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HomeMy WebLinkAboutCity Council - 97-59 RESOLUTION NO. 97-59 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HUNTINGTON BEACH, CALIFORNIA PROVIDING FOR THE ISSUANCE AND SALE OF 1997-98 TAX AND REVENUE ANTICIPATION NOTES THEREFOR WHEREAS, pursuant to Section 53850, et sea. of the Government Code of the State of California (the "Act"), the Council of the City of Huntington Beach (the "Council") has found and determined that the sum of up to $20,000,000 is needed for the requirements of the City of Huntington Beach, California (the "City") to satisfy obligations payable from the General Fund of the City, and that it is necessary that an amount up to said sum be borrowed for such purpose at this time by the issuance of notes therefor in anticipation of the receipt of taxes, income, revenue, cash receipts and other moneys to be received by the City for the General Fund of the City during or allocable to Fiscal Year 1997-1998; and NOW, THEREFORE, the Council of the City of Huntington Beach hereby finds, determines, declares and resolves as follows: Section 1 . Recitals True and Correct. All of the recitals herein set forth are true and correct, and the Council so finds and determines. Section 2. Limitation on Maximum Amount. The principal amount of notes issued pursuant hereto, when added to the interest payable thereon, shall not exceed eighty-five percent (85%) of the estimated amount of the uncollected taxes, income, revenue, cash receipts and other moneys of the City for the General Fund of the City attributable to Fiscal Year 1997-1998, and available for the payment of said notes and interest thereon. Section 3. Authorization of Notes, Terms. Solely for the purpose of anticipating taxes, income, revenues, cash receipts and other moneys to be received by the City for the General Fund of the City during or allocable to Fiscal Year 1997-1998, and not pursuant to any common plan of financing, the City hereby determines to and shall borrow the aggregate principal sum of not to exceed $20,000,000. Such borrowing shall be in effect by issuance of notes under Section 53850, et sea. of the Government Code of the State of California, designated "City of Huntington Beach 1997-98 Tax and Revenue Anticipation Notes" (the "Notes"), to be numbered from 1 consecutively upward in order of issuance, to be in denominations of Five Thousand Dollars ($5,000) and multiples thereof, to be dated their date of issue, to mature (without option of prior redemption) no later than twelve (12) months from said date of issue as set forth in the Notice Inviting Bids and to bear interest, payable at maturity and computed on a 30-day monthl360-day year basis, at the rate or rates determined in accordance with the Notice Inviting Bids referred to below. Both the principal of and interest on the Notes shall be payable, only upon surrender thereof, in lawful money of the United States of America, at the office of the Treasurer of the City of Huntington Beach in Huntington Beach, California (the "Paying Agent"). Section 4. Form of Notes; Book Entry Only System. The Notes shall be issued without coupons and shall be substantially in the form and substance set forth in Exhibit A attached hereto and by reference incorporated herein, the balance in said form to be filled in with appropriate words and figures. Except as provided below, the owner of all of the Notes shall be The Depository Trust Company, New York, New York ("DTC") and the Notes shall be registered in the name of CEDE & Co., as nominee for DTC. The Notes shall be initially executed and delivered in the form of a single fully registered Note in the full aggregate principal amount of the Notes. The City may treat DTC (or its nominee) as the sole and exclusive owner of the Notes registered in its name for all purposes of this Resolution, and the City shall not be affected by any notice to the contrary. The City shall not have any responsibility or obligation to any participant of DTC (a "Participant"), any person claiming a beneficial ownership interest in the Notes under or through DTC or any Participant, or any other person which is not shown on the register of the Paying Agent as being a owner, with respect to the accuracy of any records maintained by DTC or any Participant or the payment or failure to pay by DTC or any Participant of any amount in respect of the principal or interest with respect to the Notes. The Paying Agent shall pay all principal and interest with respect to the Notes only to DTC, and all such payments shall be valid and effective to fully satisfy and discharge the City`s obligations with respect to the principal and interest with respect to the Notes to the extent of the sum or sums so paid. Except under the conditions noted below, no person other than DTC shall receive a Note. Upon delivery by DTC to the Paying Agent of written notice to the effect that DTC has determined to substitute a new nominee in place of CEDE & Co., the term "CEDE & Co." in this Resolution shall refer to such new nominee of DTC. If the City determines that it is in the best interest of the beneficial owners that they be able to obtain Notes and delivers a written certificate to DTC to that effect, DTC shall. notify the Participants of the availability through DTC of Notes. In such event, the City shall issue, transfer and exchange Notes as requested by DTC and any other owners in appropriate amounts. DTC may determine to discontinue providing its services with respect to the Notes at any time by giving notice to the City and discharging its responsibilities with respect thereto under applicable law. Under such circumstances (if there is no successor securities depository), the City shall provide for the printing of definitive Notes and shall use its best efforts to deliver definitive Notes to the Participants for redistribution to the beneficial owners. Whenever DTC requests the City to do so, the City will cooperate with DTC in taking appropriate action after reasonable notice to (a) make available one or more separate Notes evidencing the Notes to any Participant having Notes credited to its DTC account or (b) arrange for another securities depository to maintain custody of certificates evidencing the Notes. Notwithstanding any other provision of this Resolution to the contrary, so long as any Note is registered in the name of CEDE & Co., as nominee of DTC, all payments with respect to the principal and interest with respect to such Note and all notices with respect to such Note shall be made and given, respectively, to DTC as provided in the Representation Letter delivered on the date of issuance of the Notes. Section 5. Approval of Notice Inviting Bids. The Notes shall be sold at a public sale upon the direction of the Deputy City Administrator/Administrative Services, said public sale to be at the time and place and upon the terms provided in the Official Notice Inviting Bids for the Notes, which Notice of Inviting Bids shall be substantially in the form set forth as Exhibit 6 hereto and by reference incorporated herein (the "Notice Inviting Bids"). Sealed bids for the purchase of the Notes shall be received by the Treasurer at the time and place set forth in said Notice Inviting Bids. The Deputy City Administrator/Administrative Services is authorized to distribute copies of said Notice Inviting Bids. The City hereby authorizes publication in THE BOND BUYER of a Notice of Intention To Sell (the "Notice of Intention to Sell") in substantially 2 the form attached hereto as Exhibit C and made a part hereof by this reference, said Notice ., of Intention to Sell being required to be made in a financial publication generally circulated throughout the State at least 15 days prior to the award of the Notes at competitive bid pursuant to Section 53692 of the Government Code. The Deputy City Administrator/Administrative Services is hereby authorized to award the Notes in an aggregate principal amount not exceeding the aforesaid sum to the bidder for the Notes providing the lowest net interest rate as noticed in the Notice Inviting Bids, provided that the interest rate on the Notes shall not exceed five percent (5%) per annum. Upon award of the Notes to the successful bidder, (a) the Deputy City Administrator/Administrative Services is hereby authorized and directed to attach to this Resolution a certificate stating the principal amount of the Notes, the maturity date of the Notes and the interest rate on the Notes, and (b) the City officials identified in Section 9 herein are authorized and directed to execute and deliver the Notes to the successful bidder. In the event two or more bids setting forth identical net interest rates are received and aggregating in excess of the principal amount of the Notes, the Deputy City Administrator/Administrative Services shall offer the Notes to such bidders on a pro-rata basis, to the extent practicable. Section 6. Use of Note Proceeds. The moneys so borrowed shall be deposited in the General Fund of the City and used and expended by the City for any purpose for which it is authorized to use and expend funds from the General Fund of the City. Section 7. Pledged Moneys. The principal amount of the Notes, together with the interest thereon, shall be payable from taxes, income, revenue, cash receipts and other moneys which are received by the City for the General Fund of the City for the Fiscal Year 1997-1998. As security for the payment of the principal of and interest on the Notes the City hereby pledges: an amount not to exceed the first $9,225,000.00 of unrestricted moneys to be received by the City in the month ending April 30, 1998; an amount not to exceed the first $4,615,000.00 of unrestricted moneys to be received by the City in the month ending July 31 , 1998; and an amount not to exceed the first $4,610,000.00 of unrestricted moneys to be received by the City in the month ending August 31 , 1998, and an amount equal to the interest payable on the Notes at maturity, from unrestricted moneys to be received by the City in the month ending September 30, 1998 (such pledged amounts being hereinafter called the "Pledged Revenues"), and the principal of the Notes and the interest thereon shall constitute a first lien and charge thereon and shall be payable from the Pledged Revenues, and to the extent not so paid shall be paid from any other moneys of the City lawfully available therefor. In the event there are insufficient unrestricted moneys received by the City to permit the deposit into the Repayment Fund, (as hereinafter defined) of the full amount of the Pledged Revenues to be deposited into such Repayment Fund during any accounting period used by the City, by the next to last business day of such accounting period, then the amount of any deficiency shall be satisfied and made up from any other moneys of the City lawfully available for the repayment of the Notes and interest thereon. The term "unrestricted moneys" shall mean taxes, income, revenue, cash receipts and other moneys, intended as receipts for the General Fund of the City and which are generally available for the payment of current expenses, capital expenditures and other obligations or indebtedness of the City. Section 8. Del) sit of Pled a Revenues in Re a ment Fund. There is hereby created a special fund to be held by the Treasurer of the City, as Paying Agent, designated the "City of Huntington Beach 1997-1998 Tax and Revenue Anticipation Notes Repayment Fund" (hereinafter referred to as the "Repayment Fund"). Any moneys placed in the 3 Repayment Fund shall be applied as directed in this Resolution and shall be held solely for the benefit of the owners of the Notes until the Notes and all interest thereon are paid or until provision has been made for the payment of the Notes at maturity with interest to maturity; provided however, that any interest earned on amounts deposited in the Repayment Fund may periodically be transferred to the City`s General Fund. From the date this Resolution takes effect, all Pledged Revenues shall, during the months in which received, be deposited in the Repayment Fund. On the date of maturity of the Notes, the moneys in the Repayment Fund shall be used, to the extent necessary, to pay the principal of and interest on the Notes. Any moneys remaining in the Repayment Fund after the Notes and the interest thereon have been paid, or provision for such payment has been made, shall be transferred to the City`s General Fund. Moneys in the Repayment Fund shall, to the greatest extent possible, be invested as permitted by California Government Code Section 53601 except that no such investment shall have a maturity date later than the maturity date of the Notes. The proceeds of any such investment shall be deposited by the Paying Agent in the Repayment Fund. Section 9. Execution of Notes. The City Administrator or the Deputy City Administrator/Administrative Services of the City are hereby authorized to sign the Notes by manual or facsimile signature, and the City Clerk of the City is hereby authorized to countersign the same by manual or facsimile signature and to affix the seal of the City thereto, and such signing and sealing shall constitute a valid and sufficient execution of the Notes. Said officers are hereby authorized to cause the blank spaces thereof to be filled in as may be appropriate, and to deliver the Notes to the successful bidder in accordance with the Notice of Sale. Section 10. Covenant as to Reoresentatio_ns. It is hereby covenanted and warranted by the City that all representations and recitals contained in this Resolution are true and correct, and that the City and its appropriate officials have duly taken all proceedings necessary to be taken by them, and will take any additional proceedings necessary to be taken by them, for the levy, collection and enforcement of the taxes, income, revenue, cash receipts and other moneys pledged hereunder in accordance with law and for carrying out the provisions of this Resolution. Section 11 . Transfer of Notes. If the City determines to no longer maintain the book entry only status of the Notes, if DTC determines to discontinue providing such services and no successor securities depository is named or if DTC requests the City to deliver Note certificates to particular DTC Participants, any Note may, in accordance with its terms, be transferred, upon the books required to be kept pursuant to the provisions of Section 13 hereof, by the person in whose name it is registered, in person or by his duly authorized attorney, upon surrender of such Note for cancellation at the office of the City, accompanied by delivery of a written instrument of transfer in a form approved by the City, duly executed. Whenever any Note or Notes shall be surrendered for transfer, the City shall execute and deliver a new Note or Notes, for like aggregate principal amount. Section 12. Exchange of Notes. Notes may be exchanged at the office of the City for a like aggregate principal amount of Notes of authorized denominations and of the same maturity. 4 Section 13. Note Register. The City shall keep or cause to be kept sufficient books for the registration and transfer of the Notes if the book entry only system is no longer in effect and, in such case, the City shall register or transfer or cause to be registered or transferred, on said books, Notes as herein before provided. While the book entry only system is in effect, such books need not be kept as the Notes will be represented by one Note registered in the name of Cede & Co., as nominee for DTC. Section 14. Temporary Notes. The Notes may be initially issued in temporary form exchangeable for definitive Notes when ready for delivery. The temporary Notes may be printed, lithographed or typewritten, shall be of such denominations as may be determined by the City, and may contain such reference to any of the provisions of this Resolution as may be appropriate. Every temporary Note shall be executed by the City upon the same conditions and in substantially the same manner as the definitive Notes. If the City issues temporary Notes, it will execute and furnish definitive Notes without delay, and thereupon the temporary Notes may be surrendered, for cancellation, in exchange therefor at the office of the City and the City shall deliver in exchange for such temporary Notes an equal aggregate principal amount of definitive Notes of authorized denominations. Until so exchanged, the temporary Notes shall be entitled to the same benefits pursuant to this Resolution as definitive Notes executed and delivered hereunder. Section 15. Notes_Mutilated, Lost, Destroyed or Stolen. If any Note shall become mutilated, the City, at the expense of the registered owner of said Note, shall execute and deliver, a new Note of like maturity and principal amount in exchange and substitution for the Note so mutilated, but only upon surrender to the City of the Note so mutilated. Every mutilated Note so surrendered to the City shall be canceled by it and delivered to, or upon the order of, the City. if any Note shall be lost, destroyed or stolen, evidence of such loss, destruction or theft may be submitted to the City and, if such evidence be satisfactory to the City and indemnity satisfactory to it shall be given, the City, at the expense of the registered owner, shall execute and deliver a new Note of like maturity and principal amount in lieu of and in substitution for the Note so lost, destroyed or stolen. The City may require payment of a sum not exceeding the actual cost of preparing each new Note issued under this Section 15 and of the expenses which may be incurred by the City in the premises. Any Note issued under the provisions of this Section 15 in lieu of any Note alleged to be lost, destroyed or stolen shall constitute an original additional contractual obligation on the part of the City whether or not the Note so alleged to be lost, destroyed or stolen be at anytime enforceable by anyone, and shall be equally and proportionately entitled to the benefits of this Resolution with all other Notes issued pursuant to this Resolution. Section 16. Tax Covenants. lay No Arbitrage. The City shall not take, nor permit nor suffer to be taken any action with respect to the proceeds of the Notes, 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 Notes (the "Closing Date") would have caused the Notes to be "arbitrage bonds" within the meaning of Section 148 of the Internal Revenue Code of 1986, as amended (the "Code"). 5 (b) Rebate Re uirement. The City 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 Notes. (c) Private Activity Bond Limitation. The City shall assure that proceeds of the Notes are not so used as to cause the Notes to satisfy the private business tests of Section 141(b) of the Code or the private loan financing test of Section 141 (c) of the Code. (d) Federal Guarantee Prohibition. The City 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 Notes to be "federally guaranteed" within the meaning of Section 149(b) of the Code. (e) Maintenance of Tax-Exemption. The City shall take all actions necessary to assure the exclusion of interest on the Notes from the gross income of the owners of the Notes to the same extent as such interest is permitted to be excluded from gross income under the Code as in effect on the Closing Date. Section 17. Preliminary Official Statement and Official Statement. The Preliminary Official Statement, in substantially the form presented at this Council meeting at which this Resolution is adopted, is incorporated into this Resolution by reference and is hereby approved for distribution and use in connection with the offering and sale of the Notes. The City Administrator or Deputy City Administrator/Administrative Services is hereby authorized to execute an appropriate certificate stating his determination that the. Preliminary Official Statement has been deemed nearly final within the meaning of Rule 15c2-12 of the Securities Exchange Act of 1934. The facts contained in the Preliminary Official Statement are true and correct in all material respects and the Preliminary Official Statement omits no statement of a material fact necessary to make the Preliminary Official Statement not misleading in light of the circumstances under which it was made, provided, however, that the Preliminary Official Statement does not contain final interest rates with respect to the Notes and that amounts set forth therein are subject to change. The City Administrator or Deputy City Administrator/Administrative Services or other qualified officer of the City is authorized to approve corrections and additions to the Preliminary Official Statement,acting with the advice of the Financing Consultant and Bond Counsel, by supplement or amendment thereto, or otherwise as may be appropriate, provided either that any such corrections or additions shall be necessary to causQ the information contained in the Preliminary Official Statement to conform with facts material to the Notes or to requirements of proceedings of this City, or that such corrections or additions are of form rather than of substance. The City Administrator or Deputy City Administrator/Administrative Services is authorized to approve a Final Official Statement for distribution and use in connection with the offering and sale of the Notes. Section 18. Continuing Disclosure. The City hereby covenants and agrees that it will comply with and carry out all of the provisions of that certain Continuing Disclosure Certificate substantially in the form set forth as Exhibit D hereto and by reference incorporated herein, executed by the City and dated the date of issuance and delivery of the Notes, as originally executed and as it may be amended from time to time in accordance with the terms thereof. Any Noteholder may take such actions as may be necessary and appropriate, including 6 seeking mandate or specific performance by court order, to cause the City to comply with its obligations under this Section. Noncompliance with this Section shall not result in acceleration of the Notes. Section 19. Other Actions. All actions heretofore taken by the officers and agents of the City with respect to the sale and issuance of the Notes are hereby approved, confirmed and ratified, and the officers of the City are hereby authorized and directed, for and in the name and on behalf of the City, to do any and all things and take any and all actions and execute and deliver any and all certificates, agreements and other documents, which they, or any of therm, may deem necessary or advisable in order to consummate the lawful issuance and delivery of the Notes in accordance with this Resolution. Section 20. Aggointment of_Bond Counsel. Musick, Peeler & Garrett LLP is hereby designated as the bond counsel to the City in connection with the issuance of the Notes in accordance with the letter proposal on file with the City Attorney. Section 21. This Resolution shall be effective immediately upon its adoption. PASSED AND ADOPTED by the City Council of the City of Huntington Beach at a regular meeting thereof held on the 2nd day of _September, 1997. Z Mayor ATTEST: APPROVED AS TO FORM: City Cler City Attorney 9-rr-�I REVIEWED AND APPROVED: INITIATED AND APPROVED: City Administrator Deputy City Administrat ,/ Administrative Services-' 7 EXHIBIT A FORM OF NOTE No. 97-59 $ CITY OF HUNTINGTON BEACH COUNTY OF ORANGE STATE OF CALIFORNIA 1997-98 TAX AND REVENUE ANTICIPATION NOTE INTEREST RATE: MATURITY DATE: ISSUE DATE: CUSIP: REGISTERED OWNER: CEDE & CO. PRINCIPAL SUM: Unless this Note is presented by an authorized representative of The Depository Trust Company to the issuer or its agent for registration of transfer, exchange or payment, and any Note 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. The CITY OF HUNTINGTON BEACH, Orange County, State of California (the "City"), acknowledges itself indebted, and promises to pay, to the Registered Owner stated above, or registered assigns (the "Owner"), on the Maturity Date stated above, the Principal Sum stated above, in lawful money of the United States of America, and to pay interest thereon in like lawful money at the rate per annum stated above, payable on the Maturity Date stated above, calculated on the basis of a 360-day year composed of twelve 30-day months. Both the principal of and interest on this Note shall be payable at maturity to the Owner. It is hereby certified, recited and declared that this Note is one of an authorized issue of notes in the aggregate principal amount of ($ ), all of like tenor, made, issued pursuant to and by authority of Resolution No. 97-59 of the Council of the City duly adopted on September 2.,_ 1997 under and by authority of Article 7.6 (commencing with Section 53850) of Chapter 4, Part 1, Division 2, Title 5, California Government Code, and that all acts, conditions and things required to exist, happen and be performed precedent to and in the issuance of this Note have existed, happened and been performed in regular and due time, form and manner as required by law, this Note, together with all other indebtedness and obligations of the City, does not exceed any limit prescribed by the Constitution or statutes of the State of California. A-1 The principal amount of the Notes, together with the interest thereon, shall be payable from taxes, income, revenues, cash receipts and other moneys which are received by the City for the General Fund of the City for the Fiscal Year 1997-1998. As security for the payment of the principal of and interest on the Notes the City has pledged: an amount equal to the first $ of unrestricted moneys (as the term is defined hereinafter) to be received by the City in the month ending April 30, 1998; an amount equal to the first of unrestricted moneys to be received by the City in the month ending July 31 , 1998; an amount equal to the first $ of unrestricted moneys to be received by the City in the month ending August 31 , 1998; and an amount equal to the interest payable on the Notes at maturity, from unrestricted moneys to be received by the City in the month ending September 30, 1998 (such pledged amounts being hereinafter called the "Pledged Revenues"). The principal of the Notes and the interest thereon shall constitute a first lien and charge on the Pledged Revenues and shall be payable from the Pledged Revenues and, to the extent not so paid, shall be payable from any other moneys of the City lawfully available therefor. The term "unrestricted moneys" shall mean taxes, income, revenue and other moneys intended as receipts for the General Fund of the City and which are generally available for the payment of current expenses and other obligations of the City. The Notes are issuable as fully registered notes, without coupons, in denominations of $5,000 each or any integral multiple thereof. Subject to the limitations and conditions as provided in the Resolution, the Notes may be exchanged for a like aggregate principal amount of Notes of other authorized denominations and of the same maturity. The Notes are not subject to redemption prior to maturity. This Note is transferrable by the Owner hereof, but only under the circumstances, in the manner and subject to the limitations provided in the Resolution. Upon registration of such transfer a new Note or Notes, 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 City may treat the Owner hereof as the absolute owner hereof for all purposes, and the City shall not be affected by any notice to the contrary. A-2 IN WITNESS WHEREOF, the City of Huntington Beach has caused this Note to be executed by the manual or facsimile signatures of either the City Administrator or the Deputy City Administrator/Administrative Services and countersigned by the manual or facsimile signature of the City Clerk, and has caused a facsimile of its official seal to be printed hereon all as of the Issue Date stated above. CITY OF HUNTINGTON BEACH By City Administrator or Deputy City Administrator/ Administrative Services (SEAL} Countersigned City Clerk A-3 EXHIBIT B NOTICE INVITING BIDS CITY OF HUNTINGTON BEACH (ORANGE COUNTY, CALIFORNIA) 1997 TAX AND REVENUE ANTICIPATION NOTES NOTICE IS HEREBY GIVEN that sealed bids for the purchase of $ aggregate principal amount of the City of Huntington Beach (Orange County, California) 1997 Tax and Revenue Anticipation Notes (the "Notes" herein) will be received and opened by a representative of the City of Huntington Beach, California (herein the "City") at the place and up to the time below specified. Bids will only be accepted via facsimile (see "FORM OF BIDS" herein). TIME: 1 0:00 am. (Pacific Daylight Savings Time), , 1997 PLACE: Rod Gunn Associates, Inc. Telephone (562) 598-7677 3010 Old Ranch Parkway, Facsimile (562) 431-5446 Suite 330 Seal Beach, CA 90740 OPENING OF THE BIDS AND AWARD OF NOTES: The bids will be opened at 10:00 am., 1997 at the above-stated location and are expected to be awarded by a representative of the City later that same day. OFFICIAL STATEMENT: The City has caused a preliminary official statement to be prepared relating to the Notes (the "Preliminary Official Statement"), copies of which may be obtained at the office of the City's Financing Consultant, Rod Gunn Associates, Inc., 3010 Old Ranch Parkway, Suite 330, Seal Beach, California 90740, telephone (310) 598-7677. The Preliminary Official Statement is in a form deemed final by the City for the purposes of SEC Rule 1 5c2-1 2(b)(1 ), but is subject to revision, amendment and completion in a final official statement (the "Official Statement"). The City will furnish the successful bidder with a reasonable number of copies of the final Official Statement within seven (7) business days of award of the Notes without charge. THE NOTES DATE; DENOMINATION: The Notes are to be delivered as a single fully registered Note in the denomination of $ , dated as of , 1997. When delivered, the Notes will be registered in the name of The Depository Trust Company, New York, New York ("DTC"), or its nominee. DTC will act as securities depository for the Notes. Individual purchases of Notes will be made in book entry from only in the principal amounts of $5,000 each or any B-1 integral thereof. Purchasers of the Notes will not receive certificates representing their ownership interest in the Notes purchased. Bidders are referred to the Preliminary Official Statement for particulars related to the Notes. MATURITY: The Notes will mature on REDEMPTION: The Notes are not subject to redemption prior to maturity. INTEREST: The Notes will bear interest (computed on the basis of a 360-day year of twelve 30-day months) from their date at the rate to be fixed upon the sale thereof, but not to exceed 5% per annum. PAYMENT: Principal of and interest on the Notes at maturity will be paid at maturity by the City to DTC which will credit the account of the successful bidder as a participant in the DTC system. PURPOSE: Issuance of the Notes will provide moneys to help meet current 1997/98 City General Fund expenditures for the fiscal of the City ending September 30, 1998, including current expenses, capital expenditures and the discharge of other obligations or indebtedness of the City. SECURITY: The Notes are authorized to be issued pursuant to Article 7.6, Chapter 4, Part 1 , Division 2,Title 5, Sections 53850 et sea. of the Government Code of the State of California (the "Government Code") and Resolution No.97-59 adopted by the City authorizing the issuance thereof. Payment of the principal of and interest on the Notes is secured by a pledge of certain unrestricted taxes, income, revenue, cash receipts.and other moneys to be received by the City (the "Pledged Revenues") in the months of April, 1998 and July, 1998 through September, 1998, as more particularly described in the Preliminary Official Statement. Accordingly, pursuant to Section 53856 of the Government Code, the Notes and the interest therein are a lien and charge against, and are payable from, such Pledged Revenues. In addition to such Pledged Revenues, pursuant to Section 53857 of the Government Code, the Notes and the interest thereon are general obligations of the City payable from the taxes, income, revenue, cash receipts and other moneys of the City attributable solely to fiscal year 1997/98 and legally available for payment thereof. In accordance with the terms of the Resolution, the City Treasurer is required to establish in the City's General Fund the 1997 Tax and Revenue Anticipation Notes Repayment Account (the "Repayment Account"), and to deposit into the Repayment Account the Pledged Revenues for the payment of the Notes. Moneys in the Repayment Account will be retained therein until applied to the payment of the principal of and interest on the Notes, provided that any interest earned on amounts in the Repayment Account shall be periodically transferred to the City's General Fund. The Resolution provides that such amounts may not be used for any other purposes, although they may be invested as permitted by the Government Code. Any balance in the Repayment Account on or after September 30, 1998 in excess of the amount needed to repay the Notes and the interest thereon will be released to the City's General Fund. B-2 Bidders are referred to the Preliminary Official Statement for further particulars related to the Notes. TERMS OF SALE STATED INTEREST RATE: The stated interest rate bid for the Notes may not exceed five percent (5%) per annum. Bidders must specify the rate of interest which shall be payable with respect to the Notes stricken in accordance with the following conditions: (a) The interest rate specified in any bid must be in a multiple of one- twentieth of one percent (1120%) or one-eighth of one percent (1/8%) per annum; (b) The Notes shall not bear more than one rate of interest; (c) Interest with respect to the Notes shall be computed from their date to their stated maturity date at the interest rate specified in the bid; and (d) Any premium must be paid as part of the purchase price, and no bid will be accepted which contemplates the cancellation or the waiver of any interest or other concession by the bidder as a substitute for payment in full of the purchase price. AWARD: The Notes will be sold for cash only. All bids must be for not lesthan all of the Notes hereby offered for sale and each bid shall state the total price offered for the Notes, the premium, if any, and the interest rate (which shall not exceed those specified herein) at which the bidder offers to buy the Notes. HIGHEST BIDDER: The Notes will be awarded to the highest responsible bidder with the lowest net interest cost, considering the interest rate specified and the premium offered, if any. No bid for less than par will be accepted. RIGHT OF REJECTION: The City reserves the right, in its discretion, to reject any and all bids and, to the extent not prohibited by law, to waive any irregularity or informality in any bid. PROMPT AWARD: The City will take action awarding the Notes or rejecting all bids not later than twenty-four (24) hours after the expiration of the time herein prescribed for the receipt of bids; provided that the award may be made after the expiration of the specified time if the bidder shall not have given the City notice in writing of the withdrawal of such bid. DELIVERY OF OFFICIAL STATEMENT: The City will furnish the successful bidder with a reasonable number of copies of the final Official Statement within seven (7) business days after award of the Notes, without charge. PLACE OF DELIVERY: Delivery of the Notes will be made to DTC for the account of the successful bidder. Payment for the Notes shall be made in cash or Federal Reserve Bank funds which are immediately available to the City. PROMPT DELIVERY; CANCELLATION FOR LATE DELIVERY: It is expected that the Notes will he delivered to the successful bidder on or about , 1997.The successful bidder shall have the right, at its option, to cancel the contract of purchase if the City shall fail to execute B-3 the Notes and tender them for delivery within sixty (60) days from the date of sale thereof, and in such event the successful bidder shall be entitled to the return of the check (if any) accompanying its bid. LIST ACCOUNT MEMBERS: Bidders are requested to list in the place and in the manner set forth in the Bid Form the members of the bidding group on whose behalf the bid is made. The apparent willing bidder will be required to verify such list or to provide an updated list via facsimile prior to the award of the bids. EQUAL OPPORTUNITY: It is the policy of the City to provide minority business enterprises (MBEs), women business enterprises (WBEs) and all other business enterprises an equal opportunity to participate in the performance of all City Contracts. Bidders are requested to assist the City in implementing this policy by taking all reasonable steps to include all business enterprises, including MBEs and WBEs in any syndicate submitting a bid. FORM OF BID: Bach bid must be unconditional and in accordance with the terms and conditions set forth herein, or permitted herein, and must be submitted on, or in substantial accordance with, bid forms provided by the City. Bids will only be accepted via facsimile. Bid forms should be sent via facsimile to Rod Gunn Associates, Inc. at (562) 431-5446, and must be time-stamped by the receiving facsimile machine no later than 10:00 am. (Pacific Daylight Savings Time) on I , 1997. Telephone confirmation of the receipt of the bid form is suggested and may be made at Rod Gunn Associates, Inc. (562) 598-7677. All responsibility for any delay in receipt of the bid form or illegibility of the bid form received caused by this method of transmission will be that of the bidder. The authorized representative of the City has the right and responsibility to reject a bid if it is not received and confirmed at the place and time, in legible form, and in the manner described herein. BID CHECK: No bid check is required with submittal of the bid. The City reserves the right to require, prior to award to the highest bidder, a certified or cashier's check drawn on a responsible bank or trust company in the amount of $15,000 payable to the order of the City of Huntington Beach, as a guaranty that the bidder will accept and pay for the Notes in accordance with the terms of the bid. The check (if requested), shall be held by the City and returned to the successful bidder upon tender of the purchase price for the Notes at the closing for the Notes, or, if such proposal is accepted but not performed, unless such failure of performance shall be caused directly by any act or omission of the City in satisfaction of the damages the City suffers by reason of the successful bidder's failure to perform hereunder in accordance with the terms of sale. Each bidder and the City agrees that such damages are incapable of calculation and that the amount of the check is appropriate as liquidated damages for such nonperformance of the successful bidder. CHANGE IN TAX-EXEMPT STATUS: At any time before the Notes are tendered for delivery, the successful bidder may disaffirm and withdraw the proposal if interest on the Notes received by private owners from securities of the same type and character shall be declared to be includable in gross income under present federal income tax laws in a manner not described in the section "Tax Matters" in the Preliminary Official Statement, either by a ruling of the Internal Revenue Service or by a decision of any federal court, or shall be declared includable in gross income or shall be required to be taken into account in computing personal federal income taxes by the terms of any federal income tax law enacted subsequent to the date of this notice. B-4 CLOSING PAPERS: Each proposal will be understood to be conditioned upon the City furnishing to the successful bidder, without charge, concurrently with payment for and delivery of the Notes, the following closing papers each dated the date of delivery: (a) Legal Opinion. The legal opinion of Musick, Peeler & Garrett LLP, Los Angeles, California, Bond Counsel, approving the validity of the Notes and the Resolution and stating that interest on the Notes is excluded from gross income for federal income tax purposes of the United States of America under existing law (see Preliminary Official Statement for a description of certain qualifications with respect to taxes on corporations and others), and that such interest is also exempt from personal income taxes of the State of California under existing law, will be furnished the successful bidder at the time of delivery of the Notes, at the expense of the City. A copy of the opinion of Musick, Peeler & Garrett LLP, Los Angeles, California, certified by an officer of the City by such officer's facsimile signature, will be printed on the back of or delivered with each Note. No charge will be made to the purchaser for such printing or certification. (b) No Arbitrage Certificate. A Certificate of the City certifying that on the basis of the facts, estimates and circumstances in existence on the date of delivery, it is not expected that the proceeds of the Notes will be used in a manner that would cause the Notes to be "arbitrage bonds". (c) No Litigation Certificate. At the time of payment for and delivery of the Notes, the City will furnish the successful bidder a Certificate that there is no litigation pending affecting the validity of the Resolution or the Notes. (d) Certificate Concerning Official Statement. A Certificate of the City. signed by an appropriate officer, acting in his official capacity, to the effect that to the best of such officer's knowledge and belief, and after reasonable investigation: (a) neither the Official Statement nor any amendment or supplement thereto contains any untrue statement of a material fact or omits to state any material fact necessary to make the statements therein, in light of the circumstances in which they were made, not misleading; (b) since the date of the Official Statement no event has occurred which should have been set forth in an amendment or supplement to the Official Statement which has not been set forth in such an amendment or supplement which would make the statements therein, in light of the circumstances in which they were made misleading; nor (c) has there been any material adverse change in the operation or financial affairs of the City since the date of such Official Statement. CUSIP NUMBERS: CUSIP identification numbers will be requested by the City and will be printed on the Notes. All expenses in relation to the printing of CUSIP numbers on the Notes shall be paid for by the City; provided, however, that the CUSIP Service Bureau charge for the assignment of said numbers shall be the responsibility of and shall be paid for by the purchaser. CALIFORNIA DEBT INVESTMENT AND ADVISORY COMMISSION FEE: Attention of bidders is directed to California Government Code Section 8856, which provides that the purchaser of the Notes will be charged for the California Debt Investment and Advisory Commission fee relating to the Notes. B-5 PURCHASER'S CERTIFICATE: On the date of delivery of the Notes, the successful bidder will be required to furnish a certificate certifying the price at which the Notes were reoffered to the public and the price at which a substantial amount of the Notes were sold. GIVEN by order of the City of Huntington Beach made on 1997. B-6 BID FOR THE PURCHASE OF S CITY OF HUNTINGTON BEACH (ORANGE COUNTY, CALIFORNIA) 1997 TAX AND REVENUE ANTICIPATION NOTES To: City of Huntington Beach 1997 Huntington Beach, California On behalf of a group which we have formed and pursuant to the Notice Inviting Bids hereinafter mentioned, we offer to purchase all of the dollars($ )aggregate principal amount of the Notes designated as "City of Huntington Beach (Orange County, California) 1997 Tax and Revenue Anticipation Notes" (the "Notes"), maturing on and bearing interest at the following rate: Principal Amount Maturity Interest Rate $ and to pay therefor the aggregate sum of$ *which represents the aggregate principal amount of the Notes plus a premium of$ This bid is made subject to all the terms and conditions of the Notice Inviting Bids, all of which terms and conditions are made a part hereof as though fully set forth in full in this bid. As specified in the Notice Inviting Bids, this bid is subject to acceptance not later than twenty-four(24) hours after the expiration of the time for the receipt of bids, and the opinion of Musick, Peeler&Garrett LLP, Los Angeles, California, approving the validity of the Notes will be furnished us (if we are the successful bidder) at the time of the delivery of the Notes at the expense of the City of Huntington Beach. There is submitted herewith a memorandum(which shall not constitute a part of this bid)stating the total net interest cost in dollars on the Notes during the life of the issue under this bid. Other members of the Syndicate are: Respectfully submitted, (Firm) By: (Representative) *$ plus premium, if any. Telephone No. MEMORANDUM OF INTEREST COST The total net interest cost on the Notes during the life of the issue to October 1, 1998, under the above bid is $ and the effective net interest rate is %. EXHIBIT C NOTICE OF INTENTION TO SELL $ (Approximate) CITY OF HUNTINGTON BEACH (ORANGE COUNTY, CALIFORNIA) 1997 TAX AND REVENUE ANTICIPATION NOTES NOTICE IS HEREBY GIVEN, pursuant to California Government Code Section 53692 that the City of Huntington Beach, California (the "City") intends to sell $_ principal amount of its 1997 Tax and Revenue Anticipation Notes, at a public sale. Facsimile bids will be received and opened by a representative of the City at the place and up to the time below specified. Bids will only be accepted via facsimile. TIME: 10:00 am. (Pacific Daylight Savings Time), , 1997 PLACE: Rod Gunn Associates, Inc. Telephone (562) 598-7677 3010 Old Ranch Parkway, Facsimile (562) 431-5446 Suite 330 Seal Beach, CA 90740 The Notice Inviting Bids and the Preliminary Official Statement pertaining to the Notes are being prepared and may be obtained from Rod Gunn Associates, Inc. at the address and telephone number listed above. Dated: September , 1997 Michael T. Uberuaga City Administrator City of Huntington Beach, California C-1 EXHIBIT D FORM OF CONTINUING DISCLOSURE CERTIFICATE This Continuing Disclosure Certificate (the "Disclosure Certificate") is executed and delivered by the City of Huntington Beach, California (the "City") in connection with the issuance of $ 1997 Tax and Revenue Anticipation Notes (the "Notes"). The Notes are being issued pursuant to Resolution No. 97-59 of the City dated September. 2 1997. The City covenants and agrees as follows. SECTION 1. Purpose of the Disclosure Certificate. This Disclosure Certificate is being executed and delivered by the City for the benefit of the owners and beneficial owners of the Notes and in order to assist the Participating Underwriters in complying with S.E.C. Rule 15c2-12(b)(5). SECTION 2. Definitions. In addition to the definitions set forth in the Resolution, which apply to any capitalized term used in this Disclosure Certificate unless otherwise defined in this Section, the following capitalized terms shall have the following meanings: "Dissemination Agent" shall mean the City or any successor Dissemination Agent designated in writing by the City and which has filed with the City a written acceptance of such designation. "Listed Events" shall mean any of the events listed in Section 3(a) of this Disclosure Certificate. "Participating Underwriter" shall mean any of the original underwriters of the Notes required to comply with the Rule in connection with offering of the Notes. "Rule" shall mean Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time. "State Repository" shall mean any public or private repository or entity designated by the State as a state repository for the purpose of the Rule and recognized as such by the Securities and Exchange Commission. As of the date of this Disclosure Certificate, there is no State Repository. SECTION 3. Reporting of Significant Events. (a) Pursuant to the provisions of this Section 3, the City shall give, or cause to be given, notice of the occurrence of any of the following events with respect to the Notes, if material: 1 . Principal and interest payment delinquencies. 2. Non-payment related defaults. 3. Unscheduled draws on debt service reserves reflecting financial difficulties. D-1 4. Unscheduled draws on credit enhancements reflecting financial difficulties. 5. Substitution of credit or liquidity providers, or their failure to perform. 6. Adverse tax opinions or events affecting the tax-exempt status of the security. 7. Modifications to rights of security owners. 8. Contingent or unscheduled Bond calls. 9. Defeasances. 10. Release, substitution, or sale of property securing repayment of the securities. 11 . Rating changes. (b) Whenever the City obtains knowledge of the occurrence of a fisted Event, the City shall as soon as possible determine if such event would be material under applicable Federal securities laws. (c) If the City determines that knowledge of the occurrence of a Listed Event would be material, the City shall promptly file a notice of such occurrence with the Municipal Securities Rulemaking Board and each State Repository. SECTION 4. Termination of Reporting Obligation. The City's obligations under this Disclosure Certificate shall terminate upon the defeasance, prior redemption or payment in full of all of the Notes. SECTION 5. Dissemination A e_ nt. The City may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its obligations under this Disclosure Certificate, and may discharge any such Agent, with or without appointing a successor Dissemination Agent. SECTION 6. Amendment. Notwithstanding any other provision of this Disclosure Certificate,the City may amend this Disclosure Certificate and any provision of this Disclosure Agreement may be waived, only if: (a) the amendment or waiver is made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature, or status of the City, or type of business conducted; (b) this Disclosure Certificate, as amended, would have complied with the requirements of the Rule at the time of award of the Notes, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and D-2 (c) the amendment does not materially impair the interests of owners or beneficial owners of the Notes, as determined by parties unaffiliated with the City (such as, but without limitation, the City's bond counsel). SECTION 7. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the City from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Certificate. If the City chooses to include any information in any notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Certificate, the City shall have no obligation under this Agreement to update such information or include it in any future notice of occurrence of a Listed Event. SECTION 8. Default. In the event of a failure of the City to comply with any provision of this Disclosure Certificate any owner or beneficial owner of the Notes may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the City to comply with its obligations under this Disclosure Certificate. A default under this Disclosure Certificate shall not be deemed an event of default under the Resolution, and the sole remedy under this Disclosure Certificate in the event of any failure of the City to comply with this Disclosure Certificate shall be an action to compel performance. SECTION 9. Duties, Immunities and Liabilities of Dissemination Agent. The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Certificate, and the City agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents, harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including attorneys fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent's negligence or wilful misconduct. The obligations of the City under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Notes. SECTION 10. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the City, the Dissemination Agent, the Participating Underwriter and owners and beneficial owners of the Notes from time to time of the Notes, and shall create no rights in any other person or entity. Date: October _, 1997 CITY OF HUNTINGTON BEACH, CALIFORNIA By: City Administrator or Deputy City Administrator/ Administrative Services D-3 Res.No. 97-59 STATE OF CALIFORNIA ) COUNTY OF ORANGE ) ss: CITY OF HUNTINGTON BEACH ) I, CONNIE BROCKWAY, the duly elected, qualified City Clerk of the City of Huntington Beach, and ex-officio Clerk of the City Council of said City, do hereby certify that the whole number of members of the City Council of the City of Huntington Beach is seven; that the foregoing resolution was passed and adopted by the affirmative vote of at least a majority of all the members of said City Council at an regular meeting thereof held on the 2nd day of September, 1997 by the following vote: AYES: Julien, Harman, Dettloff, Bauer, Sullivan, Garofalo NOES: None ABSENT: Green City Clerk and ex-officigClerk of the City Council of the City of Huntington Beach, California G/resoluti/resbkpg/97-39