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HomeMy WebLinkAbout84-11 jjg@Zgy?% AUG 161983 CITY OF UKIAH CITY OF UKIAH RESOLUTION NO. 84-11 A Resolution of the City Council of the City of Ukiah Authorizing the Issuance and Prescribing the Terms, Conditions and Form of $18, 000, 000 Principal Amount of City of Ukiah Electric Revenue Bonds, Series A (First Supplemental Resolution) Adopted August 17, 1983 TABLE OF CONTENTS Page Recital . . . . . . . . . . . . . . . . . . . . . . . 1 ARTICLE I - Definitions . . . . . . . . . . . . . . . 1 Section 1 . 01 . Definitions . . . . . . . . . . . 1 ARTICLE II - Issuance of Series A Bonds . . . . . . . 3 Section 2 . 01. Authorization and Purpose of Series A Bonds . . . . . . . . . . 3 Section 2 . 02 . Principal Amount, Designations, Denominations and Numbering of Series A Bonds . . . . . . . . . 4 Section 2 . 03 . Date and Maturity Dates of and Sinking Fund Payments for Series A Bonds . . . . . . . . . 4 Section 2 . 04. Interest Payment Dates of Series A Bonds . . . . . . . . . 6 Section 2 . 05. Redemption Prices and Terms of Series A Bonds . . . . . . . 7 Section 2 . 06. Form of Series A Bonds . . . . . . 8 Section 2 . 07. Application of Proceeds of Sale of Series A Bonds . . . . . . . 21 ARTICLE III - Miscellaneous . . . . . . . . . . . . . 24 Section 3 . 01 . Authority for the First Supplemental Resolution . . . . 24 Section 3 . 02 . Effective Date of the First Supplemental Resolution . . . . 24 Section 3 . 03 . Covenant Re Industrial Development Bonds . . . . . . . 24 Adoption . . . . . . . . . . . . . . . . . . . . . . . 25 i CITY OF UKIAH RESOLUTION NO. 84-11 A Resolution of the City Council of the City of Ukiah Authorizing the Issuance and Prescribing the Terms, Conditions and Form of $18, 000,000 Principal Amount of City of Ukiah Electric Revenue Bonds, Series A (First Supplemental Resolution) WHEREAS, the City Council of the City of Ukiah has duly adopted Resolution No. 84-10 on August 17, 1983, which Resolution No. 84-10 provided for the issuance of electric revenue bonds for the purposes therein stated, and it is desirable and necessary to authorize the issuance thereunder of $18, 000, 000 principal amount of electric revenue bonds for the purpose herein set forth; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF UKIAH, AS FOLLOWS: ARTICLE I DEFINITIONS SECTION 1 . 01 . Definitions. (a) All terms which are defined in Section 1 . 01 of the Resolution shall have the same definitions, respectively, 1 in the First Supplemental Resolution that are given to such terms in Section 1. 01 of the Resolution. (b) Unless the context otherwise requires, the terms defined in this subsection shall for all purposes of the Resolution and hereof and of the Series A Bonds and of any certificate, opinion, report, request or other document mentioned herein or therein have the meanings defined herein, the following definitions to be equally applicable to both the singular and plural forms of any of the terms defined herein: 1983 Electric Project The term "1983 Electric Project" means the electric generation and transmission works constituting additions and betterments to the Enterprise authorized at the special revenue bond election held in the City on June 8, 1982, including the acquisition and construction of a hydroelectric generating unit to be installed at Coyote Dam, together with related penstocks and outlet and control facilities, and the acquisition and construction of a 115-kV transmission line, together with related transformers and switching gear. 1983 Electric Project Account The term "1983 Electric Project Account" means the account by that name established in Section 2 . 07(c) . First Supplemental Resolution The term "First Supplemental Resolution" means this Resolution No. 84-11 adopted by the Council on 2 August 17, 1983 under the Law and pursuant to Articles II and VIII of the Resolution. Resolution The term "Resolution" means Resolution No. 84-10 adopted by the Council on August 17, 1983 under the Law. Series A Bonds The term "Series A Bonds" means the Bonds authorized to be issued by Article II of the First Supplemental Resolution. Series A Sinking Fund Account The term "Series A Sinking Fund Account" means the account by that name established in Section 2 . 03 . ARTICLE II ISSUANCE OF SERIES A BONDS SECTION 2 . 01. Authorization and Purpose of Series A Bonds. (a) The Council has reviewed all proceedings heretofore taken relative to the authorization of the Series A Bonds and has found, as a result of such review, and hereby finds and determines that all acts, conditions and things required by law to exist, happen and be performed precedent to and in the issuance of the Series A Bonds do exist, have happened and have been performed in due time, form and manner as required by law, and the City is now 3 authorized., pursuant to each and every requirement of the Law and the Resolution, to issue the Series A Bonds in the form and manner provided in the Resolution and herein, which Series of Bonds shall be entitled to the benefit, protection and security of the provisions of the Resolution. (b) The purpose for which the Series A Bonds are to be issued is to provide funds (together with other available funds) for the acquisition and construction of the 1983 Electric Project, including payment of costs incidental to or connected with such acquisition and construction. SECTION 2 . 02 . Principal Amount, Designation, Denominations and Numbering of Series A Bonds. The Series A Bonds shall be in the aggregate principal amount of Eighteen Million Dollars ($18, 000, 000) . The Series A Bonds shall be designated as, and shall be distinguished from the Bonds of all other Series by the title, "Electric Revenue Bonds, Series A. " The Series A Bonds shall be issued as fully registered Bonds in the denomination of five thousand dollars ($5, 000) or any integral multiple of five thousand dollars ($5, 000) (not exceeding the principal amount of Series A Bonds maturing at any one time) , and shall be numbered in consecutive numerical order upward in order of issuance from AR1 . SECTION 2 . 03 . Date and Maturity Dates of and Sinking Fund Payments for Series A Bonds. The Series A Bonds 4 shall be dated, and shall bear interest from, September 1, 1983 . The Series A Bonds shall mature on the dates and in the principal amounts as set forth in the following schedule: Maturity Maturity Date Principal Date Principal June 1 Amount June 1 Amount 1985 $60, 000 1998 $230, 000 1986 65, 000 1999 255, 000 1987 70, 000 2000 280, 000 1988 80, 000 2001 310, 000 1989 90, 000 2002 345, 000 1990 100, 000 2003 385, 000 1991 110, 000 2004 425,000 1992 120, 000 2005 475, 000 1993 135, 000 2006 525, 000 1994 150, 000 2007 585, 000 1995 165, 000 2008 645, 000 1996 185, 000 2018 12,005, 000 1997 205, 000 Sinking fund payments are hereby established for the mandatory redemption and payment of the Series A Term Bonds maturing on June 1, 2018, which payments shall become due during the years ending on the dates and in the amounts as set forth in the following schedule: Year Year Ending Sinking Fund Ending Sinking Fund June 1 Payment June 1 Payment 2009 $720, 000 2014 $1,210, 000 2010 795, 000 2015 1, 345, 000 2011 885, 000 2016 1, 490, 000 2012 980, 000 2017 1, 655, 000 2013 1, 090, 000 2018 1, 835, 000 All such sinking fund payments shall be deposited in a separate account in the Principal Account, which account is hereby established and shall be known as the Series A Sinking Fund Account and which account the City hereby agrees 5 and covenants to cause to be maintained so long as any Series A Term Bonds are Outstanding. All money in the Series A Sinking Fund Account shall be used and withdrawn by the Fiscal Agent at any time, upon the Written Request of the City, for the purchase of Series A Term Bonds maturing on June 1, 2018 at public or private sale as and when and at such prices (including brokerage and other charges, but excluding accrued interest, which is payable from the Interest Account) as it may in its discretion determine, but not to exceed the principal amount of such Series A Term Bonds, and all Series A Term Bonds so purchased shall be cancelled. All money in the Series A Sinking Fund Account on June 1 of each year, beginning on June 1, 2009, shall be used and withdrawn by the Fiscal Agent on such June 1 for the mandatory redemption or payment of Series A Term Bonds maturing on June 1, 2018, and the City hereby agrees and covenants with the Holders of the Series A Term Bonds to call and redeem in accordance with Article IV of the Resolution or pay Series A Term Bonds maturing on June 1, 2018 from sinking fund payments deposited in the Series A Sinking Fund Account pursuant to this paragraph whenever on June 1 of any year, beginning on June 1, 2009, there is money in the Series A Sinking Fund Account available for such purpose. SECTION 2 . 04. Interest Payment Dates of Series A Bonds. The Series A Bonds shall bear interest from the interest payment date next preceding the date of registration 6 thereof, unless such date of registration is an interest payment date, in which event they shall bear interest from such date, or unless such date of registration is prior to the first interest payment date, in which event they shall bear interest from September 1, 1983; provided, however, that if at the time of registration of any Series A Bond interest is then in default on the Outstanding Series A Bonds, such Series A Bond shall bear interest from the interest payment date to which interest has previously been paid or made available for payment on the Outstanding Series A Bonds. Payment of interest on the Series A Bonds due on or before the maturity or prior redemption thereof shall be made to the person whose name appears in the registration books required to be kept by the Fiscal Agent pursuant to Section 3 .03 of the Resolution as the registered owner thereof, such interest to be paid by check mailed to such registered owner at his address as it appears in such books or at such other address as he may have filed with the Fiscal Agent for that purpose. SECTION 2 .05 . Redemption Prices and Terms of Series A Bonds. Series A Term Bonds are subject to mandatory redemption prior to their maturity date on any June 1 on or after June 1, 2009, in part solely from sinking fund payments deposited in the Series A Sinking Fund Account, upon published notice as provided in the Resolution, at the principal amount thereof and accrued interest thereon to the date of redemption. Series A Bonds maturing by their terms 7 on or after June 1, 1995 are subject to redemption prior to their respective maturity dates, at the option of the City, as a whole on any date on or after June 1, 1994 or in part on any interest payment date on or after June 1, 1994, from funds derived by the City from any source other than sinking fund payments, upon published notice as provided in the Resolution, at the following redemption prices (computed upon the principal amount of Series A Bonds or portions thereof called for redemption) together with accrued interest to the date of redemption, to wit: 103% if redeemed prior to June 1, 1995; 102 1/2% if redeemed thereafter and prior to June 1, 1996; 102% if redeemed thereafter and prior to June 1, 1997; 101 1/2% if redeemed thereafter and prior to June 1, 1998; 101% if redeemed thereafter and prior to June 1, 1999; 100 1/2% if redeemed thereafter and prior to June 1, 2000; and 100% if redeemed thereafter and prior to maturity. SECTION 2 . 06. Form of Series A Bonds. The Series A Bonds and the authentication and registration endorsement and assignment to appear thereon shall be substantially in the following form, respectively: 8 [FORM OF SERIES A BONDS] No. AR $ UNITED STATES OF AMERICA STATE OF CALIFORNIA MENDOCINO COUNTY CITY OF UKIAH ELECTRIC REVENUE BOND, SERIES A The City of Ukiah, a municipal corporation duly organized and existing under and pursuant to the Constitution and laws of the State of California (the "City" ) , for value received hereby promises to pay (but only out of the Net Revenues and Net Distribution Income hereinafter referred to) to or registered assigns on June 1, ( subject to any right of prior redemption hereinafter provided for) the principal sum of Dollars ($ ) together with interest thereon from the interest payment date next preceding the date of registration of this Bond (unless this Bond is registered as of an interest payment date, in which event it shall bear interest from that date, or unless this Bond is registered prior to June 1, 1984, in which event it shall bear interest from September 1, 1983 ) until the principal hereof shall have been paid at the rate of per cent ( %) per annum, payable on June 1, 1984 and semiannually thereafter on December 1 and June 1 in each year. Interest due on or before the maturity 9 or prior redemption of this Bond shall be payable only by check mailed to the registered owner hereof, and the principal hereof and redemption premium, if any, hereon shall be payable on the maturity or prior redemption of this Bond only upon surrender hereof. Both the interest hereon and principal hereof and redemption premium, if any, hereon are payable in lawful money of the United States of America at the principal office of in San Francisco, California, Fiscal Agent of the City. This Bond is one of a duly authorized issue of Bonds of the City designated as its "Electric Revenue Bonds" (the "Bonds" ) issued and to be issued in various series under and pursuant to the Revenue Bond Law of 1941 (being Chapter 6, Part 1, Division 2, Title 5 of the Government Code of the State of California, as amended) and all laws amendatory thereof or supplemental thereto (the "Law" ) , and under and pursuant to Resolution No. adopted by the City Council of the City on 1983, and is one of a series of Bonds of various maturities designated as "Electric Revenue Bonds, Series A" (the "Series A Bonds" ) in the aggregate principal amount of Eighteen Million Dollars ($18, 000, 000) authorized at an election held in the City on June 8, 1982 issued under and pursuant to the Law and said Resolution No. and Resolution No. supplemental thereto adopted by the City Council of the City on 1983 (collectively the "Resolutions" ) , all 10 of like tenor and date (except for such variations, if any, as may be required to designate varying numbers, denominations, maturities, interest rates or redemption provisions) . All the Series A Bonds are equally and ratably secured in accordance with the terms and conditions of the Resolutions (copies of which are on file at the office of the City Clerk of the City and at the above-mentioned office of the Fiscal Agent) , and reference is hereby made to the Law and to the Resolutions and any and all amendments thereof and supplements thereto for a description of the terms on which the Series A Bonds are issued, for the provisions wih regard to the nature and extent of the Revenues, as that term is defined in the Resolutions, and for the rights of the registered owners of the Series A Bonds; and all the terms of the Law and the Resolutions are hereby incorporated herein and constitute a contract between the City and the registered owner from time to time of this Series A Bond, to all the provisions of which the registered owner of this Series A Bond, by his acceptance hereof, agrees and consents. Each taker and subsequent registered owner hereof shall have recourse to all the provisions of the Law and the Resolutions and shall be bound by all the conditions and terms thereof. The Series A Bonds are issued to provide funds to acquire and construct additions and betterments to the electric generation and transmission system of the City (the "Enterprise" ) , as more particularly described in the 11 Resolutions. The Series A Bonds are special obligations of the City and are payable, as to interest thereon, principal thereof and any premiums upon the redemption thereof, solely from the net revenues of the Enterprise (the "Net Revenues" ) , as that term is defined in the Resolutions, and the Net Distribution Income (the "Net Distribution Income" ) , as that term is defined in the Resolutions, and the City is not obligated to pay them except from the Net Revenues and the Net Distribution Income. All the Bonds are equally secured by a pledge of and charge and lien upon the Net Revenues and the Net Distribution Income, and the Net Revenues and the Net Distribution Income constitute a trust fund for the security and payment of the interest on and principal of and redemption premiums, if any, on the Bonds as provided in the Resolutions. The general fund of the City is not liable and the full faith and credit or taxing power of the City is not pledged for the payment of the interest on or principal of or redemption premiums, if any, on the Bonds, and no tax or assessment shall ever be levied or collected to pay the interest on or principal of or redemption premiums, if any, on the Bonds. The Bonds are not secured by a legal or equitable pledge of or charge, lien or encumbrance upon any property of the City or any of its income or receipts except the Net Revenues and the Net Distribution Income as provided in the Resolutions, and neither the payment of the interest on or principal of or redemption premiums, if any, on the 12 Bonds is a general debt, liability or obligation of the City. Additional Bonds payable from the Net Revenues and the Net Distribution Income may be issued which will rank equally as to security with the Series A Bonds, but only subject to the conditions and limitations contained in the Resolutions. The City covenants that, so long as any Bonds are outstanding, it will fix, prescribe and collect rates, fees and charges in connection with the electric service furnished, made available or sold by the Enterprise so as to yield Net Revenues at least equal to the amounts thereof prescribed by the Resolutions and which, together with the Net Distribution Income, are sufficient to pay the interest on and principal of and redemption premiums, if any, on the Bonds in accordance with the provisions of the Resolutions. Series A Bonds maturing by their terms on June 1, 2018 are subject to mandatory redemption prior to their maturity date on any June 1 on or after June 1, 2009, in part solely from sinking fund payments deposited in the Series A Sinking Fund Account provided in the Resolutions, upon published notice as hereinafter provided, at the principal amount thereof and accrued interest thereon to the date of redemption. Series A Bonds maturing by their terms on or after June 1, 1995 are subject to redemption prior to their respective maturity dates, at the option of the City, as a whole on any date on or after June 1, 1994 or in part on any interest payment date on or after June 1, 1994, from funds 13 derived by the City from any source other than sinking fund payments, upon published notice as hereinafter provided, at the following redemption prices (computed upon the principal amount of Series A Bonds or portions thereof called for redemption) together with accrued interest to the date of redemption, to wit: 103% if redeemed prior to June 1, 1995; 102 1/2% if redeemed thereafter and prior to June 1, 1996; 102% if redeemed thereafter and prior to June 1, 1997; 101 1/2% if redeemed thereafter and prior to June 1, 1998; 101% if redeemed thereafter and prior to June 1, 1999; 100 1/2% if redeemed thereafter and prior to June 1, 2000; and 100% if redeemed thereafter and prior to maturity. If less than all the Series A Bonds are to be redeemed at the option of the City at any one time, the Series A Bonds of the latest maturity date or dates shall be redeemed prior to or simultaneously with the redemption of any Series A Bonds maturing prior thereto. If less than all the Series A Bonds of any one maturity date are to be redeemed at any one time, the Fiscal Agent shall select the Series A Bonds of such maturity date to be redeemed in any manner that it deems appropriate and fair. 14 As provided in the Resolutions, notice of redemption of this Series A Bond shall be given by publication once a week for two (2 ) successive weeks in a newspaper or journal publishing financial news selected by the Fiscal Agent that is printed in the English language, is customarily published on each business day and is circulated in San Francisco, California, with the first such publication to be not less than thirty (30) days nor more than sixty (60) days before the redemption date; all in the manner and upon the conditions and terms set forth in the Resolutions. In addition, notice of redemption of this Series A Bond shall be mailed not less than thirty (30) days nor more than sixty (60) days before the redemption date to the registered owner hereof, but neither failure to mail or receive such notice shall affect the sufficiency of such proceedings for redemption. If notice of redemption has been duly given as aforesaid, then this Series A Bond shall, on the redemption date designated in such notice, become due and payable at the above-described redemption price, and from and after the date so designated interest on this Series A Bond shall cease to accrue and the registered owner of this Series A Bond shall have no rights in respect hereof except to receive payment of the redemption price hereof. If an event of default, as defined in the Resolutions shall occur, the principal of all Bonds may be declared due and payable upon the conditions, in the manner 15 and with the effect provided in the Resolutions; except that the Resolutions provide that in certain events such declaration and its consequences may be rescinded by the registered owners of at least twenty-five per cent (25%) in aggregate principal amount of the Bonds then outstanding. The Series A Bonds are issuable in the form of fully registered Bonds in the denomination of Five Thousand Dollars ($5, 000) or any integral multiple of Five Thousand Dollars ($5, 000) (not exceeding the principal amount of Series A Bonds maturing at any one time) . The registered owner of any Series A Bond or Bonds may surrender the same (together with a written instrument of transfer satisfactory to the Fiscal Agent duly executed by the registered owner or his duly authorized attorney) in exchange for an equal aggregate principal amount of Series A Bonds of any other authorized denominations in the manner, subject to the conditions and upon payment of the charges provided in the Resolutions. This Series A Bond is transferable upon a register to be kept for that purpose at the above-mentioned office of the Fiscal Agent by the registered owner hereof in person or by his duly authorized attorney, upon surrender of this Series A Bond together with a written instrument of transfer satisfactory to the Fiscal Agent duly executed by the registered owner or his duly authorized attorney, and thereupon a new fully registered Series A Bond or Bonds in 16 the same aggregate principal amount will be issued to the transferee in exchange therefor in the manner, subject to the conditions and upon payment of the charges provided in the Resolutions. The City and the Fiscal Agent may deem and treat the person in whose name this Series A Bond is registered as the absolute owner hereof for the purpose of receiving payment of, or on account of, the interest hereon and principal hereof and redemption premium, if any, hereon and for all other purposes. The rights and obligations of the City and of the registered owners of the Bonds may be amended at any time in the manner, to the extent and upon the terms provided in the Resolution, but no such amendment shall (a) extend the maturity of this Series A Bond or reduce the interest rate hereon or otherwise alter or impair the obligation of the City to pay the interest hereon or principal hereof or any premium payable on the redemption hereof at the time and place and at the rate and in the currency provided herein without the express written consent of the registered owner of this Series A Bond, or (2 ) permit the creation by the City of any pledge of or charge and lien upon the Net Revenues and the Net Distribution Income superior to or on a parity with the pledge, charge and lien created by the Resolutions for the benefit of the Bonds, or (3) reduce the percentage of Bonds required for the written consent to an amendment of the Resolutions, or (4) modify any rights or obligations of the 17 Fiscal Agent without its prior written assent thereto; all as more fully set forth in the Resolutions. The Series A Bonds do not constitute an indebtedness of the City within the meaning of any constitutional or statutory debt limitation or restriction, and neither the City Council of the City nor the City nor any Councilmember, officer or employee thereof shall be liable for the payment of the interest on or principal of or redemption premiums, if any, on the Series A Bonds otherwise than from the Net Revenues and the Net Distribution Income and such other funds as provided in the Resolutions. This Series A Bond shall not be entitled to any benefits under the Resolution or become valid or obligatory for any purpose until the certificate of authentication and registration hereon endorsed shall have been signed by the Fiscal Agent. It is hereby certified that all acts, conditions and things required by law to exist, to have happened or to have been performed precedent to and in the issuance of this Series A Bond do exist, have happened and have been performed in due time, form and manner as required by law and that the amount of this Series A Bond, together with all other obligations of the City, does not exceed any limit prescribed by the laws of the State of California and is not in excess of the amount of Series A Bonds permitted to be issued under the Resolutions. 18 In Witness Whereof, the City of Ukiah has caused this Series A Bond to be executed in its name and on its behalf by its Mayor and attested by its City Clerk, and has caused its seal to be reproduced hereon and has caused this Series A Bond to be dated , 1983 . CITY OF UKIAH By Mayor ATTEST: City Clerk ( SEAL) 19 [FORM OF FISCAL AGENT' S CERTIFICATE OF AUTHENTICATION AND REGISTRATION TO APPEAR ON SERIES A BONDS] This is one of the Bonds described in the within-mentioned Resolutions which has been authenticated and registered this day of , as Fiscal Agent By Authorized Officer [FORM OF ASSIGNMENT TO APPEAR ON SERIES A BONDS] For value received the undersigned do(es) hereby sell, assign and transfer unto the within Bond and do(es) hereby irrevocably constitute and appoint attorney to transfer the same on the bond register of the Fiscal Agent, with full power of substitution in the premises. Dated: , Note: The signature( s) to this Assignment must correspond with the name( s) as written on the face of the within Bond in every particular, without alteration or enlargment or any change whatsoever. 20 SECTION 2 .07 . Application of Proceeds of Sale of Series A Bonds. Upon the receipt of payment for the Series A Bonds when the same shall have been duly sold by the City, the Fiscal Agent shall set aside and deposit or cause to be deposited the proceeds of sale of the Series A Bonds in the following respective accounts: (a) The Fiscal Agent shall deposit in the Interest Account a sum equal to the amount of interest accruing on the Series A Bonds to and including June 1, 1985, which sum shall be used for the payment of interest accruing on the Series A Bonds to and including June 1, 1985 . (b) The Fiscal Agent shall deposit in the Bond Reserve Account a sum equal to the Maximum Annual Debt Service. (c) The Fiscal Agent shall transfer the remainder of the proceeds of sale of the Series A Bonds to the Treasurer of the City who shall deposit such proceeds in a separate account in the Acquisition and Construction Fund, which account is hereby established and shall be known as the "1983 Electric Project Account" and which account the City hereby agrees and covenants to maintain until the completion of the acquisition and construction of the 1983 Electric Project. The money in the 1983 Electric Project Account shall be used and disbursed in the manner provided by law for the purpose of paying the Costs of Acquisition and Construction of the 1983 Electric Project provided that 21 substantially all (at least 92%) of the sum of gross original proceeds (including accrued interest, but reduced by the offering discount) and investment earnings through completion of construction, reduced by the sum of issuance costs, accrued interest to the date of issuance and amounts deposited in the Bond Reserve Account, shall have been used to finance property (the costs of which were incurred after February 17, 1982 ) for facilities for the local furnishing of electric energy or gas within the meaning of Section 103 (b) (4) (E) of the Internal Revenue Code of 1954, as amended, and property that is functionally related and subordinate thereto ( "Financeable Costs" ) . Moneys in the 1983 Electric Project Account may be used to pay for Costs of Acquisition and Construction of the 1983 Electric Project which are not Financeable Costs provided the payment of costs which are not Financeable Costs will not exceed 8% of the cumulative aggregate amount disbursed for Financeable Costs. Any balance of money remaining in the 1983 Electric Project Account after the completion of the acquisition and construction of the 1983 Electric Project shall be transferred by the Treasurer of the City to the Fiscal Agent and shall be deposited by the Fiscal Agent into a separate account within the Principal Account which the Fiscal Agent shall establish and hold in trust, and which shall be entitled the "Escrow Account. " The moneys in the Escrow Account shall be used and applied (unless some other 22 application of such moneys would not, in the opinion of bond counsel, cause interest on the Series A Bonds to become subject to federal income taxation) to the call and redemption of Series A Bonds to the maximum degree permissible, and at the earliest possible dates at which Series A Bonds can be redeemed without payment of premium pursuant to this Resolution. Any moneys in the Escrow Account not used to call and redeem Series A Bonds as herein provided shall be used and applied to pay the principal of the Series A Bonds as such principal becomes due and payable, in annual amounts which bear the same ratio to the annual principal due on the Series A Bonds that the amount deposited in the Escrow Account bears to the original face amount of the Series A Bonds (unless in the opinion of bond counsel another use would not cause interest on the Series A Bonds to become subject to federal income taxation) . Notwithstanding Section 11 . 05 of the Resolution, the moneys in the Escrow Account shall be invested at a yield no higher than the yield on the Outstanding Series A Bonds (unless in the opinion of bond counsel investment at a higher yield would not cause interest on the Series A Bonds to become subject to federal income taxation) , and all such investment income shall be deposited in the Escrow Account and expended or reinvested as provided above. 23 ARTICLE III MISCELLANEOUS SECTION 3 . 01. Authority for the First Supplemental Resolution. The First Supplemental Resolution is adopted pursuant to the provisions of the Law and is supplemental to and is adopted in accordance with Articles II and VIII of the Resolution. SECTION 3 .02 . Effective Date of the First Supplemental Resolution. The First Supplemental Resolution shall take effect from and after its passage and approval. SECTION 3 . 03 . Covenant Re Industrial Development Bonds. The City will use Series A Bond proceeds in such a way that substantially all Series A Bond proceeds will be used to provide "facilities for the local furnishing of electric energy or gas" within the meaning of Section 103(b) (4) (E) of the Internal Revenue Code 1954, as amended, and the City will comply with all the requirements of said Section 103 (b) and all applicable regulations of the United States Treasury issued thereunder. PASSED AND ADOPTED on August 17, 1983 by the following vote: 24 AYES: Counci lmembers Dickens, Hickey, Myers, Kelley NOES: None ABSENT: Council member Fei busch Approved: Mayor of the City of Ukiah, California [ SEAL] ATTEST: Deputy City Clerk of the City of Ukiah, California 25 CITY CLERK' S CERTIFICATE I , Hattie Tillotson, City Clerk of the City of Ukiah, California, hereby certify as follows: The foregoing is a full, true and correct copy of a resolution duly adopted at a regular meeting of the City Council of the City of Ukiah, California duly and regularly and legally held at the regular meeting place thereof on August 17, 1983, of which meeting all the members of said City Council had due notice and at which a majority thereof was present. At said meeting said resolution was adopted by the following vote: Ayes: Counci lmembers Dickens, Hickey, Myers , Kelley Noes: None Absent: Counci lmember Fei busch I have carefully compared the same with the original minutes of said meeting on file and of record in my office and the foregoing is a full, true and correct copy of the original resolution adopted at said meeting and entered in said minutes, and said original resolution has not been amended, modified or rescinded since the date of its adoption and the same is now in full force and effect. Dated: 1983 . Veiputy City Clefof the67 City of Ukiah, California (Seal)