and have been performed in due time, form and manner as required by the Constitution and statutes of the State of California and by the Bond Law and the amount of this Bond, together with all other indebtedness of the Authority, does not exceed any limit prescribed by the Constitution or statutes of the State of California or by the Bond Law. This Bond shall not be entitled to any benefit under the Indenture or become valid or obligatory for any purpose, until the certificate of authentication hereon shall have been manually signed by the Trustee. IN WITNESS WHEREOF, the Authority has caused this Bond to be executed in its name and on its behalf by the facsimile signatures of its Chairman and Secretary all as of the Original Issue Date identified above. TUSTIN PUBLIC FINANCING AUTHORITY [SEAL] Attest: By Chairman By Secretary A-2 [FORM OF REVERSE OF SERIES A BOND] This Bond is one of a duly authorized issue of bonds of the Authority designated the "Tustin Public Financing Authority Revenue Bonds (Tusfin Ranch), Series A" (the "Series A Bonds"), limited in principal amount to $ , secured by an Indenture of Trust, dated as of 1, 1995 (the "Indenture"), by and between the Authority and the Trustee. The Authority may issue additional bonds on a parity with the Series A Bonds, in accordance with the terms of, and upon satisfaction of the conditions contained in, the Indenture; the Series A Bonds, together with any such additional bonds, are referred to as the "Bonds". Reference is hereby made to the Indenture and all indentures supplemental thereto for a description of the fights thereunder of the owners of the Bonds, of the nature and extent of the Revenues (as that term is defined in the Indenture), of the rights, duties and immunities of the Trustee and of the rights and obligations of the Authority thereunder; and all of the terms of the Indenture are hereby incorporated herein and constitute a contract between the Authority and the Registered Owner hereof, and to all of the provisions of which Indenture the Registered Owner hereof, by acceptance hereof, assents and agrees. The Bonds are authorized to be issued pursuant to the provisions of the Marks-Roos Local Bond Pooling Act of 1985, constituting Article 4 (commencing with Section 6584) of Chapter 5 of Division 7 of Title 1 of the Government Code of the State of California (the "Bond Law"). The Bonds are special obligations of the Authority and, as and to the extent set forth in the Indenture, are payable solely from and secured by a first lien on and pledge of the Revenues and certain other moneys and.securities held by the Trustee as provided in the Indenture. Allof the Bonds are equally secured by a pledge of, and charge and lien upon, all of the Revenues and such other moneys and securities, and the Revenues and such other moneys and securities constitute a trust fund for the security and payment of the principal of and interest on the Bonds. The full faith and credit of the Authority is not pledged for the payment of the principal of or interest or redemption premiums, ff any, on the Bonds. The Bonds are not secured by a legal or equitable pledge of, or charge, lien or encumbrance upon, any of the property of the Authority or any of its income or receipts, except the Revenues and such other moneys and securities as provided in the Indenture. The Series A Bonds have been issued to provide a portion of the funds to 'acquire certain Assessment Bonds (the "Assessment Bonds") issued by the City of Tustin, a municipal corporation organized and existing under the laws of the State of California (the "City") in the aggregate principal amount of $ . The Revenues which secure the Series A Bonds and from which the Series A Bonds are payable consist primarily of amounts derived from the Assessment Bonds, as more fully set forth in the Indenture. The Series A Bonds maturing on or after September 2, 2005, are subject to optional redemption in whole, or in part on such basis among maturities as shall be designated by the Authority and by lot within a maturity, on any Interest Payment Date on or after September 2, 2004, at the following respective redemption prices (expressed as percentages of the principal amount of the Series A Bonds to be redeemed), plus accrued interest thereon to the date of redemption: Redemption Dates Redemt~tion Price September 2, 2004 and March 2, 2005 September 2, 2005 and March 2, 2006 September 2, 2006 and thereafter 102% 101 100 The Series A Bonds shall be subject to mandatory redemption, in whole, or in part among maturities on the same basis as the ASsessment Bonds are redeemed and by lot within a maturity, A-3 on any Interest Payment Date, from and to the extent of any prepayments of principal of the Assessment Bonds as more particularly set forth in the Indenture, at the following respective redemption prices (expressed as percentages of the principal amount of the Series A Bonds to be redeemed), plus accrued interest thereon to the date of redemption. Redemption Dates Redemption Price March 2, 1996 through March 2, 2004 September 2, 2004 and March 2, 2005 September 2, 2005 and March 2, 2006 September 2, 2006 and thereafter 103% 102 101 100 The Trustee on behalf and at the expense of the Authority shall mail (by first class mail) notice of any redemption to the respective owners of any Series A Bonds designated for redemption, at their respective addresses appearing on the Registration Books maintained by the Trustee, at least 30 but not more than 60 days prior to the redemption date; provided, however, that neither failure to receive any such notice so mailed nor any defect therein shall affect the validity of the proceedings for the redemption of such Series A Bonds or the cessation of the accrual of interest thereon. The redemption price of the Series A Bonds to be redeemed shall be paid only upon presentation and surrender thereof at the Trust Office of the Trustee. From and after the date fixed for redemption of any Bonds, interest on such Bonds will cease to accrue. The Series A Bonds are issuable as fully registered Bonds without coupons in denominations of $5,000 or any integral multiple thereof. Subject to the limitations and upon payment of the charges, if any, provided in the Indenture, fully registered Series A Bonds may be exchanged at the Trust Office of the Trustee for a like aggregate principal amount and maturity of fully registered Series A Bonds of other authorized denominations. This Bond is transferable by the Registered Owner hereof, in person or by his attorney duly authorized in writing, at the Trust Office of the Trustee, but only in the manner, subject to the limitations and upon payment of the charges provided in the Indenture, and upon surrender and cancellation of this Bond. Upon such transfer a new fully registered Series A Bond or Series A Bonds, of authorized denomination or denominations, for the same aggregate principal amount and of the same maturity will be issued to the transferee in exchange herefor. The Authority and the Trustee may treat the Registered Owner hereof as the absolute owner hereof for all purposes, and the Authority and the Trustee shall not be affected by any notice to the contrary. The Indenture and the fights and obligations of the Authority and of the'owners of the Bonds and of the Trustee may be modified or amended from time to time and at any time in the manner, to the extent, and upon the terms provided in the Indenture; provided that no such modification or amendment shall (a) extend the maturity of or reduce the interest rate on any Bond or.the amount of principal thereof without the express written consent of the owner of such Bond, (b) reduce the percentage of Bonds required for the written consent to any such amendment or modification, or (c) permit the creation of any lien on the Revenues and other assets pledged under the Indenture, or deprive the Bonds owners of the lien created under the Indenture on the Revenues and such other assets, without the consent of the owners of all outstanding Bonds. A-4 [FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION] This is one of the Sen'es A Bonds described in the within-mentioned Indenture and registered on the Registration Books. Date: STATE STREET BANK AND TRUST COMPANY OF CALIFORNIA, N.A., as Trustee By Authorized Signatory A-5 ASSIGNMENT For value received the undersigned hereby sells, assigns and transfers unto whose address and social security or other tax identifying number is , the within-mentioned Bond and hereby irrevocably constitute(s) and appoint(s) attorney, to transfer the same on the registration books of the Trustee with full power of substitution in the premises. Dated: Signature Guaranteed: Note: Signature(s) must be guaranteed by an eligible guarantor. Note: The signature(s) on this Assignment must correspond with the name(s) as written on the face of the Within Bond in every particular without alteration or enlargement or any change whatsoever. A-6