HomeMy WebLinkAboutF-2 Staff Report - Successor Agency Agenda Item-Bond Ref 2007A 2007BBond Refundings-2007A and 2007B TABS
July 17, 2017
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SUCCESSOR AGENCY ITEM
F-2
TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE SUCCESSOR
AGENCY BOARD
VIA: STEPHAN E. HUNT, CHIEF OF POLICE/ACTING CITY MANAGER
FROM: TALIKA M. JOHNSON, DIRECTOR OF FINANCE
DATE: JULY 17, 2017
SUBJECT: AUTHORIZATION TO ISSUE 2017 TAX ALLOCATION REFUNDING
BONDS TO REFUND 2007A AND 2007B TAX ALLOCATION BONDS
SUMMARY:
This action requests approval of issuance of refunding bonds to refund (repay) the outstanding
2007A and 2007B Tax Allocation Bonds issued by the former Redevelopment Agency to
achieve debt service savings.
RECOMMENDATION:
Staff recommends the Successor Agency Board take the following actions:
1) Determine the preferred structure, Public Offering or Private Placement, for the
refinancing of the Successor Agency’s outstanding Series 2007A and 2007B Tax
Allocation Bonds; and
2) Adopt Resolution No. 2017-R11, Approve the issuance of Bonds in a not-to-exceed
amount of $7.5 million in order to refund certain outstanding bonds of the former
Redevelopment Agency of the City of Azusa; and
3) Approve the execution and delivery of an Indenture of Trust and Escrow Agreement, and
provide for other matters properly relating thereto.
BACKGROUND:
On June 19, 2017, the Successor Agency authorized Staff and the Agency’s Financial Advisor,
Urban Futures, Inc. (UFI) to commence preparation of documents necessary for the issuance of
the Agency’s (proposed) Tax Allocation Refunding Bonds, Series A (tax exempt) and Series B
APPROVED
CITY COUNCIL
7/17/2017
Bond Refundings-2007A and 2007B TABS
July 17, 2017
Page 2
(taxable) (the “2017 Bonds”).
The former Redevelopment Agency of the City of Azusa (the “Prior Agency”) issued Taxable
Tax Allocation Bonds in 2007 for the purpose of financing redevelopment activities. Total
issuances were $15,780,000 of 2007A Bonds and $4,790,000 of 2007B Bonds. The 2007A bonds
were partially refunded with the issuance of the 2015 A&B Subordinate Tax Allocation
Refunding Bonds. Currently, $3.945 million and $3.930 million of the 2007A and 2007B Bonds,
respectively, are outstanding. The (remaining) 2007A Bonds have interest rates ranging from
5.77% to 5.95% with a final maturity of August 1, 2022, and the 2007B Bonds have interest rates
ranging from 4.70% to 5.30% with a final maturity of August 1, 2036.
The Successor Agency to the former Redevelopment Agency of the City of Azusa (the
“Successor Agency”) has assumed responsibility for repayment of the 2007A and 2007B Bonds
from the Prior Agency. Per AB 1484, the Successor Agency may refund existing bonds, with
approval of the Oversight Board and the State Department of Finance, for the purpose of creating
debt service savings.
DISCUSSION:
Based on current market interest rates, the proposed 2017 Bonds would generate an estimated
total debt service savings of $1.29 million to $1.44 million net of all costs of issuance; equal to
average annual savings of $64,362 for the Public Offering option and $72,066 average annual
savings for the Private Placement option. The term of the 2017 Bonds will not exceed the
existing term of the 2007A and 2007B Bonds and the Agency’s financing team is recommending
a not-to-exceed interest rate of 4.75%.
Currently, a private placement produces the highest gross cash flow savings while also reflecting
a lower net present value savings when compared to the public offering structure. This is due
primarily to the flow of savings which significantly increase in 2034 through 2037 for the private
placement structure. Should the Agency prefer a level savings structure throughout the term of
the transaction, a public offering structure will meet this objective with a minor impact to overall
gross cash flow savings.
Listed below are the summary points of the analysis comparing a public bond offering to a
private placement.
Public Offering
Rating fee, higher legal costs, bond insurance premium, surety policy premium
True Interest Cost (“TIC”): 3.88%
NPV Savings: 9.37%; $673,539
Gross Cash Flow Savings $1,287,237
Bond Refundings-2007A and 2007B TABS
July 17, 2017
Page 3
Private Placement
No rating fee, lower legal costs, no bond insurance or surety policy costs
True Interest Cost (“TIC”): 4.31%
NPV Savings: 7.04%; $506,102
Gross Cash Flow Savings $1,441,324
FISCAL IMPACT:
The proposed 2017 Bonds will generate an estimated total debt service savings of $1.29 million
to $1.44 million net of all costs of issuance. Based on RDA Dissolution Law, the debt service
savings will be shared with all affected taxing entities, including the City. The City’s General
Fund share of the total debt service savings would be approximately $308,000.
The source of repayment of the 2017 Bonds would be limited to tax revenues (in amounts
equivalent to the former tax increment revenues) and deposited by the County into the Successor
Agency’s Redevelopment Property Tax Trust Fund.
The 2017 Bonds will not be a debt of the City, but a special limited obligation of the Successor
Agency. Related costs of the Successor Agency will either be recovered through the 2017 Bond
Proceeds if issued, or if not, through the ROPs process.
Prepared by: Reviewed and Approved:
Talika M. Johnson Louie F. Lacasella
Director of Finance Management Analyst
Reviewed and Approved:
Stephan E. Hunt
Chief of Police/Acting City Manager
Attachments:
1) Resolution No. 2017-R11 Approving Issuance
2) Form of Supplement to 2014 Indenture of Trust
3) Form of Refunding Instructions
4) City of Azusa Successor Agency Tax Allocation Refunding Bonds Structural Options /
Savings Analysis
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RESOLUTION NO. 2017-R11
A RESOLUTION OF THE SUCCESSOR AGENCY TO THE REDEVELOPMENT
AGENCY OF THE CITY OF AZUSA APPROVING THE ISSUANCE OF BONDS TO
REFUND CERTAIN OUTSTANDING BONDS OF THE FORMER REDEVELOPMENT
AGENCY, APPROVING THE EXECUTION AND DELIVERY OF A SUPPLEMENT TO
INDENTURE OF TRUST, AND PROVIDING FOR OTHER MATTERS PROPERLY
RELATING THERETO
RECITALS:
A. Pursuant to Section 34172(a) of the California Health and Safety Code (unless
otherwise noted, all Section references hereinafter being to such Code), the Redevelopment
Agency of the City of Azusa (the “Former Agency”) has been dissolved and no longer exists as
a public body, corporate and politic, and pursuant to Section 34173, the Successor Agency to
the Redevelopment Agency of the City of Azusa (the “Successor Agency”) has become the
successor entity to the Former Agency; and
B. By implementation of California Assembly Bill X1 26, which was codified in the
Health and Safety Code beginning with Section 34161 (as amended from time to time, the
“Dissolution Act”) and amended provisions of the California Redevelopment Law (Health and
Safety Code Section 33000, et. seq., herein the “Redevelopment Law”), and the Successor
Agency, in accordance with and pursuant to the Dissolution Act, assumed the duties and
obligations of the Former Agency as provided in the Dissolution Act; and
C. Prior to dissolution of the Former Agency, the Former Agency issued the
following outstanding series of bonds (collectively, the “Prior Bonds”) pursuant to a respective
Trust Indenture for each series, by and between the Former Agency and Wells Fargo Bank,
National Association, as Trustee, for the purpose of financing and refinancing redevelopment
activities:
(i) $15,780,000 Redevelopment Agency of the City of Azusa Amended and
Restated Merged Central Business District and West End Redevelopment Project Area
Taxable Tax Allocation Bonds (Subordinate Lien) 2007 Series A; and
(ii) $4,790,000 Redevelopment Agency of the City of Azusa Amended and
Restated Merged Central Business District and West End Redevelopment Project Area
Tax Allocation Bonds (Second Subordinate Lien) 2007 Series B; and
D. Section 34177.5 authorizes the Successor Agency to issue refunding bonds
pursuant to Article 11 (commencing with Section 53580) of Chapter 3 of Part 1 of Division 2 of
Title 5 of the Government Code (the “Refunding Law”) for the purpose of achieving debt service
savings within the parameters set forth in Section 34177.5(a)(1) (the “Savings Parameters”);
and
E. The Successor Agency wishes to refund the outstanding Prior Bonds through the
issuance of the Successor Agency to the Redevelopment Agency of the City of Azusa 2017 Tax
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Allocation Refunding Bonds, Series 2017A and Series 2017B (Taxable) (together, the
“Refunding Bonds”); and
F. To determine compliance with the Savings Parameters for purposes of the
issuance of the Refunding Bonds, the Successor Agency has caused its municipal advisor,
Urban Futures, Inc. (the “Municipal Advisor”), to prepare an analysis of the potential savings that
will accrue to the Successor Agency and to applicable taxing entities as a result of the use of
the proceeds of the Refunding Bonds to refund the Prior Bonds (the “Debt Service Savings
Analysis”); and
G. The Successor Agency desires at this time to approve the issuance of the
Refunding Bonds and to approve the form of and authorize the execution and delivery of a
Second Supplemental Indenture tentatively dated as of September 1, 2017 (the “Second
Supplement”), supplementing an Indenture of Trust (the “Indenture”) dated as of October 1,
2014 and First Supplement thereto (collectively with the Second Supplement, the “Indenture”),
which Second Supplement will be entered into between the Successor Agency and Wilmington
Trust, N.A., as trustee, and to approve such other necessary actions for the purpose of
refunding the Prior Bonds; and
H. Pursuant to Section 34179 of the Dissolution Act, an oversight board (the
“Oversight Board”) has been established for the Successor Agency; and
I. The Successor Agency wishes to request that the Oversight Board approve and
direct the issuance of the Refunding Bonds pursuant to this Resolution and the Indenture; and
J. The Successor Agency further wishes to request that the Oversight Board make
certain determinations described below on which the Successor Agency will rely in undertaking
the refunding proceedings and the issuance of the Refunding Bonds.
NOW, THEREFORE, THE SUCCESSOR AGENCY TO THE FORMER
REDEVELOPMENT AGENCY OF THE CITY OF AZUSA DOES HEREBY RESOLVE AS
FOLLOWS:
Section 1. Recitals. The above recitals are true and correct and are a substantive
part of this Resolution.
Section 2. Determination of Savings. The Successor Agency hereby determines
that there are significant potential savings available to the Successor Agency and to applicable
taxing entities in compliance with the Savings Parameters by the issuance by the Successor
Agency of the Refunding Bonds to provide funds to refund the outstanding Prior Bonds, all as
evidenced by the Debt Service Savings Analysis on file with the Successor Agency, which Debt
Service Savings Analysis is hereby approved.
Section 3. Approval of Issuance of the Refunding Bonds. The Successor
Agency hereby authorizes and approves the issuance of the Refunding Bonds under the
Redevelopment Law, as amended and supplemented by the Dissolution Act, and the Refunding
Law in an aggregate principal amount sufficient to refund the Prior Bonds and not to exceed
$7,500,000, at an interest rate not to exceed 4.75%, and provided that the Refunding Bonds are
in compliance with Section 34177.5 of the Redevelopment Law at the time of sale and delivery.
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Section 4. Approval of Second Supplement. The Successor Agency hereby
approves the Second Supplement prescribing the terms and provisions of the Refunding Bonds
and the application of the proceeds of the Refunding Bonds. Each of the Successor Agency
Chairperson, the Successor Agency Executive Director, the Finance Director and the Successor
Agency Secretary, or the designee of any such officer (each, an "Authorized Officer," acting for
the Successor Agency) are each acting alone authorized and directed, for and in the name of
and on behalf of the Successor Agency, to execute, acknowledge and deliver the Second
Supplement in substantially the form presented at this meeting with such changes therein as the
Authorized Officer executing the same may approve, such approval to be conclusively
evidenced by the execution and delivery thereof. Such changes may include issuing the Bonds
in two series, and/or with either or both series being “bank qualified” purposes of paragraph (3)
of section 265(b) of the Internal Revenue Code. The date, maturity date or dates, interest rate or
rates, interest payment dates, terms of redemption and other terms of the Refunding Bonds
shall be as provided in the Second Supplement as finally executed. The Successor Agency
hereby authorizes the delivery and performance of the Second Supplement.
Section 5. Oversight Board Approval of the Issuance of the Bonds. The
Successor Agency hereby requests that the Oversight Board, as authorized by Section
34177.5(f) and Section 34180 of the Dissolution Act, approve and direct the issuance of the
Refunding Bonds pursuant to Section 34177.5(a)(1), this Resolution and the Second
Supplement.
Section 6. Determinations by the Oversight Board. The Successor Agency
requests that the Oversight Board make the following determinations upon which the Successor
Agency will rely in undertaking the refunding proceedings and the issuance of the Refunding
Bonds:
(a) The Successor Agency is authorized, as provided in Section 34177.5(f), to
recover its costs related to the issuance of the Refunding Bonds from the proceeds of the
Refunding Bonds, including the cost of reimbursing the City for administrative staff time spent
with respect to the authorization, issuance, sale and delivery of the Refunding Bonds;
(b) The application of proceeds of the Refunding Bonds by the Successor Agency to
the refunding of all or a portion of the Prior Bonds, as well as the payment by the Successor
Agency of costs of issuance of the Refunding Bonds, as provided in Section 34177.5(a), shall
be implemented by the Successor Agency promptly upon sale and delivery of the Refunding
Bonds, notwithstanding Section 34177.3 or any other provision of law to the contrary, without
the approval of the Oversight Board, the California Department of Finance, the Los Angeles
County Auditor-Controller or any other person or entity other than the Successor Agency;
(c) The Successor Agency shall be entitled to receive its full Administrative Cost
Allowance under Section 34171(b) without any deductions with respect to continuing costs
related to the Refunding Bonds, such as trustee’s fees, auditing and fiscal consultant fees and
continuing disclosure and rating agency costs (collectively, “Continuing Costs of Issuance”), and
such Continuing Costs of Issuance shall be payable from property tax revenues pursuant to
Section 34183. In addition, and as provided by Section 34177.5(f), if the Successor Agency is
unable to complete the issuance of the Refunding Bonds for any reason, the Successor Agency
shall, nevertheless, be entitled to recover its costs incurred with respect to the refunding
proceedings from such property tax revenues pursuant to Section 34183 without reduction in its
Administrative Cost Allowance. Notwithstanding Section 34177.5(f), any administrative costs
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post-issuance of the Bonds shall be placed on a subsequent ROPS in accord with the
Dissolution Act.
Section 7. Filing of Debt Service Savings Analysis and Resolution. The
Secretary of the Successor Agency is hereby authorized and directed to file the Debt Service
Savings Analysis, together with a certified copy of this Resolution, with the Oversight Board,
and, as provided in Section 34180(j), with the Los Angeles County Administrative Officer, the
Los Angeles County Auditor-Controller and the California Department of Finance.
Section 8. Sale of Refunding Bonds. The Successor Agency hereby approves the
sale of the Refunding Bonds by the Successor Agency through a private placement or public
offering. Following approval by the Oversight Board of the issuance of the Refunding Bonds by
the Successor Agency and subsequent to submission of the Oversight Board Resolution to the
California Department of Finance, the Successor Agency will, with the assistance of its Bond
Counsel and the Municipal Advisor, determine which method of sale provides the greatest
savings. If a private placement, the Successor Agency will work with a private placement agent
to obtain a purchase proposal which will be submitted to the Successor Agency for staff
approval. If a public offering the Successor Agency will work with an underwriter and disclosure
counsel to prepare an official statement and to cause preparation of a purchase agreement,
both of which will be submitted to the Successor Agency for Board approval. In no event shall
the terms of such sale result in a failure to meet the requirements of Section 34177.5 of the
Redevelopment Law.
Section 9. Issuance of Refunding Bonds in Whole or in Part. It is the intent of
the Successor Agency to sell and deliver the Refunding Bonds in whole, provided that there is
compliance with the Savings Parameters. However, the Successor Agency will initially
authorize the sale and delivery of the Refunding Bonds in whole or, if such Savings Parameters
cannot be met with respect to the whole, then in part; provided that the Refunding Bonds so
sold and delivered in part are in compliance with the Savings Parameters. The sale and
delivery of the Refunding Bonds in part will in each instance provide sufficient funds only for the
refunding of that portion of the outstanding Prior Bonds that meet the Savings Parameters. In
the event the Refunding Bonds are initially sold in part, the Successor Agency intends to sell
and deliver additional parts of the Refunding Bonds without the further approval of the
Successor Agency or the Oversight Board, provided that in each such instance the Refunding
Bonds so sold and delivered in part are in compliance with the Savings Parameters.
Section 10. Professional Services. The Authorized Officers are hereby authorized
to retain, in connection with the issuance of the Refunding Bonds, Urban Futures, Inc., as
municipal advisor and as fiscal consultant, the firm of Jones Hall, A Professional Law
Corporation, as bond counsel, and Raymond James, as placement agent, and to execute
professional services agreements with each such firm. If the Refunding Bonds are to be
publicly offered, Raymond James is approved to be the underwriter, and compensation will be
as set forth in the purchase agreement to be approved in the future, as referred to in Section 8.
Additionally, the selection of Wilmington Trust, N.A., as trustee for the Refunding Bonds, is
hereby confirmed.
Section 11. Official Actions. The Authorized Officers and any and all other officers
of the Successor Agency and the City are hereby authorized and directed, for and in the name
and on behalf of the Successor Agency, to do any and all things and take any and all actions,
which they, or any of them, may deem necessary or advisable in obtaining the requested
approval by the California Department of Finance, and in the issuance, sale and delivery of the
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Refunding Bonds. Whenever in this Resolution any officer of the Successor Agency is directed
to execute or countersign any document or take any action, such execution, countersigning or
action may be taken on behalf of such officer by any person designated by such officer to act on
his or her behalf in the case such officer is absent or unavailable.
Section 12. Effective Date. This Resolution shall take effect from and after the date
of approval and adoption thereof.
PASSED, APPROVED AND ADOPTED this ___ day of _____________ 2017.
__________________________________
Chairman
ATTEST:
____________________________
Secretary
Jones Hall Draft 7.6.17
SECOND SUPPLEMENTAL INDENTURE
by and between
SUCCESSOR AGENCY TO THE
REDEVELOPMENT AGENCY OF THE CITY OF AZUSA
and
WLIMINGTON TRUST, N.A.,
as Trustee
Dated as of ___________ 1, 2017
relating to
$____________
Amended and Restated Merged Central
Business District and West End
Redevelopment Project Area, Tax
Allocation Refunding Bonds, Series
2017A (Tax-Exempt)
$____________
Amended and Restated Merged Central
Business District and West End
Redevelopment Project Area, Tax
Allocation Refunding Bonds, Series
2017B (Taxable)
Supplementing an Indenture of Trust dated October 1, 2014
SECOND SUPPLEMENTAL INDENTURE
THIS SECOND SUPPLEMENTAL INDENTURE (this "Second Supplement") (to a 2014
Indenture described below) is dated as of _________ 1, 2017, by and between the
SUCCESSOR AGENCY TO THE REDEVELOPMENT AGENCY OF THE CITY OF AZUSA, a
public body, corporate and politic, organized and existing under, and by virtue of the laws of the
State of California, as successor to the dissolved Redevelopment Agency of the City of Azusa
(the "Successor Agency"), and WILMINGTON TRUST, N.A., as successor to Wells Fargo Bank,
National Association, a national banking association organized and existing under the laws of
the United States and authorized to accept and execute trusts of the character herein set out
with a corporate trust office located in Costa Mesa, California, as trustee (the "Trustee");
WITNESSETH:
WHEREAS, pursuant to the Community Redevelopment Law (Part 1 of Division 24 of
the Health and Safety Code of the State of California), and the acts amendatory thereof and
supplemental thereto (the "Redevelopment Law"), the City Council of the City of Azusa (the
"City") created the former Redevelopment Agency of the City of Azusa (the "Former Agency");
and
WHEREAS, the Former Agency was a redevelopment agency, a public body, corporate
and politic duly created, established and authorized to transact business and exercise its
powers, all under and pursuant to the Redevelopment Law, and the powers of such agency
included the power to issue bonds for any of its corporate purposes; and
WHEREAS, the City agreed to serve as the successor agency (referred to herein as the
"Successor Agency") to the Former Agency commencing upon the dissolution of the Former
Agency on February 1, 2012 pursuant to Assembly Bill X1 26 ("AB 26"); and
WHEREAS, on June 27, 2012 as part of the Fiscal Year 2012-2013 State of California
budget bill, the Governor signed into law Assembly Bill 1484 ("AB 1484"), which modified or
added to some of the provisions of AB 26, including provisions related to the refunding of
outstanding redevelopment agency bonds and the expenditure of remaining bond proceeds
derived from redevelopment agency bonds issued on or before December 31, 2010; and
WHEREAS, Health & Safety Code Section 34177.5 authorizes successor agencies to
refund outstanding bonds provided that (i) the total interest cost to maturity on the refunding
bonds or other indebtedness plus the principal amount of the refunding bonds or other
indebtedness shall not exceed the total remaining interest cost to maturity on the bonds or other
indebtedness to be refunded plus the remaining principal of the bonds or other indebtedness to
be refunded, and (ii) the principal amount of the refunding bonds or other indebtedness shall not
exceed the amount required to defease the 2007 Bonds or other indebtedness, to establish
customary debt service reserves, and to pay related costs of issuance; and
WHEREAS, on November 6, 2003, the City adopted Ordinance No. 03-06 approving the
Redevelopment Plan (the "Redevelopment Plan") for the Amended and Restated Merged
Central Business District and West End Redevelopment Project Area of the Redevelopment
Agency of the City of Azusa (the "Project Area"); and
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WHEREAS, the Redevelopment Plan contemplated that the Former Agency would issue
its bonds to finance and/or refinance a portion of the cost of the redevelopment of the Project
Area; and
WHEREAS, the Former Agency has heretofore issued the following bonds (herein the
“2007 Bonds”):
(i) $15,780,000 Redevelopment Agency of the City of Azusa Amended and
Restated Merged Central Business District and West End Redevelopment Project Area
Taxable Tax Allocation Bonds (Subordinate Lien) 2007 Series A (the "Series 2007A
Bonds"), of which $__________ are currently outstanding for the purpose of financing
portions of the redevelopment project; and
(ii) $4,790,000 Redevelopment Agency of the City of Azusa Amended and
Restated Merged Central Business District and West End Redevelopment Project Area
Housing Tax Allocation Bonds 2007 Series B (the "Series 2007B Bonds"), of which
$_________ are currently Outstanding, for the purpose of financing and refinancing
portions of the redevelopment project; and
WHEREAS, the Successor Agency has also previously issued the following series of
bonds:
(i) 10,470,000 aggregate principal amount of its Amended and Restated Merged
Central Business District and West End Redevelopment Project Area, Subordinate Tax
Allocation Refunding Bonds, Series 2014 (the "Series 2014 Bonds") pursuant to an
Indenture of Trust dated as of October 14, 2014 by and between the Successor Agency
and Wells Fargo Bank, N.A. (the "Original Indenture"), by and between the Successor
Agency and Wilmington Trust, N.A., as successor to Wells Fargo Bank, National
Association, as trustee (the "Trustee");
(ii) $14,315,000 aggregate principal amount of its Amended and Restated
Merged Central Business District and West End Redevelopment Project Area,
Subordinate Tax Allocation Refunding Bonds, Series 2015A (Tax-Exempt) (the "Series
2015A Bonds") for the purpose of refinancing the redevelopment project within the
Project Area through the refunding of bonds issued in 2005 and 2008; and
(iii) $16,215,000 aggregate principal amount of its Amended and Restated
Merged Central Business District and West End Redevelopment Project Area,
Subordinate Tax Allocation Refunding Bonds, Series 2015B (Federally Taxable) (the
"Series 2015B Bonds" and, together with the Series 2015A Bonds, the "Series 2015
Bonds") for the purpose of refinancing the redevelopment project within the Project Area
through the refunding of a portion of the Series 2007A Bonds; and
WHEREAS, the Successor Agency had determined that interest cost savings can be
achieved by refunding the outstanding 2007 Bonds and to that end, the Successor Agency has
authorized the issuance of (i) its Amended and Restated Merged Central Business District and
West End Redevelopment Project Area, Tax Allocation Refunding Bonds, Series 2017A (Tax-
Exempt) (the "Series 2017A Bonds") for the purpose of refinancing the redevelopment project
within the Project Area through the refunding of the Series 2007A Bonds; and (ii) its Amended
and Restated Merged Central Business District and West End Redevelopment Project Area,
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Tax Allocation Refunding Bonds, Series 2017B (Federally Taxable) (the "Series 2017B Bonds"
and, together with the Series 2017A Bonds, the "2017 Bonds"); and
WHEREAS, the Original Indenture provides that the Successor Agency may issue
subsequent series of Bonds as Parity Debt from time to time by a Supplemental Indenture,
subject to the conditions and limitations contained in the Redevelopment Law, as hereinafter
defined, and in Section 3.05 of the Original Indenture; and
WHEREAS, the Successor Agency has determined to issue the 2017 Bonds secured on
a parity basis with the Series 2014 Bonds and Series 2015 Bonds pursuant to the Original
Indenture, as amended by a First Supplement (which provided for the issuance of the 2015
Bonds) and as amended by this Second Supplement, and as hereinafter supplemented, the
"Indenture"; and
WHEREAS, the conditions and limitations contained in the Redevelopment Law and in
the Indenture have been satisfied or will be satisfied at the time of the issuance of the 2017
Bonds; and
WHEREAS, the Successor Agency has further determined that the amendments and
supplements to the Indenture herein contained are necessary and desirable and can be made
pursuant to Section 7.01 of the Indenture without the consent of any Owners and without the
consent of the Insurer, to the extent required; and
WHEREAS, all things necessary to cause the 2017 Bonds, when authenticated by the
Trustee and issued as in this Second Supplement and the Original Indenture provided, to be
legal, special obligations of the Successor Agency, enforceable in accordance with their terms,
and to constitute this Second Supplement and the Indenture a valid agreement for the uses and
purposes herein set forth in accordance with their terms, have been done and taken, and the
creation, execution and delivery of this Second Supplement and the creation, execution and
issuance of the 2017 Bonds, subject to the terms hereof, have in all respects been duly
authorized;
NOW THEREFORE, THIS SECOND SUPPLEMENTAL 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 the 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 2017
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 2017 Bonds by the
owners thereof, and for other valuable considerations, the receipt whereof is hereby
acknowledged, the Successor Agency does hereby covenant and agree with the Trustee, for
the benefit of the respective holders from time to time of the Bonds, including the 2017 Bonds,
as follows:
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ARTICLE XI
2017 BONDS; AMENDMENTS; MISCELLANEOUS
Section 11.01. Authorization and Terms of Series 2017A Bonds.
(a) The following series of Bonds to be issued under the Indenture are hereby
created, designated as (i) "Successor Agency to the Redevelopment Agency of the City of
Azusa Amended and Restated Merged Central Business District and West End Redevelopment
Project Area, Tax Allocation Refunding Bonds, Series 2017A (Tax- Exempt)" (herein, the
"Series 2017A Bonds") issued in the aggregate principal amount of $___________; and (ii)
"Successor Agency to the Redevelopment Agency of the City of Azusa Amended and Restated
Merged Central Business District and West End Redevelopment Project Area, Tax Allocation
Refunding Bonds, Series 2017B (Federally Taxable)" (herein, the "Series 2017B Bonds" and
together with the Series 2017A Bonds, the “2017 Bonds”).
The 2017 Bonds shall be dated ___________, 2017 (herein the "Dated Date"), shall
bear interest, at the rate and shall mature and become payable on August 1 in the year as to
principal in the amount, as set forth in Exhibit B hereto.
(b) Pursuant to Section 34177 of the Redevelopment Law, not later than each date a
Recognized Obligation Payment Schedule is due, the Successor Agency shall submit to the
Oversight Board and the State Department of Finance, a Recognized Obligation Payment
Schedule. The Successor Agency shall take all actions required under the Redevelopment Law
to include in the Recognized Obligation Payment Schedule for each Semiannual Period, so as
to enable the Los Angeles County Auditor-Controller to distribute from the Redevelopment
Property Tax Trust Fund for deposit in the Redevelopment Obligation Retirement Fund on each
January 2 and June 1, as applicable, amounts required to enable the Successor Agency to pay
timely payment of principal of, and interest on, the 2017 Bonds on a timely basis, as such
amounts of debt service are set forth in the Recognized Obligation Payment Schedule attached
hereto as Exhibit B and hereby made a part hereof, or as such Schedule may be hereafter
amended.
(c) The 2017 Bonds shall be issued as fully registered bonds in the denomination of
$5,000, or any integral multiple of $5,000 (not exceeding the principal amount of the 2017
Bonds maturing at any one time). The 2017 Bonds shall be numbered as determined by the
Trustee. The 2017 Bonds are initially being sold to a private investor and shall bear a CUSIP
number, nor there be any application for eligibility for the 2017 Bonds with The Depository Trust
Company (DTC).
Interest on the 2017 Bonds shall be payable on each Interest Payment Date to the
person whose name appears on the Registration Books as the Owner thereof as of the Record
Date immediately preceding each such Interest Payment Date, such interest to be paid by
check of the Trustee mailed by Second class mail, postage prepaid, on each Interest Payment
Date to the Owner at the address of such Owner as it appears on the Registration Books as of
the preceding Record Date; provided however, that payment of interest may be by wire transfer
to an account in the United States of America to any Owner of 2017 Bonds of the same series in
the aggregate amount of $1,000,000 or more who shall furnish written instructions to the
Trustee before the applicable Record Date. Any such written instructions shall remain in effect
until rescinded in writing by the Owner. Principal of and premium (if any) on any Series 2017
Bond shall be paid upon presentation and surrender thereof, at maturity or the prior redemption
5
thereof, at the Office of the Trustee and shall be payable in lawful money of the United States of
America.
Interest on the 2017 Bonds shall be computed on the basis of a 360- day year of twelve
30-day months. Each Series 2017 Bond shall be dated as of the Closing Date and shall bear
interest from the Interest Payment Date next preceding the date of authentication thereof,
unless (a) it is authenticated after a Record Date and on or before the following Interest
Payment Date, in which event it shall bear interest from such Interest Payment Date, or (b)
unless it is authenticated on or before January 15, 2018, in which event it shall bear interest
from the Closing Date; provided, however, that if, as of the date of authentication of any Series
2017 Bond, interest thereon is in default, such Series 2017 Bond shall bear interest from the
Interest Payment Date to which interest has previously been paid or made available for payment
thereon.
Section 11.02. Form of 2017 Bonds. The 2017 Bonds, the Trustee’s certificate
of authentication, and the form of assignment to appear thereon shall be in substantially the
forms, respectively, attached hereto as Exhibit A with necessary or appropriate variations,
omissions and insertions as permitted or required by the Indenture. Each Series 2017 Bond
shall be executed on behalf of the Successor Agency by the signature of its Chairman,
Executive Director or Treasurer or other Authorized Officer and the signature of its Secretary
who are in office on the date of execution and delivery of this Indenture or at any time thereafter.
Either or both of such signatures may be made manually or may be affixed by facsimile thereof.
If any officer whose signature appears on any 2017 Bond ceases to be such officer before the
Closing Date, such signature shall nevertheless be as effective as if the officer had remained in
office until the Closing Date. Any 2017 Bond may be signed and attested on behalf of the
Successor Agency by such persons as at the actual date of the execution of such 2017 Bond
shall be the proper officers of the Successor Agency, duly authorized to execute debt
instruments on behalf of the Successor Agency, although on the date of such 2017 Bond any
such person shall not have been such officer of the Successor Agency.
Only such of the Series 2017 Bond as shall bear thereon a certificate of authentication in
the form set forth in Exhibit A, manually executed and dated by the Trustee, shall be valid or
obligatory for any purpose or entitled to the benefits of this Indenture, and such certificate of the
Trustee shall be conclusive evidence that such Series 2017 Bond have been duly authenticated
and delivered hereunder and are entitled to the benefits of this Indenture.
A Series 2017 Bond may only be transferred in an Authorized Denomination to an
Accredited Investor or Qualified Institutional Buyer who delivers to the Trustee and the
Successor Agency an executed letter substantially in the form of Exhibit C of this Indenture. The
Successor Agency may remove the limitations set forth in this Section 11.01 without the consent
of any Owner of the 2017 Bonds other than the Original Purchaser (if it is still a Bondholder).
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Section 11.03. Terms of Redemption of Series 2017A Bonds.
(a) Optional Redemption of Series 2017A Bonds.
The Series 2017A Bonds due on or before August 1, ________ shall not be subject to
redemption before their respective stated maturities. Series 2017A Bonds maturing on or after
August 1, ________ shall be subject to redemption, as a whole or in part, as designated by the
Successor Agency, or, absent such designation, pro rata among maturities, and by lot within
any one maturity if less than all of the Series 2017A Bonds of a single maturity are to be
redeemed, prior to their respective maturity dates, at the option of the Successor Agency, on
any date on or after August 1, _________, from funds derived by the Successor Agency from
any source, at the redemption price of the principal amount of Series 2017A Bonds called for
redemption, together with interest accrued thereon to the date fixed for redemption.
(b) Optional Redemption of Series 2017B Bonds.
The Series 2017B Bonds due on or before August 1, ________ shall not be subject to
redemption before their respective stated maturities. Series 2017B Bonds maturing on or after
August 1, ________ shall be subject to redemption, as a whole or in part, as designated by the
Successor Agency, or, absent such designation, pro rata among maturities, and by lot within
any one maturity if less than all of the Series 2017B Bonds of a single maturity are to be
redeemed, prior to their respective maturity dates, at the option of the Successor Agency, on
any date on or after August 1, _________, from funds derived by the Successor Agency from
any source, at the redemption price of the principal amount of Series 2017B Bonds called for
redemption, together with interest accrued thereon to the date fixed for redemption.
If less than all of the outstanding Series 2017 Bonds are to be redeemed prior to
maturity, the Successor Agency will select the series and portions of the series to be redeemed.
Section 11.04. Application of Proceeds of 2017 Bonds.
(a) On the Closing Date the proceeds of the sale of the Series 2017A Bonds shall be
paid to the Trustee in the amount of $___________ (being the aggregate principal amount of
the Series 2017A Bonds) and the proceeds of the sale of the Series 2017B Bonds shall be paid
to the Trustee in the amount of in the amount of $___________ (being the aggregate principal
amount of the Series 2017B Bonds). The proceeds of the sale of the 2017 Bonds shall be
applied as follows:
Series 2017A Bonds:
(a) The Trustee shall deposit the amount of $___________ in the 2017A
Expense Account, which Account is established in the 2017 Costs of Issuance Fund, to
pay costs incurred in connection with the issuance of the Series 2017A Bonds.
(b) The Trustee shall deposit the amount of $___________ in the Series A
Reserve Subaccount of the Reserve Account.
(c) The Trustee shall deposit the remaining amount of proceeds of the Series
2017A Bonds ($___________) in the 2017A Refunding Account of the Refunding Fund.
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Series 2917B Bonds:
(d) The Trustee shall deposit the amount of $___________ in the 2017B
Expense Account, which Account is established in the 2017 Costs of Issuance Fund, to
pay costs incurred in connection with the issuance of the Series 2017B Bonds.
(e) The Trustee shall deposit the amount of $___________ in the Series
2017B Reserve Subaccount of the Reserve Account.
(f) The Trustee shall deposit the remaining amount of proceeds of the Series
2017A Bonds ($___________) in the 2017B Refunding Account of the Refunding Fund.
(c) There is hereby established a separate fund to be known as the "2017 Costs of
Issuance Fund," which shall be held by the Trustee in trust and within such fund the 2017A
Expense Account and the 2017B Expense Account. The moneys in the 2017 Costs of Issuance
Fund shall be used and withdrawn by the Trustee from time to time to pay the Costs of Issuance
upon submission of a Written Request of the Successor Agency stating the person to whom
payment is to be made, the amount to be paid, the purpose for which the obligation was
incurred and that such payment is a proper charge against said fund. On or before December
31, 2017, or upon the earlier Written Request of the Successor Agency stating that all known
Costs of Issuance have been paid, all amounts, if any, remaining in the 2017 Costs of Issuance
Fund shall be withdrawn therefrom by the Trustee and transferred to the Interest Account of the
Debt Service Fund to be used to pay interest on the Bonds on the next Interest Payment Date.
Section 11.05. Amendments to Indenture.
(a) The following defined terms are added to, or amend terms contained in, Section
1.01 hereof:
“Accredited Investor” means an "accredited investor" as such term is defined in
Rule 501(a) of Regulation D promulgated under the United States Securities Act of
1933, as amended.
"Closing Date" means, with respect to the Series 2017 Bond, the date on which
the Series 2017 Bond are delivered by the Successor Agency to the Original Purchaser.
"Irrevocable Refunding Instructions and Agreement (2007 Bonds)" means the
Irrevocable Refunding Instructions and Agreement, dated as __________, 2017, relating
to the 2007A Bonds and the 2007B Bonds, executed by the Successor Agency and
agreed and accepted by Wilmington Trust, N.A., as prior trustee.
"Original Purchaser" means _____________ as original purchaser of the 2017
Bonds.
“Qualified Institutional Buyer” means a qualified institutional buyer as defined in
Rule 144A promulgated pursuant to the United States Securities Act of 1933, as
amended.
"Series 2017A Reserve Subaccount" means the sub-account of the Reserve
Account applicable to the Series 2017A Bonds by that name established and held by the
Trustee pursuant to Section 4.03(d) hereof.
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"Series 2017B Reserve Subaccount" means the sub-account of the Reserve
Account applicable to the Series 2017B Bonds by that name established and held by the
Trustee pursuant to Section 4.03(d) hereof.
"Series 2017A Reserve Requirement" means the amount of $________.
"Series 2017B Reserve Requirement" means the amount of $________.
“Taxable Rate” means an amount equal to 8% per annum, based on a 360-day
year and 12 30-day months.
(b) References in Sections 2.06 through 2.10 to Series 2014 Bonds shall include the
Series 2015 Bonds and 2017 Bonds. Because the Original Purchaser intends to treat the
acquisition of the 2017 Bonds as a loan and hold the Bonds in its loan portfolio, the Original
Purchaser has directed there be no CUSIP number for the 2017 Bonds, or the 2017 Bonds be
eligible for participation by The Depository Trust Company (DTC).
(c) Section 3.04 of the Indenture is amended to create the “2017 Refunding Fund”
and referred to therein as the “Refunding Fund.” Within such fund shall be established a 2017A
Refunding Account and a 2017B Refunding Account.
(d) Section 4.03(d) of the Indenture is amended to include the following additional
paragraph:
Within the Reserve Account, the Trustee shall establish and hold another
separate sub- account referred to as the Series 2017 Reserve Subaccount. Within the
Series 2017 Reserve Subaccount the Trustee shall account separately for the debt
service reserves allocable to the Series 2017A Bonds and the Series 2017B Bonds
without the need to establish separate subaccounts for each sub-series. The term
Reserve Account as used in this Section 4.03 shall include equally and respectively
each reserve sub-account established for the purpose of securing separate series of
Bonds or Parity Debt including, without limitation, the Series 2017 Reserve Subaccount
and the term Reserve Requirement shall include equally and respectively the Reserve
Requirement applicable to the Series 2017A and Series 2017B Reserve Requirement
and any reserve requirement established for the purpose of securing separate series of
Bonds or Parity Debt hereafter.
(e) References in Section 5.03 to Series 2014 Bonds shall include the Series 2015
Bonds and the 2017 Bonds.
(f) Section 5.12 of the Indenture is amended to read as follows:
(i) Private Activity Bond Limitation. The Successor Agency shall assure that
the proceeds of the Bonds are not so used as to cause Bonds to satisfy the private
business tests of Section 141(b) of the Tax Code or the private loan financing test of
Section 141(c) of the Tax Code.
(ii) Federal Guarantee Prohibition. The Successor Agency shall not take any
action or permit or suffer any action to be taken if the result of the same ,would be to
9
cause any of the Bonds to be "federally guaranteed" within the meaning of Section
149(b) of the Tax Code.
(iii) No Arbitrage. The Successor Agency shall not take, or permit or suffer to
be taken by the Trustee or otherwise, any action with respect to the proceeds of the
Bonds which, if such action had been reasonably expected to have been taken, or had
been deliberately and intentionally taken, on the Closing Date would have caused the
Bonds to be "arbitrage bonds" within the meaning of Section 148 of the Tax Code.
(iv) Maintenance of Tax-Exemption. The Successor Agency shall take all
actions necessary to assure the exclusion of interest on the Bonds from the gross
income of the Owners of the Bonds to the same extent as such interest is permitted to
be excluded from gross income under the Tax Code as in effect on the Closing Date.
This covenant shall remain in full force and effect following defeasance of Bonds
pursuant to Section 9.03.
(v) Rebate Requirement. The Successor Agency shall take any and all
actions necessary to assure compliance with Section 148(f) of the Tax 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 Bonds.
The requirements of this Section shall not apply to any Bonds the interest on
which is not intended to be excluded from the gross income of the owners for federal
income tax purposes.
The Trustee shall have no duty to monitor the compliance by the Successor
Agency with any of the covenants contained in this Section 5.12.
(g) The reference in Section 7.01(d) to Series 2014 Bonds shall include the Series
2015 Bonds and the 2017 Bonds.
(h) In the event that an action or inaction of the Successor Agency or the Former
Agency directly causes the Department of Treasury (the “Treasury”) to make a final, non-
appealable determination that the interest payable with respect to the Series 2017A Bonds is
includable in gross income of the Bondholder for federal income tax purposes or that the Series
2017A Bonds are no longer tax-exempt (a “Final Determination of Taxability”), the Successor
Agency shall take one of the following actions in its discretion:
(i) enter into a closing agreement with the Internal Revenue Service to
preserve the tax-exempt status of interest on the Series 2017A Bonds; or
(ii) from the date of the Final Determination of Taxability until payment or
redemption of the 2017 Bonds, pay to the Trustee for the benefit of the Original
Purchaser, interest on the Series 2017A Bonds at the Taxable Rate; and
In the event that a Final Determination of Taxability is made subsequent to the
defeasance of any Series 2017A Bonds, notwithstanding the defeasance of such Series 2017A
Bonds, the Successor Agency shall either take the action described in clause (i) of this Section
or make a payment to the Original Purchaser (or a successor designated by the Original
purchaser) in the amount that would have been paid to the Original Purchaser pursuant to
clause (ii) of this Section with respect to the defeased Series 2017A Bonds.
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Section 11.06. Continuing Disclosure. The Successor Agency shall provide to
the Original Purchaser (or a successor designated by the Original Purchaser) the following
information:
(a) within 270 days of the end of each fiscal year of the Successor Agency, audited
financial statements of the Successor Agency and the City for the most recently-completed
fiscal year, beginning with the financial statements for fiscal year 2017-18;
(b) within 270 days of the end of each fiscal year of the Successor Agency, a copy of
the written report from the County that identifies the amount of the semi-annual deposits by the
County to the Successor Agency’s Redevelopment Property Tax Trust Fund (RPTTF) during the
most recently-completed fiscal year;
(c) within 270 days of the end of each fiscal year of the Successor Agency,
beginning with the information for fiscal year 2017-18, the following information for the most
recently-completed fiscal year for the Project Area:
(i) total assessed value and identification of top ten taxpayers,
(ii) incremental assessed value,
(iii) property tax revenues allocated to the County for administrative costs,
(iv) total Tax Revenues,
(v) debt service coverage for the then-current Bond Year provided by Tax
Revenues for the most recently-completed fiscal year.; and
In addition, within 270 days of the end of each fiscal year of the Successor Agency,
beginning with the information for fiscal year 2017-18, the Successor Agency will ask the
County to provide it with the following information and, if it can be received from the County
without significant third-party cost to the Successor Agency, it will promptly forward such
information to the Original Purchaser (or a successor designated by the Original Purchaser):
(i) information about outstanding material appeals of assessed values by
any of the 10 largest assessees in the Project Area for the most recently-completed
fiscal year, when considered on a combined basis,
(ii) during the most recently-completed fiscal year, any relocations from the
Project Area of any of the 10 largest assessees in the Project Area for the most recently-
completed fiscal year, when considered on a combined basis, and
(iii) levy, collection and delinquency information for the Project Area on a
combined basis for the most recently-completed fiscal year.
In addition, the Successor Agency shall provide to the Original Purchaser (or a
successor designated by the Original Purchaser) such other information that is reasonably
available and related to Tax Revenues as shall be reasonably requested by the Original
Purchaser (or a successor designated by the Original Purchaser); for purposes of clarification,
information will not be considered to be reasonably available if, among other things, it cannot be
11
obtained by the Successor Agency without the Successor Agency incurring significant third-
party cost or without significant effort.
Section 11.07. Terms of 2017 Bonds Subject to the Indenture. Except as in
this Second Supplement expressly provided, every term and condition contained in the
Indenture shall apply to this Second Supplement and to the 2017 Bonds with the same force
and effect as if the same were herein set forth at length, with such omissions, variations and
modifications thereof as may be appropriate to make the same conform to this Second
Supplement.
This Second Supplement and all of the terms and provisions herein contained shall form
part of the Indenture as fully and with the same effect as if all such terms and provisions had
been set forth in the Indenture. The Indenture is hereby ratified and confirmed and shall
continue in full force and effect in accordance with the terms and provisions thereof, as
heretofore amended and supplemented, and as amended and supplemented hereby.
Section 11.08. Due Authorization. The Successor Agency has reviewed all
proceedings heretofore taken relative to the authorization of the 2017 Bonds and has found, as
a result of such review, and does hereby find and determine, that the Successor Agency has
duly and regularly complied with all applicable provisions of law and is duly authorized by law to
issue the 2017 Bonds in the manner and upon the terms in the Indenture and this Second
Supplement provided and that all acts, conditions and things required by law to exist, happen
and be performed precedent to and in connection with the issuance of the 2017 Bonds exist,
have happened and have been performed in regular and due time, form and manner as
required by law, and the Successor Agency is now duly empowered to issue the 2017 Bonds.
Section 11.09. Execution in Several Counterparts. This Second Supplement
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
Successor Agency and the Trustee shall preserve undestroyed, shall together constitute but
one and the same instrument.
Section 11.10. Governing Law. This Second Supplement shall be governed and
construed in accordance with the laws of the State of California.
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IN WITNESS WHEREOF, the SUCCESSOR AGENCY TO THE REDEVELOPMENT
AGENCY OF THE CITY OF AZUSA has caused this Second Supplement be signed in its name
by its Authorized Officer, and WILMINGTON TRUST, N.A., in token of its acceptance of the
trusts created hereunder, has caused this Second Supplement be signed in its corporate name
by its officer thereunto duly authorized, all as of the date and year Second above written.
SUCCESSOR AGENCY TO THE
REDEVELOPMENT AGENCY OF THE
CITY OF AZUSA
By:
Joseph Romero Rocha,
Mayor of the City of Azusa
WILMINGTON TRUST, N.A., as Trustee
By:
Authorized Officer
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EXHIBIT A
FORM OF SERIES 2017 BOND
No._______ $ _____________
UNITED STATES OF AMERICA
STATE OF CALIFORNIA
SUCCESSOR AGENCY TO THE
REDEVELOPMENT AGENCY OF THE
CITY OF AZUSA AMENDED AND RESTATED
MERGED CENTRAL BUSINESS DISTRICT
AND WEST END REDEVELOPMENT PROJECT AREA
TAX ALLOCATION REFUNDING BONDS,
[SERIES 2017A (TAX-EXEMPT) OR 2017B (FEDERALLY TAXABLE)]
RATE OF INTEREST MATURITY DATE ORIGINAL ISSUE DATE
_______% August 1, 20__ _________, 2017
REGISTERED OWNER:
PRINCIPAL AMOUNT: ___________________________DOLLARS
THIS BOND HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY BE
TRANSFERRED ONLY IN AN AUTHORIZED DENOMINATION BY THE REGISTERED OWNER
SOLELY TO (A) A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT OF 1933), OR (ii) AN “ACCREDITED INVESTOR” (AS DEFINED IN RULE 501 OF
REGULATION D UNDER THE SECURITIES ACT OF 1933, AS AMENDED) AND ONLY UPON THE
EXECUTION AND DELIVERY BY THE TRANSFERREE OF AN INVESTOR LETTER IN
SUBSTANTIALLY THE FORM OF EXHIBIT C TO THE INDENTURE AND BY THIS REFERENCE
INCORPORATED HEREIN.
The SUCCESSOR AGENCY TO THE REDEVELOPMENT AGENCY OF THE CITY OF
AZUSA, a public entity duly existing under the laws of the State of California (the "Successor
Agency"), for value received, hereby promises to pay (but only out of the Pledged Tax
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, 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 (a "Record Date"), in which event it shall bear interest from such Interest
Payment Date, or unless this Bond is authenticated on or prior to January 15, 2018, in which
event it shall bear interest from the Original Issue Date identified above; provided, however, that
if, 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
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or made available for payment), payable semiannually on February 1 and August 1 in each
year, commencing February 1, 2018 (the "Interest Payment Dates"), until payment of such
Principal Amount in full. The Principal Amount hereof is payable upon presentation hereof at the
principal corporate trust office of Wilmington Trust, N.A., as trustee (the "Trustee"), in Costa
Mesa, California or such other location as the trustee may designate. Interest hereon is payable
by check of the Trustee mailed by Second class mail on each Interest Payment Date to the
Registered Owner hereof at the address of such Registered Owner as it appears on the
registration books of the Trustee as of the preceding Record Date; provided that at the written
request of the owner of at least $1,000,000 aggregate principal amount of Bonds, which written
request is on file with the Trustee prior to any Record Date, interest on such Bonds shall be paid
on the succeeding Interest Payment Date by wire transfer to an account of a financial institution
within the United States of America as shall be specified in such written request.
This Bond is one of a duly authorized issue of bonds of the Successor Agency
designated as the "Successor Agency to the Redevelopment Agency of the City of Azusa
Amended and Restated Merged Central Business District and West End Redevelopment
Project Area Tax Allocation Refunding Bonds, Series 2017[ ]" (the "Bonds") of an aggregate
principal amount of $__________ all of like tenor and date (except for such variation, if any, as
may be required to designate varying numbers, maturities, interest rates or redemption
provisions) and all issued pursuant to the provisions of the Article 11 (commencing with Section
53580) of Chapter 3 of Part 1 of Division 2 of Title 5 of the Government Code of the State (the
"Refunding Law") and the Community Redevelopment Law, constituting Part 1 of Division 24 of
the California Health and Safety Code (the "Redevelopment Law"), and pursuant to an
Indenture of Trust, dated as of October 1, 2014, by and between the Successor Agency and the
Trustee, as supplemented by a First Supplemental Indenture, dated as of September 1, 2015
and a Second Supplemental Indenture, dated as of ___________ 1, 2017, by and between the
Successor Agency and the Trustee (collectively, the "Indenture"). Concurrently with the
issuance of the Bonds, the Successor Agency is issuing under the Indenture its "Successor
Agency to the Redevelopment Agency of the City of Azusa Amended and Restated Merged
Central Business District and West End Redevelopment Project Area Tax Allocation Refunding
Bonds, Series 2017[ ]" (the Series 2017[ ] Bonds" and, together with the Bonds, the "2017
Bonds") of an aggregate principal amount of $___________. The Successor Agency may issue
or incur additional obligations on a parity with the 2017 Bonds, but only subject to the terms of
the Indenture. Reference is hereby made to the Indenture (copies of which are on file at the
office of the Successor Agency) and all supplements thereto and to the Refunding Law and the
Redevelopment Law for a description of the terms on which the 2017 Bonds are issued, the
provisions with regard to the nature and extent of the Pledged Tax Revenues, as that term is
defined in the Indenture, and the rights thereunder of the owners of the 2017 Bonds and the
rights, duties and immunities of the Trustee and the rights and obligations of the Successor
Agency thereunder, to all of the provisions of which the Registered Owner of this Bond, by
acceptance hereof, assents and agrees.
The Bonds have been issued by the Successor Agency to finance and refinance
redevelopment activities of the Successor Agency. This Bond and the interest hereon and all
other parity obligations and the interest thereon (to the extent set forth in the Indenture) are
payable from, and are secured by a charge and lien on the Pledged Tax Revenues derived by
the Successor Agency from the Amended and Restated Merged Central Business District and
West End Redevelopment Project Area in the City of Azusa (the "Project Area"), a duly
designated redevelopment project under the laws of the State of California, under and in
accordance with the Indenture. As and to the extent set forth in the Indenture, all of the Pledged
Tax Revenues are exclusively and irrevocably pledged in accordance with the terms hereof and
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the provisions of the Indenture and the Redevelopment Law, to the payment of the principal of
and interest and premium (if any) on the 2017 Bonds and any such parity obligations. The
Bonds and any such parity obligations are secured by a pledge on, security interest in and lien
on the Pledged Tax Revenues which is subordinate to or on a parity with the pledge, security
interest and lien on the Pledged Tax Revenues in favor of certain outstanding obligations of the
Successor Agency, as provided in the Indenture. Notwithstanding the foregoing, certain
amounts out of Pledged Tax Revenues may be applied for other purposes as provided in the
Indenture.
This Bond is not a debt of the City of Azusa, the County of Los Angeles, the State of
California, or any of its political subdivisions, other than the Successor Agency, and neither said
City, said County, said State, nor any of its political subdivisions, is liable hereon nor in any
event shall this Bond be payable out of any funds or properties other than the Pledged Tax
Revenues.
The rights and obligations of the Successor Agency and the owners of the Bonds may
be modified or amended at any time in the manner, to the extent and upon the terms provided in
the Indenture, but no such modification or amendment shall permit a change in the terms of
redemption or maturity of the principal of any outstanding Bond or of any installment of interest
thereon or a reduction in the principal amount or the redemption price thereof or in the rate of
interest thereon without the consent of the owner of such Bond, or shall reduce the percentages
of the Bond owners required to effect any such modification or amendment.
The Bonds may be called before maturity and redeemed at the option of the Successor
Agency, in whole or in part, from the proceeds of refunding bonds or other available funds, as
provided in the Indenture.
If an Event of Default, as defined in the Indenture, shall occur, the principal of all
outstanding Bonds may be declared due and payable upon the conditions, in the manner and
with the effect provided in the Indenture, but such declaration and its consequences may be
rescinded and annulled as further provided in the Indenture.
This Bond is transferable by the Registered Owner hereof, in person or by his attorney
duly authorized in writing, at said corporate trust office of the Trustee in Costa Mesa, California
or such other place as designated by 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 registration of such transfer a new Bond or 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 Successor Agency and the Trustee may treat the Registered Owner hereof as the
absolute owner hereof for all purposes, and the Successor Agency and the Trustee shall not be
affected by any notice to the contrary.
It is hereby certified that all of the things, conditions and acts required to exist, to have
happened or to have been performed precedent to and in the issuance of this Bond do exist,
have happened or have been performed in due and regular time, form and manner as required
by the
Redevelopment Law and the laws of the State of California and that the amount of this
Bond, together with all other indebtedness of the Successor Agency, does not exceed any limit
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prescribed by the Redevelopment Law or any laws of the State of California, and is not in
excess of the amount of Bonds permitted to be issued under the Indenture.
Unless this Bond is presented by an authorized representative of The Depository Trust
Company to the Trustee for registration of transfer, exchange or payment, and any Bond issued
is registered in the name of Cede & Co. or such other name as requested by an authorized
representative of The Depository Trust Company and any payment is made to Cede & Co., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR
TO ANY PERSON IS WRONGFUL since the registered owner hereof, Cede & Co., has
an interest herein.
This Bond shall not be entitled to any benefit under the Indenture or become valid or
obligatory for any purpose until the Trustee’s Certificate of Authentication hereon endorsed shall
have been manually signed by the Trustee.
A-5
IN WITNESS WHEREOF, the SUCCESSOR AGENCY TO THE REDEVELOPMENT
AGENCY OF THE CITY OF AZUSA has caused this Bond to be executed in its name
and on its behalf with the facsimile signature of the Mayor of the City as Successor Agency and
attested to by the facsimile signature of the City Clerk of the City as Successor Agency, all as of
the Original Issue Date specified above.
SUCCESSOR AGENCY TO THE
REDEVELOPMENT AGENCY OF THE
CITY OF AZUSA
By:
Joseph Romero Rocha
Mayor
ATTEST:
By:
Jeffrey Lawrence Cornejo, Jr.
City Clerk
A-6
TRUSTEE’S CERTIFICATE OF AUTHENTICATION
This is one of the Bonds described in the within-mentioned Indenture.
Dated:______________________________
WILMINGTON TRUST, N.A., as
Trustee
By:
A-7
FORM OF ASSIGNMENT
For value received the undersigned do(es) hereby sell, assign and transfer unto
(Name, Address and Tax Identification or Social Security Number of Assignee)
the within Bond and do(es) hereby irrevocably constitute and appoint
attorney, to transfer the same on the books of the Trustee, with full power
of substitution in the premises.
Dated:
Signature Guaranteed:
Note: Signature guarantee shall be made
by a guarantor institution
participating in the Securities
Transfer Agents Medallion Program
or in such other guarantee program
acceptable to the Trustee.
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.
B-1
EXHIBIT B
RECOGNIZED OBLIGATION DEBT SERVICE PAYMENT SCHEDULE
2017 Series A Tax Allocation Refunding Bonds
BOND DEBT SERVICE
Period
Ending Principal Coupon Interest
Debt
Service
Annual Debt
Service
B-2
2017 Series B Tax Allocation Refunding Bonds
BOND DEBT SERVICE
Period Ending Principal Coupon Interest Debt Service
Annual Debt
Service
C-1
EXHIBIT C
______________, 2017
Successor Agency to the Redevelopment Agency of the City of Azusa
Wilmington Trust, N.A.
Re: Successor Agency to the Redevelopment Agency of the City of AzusaAmended
and Restated Merged Central Business District and West End Redevelopment
Project Area, Tax Allocation Refunding Bonds, Series 2017A (Tax-Exempt) and
Taxable Series 2017B
Ladies and Gentlemen:
The undersigned (the “Purchaser”) understands that the Successor Agency to the
Redevelopment Agency of the City of Azusa (the “Successor Agency”) has issued its 2017 Tax
Allocation Refunding Bonds in the aggregate principal amount of $__________. The Purchaser
intends to purchase said bonds (for purposes of this Investor Letter, the “Bonds”). In connection
with such purchase of the Bonds, the Purchaser makes the certifications, representations,
warranties, acknowledgements and covenants contained in this Investor Letter to each of the
addressees hereof, with the express understanding that such certifications, representations,
warranties, acknowledgements and covenants will be relied upon by such addressees.
The Purchaser hereby certifies, represents, warrants, acknowledges and covenants as
follows:
(a) The Purchaser is duly organized, validly existing and in good standing
under the laws of the jurisdiction in which it was incorporated or formed and is authorized to
invest in the Bonds being purchased hereby. The person executing this letter on behalf of the
Purchaser is duly authorized to do so on the Purchaser’s behalf.
(b) The Purchaser (MARK APPROPRIATELY):
_____ is a “qualified institutional buyer” (a “Qualified Institutional Buyer”) within
the meaning of Rule 144A promulgated under the Securities Act of 1933, as
amended (the “Securities Act”), or
_____ is an “accredited investor” (an “Institutional Accredited Investor”) as
defined in Section 501(a)(1), (2), (3) or (7) of Regulation D promulgated under
the Securities Act.
C-2
(c) The Purchaser is not purchasing the Bonds for more than one account, is
purchasing the Bonds for its own account and is not purchasing the Bonds with a view to
distributing the Bonds.
(d) The Purchaser has sufficient knowledge and experience in financial and
business matters, including the purchase and ownership of municipal bonds and other tax-
exempt obligations similar to the Bonds, to be capable of evaluating the merits and risks of an
investment in the Bonds, and the Purchaser is able to bear the economic risks of such an
investment.
(e) The Purchaser recognizes that an investment in the Bonds involves
significant risks, that there is no established market for the Bonds and that none is likely to
develop and, accordingly, that the Purchaser must bear the economic risk of an investment in
the Bonds for an indefinite period of time.
(f) The Purchaser understands and agrees that ownership of a Bond may be
transferred: (i) only to a person that the Purchaser reasonably believes is either: (A) a Qualified
Institutional Buyer that is purchasing such Bond for not more than one account, for their own
account and not with a view to distributing such Bond; or (B) an Institutional Accredited Investor
that is purchasing such Bond for not more than one account for investment purposes and not
with a view to distributing such Bond; and (ii) only if such Qualified Institutional Buyer or
Institutional Accredited Investor delivers to the Successor Agency a completed and duly
executed Investor Letter substantially in the form hereof.
(g) The Purchaser is not relying upon the Successor Agency, or any of its
affiliates, agents or employees, for advice as to the merits and risks of investment in the Bonds.
The Purchaser understands that the Bonds are special, limited obligations payable and secured
solely from Tax Revenues as provided for in the Indenture of Trust, dated as of June 1, 2017
(the “Indenture”), between the Successor Agency and The Bank of New York Mellon Trust
Company, N.A., as Trustee. The Purchaser has sought such accounting, legal and tax advice
as it has considered necessary to make an informed investment decision.
(h) The Purchaser has conducted its own independent examination of, and
has had an opportunity to ask questions and receive answers concerning, the Successor
Agency, the authorizing resolution of the Successor Agency with respect to the Bonds (the
“Resolution”), the Bonds, the Indenture and the security therefor and the transactions and
documents related to or contemplated by the foregoing.
(i) The Purchaser has been furnished with all documents and information
regarding the Successor Agency, the Resolution, the Bonds, the Indenture and the security
therefor and the transactions and documents related to or contemplated by the foregoing, and
all matters related thereto, that it has requested.
(j) The Purchaser understands and agrees that: (i) the offering and sale of
the Bonds are exempt from Rule 15c2-12(b)(5) adopted by the Securities and Exchange
Commission under the Securities Exchange Act of 1934, pursuant to Section (d) of said Rule;
(ii) the Bonds will not be listed on any stock or other securities exchange and were issued
without registration under the provisions of the Securities Act of 1933 or any state securities
laws; (iii) no official statement or other disclosure document is being prepared in connection with
the issuance of the Bonds; and (iv) the Bonds will not carry any rating from any rating service.
C-3
(k) Because the Purchaser intends to treat the acquisition of the Bonds as a
loan and hold the Bonds in its loan portfolio, the Purchaser has directed Raymond James not to
obtain a CUSIP number for the Bonds, or apply for eligibility for the Bonds with The Depository
Trust Company (DTC).
(l) The person executing this letter on behalf of the Purchaser is duly
authorized to do so on the Purchaser’s behalf.
IN WITNESS WHEREOF, the Purchaser has executed this Investor Letter as of the date
set forth above.
______________ BANK,
as Investor
By:
Its:
IRREVOCABLE REFUNDING INSTRUCTIONS AND AGREEMENT
FOR AMENDED AND RESTATED MERGED CENTRAL BUSINESS DISTRICT
AND WEST END REDEVELOPMENT PROJECT AREA
TAX ALLOCATION BONDS,
2007 SERIES A
and
TAXABLE TAX ALLOCATION BONDS,
2007 SERIES B
These IRREVOCABLE REFUNDING INSTRUCTIONS AND AGREEMENT (these
“Instructions”), dated ______________, 2017, are given by the SUCCESSOR AGENCY TO
THE REDEVELOPMENT AGENCY OF THE CITY OF AZUSA, a public entity, duly organized
and existing under the laws of the State of California (the “Successor Agency”), to
WILMINGTON TRUST, N.A., a national banking association organized and existing under the
laws of the United States of America, acting as trustee for the hereinafter defined Prior Bonds
(the “Prior Trustee”);
W l T N E S S E T H :
WHEREAS, the Redevelopment Agency of the City of Azusa (the “Former Agency”)
previously issued its (i) Amended and Restated Merged Central Business District and West End
Redevelopment Project Area Taxable Tax Allocation Bonds, 2007 Series A, originally issued in
the amount of $15,780,000 of which $___________ is currently outstanding, and (ii) Amended
and Restated Merged Central Business District and West End Redevelopment Project Area
Taxable Tax Allocation Bonds, 2007 Series B, originally issued in the amount of $4,790,000 of
which $___________ is currently outstanding (together, the “Prior Bonds”), each issued under a
separate Trust Indenture, dated as of July 1, 2007 (the “Prior Indentures”), between the Former
Agency and the Prior Trustee.
WHEREAS, Assembly Bill X1 26, effective June 29, 2011, together with AB 1484,
effective June 27, 2012 (“AB 1484”), codified Part 1.8 (commencing with Section 34161) and
Part 1.85 (commencing with Section 34170) of Division 24 of the California Health and Safety
Code, and resulted in the dissolution of the Former Agency as of February 1, 2012, and the
vesting in the Successor Agency of all of the authority, rights, powers, duties and obligations of
the Former Agency; and
WHEREAS, the Successor Agency, by its Resolution No. 2017-____ adopted on
________, 2017 (the “Resolution of Issuance”) has authorized the issuance of its (i) Amended
and Restated Merged Central Business District and West End Redevelopment Project Area,
Tax Allocation Refunding Bonds, Series 2017A (Tax-Exempt) (the "Series 2017A Bonds") for
the purpose of refinancing the redevelopment project within the Project Area through the
refunding of the Series 2007A Bonds; and (ii) Amended and Restated Merged Central Business
District and West End Redevelopment Project Area, Tax Allocation Refunding Bonds, Series
2017B (Federally Taxable) (the "Series 2017B Bonds" and, together with the Series 2017A
Bonds, the "2017 Refunding Bonds") and therein determined to use a portion of the proceeds of
the 2017 Refunding Bonds to retire, in advance of their stated maturities, the Prior Bonds, all as
described in the Resolution of Issuance; and
2
WHEREAS, the 2017 Refunding Bonds are being issued pursuant to an Indenture of
Trust dated as of October 1, 2014, by and between the Successor Agency and Wilmington
Trust, N.A., as successor trustee (the “Trustee”), as amended and supplemented by the First
Supplemental Indenture, dated as of September 1, 2015 and a Second Supplemental Indenture,
dated as of ____________ 1, 2017 (as so amended and supplemented, the “2017 Refunding
Bonds Indenture”), by and between the Successor Agency and the Trustee;
WHEREAS, the Successor Agency has determined that it is in the best financial
interests of the Successor Agency to refund, at this time, the Prior Bonds; and
WHEREAS, the Successor Agency desires to give these Instructions to the Prior Trustee
for the purpose of providing the terms and conditions relating to the deposit and application of
moneys and securities to provide for the payment and redemption of the Prior Bonds pursuant
to the Prior Indentures;
NOW, THEREFORE, the Successor Agency hereby irrevocably instructs the Prior
Trustee as follows:
Section 1. Special Escrow. Pursuant to Section 5.03 of the Prior Indentures, there
has heretofore been established an account held by the Prior Trustee known as the “Bond
Fund.” All cash and securities deposited in or transferred pursuant to these Instructions shall be
deposited into a designated account of the Bond Fund which is hereby established (the “Escrow
Account”) are hereby irrevocably pledged as a special trust fund for the payment of the
redemption price of the Prior Bonds on ___________, 2017 in accordance with the Prior
Indentures. The Prior Trustee shall have no lien upon or right of set off against the securities
and cash at any time on deposit in the Escrow Account, and such amounts shall be applied only
as provided herein.
Section 2. Deposit and Transfer into Escrow Account; Investment of Amounts.
Concurrently with delivery of the 2017 Refunding Bonds, the Successor Agency shall cause to
be transferred to the Prior Trustee the amount of $____________ in immediately available
funds to be derived from a portion of the proceeds of sale of the 2017 Refunding Bonds, which
amount the Prior Trustee shall then deposit into the Escrow Account. The Trustee shall apply
$_____________ of the amounts deposited in the Escrow Account pursuant to these
Instructions to the costs of investments as provided in Exhibit C and hold the remainder
uninvested pending application pursuant to these Instructions. The Successor Agency confirms
that by making the deposits described herein, it is discharging the Prior Bonds pursuant to
Section 10.03 of the Prior Indentures.
Section 3. Proceedings for Redemption of Prior Bonds. The Successor Agency
hereby irrevocably elects, and directs the Trustee, to redeem, on _________, 2017, the Prior
Bonds pursuant to the provisions of Sections 4.01(a) and 10.03 of the Prior Indentures. The
Prior Trustee was previously instructed to mail pursuant to the Prior Indentures, and with
respect to the proposed redemption of the Prior Bonds on ___________, 2017, a notice of
redemption to the owners of the Prior Bonds and any insurer of such Prior Bonds substantially
in the form attached hereto as Exhibit A. The Prior Trustee is hereby instructed to file on or
about ____________, 2017, the notice substantially in the form attached hereto as Exhibit B on
the Municipal Securities Rulemaking Board’s EMMA System.
3
Section 4. Application of Funds to Redeem Prior Bonds. The Trustee shall apply
the amounts on deposit in the Escrow Account to redeem the Prior Bonds on ___________,
2017 at a price equal to 100% of the principal amount thereof, plus accrued interest.
Section 5. Transfer of Remaining Funds. On ___________, 2017, following the
payment and redemption described above, the Prior Trustee shall withdraw any amounts
remaining on deposit in the Escrow Account and transfer such amounts to the Trustee for
deposit into the Debt Service Fund established under the 2017 Refunding Bonds Indenture to
be used solely for the purpose of paying interest on the 2017 Refunding Bonds.
Section 6. Amendment. These Instructions shall be irrevocable by the Successor
Agency. These Instructions may be amended or supplemented by the Successor Agency, but
only if the Successor Agency shall file with the Trustee (a) an opinion of nationally recognized
bond counsel engaged by the Successor Agency stating that such amendment or supplement
will not, of itself, adversely affect the exclusion from gross income of interest represented by the
Prior Bonds or the 2017 Refunding Bonds under federal income tax law, and (b) a certification
of an independent accountant or independent financial adviser engaged by the Successor
Agency stating that such amendment or supplement will not affect the sufficiency of funds
invested and held hereunder to make the payments required by Section 4.
[Remainder of page left intentionally blank.]
4
Section 7. Governing Law. These Instructions shall be construed in accordance
with and governed by the laws of the State of California.
SUCCESSOR AGENCY TO THE
REDEVELOPMENT AGENCY OF THE
CITY OF AZUSA
By:
Director of Finance
of the City of Azusa
ACCEPTED:
WILMINGTON TRUST, N.A.,
as Prior Trustee
By:
Jeffrey Lawrence Cornejo, Jr.
City Clerk
ACCEPTED with respect to Section 5:
WILMINGTON TRUST, N.A.,
as Trustee
By:
Authorized Officer
A-1
EXHIBIT A
FORM OF NOTICE OF PARTIAL OPTIONAL REDEMPTION
Redevelopment Agency of the City of Azusa
Amended and Restated Merged Central Business District
and West End Redevelopment Project Area
Taxable Tax Allocation Bonds,
2007 Series A and 2007 Series B
Date of Issuance: July 31, 2007
Maturity Date Amount Interest Rate *CUSIP No.
% 055031____
NOTICE IS HEREBY GIVEN that all of the above described bonds (the “Bonds”) have
been called for optional redemption on ___________, 2017 (the “Redemption Date”) pursuant to
Section 4.01(a) of the Trust Indenture, dated as of July 1, 2007, by and between the Successor
Agency to the Redevelopment Agency of the City of Azusa, as successor to the Redevelopment
Agency of the City of Azusa, and Wilmington Trust, N.A., as successor trustee (the “Trustee”),
at a redemption price equal to the principal amount thereof, plus accrued interest to the
redemption date, without premium (the “Redemption Price”). Interest will not accrue on the
Bonds after the redemption date.
Payment of the Redemption Price of the Bonds shall be made to the registered holder
thereof, Cede & Co., without presentation. However, should the registered holder elect to make
presentation, the Bonds are to be presented for payment at the office of the Trustee, Wilmington
Trust, N.A. 1100 N. Market Street, Rodney Square North, Wilmington, Delaware 1980-1615.
IMPORTANT NOTICE
Under the provisions of the Jobs and Growth Tax Relief Reconciliation Act of 2003 (the
“Act”), paying agents making payments of interest or principal on municipal securities may be
obligated to withhold a 28% tax from remittance to individuals who have failed to furnish the
paying agent with a certified and valid taxpayer identification number. Owners of the Bonds who
wish to avoid the imposition of the tax should submit certified taxpayer identification numbers
when presenting the Bonds for payment.
*The Undersigned shall not be held responsible for the selection or use of the CUSIP
number, nor is any representation made as to its correctness indicated in the Redemption
Notice. It is included solely for the convenience of the Holders.
Dated: ____, 2017
Successor Agency to the
Redevelopment Agency of the City of
Azusa
By: Wilmington Trust, N.A.,
as Trustee
B-1
EXHIBIT B
FORM OF NOTICE OF DEFEASANCE
Redevelopment Agency of the City of Azusa
Amended and Restated Merged Central Business District
and West End Redevelopment Project Area
Taxable Tax Allocation Bonds,
2007 Series A and 2007 Series B
Date of Issuance: July 31, 2007
Maturity Date Amount Interest Rate *CUSIP No.
$ % 055031___
NOTICE IS HEREBY GIVEN, by the Successor Agency to the Redevelopment Agency
of the City of Azusa (the “Successor Agency”) with respect to the above captioned bonds (the
“Bonds”), that the Bonds listed above (the “Prior Bonds”) have been defeased and discharged
under and within the meaning of the Trust Indenture, dated as of July 1, 2007 (the “Indenture”),
by and between the Successor Agency to the Redevelopment Agency of the City of Azusa, as
successor to the Redevelopment Agency of the City of Azusa, and Wilmington Trust, N.A., as
successor trustee (the “Trustee”). Funds for the payment of the redemption price of the Prior
Bonds on ___________, 2017 have been deposited in trust with the Trustee in accordance with
the Indenture, the Prior Bonds are no longer secured by a pledge of revenues under the
Indenture, and the Prior Bonds are now payable solely from the moneys set aside in trust as
described above and, if necessary, from other legally available funds of the Successor Agency.
The Successor Agency has irrevocably elected to redeem all of the outstanding Prior
Bonds on _____________, 2017, at a redemption price equal to the principal amount thereof,
plus accrued interest to the redemption date, without premium.
*The Successor Agency and the Trustee shall not be responsible for the selection or use
of the CUSIP numbers selected, nor is any representation made as to their correctness
indicated in the notice or as printed on any Refunded Bond. They are included solely for the
convenience of the holders.
Dated: ____, 2017
Successor Agency to the
Redevelopment Agency of the City of
Azusa
By: Wilmington Trust, N.A.,
as Trustee
C-1
EXHIBIT C
INVESTMENT DETAIL
City of Azusa Successor Agency
as of 7/6/17
Public Offering Savings Results
Refunding of Series
2007A (Taxable)
Refunding of Series
2007B (Tax‐Exempt) Total
Dated Date 10/18/2017 10/18/2017
Par Refunded 3,380,000 3,810,000 7,190,000
Call Date 11/17/2017 11/17/2017
DSRF Release ‐‐325,043 325,043
Refunding Par 3,635,000 3,650,000 7,285,000
Insurance Fee 37,497 37,652 75,149
Surety Fee 8,806 8,842 17,648
Issuance Expenses 149,481 149,664 299,145
All‐In TIC 4.73% 3.63% 3.88%
Gross Savings 96,792 1,190,444 1,287,237
PV Savings ($) 95,002 578,537 673,539
PV Savings (%) 2.81% 15.18% 9.37%
Annual Savings
Year
Refunding of Series
2007A (Taxable)
Refunding of Series
2007B (Tax‐Exempt) Total
2018 15,025 65,494 80,520
2019 18,583 58,436 77,019
2020 21,592 60,973 82,565
2021 19,245 58,903 78,147
2022 22,348 56,603 78,951
2023 58,890 58,890
2024 60,684 60,684
2025 58,084 58,084
2026 61,059 61,059
2027 58,809 58,809
2028 56,434 56,434
2029 58,815 58,815
2030 60,818 60,818
2031 61,408 61,408
2032 60,593 60,593
2033 59,340 59,340
2034 57,650 57,650
2035 60,448 60,448
2036 57,675 57,675
2037 59,333 59,333
City of Azusa Successor Agency
as of 7/6/17
Private Placement Savings Results
Refunding of Series
2007A (Taxable)
Refunding of Series
2007B (Tax‐Exempt) Total
Dated Date 10/18/2017 10/18/2017
Par Refunded 3,380,000 3,810,000 7,190,000
Call Date 11/17/2017 11/17/2017
DSRF Release ‐‐325,043 325,043
Refunding Par 3,495,000 3,600,000 7,095,000
Insurance Fee ‐‐ ‐‐ ‐‐
Surety Fee ‐‐ ‐‐ ‐‐
Issuance Expenses 56,902 59,169 116,071
All‐In TIC 5.45% 3.88% 4.31%
Gross Savings 25,375 1,415,950 1,441,324
PV Savings ($) 26,949 479,153 506,102
PV Savings (%) 0.80% 12.58% 7.04%
Annual Savings
Year
Refunding of Series
2007A (Taxable)
Refunding of Series
2007B (Tax‐Exempt) Total
2018 51,411 62,136 113,546
2019 ‐4,956 8,613 3,658
2020 ‐5,388 9,350 3,961
2021 ‐6,429 4,953 ‐1,477
2022 ‐3,284 5,449 2,165
2023 ‐5,979 5,655 ‐324
2024 5,566 5,566
2025 5,356 5,356
2026 4,985 4,985
2027 9,362 9,362
2028 8,487 8,487
2029 7,441 7,441
2030 6,181 6,181
2031 4,713 4,713
2032 7,988 7,988
2033 5,964 5,964
2034 313,000 313,000
2035 313,823 313,823
2036 313,850 313,850
2037 313,083 313,083
City of Azusa Successor Agency
as of 7/6/17
Private Placement Coverage Results
Fiscal Year
FY 2016 Pledged
Tax Revenues 2014A 2015A 2015B
Total Existing Debt
Service
Total 2017AB
Debt Service Total Debt Service
Debt Service
Coverage
6/30/2018 5,639,512.00 1,090,743.76 504,212.50 925,631.26 2,520,587.52 990,924.70 3,511,512.22 1.61x
6/30/2019 5,639,512.00 1,083,393.76 504,212.50 930,018.76 2,517,625.02 1,105,739.76 3,623,364.78 1.56x
6/30/2020 5,639,512.00 1,095,643.76 504,212.50 928,056.26 2,527,912.52 1,097,457.73 3,625,370.25 1.56x
6/30/2021 5,639,512.00 1,095,643.76 504,212.50 919,806.26 2,519,662.52 1,097,576.93 3,617,239.45 1.56x
6/30/2022 5,639,512.00 1,088,768.76 504,212.50 930,018.76 2,523,000.02 1,095,856.31 3,618,856.33 1.56x
6/30/2023 5,639,512.00 1,094,768.76 504,212.50 924,000.01 2,522,981.27 1,097,175.33 3,620,156.60 1.56x
6/30/2024 5,639,512.00 2,030,893.76 504,212.50 853,068.76 3,388,175.02 310,818.00 3,698,993.02 1.52x
6/30/2025 5,639,512.00 270,143.76 504,212.50 2,515,406.26 3,289,762.52 312,628.00 3,602,390.52 1.57x
6/30/2026 5,639,512.00 270,893.76 504,212.50 2,511,406.26 3,286,512.52 314,074.00 3,600,586.52 1.57x
6/30/2027 5,639,512.00 271,143.76 504,212.50 2,516,606.26 3,291,962.52 310,247.00 3,602,209.52 1.57x
6/30/2028 5,639,512.00 397,643.76 504,212.50 2,467,828.13 3,369,684.39 311,147.00 3,680,831.39 1.53x
6/30/2029 5,639,512.00 300,000.01 504,212.50 2,507,625.00 3,311,837.51 306,774.00 3,618,611.51 1.56x
6/30/2030 5,639,512.00 301,384.38 2,998,018.75 117,900.00 3,417,303.13 312,037.00 3,729,340.13 1.51x
6/30/2031 5,639,512.00 312,103.13 421,825.00 2,581,200.00 3,315,128.13 311,845.00 3,626,973.13 1.55x
6/30/2032 5,639,512.00 22,293.76 3,010,712.50 4,500.00 3,037,506.26 306,380.00 3,343,886.26 1.69x
6/30/2033 5,639,512.00 22,293.76 2,392,850.00 102,250.00 2,517,393.76 310,551.00 2,827,944.76 1.99x
6/30/2034 5,639,512.00 22,293.76 2,494,775.00 2,517,068.76 2,517,068.76 2.24x
6/30/2035 5,639,512.00 626,146.88 2,107,743.75 2,733,890.63 2,733,890.63 2.06x
6/30/2036 5,639,512.00 2,281,800.00 2,281,800.00 2,281,800.00 2.47x
6/30/2037 5,639,512.00 585,781.25 585,781.25 585,781.25 9.63x