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RDA Resolution 1988-014: 425 RESOLUTION NO. Z88-l4 RESOLUTION OF THE BOARD OF DIRECTORS OF THE LA QUINTA REDEVELOPMENT AGENCY AUTHORIZING THE ISSUANCE OF TAX ALLOCATION BONDS OF SAID AGENCY IN A PRINCIPAL AMOUNT NOT TO EXCEED EIGHT MILLION DOLLARS $6,000,000) TO FINANCE A PORTION OF THE COST OF A REDEVELOPMENT PROJECT KNOWN AS THE LA QUINTA REDEVELOPMENT PROJECT AND APPROVING CERTAIN DOCUMENTS AND TAKING CERTAIN c\j OTHER ACTIONS IN CONNECTION THEREWITH 1) 0 WHEREAS, the La Quinta Redevelopment Agency the 5 Agency"), is 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 Community Redevelopment Law Part 1 of Division 24 commencing with Section 33000) of the Health and Safety Code of the State of California) and the powers of the Agency include the power to issue bonds for any of its corporate purposes; and WHEREAS, the Redevelopment Plan for a redevelopment project known and designated as La Quinta Redevelopment Project" has been adopted and approved by Ordinance No. 43 of the City of La Quinta, which became effective on December 29, 1983, and all requirements of law for and precedent to the adoption and approval of the Redevelopment Plan have been duly complied with; and WHEREAS, pursuant to Resolution No. RA 85-5 the Agency issued Twenty Million Dollars $20,000,000) of La Quinta Redevelopment Agency, La Quinta Redevelopment Project, Tax Allocation Bonds, Series 1985" the 1985 Bonds"); and WHEREAS, in order to raise additional funds for the implementation of the Redevelopment Plan, the Agency deems it necessary at this time to issue tax allocation bonds on a parity with the 1985 Bonds for such purpose; and WHEREAS, the corporate purposes of the Agency will be accomplished by issuing at this time tax allocation bonds in a principal amount of Eight Million Dollars $8,000,000) pursuant to this Resolution to be designated La Quinta Redevelopment Agency, La Quinta Redevelopment Project, Tax Allocation Bonds, Series 1989 the Bonds"); and WHEREAS, the Agency is authorized to issue the Bonds pursuant to the Community Redevelopment Law of the State of California being Part I of Division 24 of the Health and BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 :RESOLUTION NO. RA *BZ14 Safety Code of the State of California, as amended) the Law") and Article 4 of Chapter 5 of Division 7 of Title 1 commencing at Section Z584) of the California Government Code the Act"); and WHEREAS, there has been created pursuant to Chapter 5, Division 7, Title 1, commencing at Section 5500 of the Government Code of the State of California the Act"), a joint powers entity designated the La Quinta Financing Authority" the Authority") with authority to acquire the AgencyZs bonds as provided in Section 6588 of the Government Code of the State of California; and WHEREAS, the Authority and the Agency have received an offer from Painewebber Incorporated the Underwriter") to purchase the Bonds from the Authority; and WHEREAS, the Underwriter has prepared a preliminary official statement and a supplement thereto setting forth matters relating to the Agency and the issuance of the Bonds, copies of which have been presented to this Board of Directors; and WHEREAS, this Board of Directors desires to proceed to issue the Bonds; and WHEREAS, this Board of Directors has determined in accordance with Government Code Section 6588 that a negotiated sale of the Bonds to the Authority in accordance with the terms of the Purchase Contract by and between the Agency and the Authority the Authority Purchase Contract") will result in a lower overall cost to the Agency than a public sale; and WHEREAS, this Board of Directors also desires to approve the simultaneous sale of the Bonds by the Authority to the Underwriter and to authorize the execution by the Agency of a Purchase Contract by and among the Agency, the Authority and the Underwriter the Underwriter Purchase Contract"); and WHEREAS, the Agency has determined that significant public benefits" as defined in Section 6586 of the Act will be derived by the Agency in undertaking the issuance of the Bonds and their sale to the Authority and resale to the Underwriter, in furtherance of the corporate purposes of the Agency; NOW, THEREFORE, the Board of Directors of the La Quinta Redevelopment Agency DOES HEREBY RESOLVE, ORDER AND DETERMINE AS FOLLOWS: SECTION 1. Each of the above recitals is true and correct and this Board so finds and determines. 12/08/88 2101n/2338/03 2- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : RESOLUTION NO. RA 88-14 42Z SECTION 2. The issuance of the Bonds in the principal amount of $8,000,000 is hereby authorized. The Bonds shall mature on the dates, pay interest at the rates and shall be subject to redemption as set forth in the Underwriter Purchase Contract to be executed on behalf of the Agency in accordance with Section 5 hereof. All other provisions of the Bonds shall be governed by the terms and conditions set forth in a Supplement to Resolution to be prepared by Bond Counsel to the Agency and executed by the Chairman and Secretary of the Agency herein Chairman" and Secretary" respectively), which Supplement to Resolution shall be substantially in the form \j attached hereto as Exhibit A, with such additions thereto and 1) changes therein as are recommended or approved by Bond Counsel to the Agency and the officers executing the same, with such approval to be conclusively evidenced by the execution and delivery of the Supplement to Resolution. Capitalized terms used in this Resolution which are not defined herein have the meaning ascribed to them in the form of the Supplement to Resolution attached hereto as Exhibit A. SECTION 3. The Bonds shall be executed on behalf of the Agency by the manual or facsimile signature of the Chairman and attested with the manual or facsimile signature of the Secretary. The seal of the Agency, or a facsimile thereof, hereby adopted as the seal of the Agency, shall be impressed or imprinted thereon. SECTION 4. The covenants set forth in the Supplement to Resolution to be executed in accordance with Section 2 above are hereby approved, shall be deemed to be covenants of the Agency and shall be complied with by the Agency and its officers. The Supplement to Resolution shall constitute a contract between the Agency and the Owners of the Bonds. SECTION 5. Security Pacific National Bank, Los Angeles, California, is hereby appointed to act as Fiscal Agent, Registrar and Transfer Agent for the Bonds and the Executive Director of the Agency, or his written designee, is hereby authorized to enter into an agreement with the Fiscal Agent to provide such services to the Agency. The Authority Purchase Contract, the Underwriter Purchase Contract and the Preliminary Official Statement presented at this meeting are hereby approved and the Chairman is hereby authorized and directed to execute the Authority Purchase Contract and the Underwriter Purchase Contract. The Chairman is authorized to execute a final Official Statement in substantially the form of the Preliminary Official Statement and Supplement thereto which have been presented at this meeting and are hereby approved, with such additions thereto and changes therein as are recommended or approved by Bond Counsel to the Agency and the officer executing the same, with such approval to be conclusively evidenced by the execution and delivery of such documents. The Underwriter is hereby authorized to distribute 12/08/88 2101n/2338/03 3- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : RESOLUTION NO. RA 88-14 Z24 the Preliminary Official Statement to prospective purchasers of the Bonds and to provide to the purchasers of the Bonds from the Underwriter copies of the final Official Statement. SECTION 6. The Agency hereby determines that the Bonds are qualified tax-exempt obligations pursuant to Section 265(b) of the Code and finds that the reasonably anticipated amount of qualified tax-exempt obligations which will be issued by the Agency and all of its subordinate entities during the 1989 calendar yield does not exceed $10,000,000. SECTION 7. Each and every officer of the Agency is authorized to perform his or her services on behalf of the Agency. The Executive Director, or his written designee, is authorized to incur such costs and to contract for all services necessary to effect the issuance of the Bonds. Such services shall include, but not be limited to, printing the Bonds, printing the Preliminary Official Statement and the Official Statement, obtaining legal services, fiscal agent services and any other services deemed appropriate for the issuance of the Bonds referred to in the Supplement to Resolution as Costs of Issuance") and the payment for said Costs of Issuance shall be approved by the Executive Director. The Executive Director, or his written designee, is authorized to pay for such Costs of Issuance up to a maximum aggregate amount of $200,000) with Bond proceeds deposited to the Redevelopment Fund established pursuant to the Supplement to Resolution without further approval of this Board of Directors. SECTION 8. All actions heretofore taken by officers and agents of the Agency with respect to the sale and issuance of the Bonds are hereby approved, confirmed and ratified, and the Chairman and Secretary and the other officers of the Agency responsible for the fiscal affairs of the Agency are hereby authorized and directed to take any actions and execute and deliver any and all certificates, instruments and documents as are necessary to accomplish the issuance, sale and delivery of the Bonds in accordance with the provisions of this Resolution and the fulfillment of the purposes of the Bonds as described in the Supplement to Resolution. In the event that the Chairman is unavailable to sign any document authorized for execution herein, the Chairman may designate the Finace Director to sign such document. Any document authorized herein to be signed by the Secretary may be signed by a duly appointed deputy secretary. 12/08/88 2101n/2338/0Z 4- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : RESOLUTION NO. RA 88-14 421 ADOPTED AND APPROVED this flZh day of December, 1988. LA QUINTA REDEVELOPMENT AGENCY \` ATZZT: If) C FZecretary m 12/08/88 2101n/2338/03 5- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : RESOLUTION NO. RA 88-14 Z22 STATE OF CALIFORNIA SECRETARYZS CERTIFICATE ss. RE ADOPTION OZ RESOLUTION COUNTY OF RIVERSIDE I, SAUNDRA JUHOLA, Secretary of the La Quinta Redevelopment Agency, DO HEREBY CERTIFY that the foregoing Resolution was duly adopted by said Agency at an adjourned regular meeting of said Agency held on the 2Zday of December, 1988, and that the same was passed and adopted by the following vote to wit: AYES: Members BohnenberZer. Bosworth. Rushworth, Sniff, Chairman PZna NOES: Members None ABSENT: Members Z ABSTAIN: Members NpnZ j 4 Z *ZSecretary of LaZZinta Redevelopment Agency SEAL) 12/08/88 2101n/2338/03 6- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : RESOLUTION ZO. RA 88-14 41? STATE OF CALIFORNIA SECRETARYZS CERTIFICATE ss. OF AUTHENTICATION COUNTY OF RIVERSIDE I, SAUNDRA JUHOLA, Secretary of the La Quinta Redevelopment Agency, DO HEREBY CERTIFY that the above and foregoing is a full, true and correct copy of ResolutiQn No. RAZ4Of said Agency and that said Resolution was adopted at the time and by the vote stated on the above certificate, and has not been amended or repealed. L) Dated: DecemberZ, 1988 C Redevelopment Agency SEAL) 12/C8/88 2101n/2338/03 7- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : 419 ID SUPPLEMENT TO RESOLUTION NO.ZZZ4OF THE LA QUINTA REDEVELOPMENT AGENCY AUTHORIZING THE ISSUANCE OF TAX 0 ALLOCATION BONDS OF SAID AGENCY IN A PRINCIPAL AMOUNT NOT TO EXCEED EIGHT MILLION DOLLARS $8,000,000) TO FINANCE A PORTION OF THE COST OF A REDEVELOPMENT PROJECT KNOWN AS THE LA QUINTA REDEVELOPMENT PROJECT BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : 415 SUPPLEMENT TO RESOLUTION NORAB8140F THE LA QUINTA REDEVELOPMENT ACENCY AUTHORIZZ THE ISSUANCE OF TAX ALLOCATION BONDS OF SAID AGENCY IN A PRINCIPAL AMOUNT NOT TO EXCEED EIGHT MILLION DOLLARS $8,000,000) TO FINANCE A PORTION OF THE COST OF A REDEVELOPMENT PROJECT KNOWN AS THE LA QUINTA REDEVELOPMENT PROJECT TABLE OF CONTENTS Page Section 1. Definitions 1 \` Section 2. Amount, Issuance and Purpose of Bonds 5 ID 0 Section 3. Nature of Bonds 6 CD Section 4. Description of Bonds 7 Section 5. Interest 8 Section 6. Place of Payment 8 Section 7. Forms of Bonds 8 Section 8. Execution of Bonds 9 Section 9. Registration and Exchange of Bonds 10 Section 10. Bond Register 10 Section 11. Call and Redemption of Bonds Prior to 10 Maturity A.Z Terms of Rederrption 10 B. Call and Redemption 11 C. Notice of Redemption 11 D. Redemption Fund 13 E. Partial Redemption of Bonds 14 F. Effect of Redemption 14 G. Purchase of Bonds 14 i) BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : SUPPLEMENT TO RESOLUTION NO RA BB-14 413 Page Section 12. Funds 14 Section 13. Sale of Bonds; Disposition of Bond Proceeds; Redevelopment Fund 15 Section 14. Tax Revenues 16 Section 15. Special Fund 17 Section 16. Deposit and Investment of Moneys in Funds 19 1) Section 17. Issuance of Parity Bonds 21 0 Section 18. Covenants of the Agency 22 m Covenant 1. Complete Redevelopment Project; Amendment to Redevelopment Plan 22 Covenant 2. Use of Proceeds, Management and Operation of Properties 22 Covenant 3. No Priority 23 Covenant 4. Punctual Payment 23 Covenant 5. Payment of Taxes and Other Charges 23 Covenant 6. Books and Accounts; Financial Statements 23 Covenant 7. Eminent Domain 24 Covenant 8. Disposition of Property 24 Covenant 9. Statement of Indebtedness 24 Covenant 10. Protection of Security and Rights of Bondowners; Tax 24 Covenant Section 19. Taxation of Leased Property 27 Section 20. Fiscal Agent 27 Section 21. Excess Investment Earnings Fund 29 Section 22. Lost, Stolen, Destroyed or Mutilated Bonds 32 ii) BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : SUPPLEMENT TO RESOLUTION NO. RA 88-14 409 Page Section 23. Cancellation of Bonds 32 Section 24. Amendments 32 A. Calling Bondowners' Meeting 33 B. Notice of Meeting 34 C. Voting Qualifications 34 D. Issuer-Owner Bonds 34 X) 0 E. Quorum and Procedure 34 m F. Vote Required 35 G. Consent Without a Meeting 35 Section 25. Proceedings Constitute Contract; Events of Default and Remedies of Bondowners 36 A. Events of Default 36 B. Application of Funds upon Acceleration 38 C. Certain Remedies of Bondowners 38 D. Non-Waiver 39 E. Actions by Fiscal Agent as 39 Attorney- in-Fact F. General 40 Section 26. CUSIP Numbers 40 Section 27. Severability 40 Section 28. Notices to Agency 40 Section 29. Effective Date 41 Exhibit A. Form of Bond) iii) BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : 411 SUPPLEMENT TO RESOLUTION NOZ88440F THE LA QUINTA REDEVELOPMENT AGENCY AUTHORIZING THE ISSUANCE OF TAX ALLOCATION BONDS OF SAID AGENCY IN A PRINCIPAL AMOUNT NOT TO EXCEED EIGHT MILLION DOLLARS $8,000,000) TO FINANCE A PORTION OF THE COST OF A REDEVELOPMENT PROJECT KNOWN AS THE LA QUINTA REDEVELOPMENT PROJECT Section 1. Definitions. As used in this Resolution, the following terms shall have the following meanings, unless the context otherwise requires: \` a) Annual Debt Service" means the sums obtained f) for any Bond Year after the computation is made, by C totaling the following for each such Bond Year. 1) The principal amount of all serial Bonds and Cr:) serial Parity Bonds, if any, payable in such Bond Year; and 2) The amount of Minimum Sinking Fund Payments, if any, for any Term Bonds or term Parity Bonds to be made in such Bond Year in accordance with the applicable schedule or schedules of Minimum Sinking Fund Payments; and/or 3) The interest which would be due during such Bond Year on the aggregate principal amount of Bonds and Parity Bonds which would be outstanding in such Bond Year if the Bonds and Parity Bonds outstanding on the date of such computation were to mature or be redZetned in accordance with the maturity schedule or schedules for the serial Bonds and serial Parity Bonds and the schedule or schedules of Minimum Sinking Fund Payments for any Term Bonds or term Parity Bonds. At the time and for the purpose of making such computation, the amount of Term Bonds and Term Parity Bonds already retired in advance of the above mentioned schedule or schedules shall be deducted pro rata from the remaining amounts thereon. Authorized Representative" means the Executive Director of the Agency or such other person designated in writing by the Chairman of the Agency. b) Bond" or Bonds" means the La Quinta Redevelopment Agency, La Quinta Redevelopment Project Tax Allocation Bonds, Series 1989," authorized by this Resolution in a principal amount not to exceed Eight Million Dollars $8,000,000). BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 :Z12 c) 1Bond Year" means the year beginning September 1st and ending on the next following August 31st during the time any Bonds are outstanding except that the initial Bond Year shall commence on January 1, 19Z9 and end on August 31, igegZ d) Bondowner" or Owner of Bonds," or any similar term, means any person who shall be the registered owner or his duly authorized attorney, trustee or representative. For the purpose of Bondowners' voting rights or consents, Bonds owned by or held for the account of the Agency, or the City, directly or indirectly, shall not be counted. e) 1city" means the City of La Quinta, California. f) tComputation Year" means the twelve 12) month period commencing on the Delivery Date or any anniversary of the Delivery Date and extending to but not including the next succeeding anniversary of the Delivery Date. g) 9Costs of Issuance means the costs and expenses incurred in connection with the issuance and sale of the Bonds, including any municipal bond insurance premiums, the acceptance and initial annual fees and expenses of the Fiscal Agent, legal fees and expenses, costs of printing the Bonds and Official Statement, fees of financial consultants and other fees and expenses set forth in a Certificate of the Executive Director. h) Delivery Date" means the date the Bonds are issued to the initial purchaser thereof. i) Federal Securities" means direct obligations of the United States of America or bonds or other obligations for which the full faith and credit of the United States is pledged for the payment of principal and interest. j) Fiscal Agent" means the fiscal agent appointed by the Agency pursuant to Section 20 hereof, its successors and assigns, and any other corporation or association which may at any time be substituted in its place, as provided in this Resolution. k) Fiscal Year" means the year beginning July 1st and ending on the next following June 30th. 1) Gross Proceeds" means the sum of the following amounts: i) original proceeds, being the amounts received by the Agency, or held by the Fiscal Agent as proceeds of the original issuance of the Bonds or Parity Bonds after payment of all expenZes of issuing the Bonds or Parity Bonds); ii) investment proceeds, being amounts received at 12-08-Z8 2563n/2338/003 2- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : SUPPLEMENT TO RESOLUTION NO. RA 88-14 399 any time by the Agency or the Fiscal Agent, such as interest and dividends, resulting from the investment of proceeds of the Bonds or Parity Bonds, including profits and less losses received on such investment; iii) transferred proceeds as defined in Section 1.103-14(e)(2)(ii) of the Regulations), if any; iv) amounts, other than original proceeds and investment proceeds, held in any fund or account and reasonably expected to be used to pay principal of or interest on the Bonds or Parity Bonds; v) securities or obligations pledged as security for the payment of the Bonds or Parity Bonds by an ultimate obligor or a related person) or the Agency; vi) amounts used to pay principal or interest with Lf) respect to the Bonds or Parity Bonds; and vii) amounts C received as a result of investing the amounts listed in C) clauses i) through vi) m m) Independent Financial Consultant," I Engineer, 1lndependent Certified Public Accountant" or Independent Redevelopment Consultant" means any individual or firm engaged in the profession involved, appointed by the Agency, and who, or each of whom, has a favorable reputation in the field in which his opinion or certificate will be given, and: 1) is in fact independent and not under domination of the Agency; and 2) does not have any substantial interest, direct or indirect, with the Agency; and 3) is not connected with the Agency as an officer or employee of the Agency, but who may be regularly retained to make reports to the Agency. n) Law" means the Community Redevelopment Law of the State of California as cited in the recitals hereof and Article 4 of Chapter 5 of Division 7 of Title 1 of the Government Code of the State of California, and all amendments thereto. o) Maximum Annual Debt Servicet' means the largest Annual Debt Service for any Bond Year. p) 1Minimum Sinking Fund Payments" means the amount of money to be deposited into the Bond Payment Fund to be used to redeem Term Bonds or term Parity Bonds, at the principal amounts thereof, in the amounts and at the times set forth in the schedule or schedules of Minimum Sinking Fund Payments contained in this Resolution or in a supplemental resolution adopted for the purposes of establishing said schedule or in any resolution providing for the issuance of Parity Bonds. 12-08-88 2563n/2338/003 3- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : SUPPLEMENT TO RESOLUTION NO. RA 88-14 Zoo q) Nonpurpose Obligation" means any security or obligation other than an obligation on which interest is excludable from gross income for federal income tax purposes under Section 103 of the Code) in which Gross Proceeds are invested and which is not acquired to carry out the governmental purpose of the Bonds or any Parity Bonds. r) opinion of Counsel" means a written opinion of an attorney or firm of attorneys of favorable reputation in the field of municipal bond law. Any opinion of such counsel may be based upon, insofar as it is related to factual matters, information which is in the possession of the Agency as shown by a certificate or opinion of, or representation by, an officer or officers of the Agency, unless such counsel knows, or in the exercise of reasonable care should have known, that the certificate or opinion or representation with respect to the matters upon which his opinion may be based, as aforesaid, is erroneous. s) Parity Bonds" means any additional tax allocation bonds including, without limitation, bonds, notes, interim certificates, debentures or other obligations) issued by the Agency as permitted by Section 17 of this Resolution which are On a parity with the Bonds. t) Pledged Tax Revenues" means Tax Revenues less the Tax Revenues set aside as provided in Sections 33334.2 and 33334.3 of the Health and Safety Code of the State of California and, pursuant to certain agreements, paid to certain other taxing agencies in the County of Riverside. u) ZZedevelopZent Agency" or Z`AgencyZ means the La Quinta Redevelopment Agency. v) Redevelopment Plan" means the Redevelopment Plan for La Quinta Redevelopment Project," approved and adopted by the City by Ordinance No. 43, and includes any amendment thereof heretofore or hereafter made pursuant to the Law. w) Redevelopment Project" means the La Quinta Redevelopment Project. x) Redevelopment Project Area" means the project area described and defined in the Redevelopment Plan. y) Regular ReZord Date" Zneans the fifteenth day of the month preceding any interest payment date. 12-O8-Z8 2563n/2338/003 4- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : SUPPLEMIZNT TO RESOLUTION NO. RA 88-14 z) ttRegulations" means regulations adopted by the Department of Treasury from time to time. aa) Reserve Requirement" means, so long as the Series 1985 Bonds are outstanding, an amount equal to Maximum Annual Debt Service on the Bonds, as such term is defined in the Resolution No. RA 85-5 and thereafter, means an amount equal to Maximum Annual Debt Service, but not to exceed 10% of the Bond proceeds, which Reserve Requirement may be maintained in cash, invested as provided in Section 16, or by an alternate security as provided in c\j Section 15(c) hereof. Lfl bb) Resolution No, RA 85-5" means the Resolution 0 of the La Quinta Redevelopment Agency adopted 3uly 30, 1985, authorizing the issuance of La Quinta Redevelopment Q) Agency, La Quinta Redevelopment Project Tax Allocation Bonds, Series 1985. cc) Series 1985 Bonds" means the $20,000,000 original principal amount of the La Quinta Redevelopment Agency, La Quinta Redevelopment Project, Tax Allocation Bonds, Series 1985. dd) Tax Revenues" means that portion of taxes levied upon taxable property in the Redevelopment Project Area and received by the Agency on or after the date of the adoption of the ordinance approving the redevelopment plan of the Agency pursuant to Article 6 of Chapter 6 of the Law and Section 16 of Article XVI of the Constitution of the State of California plus State reimbursed amounts, to the extent actually received, all as more particularly set forth hereafter in this Resolution. ee) Treasurer" or Treasurer of the Agency" means the officer who is then performing functions of Treasurer of the Agency. ff) Yield" means that yield which, when used in computing the present worth of all payments of principal and interest or other payments in the case of Nonpurpose Obligations which require payments in a form not characterized as principal and interest) on a Nonpurpose Obligation or on the Bonds produces an amount equal to the Purchase Price of such Nonpurchase Obligation or the Bonds, as the case may be, all computed as prescribed in the applicable Regulations. Section 2. Amount, Issuance and PurpoSe of Bonds. Under and pursuant to the Law and under and pursuant to this Resolution, Bonds of the Agency in a principal amount not to exceed Eight Million Dollars $8,000,000) shall be issued by 12-08-88 2563n/2338/003 5- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : SUPPLEMENT TO RESOLUTION NO. RA 88-14 398 the Agency for the corporate purposes of financing a portion of the cost of implementing the Redevelopment Plan which constitutes a tredevelopment activity'1 as such term is defined in Section 33678 of the Law and paying the Costs of Issuance; and such issue of Bonds is hereby created. Section 3. Nature of Bonds. The Bonds shall be and are special obligations of the Agency and are secured by an irrevocable pledge of, and are payable as to principal, interest thereon and premium, if any, from, Pledged Tax Revenues and other funds as hereinafter provided. The Bonds, interest thereon and premium, if any, are not a debt of the City, the State of California or any of its political subdivisions, and neither said City, said State nor any of its political subdivisions is liable on them. In no event shall the Bonds, interest thereon and premium, if any, be payable out of any funds or properties otheZ than those of the Agency as set forth in this Resolution. The Bonds do not constitute an indebtedness within the meaning of any constitutional or statutory debt limitation or restriction. Neither the members of the Agency nor any persons executing the Bonds are liable personally on the Bonds by reason of their issuance. The Bonds shall be and are equally secured, by an irrevocable pledge of the Pledged Tax Revenues and other funds as hereinafter provided, without priority for number, maturity, date of sale, date of execution or date of delivery, except as expressly provided herein. In consideration of the acceptance of the Bonds by those who shall hold the same from time to time, this Resolution shall be deemed to be and shall constitute a contract between the Agency and the Owners from time to time of the Bonds and Parity Bonds, and the covenants and agreements herein set forth to be performed on behalf of the Agency shall be for the equal and proportionate benefit, security and protection of all Owners of the Bonds and Parity Bonds without preference, priority or distinction as to security or otherwise of any of the Bonds and Parity Bonds over any of the others by reason of the number or date thereof or the time of sale, execution or delivery thereof, or otherwise for any cause whatsoever, except as expressly provided therein or herein. The validity of the Bonds is not and shall not be dependent upon: a) the completion of the Redevelopment Prolect or any part thereof, or b) the performance of any person S obligations relative to the Redevelopment Project, or c) the proper expenditures of the proceeds of the Bonds. Nothing in this Resolution shall preclude: a) the payment of the Bonds from the proceeds of refunding bonds issued pursuant to the Law, or b) the payment of the Bonds from any legally available funds. Nothing in this Resolution 12-08-88 2563n/233Z/O03 6- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : SUPPLEMENT TO RESOLUTION NO. RA 88-14 shall prevent the Agency from making advances of its own funds, howsoever derived, to any of the uses and purposes mentioned in this Resolution. If the Agency shall pay or cause to be paid, or shall have made provision to pay upon maturity or Upon redemption prior to maturity, to the Owners of the Bonds, the principal of, premium, if any, and interest to become due thereon, through setting aside trust funds or setting apart in a reserve fund or special trust account created pursuant to this Resolution or otherwise, or through the irrevocable segregation for that purpose in some sinking fund or other fund or trust \j account with a fiscal agent or otherwise, moneys sufficient Lf) therefore, including, but not limited to, interest earned or to 0 be earned on Federal Securities, then the lien of this Resolution, including, without limitation, the pledge of the m Pledged Tax Revenues, and all other rights granted hereby, shall thereupon cease, terminate and become void and be discharged and satisfied, and the principal of, premium, if any, and interest on the Bonds shall no longer be deemed to be outstanding and unpaid; provided, however, that nothing in this Resolution shall require the deposit of more than such Federal Securities as may be sufficient, taking into account both the principal amount of such Federal Securities and the interest to become due thereon, to implement any refunding of the Bonds. In the event of such a defeasance of the Bonds, the Fiscal Agent shall cause an accounting for such period or periods as shall be requested by the Agency to be prepared and filed with the Agency, and the Fiscal Agent, upon the request of the Agency, shall release the rights of the Bondowners under this Resolution and execute and deliver to the Agency all such instruments as may be desirable to evidence such release, discharge and satisfaction, and the Fiscal Agent shall pay over or deliver to the Agency all moneys or securities held by it pursuant to this Resolution which are not required for the payment or redemption of Bonds not theretofore surrendered for such payment or redemption after payment of amounts due the Fiscal Agent pursuant to Section 20 hereof. Provision shall be made by the Agency, satisfactory to the Fiscal Agent, for the mailing of a notice to the Owners of such Bonds that such moneys are so available for such payment. Section 4. DescriZtion of Bonds. The Bonds shall be in a principal amount not to exceed Eight Million Dollars $8,000,000) and shall be desigZated LA QUINTA REDEVELOPMENT AGENCY, LA QUINTA REDEVELOPMENT PROJECT, TAX ALLOCATION BONDS, SERIES 1g89.1 The Bonds shall be initially issued in the form of fully registered Serial Bonds and Term Bonds in the denomination of $5,000 each, or any whole multiple thereof. The Bonds shall bear the dated date of January 1, 1989. The 12-08-88 2563n/2338/003 7- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : SUPPLEMENT TO RESOLUTION NO RA 88-14 39Z Bonds shall mature on September 1, of the years and in the amounts and shall be payable as to interest at the rate or rates and on the dates as hereafter set forth in a resolution to be adopted by the Agency at the time of the sale by the Agency of the Bonds to the original purchasers thereof. Section 5. Interest. The Bonds shall bear interest at a rate or rates to be hereafter fixed by resolution as aforementioned, but not to exceed twelve percent 12%) per annum payable semiannually on Zarch 1 and September 1 of each year, commencing Zarch 1, 1989, or such other dates as are established by supplemental resolution of the Agency. Each Bond shall bear interest until the principal sum thereof has been paid; provided, however, that if funds are available for the payment thereof in full accordance with the terms of this Resolution, said Bond shall then cease to bear interest. Interest is calculated on the basis of a 360-day year composed of twelve 30-day months. The Bonds shall be numbered by the Fiscal Agent as the Fiscal Agent shall determine and shall be dated as of the date of authentication thereof, except that Bonds issued upon exchanges and transfers of other Bonds shall be dated Sc that no gain or loss of interest shall result from such exchange or transfer. Each fully registered Bond shall bear interest from the interest payment date next preceding the date thereof unless i) it is dated prior to the first Regular Record Date, in which event from the date of issuance of the Bonds, ii) it is dated as of an interest payment date, in which event it shall bear interest from that interest payment date, or iii) it is dated after a Regular Record Date and before the following interest payment date, and the Agency does not default in the payment of interest due on such interest payment date, in which event it shall bear interest from such interest payment date. Interest on Bonds shall be paid by the Fiscal Agent out of the appropriate funds) by check or draft mailed by first-class mail to the registered owner as his name and address appear on the register kept by the Fiscal Agent at the close of business on the Regular Record Date preceding the interest payment date. Section 6. Place of Pavment. The Bonds and any premiums upon the redemption thereof prior to maturity shall be payable in lawful money of the United States of America and shall be payable at the corporate trust office of the Fiscal Agent in Los Angeles, California. Section 7. Form of Bonds. The Bonds shall be substantially in the form attached hereto and by this reference incorporated herein as Exhibit A". Such form is hereby approved and adopted as the form of such Bonds, and of the redemption, exchange, registration and assignment provisions 12-08-88 2563n/2338/003 8- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : SUPPLEMENT TO RESOLUTION NO. RA 88-14 103 pertaining thereto, with necessary or appropriate Variations, omissions and insertions as permitted or required by this Resolution and by any subsequent supplemental resolution of the Agency Any Bonds issued pursuant to this Resolution may be initially issued in temporary form exchangeable for definitive Bonds when the same are ready for delivery. The temporary Bonds may be printed, lithographed or typewritten, shall be of such denominations as may be determined by the Agency, shall be without coupons and may contain such reference to any of the provisions of this or any supplemental resolution as may be appropriate. Every temporary Bond shall be executed by the Agency and be issued by the Fiscal Agent upon the same conditions and in substantially the same form and manner as the definitive Bonds. If the Agency issues temporary Bonds, it will execute and furnish definitive Bonds without delay, and, m thereupon, the temporary Bonds shall be surrendered for cancellation at the principal office of the Fiscal Agent in Los Angeles, California, or at such other place in California as the Agency may approve, and the Fiscal Agent shall deliver in exchange for such temporary Bonds an equal aggregate principal amount of definitive Bonds of authorized denominations of this same issue. Until so exchanged, the temporary Bonds shall be entitled to the same benefits under this Resolution as definitive Bonds of this same issue delivered hereunder, except that any interest which has accrued thereon shall not be paid until the exchange has been accomplished. Section 8. Execution of Bonds. The Bonds shall be signed on behalf of the Agency by its Chairman by his or her manual or facsimile signature and by its Secretary by his or her manual or facsimile signature, and the seal of the Agency shall be impressed, imprinted or reproduced thereon. The foregoing officers are hereby authorized and directed to sign the Bonds in accordance with this Section. If any Agency member or officer whose manual or facsimile signature appears on the Bonds ceases to be such member or officer before delivery of Bonds, his or her signature is as effective as if he or she had remained in office. The Fiscal Agent shall date and authenticate on registration and/or exchange to effectuate the registration and exchange provisions set forth in Sections 7 and 9, and only such of the Bonds as shall have endorsed thereon a certificate of authentication, substantially in the form set forth in Exhibit A, duly executed by the Fiscal Agent, shall be entitled to any rights, benefits or security under this Resolution. No Bonds shall be valid or obligatory for any purpose unless and until such certificate of authentication shall have been duly executed by the Fiscal Agent and such certificate of the Fiscal Agent, upon any such Bond, shall be conclusive and the only 12-08-88 2563n/2338/003 9- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : SUPPLEMENT TO RESOLUTION NO. RA 8B-14 104 evidence that such Bond has been duly authenticated and delivered under this Resolution. The Fiscal Agent's certificate of authentication on any Bond shall be deemed to have been duly executed if signed by an authorized signatory of the Fiscal Agent, but it shall not be necessary that the same signatory sign the certificate of authentication on all of the Zonds that may be issued hereunder at any one time. Section 9. Registration and Exchange of Bonds. The Bonds shall be issued only in fully registered form. Bonds may be exchanged for other Bonds of equal aggregate denominations of the same maturity. Transfer of ownership of a Bond shall be made by exchanging the same for a new Bond. All of such exchanges shall be made in such manner and upon such reasonable terms and conditions as may from time to time be determined and prescribed by the Agency. The Agency shall pay any costs or charges in connection therewith which shall be established by the Fiscal Agent. The person, firm or corporation requesting such exchange shall pay any tax or governmental charge that may be imposed in connection with such exchange. Each Bond issued pursuant to this Resolution shall be of a denomination which is $5,000 or a whole multiple thereof and shall be of the same issue. The Fiscal Agent shall not be required to register the transfer or exchange of any Bond during 15 days preceding selection of Bonds for redemption and as to any Bond selected for redemption. Section 10. Bond Register. The Fiscal Agent will keep or cause to be kept at its principal office in the City of Los Angeles, California, or at such other place in California as the Agency may approve, sufficient books for the registration and transfer of the Bonds, which shall at all times be open to inspection by the Agency; and, upon presentation for such purpose, the Fiscal Agent shall under such reasonable regulations as it may prescribe, register or transfer, Ot cause to be registered or transferred, on said register, the Bonds as hereinbefore provided. Section 11. Call and Reziemption of Bonds Prior to Maturity. A. Terms of Redemption. 1) Optional Redemption. The Bonds maturing on or before September 1, 1997 are not subject to call and redemption prior to maturity. The Bonds due on or after September 1, 1998 are subject ta redemption, at the option of the agency, from any source of funds, as a whole or in part in inverse order of maturity, and by lot within a maturity, on any 12-OZ-88 2563n/2338/003 10- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : SUPPLEMENT TO RESOLUTION NO RA 88-14 101 interest payment date on and after September 1, 1997 at the following redemption prices, together with accrued interest to the date of redemption: Redemption Date Redemption Price September 1, 1998 and March 1, 1999...........102 September 1, 1999 and March 1, 2000...........101 1/2% September 1, 2000 and March 1, 2001............101 September 1, 2001 and March 1, 2002............100 1/2% September 1, 2002 and thereafter...............100 2) Mandatory Sinking Fund Redemption. The Term Bond maturing on September 1, 2008 shall be subject to Cr) mandatory redemption in part, by lot, on September 1, 2004 and on each September 1 thereafter to and including September 1, 2008 from Minimum Sinking Fund Payments on hand in the Bond m Payment Fund, at the principal amount of such Bonds to be prepaid, without premium, plus accrued but unpaid interest. The principal amount of such Bonds to be so prepaid and the dates therefor shall be indicated by reZolution of the Agency. B. Call and Redemption. The Agency may and, if required by Section 11A(2), Shall) by resolution direct the call and redemption prior to maturity of Bonds by the Fiscal Agent in such amounts as funds are available therefor and shall give notice to the Fiscal Agent of such redemption not less than sixty 60) days prior to the redemption date. C. Notice of Redemption. Notice of redemption prior to maturity except as provided below) shall be given by first class mail, postage prepaid to the registered owner of each Bond at the address shown on the registration books of the Fiscal Agent not less than thirty 30) nor more than sixty 60) days prior to such redemption date. In the case of refunding, notice shall also be given as provided in Section 3 hereof. Neither failure to mail such notice nor any defect in any notice so mailed shall affect the sufficiency of the proceedings for the redemption of any Bonds. The notice of redemption shall a) state the redemption date; b) state the redemption price; c) state the numbers of the Bonds to be redeemed; provided, however, that whenever any call for redemption includes all of the outstanding Bonds, the numbers of the Bonds need not be stated; d) state, as to any Bonds redeemed in part only, the registered Bond numbers and the principal portion thereof to be redeemed; e) state that interest on the principal portion of the Bonds so designated for redemption shall cease to accrue from and after such redemption date and that on said date there shall become due and payable on each of such Bonds the redemption price thereof; f) the date of issue of the Bonds as originally issued; and g) the rate of interest borne by each Bond being redeemed. 12-08-88 2563n/2338/003 11- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : SUPPLEMENT TO RESOLUTION NO. RA 88-14 102 The actual receipt by the Owner of any Bond or notice of such redemption shall not be a condition precedent to redemption, and failure to receive such notice shall not affect the validity of the proceedings for the redemption of such Bonds or the cessation of interest on the redemption date. Notice of redemption of Bonds shall be given by the Ziscal Agent and on behalf of the Agency at the expense of the Agency. In addition to the foregoing notice, further notice shall be given by the Fiscal Agent as set out below, but no defect in said further notice nor any failure to give all or any portion of such further notice shall in any manner defeat the effectiveness of a call for redemption if notice thereof is given as above prescribed. Each further notice of redemption shall be sent 2 days prior to sending notice of redemption pursuant to the first paragraph of this Section liC by registered or certified mail or overnight delivery service to the four registered securities depositories listed below and by first-class mail to one or more of the national information services listed below as shall be specified to the Fiscal Agent by the Agency, that disseminate notice of redemption of obligations as the Bonds. Registered Securities Depositories The Depository Trust Company 711 Stewart Avenue Carden District, New York 11530 Attention. Diana Difiglia Telecopy. 516) 227-4039 or 4190 Midwest Securities Trust Company Capital Structures-Call Zotification 440 South LaSalle Street Chicago, Illinois 60605 Telecopy: 312) 663-2343 Pacific Securities Depository Trust Company Pacific and Company P. 0. Box 7041 San Francisco, California 94120 Telecopy: 415) 393-4128 Philadelphia Depository Trust Company Reorganization Division 1900 Market Street Philadelphia, Pennsylvania 19103 Attention: Bond Department Telecopy: 215) 496-5058 12-08-88 2563n/2338/003 12- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : SUPPLEMENT TO RESOLI]TION NO RA 88-14 99 National Information Services Financial Information, Inc.'s Financial Daily Called Bond Service 30 Montgomery Street, 10th Floor JerZey District, New Jersey 07302 Attention: Editor Interactive Data CorporationZs Bond Service 22 Cortland Street, 32nd floor New York, New York 10007 Kenny Information Service's Called Bond Service 55 Broad Street, 29th Floor Cr) New York, New York 10004 Moody's Investors Service 99 Church Street, 8th Floor New York, New York 10007 Attention. Municipal News Report Standard and Poor's Called Bond Record 25 Broadway, 3rd Floor New York, New York 10004 Upon the payment of the redemption price of any Bonds being redeemed, each check or other transfer of funds issued for such purpose shall bear the CUSIP number identifying, by issue and maturity, the Bonds being redeemed with the proceeds of such check or other transfer. A certificate by the Fiscal Agent that notice of redemption has been given as herein provided shall be conclusive as against all parties, and no Bondowner whose Bond is called for redemption may object thereto or object to the cessation of interest on the redemption date fixed by any claim or showing that he failed actually to receive such notice of call and redemption. D. Redemption Fund. There is Zereby created with the Fiscal Agent a special trust fund called the La Quinta Redevelopment Agency, La Quinta Redevelopment Project Tax Allocation Bonds, Series 1989, Redemption Fund" hereinafter referred to as the Redemption Fund"). There shall be set aside in the Redemption Fund, prior to mailing as above required, moneys for the purpose and sufficient to redeem, at the premiums, if any, payable as provided in this Resolution, the Bonds designated in such notice of redemption to be redeemed as provided in this Section 11A(1). Said moneys must be set aside in the Redemption Fund solely for that purpose and shall be transferred to the Fiscal Agent to be applied to the payment principal and premium, if any) of the Bonds to be 12-08-88 2563n/2338/003 13- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : SUPPLEMENT TO RESOLUTION NO. RA 88-14 100 redeemed upon presentation and surrender of such Bonds. Zoneys for the purpose and sufficient to redeem the Bonds designated in the notice as hereinbefore required to be redeemed as provided in this Section 11A(2) shall be deposited in the Bond Payment Fund on or prior to the business day preceding the redemption date. Any interest due on the Bonds on or prior to the redemption date shall be paid from the Special Fund created by this Resolution upon presentation and surrender thereof. E. Partial Redemption of Bonds. Upon surrender of any Bond redeemed in part only, the Agency shall execute and the Fiscal Agent shall authenticate and deliver to the registered owner thereof, at the expense of the Agency, a new Bond or Bonds of authorized denominations equal in aggregate principal amount to the unredeemed portion of the Bond surrendered and of the same interest rate and same maturity. Such partial redemption shall be valid upon payment of the amount thereby required to be paid to such registered owner, and the Agency and the Fiscal Agent shall be released and discharged from all liability to the extent of such payment. F. Effect of Redemption. Notice of redemption having been duly given as aforesaid, and moneys for payment of the principal of, premium, if any, and interest payable upon redemption of the Bonds being set aside as aforesaid, the Bonds, or parts thereof, as the case may be, so called for redemption shall, on the redemption date, become due and payable at the redemption price specified in sZch notice, interest on the Bonds, or parts thereof, as the case may be, so called for redemption shall cease to accrue, shall cease to be entitled to any lien, benefit or security under this Resolution, and the Owners of said Bonds shall have no rights in respect thereof except to receive payment of the redemption price thereof, and, in the case of partial redemption of Bonds, also to receive a new Bond or Bonds for the unredeemed balance as aforesaid. All Bonds, or parts theZeof, as the case may be, redeemed pursuant to the provisions of this Section shall be cancelled upon surrender thereof. G. Purchase of Bonds. The Fiscal Agent, at the written direction of the Agency, is hereby authorized to purchase Bonds on the open market at any time at a price not to exceed 102% of the principal amount thereof or the redemptZon price of the allocable Bonds on the next interest payment date plus accrued interest, if any, to the date of purchase plus brokerage fees, if any. Section 12. Funds. There was created by Resolution No. RA 85-5 with the Treasurer a special trust fund called the La Quinta Redevelopment Project Fund" hereinafter sometimes called the Redevelopment Fund"), which Redevelopment Fund is 12-08-88 2563n/2338/003 14 BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : SUPPLEMENT TO RESOLUTION NO. RA 88-14 continued for the purpose of this Resolution. There is hereby created with the Fiscal Agent a special trust fund called the ZLa Quinta Redevelopment Project, Tax Allocation Bonds, Series 1989, Special Fund" with special trust funds contained therein and known as the Bond Interest Fund, Bond Payment Fund, the Debt Service Reserve Fund and the Debt Service Special Fund. There is hereby created with the Fiscal Agent a special trust fund called the Holding Fund". So long as any of the Bonds herein authorized, or any interest thereon, remain unpaid, the moneys in the foregoing Funds shall be used for no purposes other than those required CD or permitted by this Resolution and the Law. Cr) SectZon Z3. Sale of Bonds; Disposition of Bond Proceeds; Redevelopment Fund. The Agency may provide by resolution for the sale of the Bonds in the manner provided by the Law. A. The Fiscal Agent, on behalf of the Agency, shall receive the proceeds from the sale of the Bonds, upon the delivery of the Bonds to the purchasers thereof, and shall dispose of such proceeds and moneys as follows: 1) Deposit in the Bond Interest Fund accrued interest and premium, if any, paid by the purchasers of the Bonds; 2) Deposit in the Debt Service Reserve Fund an amount, which together with $____________ transferred from the Series 1985 Bonds Special Fund, will be equal to the Reserve Requirement; 3) After making the above deposits, the balance of the proceeds from the sale of the Bonds shall be transferred to the Treasurer who shall place the same in the Redevelopment Fund. B. The moneys set aside in the Redevelopment Fund shall remain therein until from time to time expended solely for the purpose of financing a portion of the costs of the Redevelopment Project and other costs related thereto, and also including in such costs. 1) The payment, in any year during which the Agency owns the property in the Redevelopment Project Area, to any city, county, city and county, district or other public corporation which would have levied a tax upon such property had it not been exempt, an amount of money in lieu of taxes as authorized by Section 33401 of the Law; and 12-08-88 2563n/2338/003 15- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : SUPPLEMENT TO RESOLUTION NO. RA 88-14 2) The cost of any lawful purposes in connection with implementation of the Redevelopment Project, including, without limitation, those purposes authorized by Section 33445 of the Law; and 3) The Costs of Issuance and any necessary expenses in connection with the issuance and sale of the Bonds and fees of the Fiscal Agent and paying agents. If any sum remains in the Redevelopment Fund after the full accomplishment of the objects and purposes for which said Bonds were issued, said sum shall be transferred to the Special Fund. Disposition of Redevelopment Fund moneys may be further specified by supplemental resolution of the Agency. All of the above uses constitute a t1redevelopment activity as such term is defined in Section 33678 of the Law. Section 14. Tax Revenues. As provided in the Redevelopment Plan, pursuant to Article 6 of the Law and Section 16 of Article XVI of the Constitution of the State of California, taxes levied upon taxable property in the Redevelopment Project Area each year by or for the benefit of the State of California, any city, county, city and county, district, or other public corporation herein sometimes collectively called ttaxing agencies") after the effective date of the Ordinance approving the Redevelopment Plan being Ordinance No. 43 of the City of La Quinta, which became effective on December 29, 1983 shall be divided as follows. a) That portion of the taxes which would be produced by the rate upon which the tax is levied each year by or for each of the taxing agencies upon the total sum of the assessed value of the taxable property in the Redevelopment Project Area as shown upon the assessment roll used in connection with the taxation of such property by such taxing agency last equalized prior to December 29, 1983 base assessment roll"), shall be allocated to and when collected shall be paid into the funds of the respective taxing agencies as taxes by or for the taxing agencies on all other property are paid; and b) That portion of said levied taxes each year in excess of such amount shall be allocated to and when collected by the Agency shall be paid into the following funds, i) into the low and moderate income housing fund held by the Agency the amount required by the law to be deposited into said fund, and ii) the balance into the Special Fund of the Agency. 12-O8-8Z 2563n/2338/003 16- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : SUPPLEMENT TO RESOLUTION NO. RA 88-14 95 The Pledged Tax Revenues received by the Agency on or after the date of issue of the Bonds are hereby irrevocably pledged to the payment of the principal of, premium, if any, and interest on the Series 1985 Bonds and the Bonds, and any Parity Bonds, without preference, and until all of the Bonds and all interest thereon, have been paid or until monies for that purpose have been irrevocably set aside), the Pledged Tax Revenues subject to the exception set forth in Section 1S(d) shall be applied solely to the payment of the Series 1985 Bonds and the Bonds and any Parity Bonds plus premium if any, and the interest thereon as provided in this Resolution. This allocation and pledge is for the exclusive benefit of the a) Owners of the Series 1985 Bonds and the Bonds and shall be irrevocable. Annually, on or before each September 1, the Cr) Agency shall certify to the Fiscal Agent that it has transferred to the Fiscal Agent Pledged Tax Revenues as 0 required by this Section 14. The foregoing provisions of this Section are a portion of the provisions of said Article 6 of the Law as applied to the Bonds and shall be interpreted in accordance with said Article 6 of the Law, and the further provisions and definitions contained in said Article 6 of the Law are hereby incorporated herein by reference and shall apply. Section 33645 of the Health and Safety Code provides, in applicable part as follows: The resolution, trust indenture, or mortgage shall provide that tax increment funds allocated to an agency pursuant to Section 33670 shall not be payable to a trustee on account of any issued bonds when sufficient funds have been placed with the trustee to redeem all outstanding bonds of the issue." This Resolution is presently in compliance with the above quoted provision and shall be so construed. Section 15. Special Fund. All Pledged Tax Revenues, and other moneys identified herein, deposited in the Special Fund in accordance with Section 14 hereof shall be allocated as herein provided. The interest on the Bonds until maturity shall be paid by the Fiscal Agent from the Bond Interest Fund. After all interest then due on the Bonds on the next interest payment date has been paid or provided for, moneys in the Special Fund shall be applied to the payment of the principal, including Minimum Sinking Fund Payments, of the Bonds. Without limiting the generality of the foregoing and for the purpose of assuring that the payments referred to above will be made as scheduled, the Pledged Tax Revenues accumulated in the Special Fund shall be used in the following priority; provided, however, that to the extent that deposits have been made in any of the Funds referred to below from the proceeds of the sale of the Bonds or otherwise, the deposits below need not be made: 12-08-88 2563n/2338/003 17- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 :SUPPLEMENT TO RESOLUTION NO RA 88-14 a) Bond Interest Fund. Deposits shall be made into the Bond Interest Fund on or before the last day in February and on or before August 31 of each Bond Year so that the amount in said Fund on said date shall be equal to the aggregate amount of interest becoming due and payable on the then outstanding Series l9ZS Bonds and Bonds on the next succeeding interest payment date. Zoneys in the Bond Interest Fund shall be used for the payment of interest on the Bonds as the same becomes due. b) Bond Payment Fund. After the deposits have been made pursuant to subparagraph a) above, deposits shall next be made into the Bond Payment Fund so that the balance in said Fund on or before August 31 of each Bond Year is equal to the principal Corning due on the then outstanding Series 1985 Bonds and Bonds, including Minimum Sinking Fund Payments, on the next succeeding September 1. c) Debt Service Reserve Fund. After deposits have been made pursuant to subparagraphs a) and b) above, deposits shall be made to the Debt Service Reserve Funds established under Resolution No. RA 85-5 and under this Resolution from available Pledged Tax Revenues, if necessary, in order to cause the amounts on deposit therein to equal the Reserve Requirement. Money in the Debt Service Reserve Fund shall be transferred to the Bond Interest Fund and/or the Bond Payment Fund to pay interest on and principal of the Bonds, including Minimum Sinking Fund Payments, as they become due to the extent Pledged Tax Revenues are insufficient therefor. Any portion of the Debt Service Reserve Fund which is in excess of the Reserve Requirement shall be transferred to the Bond Interest Fund, semiannually on or before the last day in February and on or before August 31. The Agency may at any time elect to maintain the Reserve Requirement by obtaining i) a letter of credit, ii) a surety bond, or iii) a policy of insurance in an amount which will guarantee to the Agency the full amount of the Reserve Requirement at such times as all or any portion of the Reserve Requirement is needed for transfer to the Bond Interest Fund and/or the Bond Payment Fund as hereinbefore stated, provided that the letter of credit bank is rated in the top two rating categories by Moody's Investor's Service, Inc. and Standard & Poor's Corporation and that upon the expiration of the letter of credit, if not extended, the Agency shall obtain a substitute letter of credit, a surety bond or a policy of insurance as hereinafter provided, or shall deposit cash in the Debt Service Reserve Fund, and further provided that the issuer of any surety bond or insurance policy shall be rated in the top three rating categories by Moody's Investor's Service, Inc. and Standard & Poor's Corporation. The Agency shall direct the Fiscal Agent to acquire such 12-08-88 2563n/2338/003 18- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : SUPPLEMENT TO RESOLUTION NO. RA 88-14 93 alternate security and to pay from money in the Debt Service Reserve Fund the letter of credit fees, the cost of a surety bond, or the insurance policy premium, as the case may be. Any money in the Debt Service Reserve Fund after the Agency acquires the alternate security and pays the appropriate costs as herein provided shall be transferred to the Agency for deposit into the Redevelopment Fund. d) Holding Fund. The Fiscal Agent shall transfer from the Special Fund and deposit into the Holding Fund all moneys then remaining in the Special Fund after the above mentioned transfers have taZen place. If a) the Series CD l9Z5 Bonds are still outstanding, and b) 125% of Annual Debt Service was placed in the Special Fund in such Bond Year, and c) the Agency is not in default under the Cr) Resolution, and d) the Debt Service Reserve Fund is equal to Maximum Annual Debt Service, then all money then remaining in the Holding Fund may be returned to the Agency for any lawful purpose. If a) the Series 1985 Bonds are no longer outstanding, and b) 120% of Annual Debt Service was placed in the Special Fund in such Bond Year, and c) the Agency is not in default under the Resolution, and d) the Debt Service Reserve Fund is equal to the Reserve Requirement, then all money then remaining in the Holding Fund may be returned to the Agency for any lawful purpose. Except as set forth in the preceding sentence, all money in the Holding Fund shall be used and withdrawn by the Fiscal Agent for the purpose of replenishing the Bond Interest Fund, the Bond Payment Fund, and the Debt Service Reserve Fund, in such order, in the event of any deficiency at any time in such Funds, or for the purpose of paying the interest on or redemption premiums, if any, on the Bonds, in the event that no other money of the Agency is lawfully available therefor, or for the retirement of all the Bonds then outstanding, or, so long as the Agency is not in default hereunder, and, at the request of the Agency, for the purchase or redemption of Bonds. Any remaining Pledged Tax Revenues after providing for a), b), c), and d) above shall be transferred to the Agency and may be used in a manner provided by law for the purpose of aiding in financing the Project, including early redemption or purchase of the Bonds, as provided in this Resolution. Section 16. Deposit and Investment of Moneys in Funds. All moneys held by the Fiscal Agent in the Special Fund, the Holding Fund, the Redemption Fund or the Excess Investment Earnings Fund shall be i) invested at the written direction of the Agency in Federal Securities, or ii) held in trust accounts, time or demand deposits, including certificates of deposit, in any commercial banZ or trust company authorized to accept deposits of public funds including the banking 12-08-88 2S63n/2338/003 BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : SUPPLEMENT TO RESOLUTION NO RA 88-14 94 department of the Fiscal Agent) which are fully insured by the Federal Deposit Insurance Corporation or the Federal Savings and Loan Insurance Corporation or are secured at all times by Federal Securities, or secured at all times by bonds or other obligations which are authorized by law as security for public deposits, of a market value at least equal to the amount required by law, or iii) invested in a taxable government money market portfolio restricted to obligations with maturities of one year or less, issued or guaranteed as to payment of principal and interest by the full faith and credit of the United States or repurchase agreements collateralized by such obligations. If the Fiscal Agent receives no written directions from the Agency as to the investment of moneys held in any Fund or Account, the Fiscal Agent shall, pending receipt of instructions, invest such moneys in a taxable government money market portfolio as described in iii) above. a) Moneys in the Redevelopment Fund may be invested in any investment authorized by law for the investment of Agency money, which will by their terms mature not later than the date the Agency estimates the moneys represented by the particular investment will be needed for withdrawal from such Fund. b) Moneys in the Bond Interest Fund and the Bond Payment Fund shall be invested only in obligations which will by their terms mature on such dates as to ensure that before each interest payment date and principal payment date there will be in such Funds, from matured obligations and other moneys already in such Funds, cash equal to the interest and principal payable on the respective payment dates. c) Except as provided in Section 15(c) hereof, moneys in the Debt Service Reserve Fund shall be invested in obligations which will by their terms mature prior to the date which is the final maturity date of the Bonds. Except as otherwise provided herein, obligations purchased as an investment of moneys in any of said Funds shall be deemed at all times to be a part of such respective Fund and the interest accruing thereon and any gain realized from such investment shall be credited to such Fund and any loss resulting from any such authorized investment shall be charged to such Fund without liability to the Agency or the members and officers thereof or to the Fiscal Agent. The Agency or the Fiscal Agent, as the case may be, shall sell at the best price obtainable or present for redemption any obligation so purchased whenever it shall be necessary to do so in order to provide moneys to meet any payment or transfer from such Fund as required by this Resolution. The investment constituting a part of such Fund shall be valued at the then estimated or 12-08-88 2563n/2338/003 20- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 : SUPPLEMENT TO RESOLUTION NO. RA 88-14 91 appraised market value of such investment or face amount thereof, which ever is lower; providedZ however, that investments in the Bond Interest Fund and the Bond Payment Fund shall be valued at the face amount thereof. Section 17. Issuance of Parity Bonds. The Agency may provide for the issuance of, and sell, Parity Bonds in such principal amounts as it estimates will be needed for the Redevelopment Project purposes. Until such time as the Series 1985 Bonds are no longer outstanding under the terms of Resolution No. RA Z5-5, any Parity Bonds issued under this Resolution shall comply with Section 17 of Resolution NO. RA 85-5. Cr) At such time as the Series 1985 Bonds are no longer outstanding, the issuance and sale of any Parity Bonds shall be m subject to the following conditions precedent: a) The Agency shall be in compliance with all covenants in this Resolution; b) The Parity Bonds shall be on such terms and conditions as may be set forth in a supplemental resolution, which shall provide for i) bonds substantially in accordance with the Resolution, ii) the deposit into the Debt Service Reserve Fund, or the acquisition of an alternate security as provided in Section 15(c) hereof, in an amount sufficient, together with the balance of the Debt Service Reserve Fund, to equal the Zaximum Annual Debt Service on all Bonds expected to be outstanding including the outstanding Bonds and Parity Bonds, iii) the disposition of surplus Pledged Tax Revenues in substantially the same manner as Section 15(d) hereof; c) Receipt of a certificate of an Independent Financial Consultant showing. i) The current and each future Bond Year the Annual Debt Service for each such Bond Year with respect to all Bonds and Parity Bonds reasonably expected to be outstanding following the issuance of such Parity Bonds; ii) For the then current Bond Year, A) the Pledged Tax Revenues including revenue attributable to utility property to be received by the Agency based upon the most recent assessed valuation of taxable property in the Redevelopment Project Area certified by the appropriate officer of the County of Riverside or any value attributable to assessment of utility property) plus B) additional Pledged Tax Revenues to be received by the Agency due to expected increases in assessed valuation of taxable property in the 12-08-88 2563n/2338/003 21- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 !: SflPPLEMENZ TO RESOLUTION NO. RA 88-14 92 Redeveloprnent Project Area resulting from construction which has been completed but the assessed value of which is not yet included on the assessment roll or any supplemental roll) as projected and certified by an Independent Redevelopment Consultant; iii) Any tax revenues attributable to the assessment of utility property to be received by the Agency in the current Bond Year; and iv) That for the then current Bond Year, the Pledged Tax Revenues referred to in item ii)(A) and B) above are at least equal to 1.20 times the Annual Debt Service referred to in item i) above. d) Such Parity Bonds shall mature on September 1 and interest thereon shall be payable on March 1 and September 1, subject to such dates being changed by a supplemental resolution of the Agency. Section 18. Covenants of the AgencZ. As long as the Bonds are outstanding and unpaid, the Agency shall through its proper members, officers, agents or employees) faithfully perform and abide by all of the covenants, undertakings and provisions contained in this Resolution or in any Bond issued hereunder, including the following covenants and agreements for the benefit of the Bondowners Which are necessary, convenient and desirable to secure the Bonds and will tend to make them more marketable; provided, however, that said Covenants do not require the Agency to expend any funds other than the Tax Revenues: Covenant 1. Complete Redevelopment Project; Amendment to Redevelopment Plan. The Agency covenants and agrees that it will diligently carry out and continue to completion, with all practicable dispatch, the Redevelopment Project in accordance with its duty to do so under and in accordance with the Law and the Redevelopment Plan and in a sound and economical manner. The Redevelopment Plan may be amended as provided in the Law but no amendment shall be made unless it will not substantially impair the security of the Bonds or the rights of the Bondowners, as shown by an Opinion of Counsel, based upon a certificate or opinion of an Independent Financial Consultant appointed by the Agency. Covenant 2. Use of Proceeds, Management and Operation of Properties. The Agency covenants and agrees that the proceeds of the sale of the Bonds will be deposited and used as provided in this Resolution and any supplemental resolution and that it will manage and operate all properties owned by it comprising any part of the Redevelopment Project in a sound and businesslike manner. 12-08-88 2563n/2338/003 22- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 ": SUPPLEMENT TO RESOLUTION NO. RA 88-14 Covenant 3. No PrioritZ. The Agency covenants and agrees that it will not issue any obligations payable, either as to principal or interest, from the Pledged Tax Revenues which have, or purport to have, any lien upon the Pledged Tax Revenues prior or superior to the lien of the Bonds herein authorized. Except as permitted by Section 17 hereof, it will not issue any obligations, payable as to principal or interest, from the Pledged Tax Revenues, which have, or purport to have, any lien upon the Pledged Tax Revenues on a parity with the Bonds herein authorized. Notwithstanding the foregoing, nothing in this Resolution shall prevent. the Agency i) from issuing and selling pursuant to law, refunding obligations a) payable from and having any lawful lien upon the Pledged Tax Revenues, if such refunding obligations are issued for the Cr) purpose of, and are sufficient for the purpose of, refunding all of the outstanding Bonds or Parity Bonds, or ii) from m issuing and selling obligations which have, or purport to have, any lien upon the Pledged Tax Revenues which is junior to the Bonds or iii) from issuing and selling bonds or other obligations which are payable in whole or in part from sources other than the Pledged Tax Revenues. As used herein Z shall include, without limitation, bonds, notes, interim certificateZ, debentures or other obligations. Covenant 4. Punctual Payment. The Agency covenants and agrees that it will duly and punctually pay or cause to be paid the principal of and interest on each of the Bonds issued hereunder on the date, at the place and in the manner provided in the Bonds. Covenant 5. Payment of Taxes and Other Charges. The Agency covenants and agrees that it will from time to time pay and discharge, or cause to be paid and discharged, all payments in lieu of taxes, service charges, assessments or other governmental charges which may lawfully be imposed upon the Agency or any of the properties then owned by it in the Redevelopment Project Area, or upon the revenues and income therefrom, and will pay all lawful claims for labor, materials and supplies which if unpaid might become a lien or charge upon any of said properties, revenues or income or which might impair the security of the Bonds or the use of Pledged Tax Revenues or other legally available funds to pay the principal of and interest thereon, all to the end that the priority and security of the Bonds shall be preserved; provided, however, that nothing in this Covenant shall require the Agency to make any such payment so long as the Agency in good faith shall contest the validity thereof. Covenant 6. Books and Accounts; Financial Statements. The Agency covenants and agrees that it will at all times keep, or cause to be kept, proper and current books and accounts separate from all other records and accounts) in which 12-08-88 2563n/2338/003 23- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 #: SUPPLEMENT TO RESOLUTION NO. RA 68-14 90 complete and accurate entries shall be made of all transactions relating to the Redevelopment Project and the Pledged Tax Revenues and other funds relating to said Project, and will prepare within one hundred and eighty 180) days after the close of each of its Fiscal Years a complete financial statement or statements for such year in reasonable detail covering such Redevelopment Project and the Pledged Tax Revenues and other funds, accompanied by an opinion of an Independent Certified Public Accountant appointed by the Agency, and will furnish a copy of such statement or statements to the Fiscal Agent, the original purchaser(s) of the Bonds in the case of a syndicate, the manager thereof), and any rating agency which maintains a rating on the Bonds, and, upon written request, to any Bondowner. Covenant 7. Eminent Domain. The Agency covenants and agrees that if all or any part of the Redevelopment Project Area should be taken from it without its consent, by eminent domain proceedings or other proceedings authorized by law, for any public or other use under which the property will be tax exempt, the Agency will use its best efforts to have the base assessment roll reduced by the amount of the assessment of said property as shown on said base assessment roll. Covenant 8. Disposition of Property. The Agency covenants and agrees that it will not dispose of more than ten percent 10%) of the land area in the Redevelopment Project Area except property shown in the Redevelopment Plan in effect on the date this Resolution is adopted as planned for public use, or property to be used for public streets, public offstreet parking, sewage facilities, parks, easements or right-of-way for public utilities, or other similar uses) to public bodies or other persons or entities whose property is tax exempt, unless such disposition will not result in the security of the Bonds or the rights of Bondowners being substantially impaired, as shown by an Opinion of Counsel, based upon the certificate or opinion of an Independent Financial Consultant appointed by the Agency. Covenant g Statement of Indebtedness. The Agency covenants and agrees to file annually with the County Auditor a statement of indebtedness as provided in Section 33675 of the Law. Covenant 10. Protection of Security and Rights of Bondowners; Tax Covenant. The Agency covenants and agrees to preserve and protect the security of the Bonds and the rights of the Bondowners and to defend their rights under all claims and demands of all persons. Without limiting the generality of the foregoing, the Agency covenants and agrees to contest by court action or otherwise a) the assertion by any officer of any government unit or any other person whatsoever against the Agency that i) the Law is unconstitutional or ii) that the Tax Revenues pledged hereunder cannot be paid to the Agency for the debt service on the Bonds, or b) any other action 12-08-88 2563n/2338/003 24- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 $: SUPPLEMENT Zo RESOLUZION NO. RA 88-14 affecting the validity of the Bonds or diluting the security therefor, or c) any assertion by the United States of America or any department or agency thereof or any other person that the interest received by the Bondowners is taxable under federal income tax laws by reason of any action of the Agency. The Agency covenants and agrees to take no action which, in the Opinion of Counsel would result in the Pledged Tax Revenues being withheld unless the withholding thereof is being contested in good faith. In order to preserve the exclusion from gross income of interest on the Bonds and any Parity Bonds for federal income tax purposes, the Agency covenants to comply with all applicable requirements of the Code, together with any Cr) amendments thereto or regulations promulgated thereunder necessary to preserve such exclusion from gross income and Co specifically covenants, without limiting the generality of the foregoing, that: 1) it will make no use of the proceeds of the Bonds or Parity Bonds at any time which will cause the Zonds or Parity Bonds to be 1arbitrage bonds" within the meaning of Section 148 of the Code and applicable Regulations adopted thereunder by the Internal Revenue Service; 2) it will not use in excess of 5% of the proceeds of the Bonds or Parity Bonds to make or finance loans to any person other than a governmental unit other than loans which are used to acquire or carry Nonpurpose Investments or are for the purpose of enabling the borrower to finance any governmental tax or assessment of general application for a specific essential governmental function, all as set forth in Section 141(c) of the Code); 3) it will neither use nor permit the use of more than 10% of the proZeeds of the Bonds or Parity Bonds for any private business use, or enter into an arrangement such that more than 10% of the proceeds of the Bonds or Parity Bonds is, directly or indirectly, secured by any interest in i) property used or to be used for a private business use or ii) payments in respect of such property or to be derived from payments in respect of property, or borrowed money, used or to be used for a private business use, all as set forth in Section 141(b) of the Code, or take any other action which would cause the Bonds or Parity Bonds to be private activity bonds" within the meaning of Section 141(a) of the Code; 4) it will ensure that the payment of principal of and interest on the Bonds or Parity Bonds shall not be directly or indirectly guaranteed in whole or in part) by the United States or any agency or instrumentality 12-0Z-86 2563n/2338/003 25- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 %:SUPPLEMENT TO RESOLUTION NO. RA 8B-14 thereof) and no portion of the moneys contained in any of the Funds created herein Bhall be i) used in Zaking loans guaranteed by the United States or any agency or instrumentality thereof); ii) invested directly or indirectly in deposits or accounts insured by the Federal Deposit Insurance Corporation, Federal Savings and Loan Insurance Corporation, National Credit Union Administration or any other similar federally chartered corporation; iii) otherwise invested directly or indirectly in obligations guaranteed in whole or in part) by the United States or any agency or instrumentality thereof); except 1) during the initial period following issuance of the Bonds or Parity Bonds and ending on the final expenditure of the Bond or Parity Bond proceeds; 2) for amounts held in the Debt Service Reserve Fund, or other reserve funds satisfying Section 148(d) of the Code; 3) for amounts held in the Bond Interest Fund and Bond Payment Fund and any other bona fide debt service funds; 4) for investments in obligations issued by the United States Treasury; 5) for investments in obligations guaranteed by the Federal National Mortgage Association, Government National Mortgage Association or Federal Home Loan Zortgage Corporation, or 6) for investments permitted under Regulations issued pursuant to Section 149(b)(3)(B) of the Code; and 5) i) it shall keep a detailed accounting of all transactions contemplated under this Resolution or any Supplemental Resolution or in any way relating to the receipt or disbursement of any of the Gross Proceeds of the Bonds or Parity Bonds for a period of six years after the later of the date of payment of all Excess Investment Earnings to the United States or the date the Agency disburses the last of the Gross Proceeds of the Bonds or Parity Bonds; ii) except for the investment of moneys in tax-exempt bonds or Gross Proceeds invested during an applicable temporary period permitted under the Regulations, it will not allow Gross Proceeds of the Bonds or Parity Bonds to be invested at any time in Nonpurpose Obligations with a Yield in excess of the lesser of the Yield on the Bonds or the Parity Bonds without an opinion of Bond Counsel to the effect that investment at a higher Yield will not adversely affect the exclusion from gross income of interest on the Bonds or any Parity Bonds for federal income tax purposes; iii) it Will neither invest Gross Proceeds nor cause Gross Proceeds to be invested in Nonpurpose Obligations if the Yield on such Nonpurpose Obligations would be less than the Yield that would have resulted in an arm's-length transaction; and iv) it will not sell or otherwise dispose of or cause to be sold or otherwise disposed of Nonpurpose Obligations, if such sale or disposition would result in a smaller profit or larger loss than would have resulted from a sale at fair market value arrived at in an arm1s-length transaction. 12-08-88 2563n/2338/O03 26- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 &: SUPPLEMENT TO RESOLUTION NO. RA 88-14 85 Section 19. Taxation of Leased ropertZ. Whenever any property in the Redevelopment Project Area has been redeveloped and thereafter is leased by the Agency to any person or persons other than a public agency) or whenever the Agency leases real property in the Redevelopment Project Area to any person or persons other than a public agency) for redevelopment, the property shall be assessed and taxed in the same manner as privately owned property, as required by Section 33673 of the Law, and the lease or contract shall provide a) that the lessee shall pay taxes upon the assessed value of the entire property and not merely upon the assessed value of his or its leasehold interest, and b) that if for any reason the a) taxes levied on such property in any year during the term of the lease or contract are less than the taxes which would have Cr) been levied Zf the entire property had been assessed and taxed in the same manner as privately owned property, the lessee shall pay such difference to the Agency within thirty 30) days Co after the taxes for such year become payable to the taxing agencies and in no event later than the delinquency date of such taxes established by law. All such payments shall be treated as Pledged Tax Revenues, and when received by the Agency shall be transferred to the Fiscal Agent for deposit in the Special Fund. Section 20. Fiscal Agent. The Agency hereby appoints Security Pacific National Bank as Fiscal Agent hereunder, to act as the fiscal agent, bond registrar and paying agent of the Agency for the purpose of receiving Pledged Tax Revenues and other funds in trust as provided in this Resolution, to hold, allocate, use and apply the Pledged Tax Revenues and other funds in trust as provided in this Resolution, and to perform the other duties and powers of the Fiscal Agent as are prescribed in this Resolution. The Agency agrees to pay the Fiscal Agent its reasonable fees and expenses incurred in fulfilling its duties as set forth in this Resolution. The Fiscal Agent shall signify its acceptance of the duties and obligations imposed upon it by this Resolution by executing and delivering to the Agency a written acceptance thereof; and, by executing and delivering such acceptance, the Fiscal Agent shall be deemed to have accepted such duties and obligations, but only upon the terms and conditions set forth in this Resolution. The Agency may, with or without cause, remove the Fiscal Agent initially appointed, or any successor, following a breach by the Fiscal Agent of itZ duties hereunder. Upon the removal of the Fiscal Agent, the Agency shall forthwith appoint a successor thereto, but any successor shall be a commercial bank or trust company doing business and having an office in the City of San Francisco or the City of Los Angeles and having a combined capital exclusive of borrowed capital) and surplus of at least $75,000,000 and subject to supervision or examination by federal or state authority. If such bank or 12-08-88 2563n/2338/003 27- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 ':SUPPLEMENZ TO RESOLUTION NO RA 88-14 trust company publishes a report of condition at least annually, pursuant to law or to the requirements of any supervising or examining authority above referred to, then for the purposes of this Section the combined capital and surplus of such bank or trust company shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. The Fiscal Agent or any substituted Fiscal Agent may at any time resign by filing written notice thereof with the Agency. Upon a resignation in writing, the Agency shall forthwith appoint a substitute Fiscal Agent, and the resignation shall become effective upon appointment. In the event that the Fiscal Agent or any successor becomes incapable of acting as such, the Agency shall forthwith appoint a substitute Fiscal Agent. Any bank or trust company into which the Fiscal Agent may be merged or with which it may be consolidated shall become the Fiscal Agent without action of the Agency. The Fiscal Agent may become the owner of any of the Bonds authorized by this Resolution with the same rights it would have had if it were not the Fiscal Agent. The Fiscal Agent shall have no duty or obligation to enforce the collection of or to exercise diligence in the enforcement of the collection of funds assigned to it hereunder, or as to the correctness of any amounts received, but its liability shall be limited to the proper accounting for the funds that it actually receives. The recitals of fact and all promises, covenants and agreements herein and in the Bonds shall be taken as statements, promises, covenants and agreements of the Agency, and the Fiscal Agent assumes no responsibility for the correctness of them, and makes no repreZentations as to the validity or sufficiency of this Resolution or of the Bonds, and shall incur no responsibility in respect thereof, other than in connection with the duties or obligations herein or in the Bonds assigned to or imposed upon the Fiscal Agent. The Fiscal Agent shall not be liable in connection with the performance of its duties hereunder, except for its own negligence or default. The Fiscal Agent shall be obligated to perform only such duties as are specifically set forth in this ResolutiQn and no implied duties or obligations shall be read into this Resolution against the Fiscal Agent. No provision in this Resolution shall require the Fiscal Agent to risk or expend its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not assured to it. 12-08-88 2563n/2338/003 28- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 (: SUPPLEMENT TO RESOLUTION NO. RA 88-14 In accepting its duties hereunto er, t e Fiscal Agent acts solely as FZscal Agent for the Owners and under no circumstances shall the Fiscal Agent be liable in its individual capacity for the principal, premium, if any, or interest due on the Bonds. The Fiscal Agent shall not be accountable for the use or application by the Agency of any funds which the Fiscal Agent has released under this Resolution. The Agency agrees to pay the Fiscal Agent for its services this payment shall not be limited by any provision of law affecting the compensation of a Fiscal Agent). Further, the Agency shall pay or reimburse the Fiscal Agent upon its Cr) request for all reasonable expenses of the Fiscal Agent, including the reasonable compensation and the expenses of its counsel. The Agency agrees to indemnify and hold harmless the Fiscal Agent against all claims, demands, losses, damages, liabilities or expenses including, but not limited to reasonable attorneys' fees) relating to i) Fiscal Agent exercising its rights or performing its duties under this Resolution, or ii) Fiscal Agent being appointed and serving as such under this Resolution, or iii) otherwise relating to this Resolution or the Bonds, except to the extent resulting from Fiscal Agent's own negligence or willful misconduct. Section 21. Excess Investment Earnings Fund. a) The Agency shall calculate Excess Investment Earnings in accordance with paragraph b) and shall pay Excess Investment Earnings to the United States government in accordance with paragraph c). The term Excess Investment Earnings" means an amount equal to the sum of: i) the excess of: A) the aggregate amount earned from the Delivery Date on all Nonpurpose Obligations in which Gross Proceeds of the Bonds are invested other than amounts attributable to an excess described in this subparagraph i)), over B) the amount that would have been earned if the yield on such Nonpurpose Obligations other than amounts attributable to an excess described in this subparagraph i)) had been equal to the Yield on the Bonds, plus ii) any income attributable to the excess described in paragraph i). 12-O8-8Z 2563n/2338/003 29- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 ): SUPPLEMENT TO RESOLUTION NO RA 88-14 84 b) Within 20 days following the first Computation Year, the Agency shall calculate the Excess Investment Earnings referenced in subparagraph i) of paragraph a) and shall direct the Fiscal Agent to deposit the same into the Excess Investment Earnings Fund to the extent funds are available from any legally available funds, including the Debt Service Zeserve Fund. Thereafter, within 20 days following the last day of each Computation Year and within 20 days following the date of the retirement of the Bonds, the Agency shall calculate the amount of Excess Investment Earnings referenced in subparagraphs i) and ii) of paragraph a) and the Fiscal Agent, at the direction of the Agency, shall make corresponding transfers into the Excess Investment Earnings Fund from the sources Specified in the preceding sentence. The calculations shall be inade in accordance with the following: 1) Except as provided in 2), in determining the amount described in subparagraph i)(A) of paragraph a), the aggregate amount earned on Nonpurpose Obligations shall include i) all income realized under federal income tax accounting principles whether or not the person earning such income is subject to federal income tax) with respect to such Nonpurpose Obligation and with respect to the reinvestment of investment receipts from such Nonpurpose Obligations without regard to the transaction costs incurred in acquiring, carrying, selling or redeeming such Nonpurpose Obligations), including, but not limited to, gain or loss realized on the disposition of such Nonpurpose Obligations without regard to when such gains are taken into account under Section 453 of the Code relating to the taxable year of inclusion of gross income), and income under Section 1272 of the Code relating to original issue discount) and ii) any unrealized gain or loss as of the date of retirement of the Bonds if any Nonpurpose Obligation is retained after such date. 2) In determining the amount described in subparagraph i) of paragraph a), an obligation or security shall be treated as acquired for its fair market value at the time it becomes a Nonpurpose Obligation, so that gain or loss on the disposition of such an obligation or security shall be computed with reference to such fair marZet value as its adjusted basis. 3) In determining the amount described in subparagraph i)(B) of paragraph a), the Yield on the Bonds shall be determined based on the actual Yield of the Bonds during the period between the Delivery Date and the date the computation is made with adjustments for discount or premium). 12-08-88 2563n/2338/003 30- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 *: SUPPLEMENT TO RESOLUTION NO. RA 88-14 81 4) In determining the amount described in subparagraph ii) of paragraph a), all income attributable to the excess described in subparagraph i) of paragraph a) must be taken into account, whether or not that income exceeds the Yield on the Bonds, and no amount may be treated as negative arbitrage.Zf S) In determining the amount described in subsection a) of this Section, there shall be excluded any amount earned on any fund or account which is used primarily to achieve a proper matching of revenues and annual debt service on the Bonds during each Bond Year and CD which is depleted at least once a year except for a reasonable carryover amount not in excess of the greater of Cr) one year's earnings on such fund or account or one-twelfth 1/12) of annual debt service on the Bonds, as well as amounts earned on said earnings if the gross earnings on m all such funds for the Computation Year are less than $100,000. c) At the direZtion of the Agency the Fiscal Agent shall pay Excess Investment Earnings to the United States government in installments with the first payment to be made not later than thirty 30) days after the end of the fifth Computation Year and with subsequent payments to be made not later than five 5) years after the preceding payment was due. The Agency shall assure that each installment is in an amount equal to at least 90 percent of the Excess Investment Earnings with respect to the Bonds as of the close of the computation period. Not later than thirty 30) days after the retirement of the Bonds, the Fiscal Agent, at the direction of the Agency, shall pay from the Excess Investment Earnings Fund, or the Agency shall pay directly from funds legally available for such purpose, 100 percent of the theretofore unpaid Excess Investment Earnings of the Bonds. The Fiscal Agent shall remit such payments to the United States government at the address and in the manner directed by the Agency prescribed by the Regulations as the Same may be in time to time in effect, together with such reports and statements prepared by Agency as may be prescribed by such Regulations. d) In order to assure that Excess Investment Earnings are paid to the United States rather than to a third party, investments in certificates of deposit and in Investment Agreements shall be made only in accordance with the Regulations therefor as from time to time in effect. e) The Agency shall keep and retain for a period of six 6) years following the retirement of the Bonds records of the determinations made pursuant to this Section. The Fiscal Agent shall keep a record of all investments made with moneys 12-08-88 2563n/2338/003 31- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 +: SUPPLEMENT TO RESOLUTION NO. RA 88-14 82 on deposit in any Fund or Account established hereunder. Such records shall contain a reference to the date of purchase, the date of sale, the purchase price, the sales price, the principal amount and coupon rate of each obligation purchased or sold. f) Payments pursuant to this Section shall be made to the maximum extent possible from moneys on deposit in the Excess Investment Earnings Fund and, to the extent of any deficiency therein for such purpose, shall be made from the Zeserve Fund. In the event of any remaining deficiency in available moneys for the purposes of such transfer, such deficiency shall be paid by the Agency from any legally available funds. g) The Agency shall compute Excess Investment Earnings on any Parity Bonds in accordance with the provisions of this Section 21 and may make a joint computation for the Bonds and any Parity Bonds with an opinion of Bond Counsel to the effect that a joint computation will not adversely affect the exclusion from gross income for federal income tax purposes of interest on the Bonds or any Parity Bonds then outstanding. h) Notwithstanding the foregoing, the foregoing method of computing Excess Investment Earnings may be modified, in Whole or in part, without the consent of the Owners of the Bonds or any Parity Bonds, upon receipt by the Agency of an opinion of Bond Counsel to the effect that such modification will not adversely affect the exclusion from gross income for federal income tax purposes of interest on the Bonds or any Parity Bonds then outstanding. Section 22. Lost, Stolen, Destroyed or Mutilated Bonds. In the event that any Bond is lost, stolen, destroyed or mutilated, the Agency will cause to be issued a new Bond(s) on reasonable terms and conditions, including the payment of costs and the posting of a surety bond if the Agency or Fiscal Agent deems such surety bond necessary, as may from time to time be determined and prescribed by resolution. The Agency may authorize such new Bond to be signed and authenticated in such manner as it determines in said resolution. Section 23. Cancellation of Bonds. All Bonds surrendered to the Fiscal Agent for payment at the maturity thereof or, in the case of call and redemption prior to maturity, at the redemption date, shall upon payment therefor be cancelled immediately and destroyed by the Fiscal Agent and a certificate of destruction shall forthwith be transmitted to the Treasurer. Any Bonds purchased by the Fiscal Agent as aforesaid shall be cancelled immediately and destroyed as aforesaid. 2563n/2338/003 32- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 ,: SUPPLEMEN TO RESOLUTION NO RA 88-14 Section 24. Amendments. This Resolution, and the rights and obligations of the Agency and of the Owners of the Bonds issued hereunder, may be modified or amended at any time by supplemental resolution adopted by the Agency. a) for any purpose at any time prior to the sale of the Bonds; b) without the consent of Bondowners, if such Zodification or amendment is for the purpose of adding covenants and agreements to further secure Bond payment, to prescribe further limitations and restrictions on Bond issuance, to surrender rights or privileges of the Agency, to make notifications not affecting any outstanding series of Bonds only with the consent of the Fiscal Agent, for the purpose of curing any ambiguities, m defects or inconsistent provisions in this Resolution or to insert such provisions clarifying matters or questions arising Cr) under this Resolution as are necessary and desirable to accomplish the same, provided that such modifications or amendments do not adversely affect the rights of the Owners of m any outstanding Bonds; c) for any purpose with the consent of the Bondowners holding sixty percent 60%) in aggregate principal amount of the outstanding Bonds, exclusive of Bonds, if any, owned by the Agency or the City, and obtained as hereinafter set forth; provided, however, that no such modification or amendment shall, without the express consent of the registered owner of the Bond affected, reduce the principal amount of any Bond, reduce the interest rate payable thereon, extend its maturity or the times for paying interest thereon, change the monetary medium in which principal and interest is payable, or create a mortgage, pledge or lien upon the revenues superior to or on a parity with the pledge and lien created for the Bonds and any Farity Bonds or reduce the percentage of consent required for amendment or modification. Any act done pursuant to a modification or amendment so consented to shall be binding upon the Owners of all of the Bonds and shall not be deemed an infringement of any of the provisions of this Resolution or of the Law, whatever the character of such act may be, and may be done and performed as fully and freely as if expressly permitted by the terms of this Resolution, and after such consent relating to such specified matters has been given, no Bondowner or Owner shall have any right or interest to object to such action or in any manner to question the propriety thereof or to enjoin or restrain the Agency or any officer thereof from taking any action pursuant thereto. A. Calling Bondowners' Zeeting. If the Agency shall desire to obtain any such consent it shall duly adopt a resolution calling a meeting of the Bondowners for the purpose of considering the action the consent to which is desired. 12-OZ-88 2563n/233B/003 33- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 -: SUPPLEMENT TO RESOLUTION NO. RA 88-14 80 B. Notice of Meeting. Notice specifying the purpose, place, date and hour of such meeting shall be mailed by the Agency, postage prepaid, to the respective registered owners of the Bonds as their addresses appear on the registration books of the Fiscal Agent. The place, date and hour of holding such meeting and the date or dates of mailing such notice shall be determined by the Agency in its discretion. Such notice shall set forth the nature of the proposed action to which consent is desired. The place, date and hour of holding such meeting and the date or dates of mailing such notice shall be determined by the Agency in its discretion. The actual receipt by any Bondowner of notice of any such meeting shall not be a condition precedent to the holding of such meeting, and failure to receive such notice shall not affect the validity of any proceedings at such meeting. A certificate by the Secretary of the Agency approved by resolution of the Agency, that the meeting has been called and that notice thereof has been given as herein provided, shall be conclusive as against all parties and it shall not be open to any Bondowner to show that he failed to receive actual notice of such meeting. C. Voting Qualifications. The Fiscal Agent shall prepare and deliver to the chairman of the meeting a statement of the names and addresses of the registered owners of Bonds, such statement to show maturities, serial numbers and the principal amounts so that voting qualifications can be determined. No Bondowners shall be entitled to vote at such meeting unless their names appear upon such statement. No Bondowners shall be permitted to vote with respect to a larger aggregate principal amount of Bonds than is set against their names on such statement. D. Issuer-Owned Bonds. The Agency covenants that it will present at the meeting a certificate, signed and verified by one member thereof and by the Treasurer, stating the serial numbers, maturities and principal amounts of all Bonds owned by, or held for account of, the Agency or the City, directly or indirectly. No person shall be permitted at the meeting to vote or consent with respect to any Bond appearing upon such certificate, or any Bond which it shall be established at or prior to the meeting is owned by the Agency or the City, directly or indirectly, and no such Bond in this Resolution It referred to as issuer-owned Bonds") shall be counted in determining whether a quorum is present at the meeting. E. Quorum and Procedure. A representation of at least sixty percent 60%) in aggregate principal amount of the Bonds then outstanding exclusive of issuer-owned Bonds, if any) shall be necessary to constitute a quorum at any meeting l2-O8-ZZ 2563n/2338/003 34- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 .: STJPPLEMENT TO RESOLUTION NO. RA 88-14 of Bondowners, but less than a quorum may adjourn the meeting from time to time, and the meeting may be held as so adjourned without further notice, whether such adjournment shall have been held by a quorum or by less than a quorum. The Agency shall, by an instrument in writing, appoint a temporary chairman of the meeting, and the meeting shall be organized by the election of a permanent chairman and secretary. At any meeting each Bondowner shall be entitled to one vote for every $5,000 principal amount of Bonds with respect to which he shall be qualified to vote as aforesaid, and such vote may be given in person or by proxy duly appointed by an instrument in writing presented at the meeting. The Agency and/or the Ziscal Agent by their duly authorized representatives and counsel, may attend any meeting of the Bondowners, but shall not be required Cr) to do so. F. Vote Required. At any such meeting held as m aforesaid there shall be submitted for the consideration and action of the Bondowners a statement of the proposed action consent to which is desired, and if such action shall be consented to and approved by Bondowners holding at least sixty percent 60%) in aggregate principal amount of the Bonds then outstanding exclusive of issuer-owned Bonds) the chairman and secretary of the meeting shall so certify in writing to the Agency, and such certificate shall constitute complete evidence of consent of the Bondowners under the provision of this Resolution. A certificate signed and verified by the chairman and the secretary of any such meeting shall be conclusive evidence and the only competent evidence of matters stated in such certificate relating to proceedings taken at such meeting. G Consent Without a Zeeting. If the Agency should desire to obtain the consent of the Owners to any proposed amendment hereto without a meeting of the Owners, the Agency may, by resolution, propose the amendment to which consent is desired. A copy of such resolution, together with a request to Owners for their consent to the amendment proposed therein, shall be mailed by the Fiscal Agent, at the expense of the Agency, first-class mail, postage prepaid, to each registered Owner at such Owner's address as it appears on the Bond Register. The lack of actual receipt by any Owner of such resolution and request for consent and any defects in such resolution and request for consent shall not affect the validity of the proceedings for the obtaining of such consent. A certificate by the Agency Secretary, approved by resolution of the Agency, that said resolution arid request for consent have been delivered as herein provided shall be conclusive as against all parties. 12-08-88 2563n/2338/003 35- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 /: SUPPLEMENT TO RESOLUTION NO. RA 8B-14 Any such written consent shall be binding upon the Owner giving such consent and on any subsequent Owner whether or not such subsequent Owner has notice thereof) unless such consent is revoked in writing by the Owner giving such consent or by the subsequent Owner. To be effective, any revocation of consent before the adoption of the resolution accepting consents as hereinafter provided. After the Owners of at least sixty percent 60%) in aggregate principal amount of the Bonds then Outstanding exclusive of Agency-owned Bonds) shall have consented in writing, the Agency shall adopt a resolution accepting such consents and such resolution shall constitute complete evidence of the consent of Owners under this Section. Notice specifying the amendment that has received the consent of Owners as required by this Section shall be mailed by the Fiscal Agent, at the expense of the Agency, first-class mail, postage prepaid, not more than 60 days following the final action in the proceedings for the obtaining of such consent, to each registered Owner at such Owner's address as it appears on the Certificate Register. Said notice is only for the information of Owners, and failure to mail such notice or any defect therein shall not affect the validity of the proceedings theretofore taken in the obtaining of such consent. Section 25. Proceedings Constitute Contract; Events of Default and Remedies of Bondowners. The provisions of this Resolution, of the resolutions providing for the sale of the Bonds and awarding the Bonds and fixing the interest rate or rates thereon, and of any other resolution supplementing or amending this Resolution, shall constitute a contract between the Agency and the Bondowners, and the provisions thereof shall be enforceable by any Bondowner for the equal benefit and protection of all Bondowners similarly situated by mandamus, accounting, mandatory injunction or any other suit, action or proceeding at law or in equity that is now or may hereafter be authorized under the laws of the State of California in any court of competent jurisdiction. Said contract is made under and is to be construed in accordance with the laws of the State of California. The following provisions shall not limit the generality of the foregoing. A. Events of Default. Each of the following shall constitute an event of default. 1) Default in the due and punctual payment of any installment of interest on any Bond when and as such interest installment shall become due and payable and such default shall have continued for a period of thirty 30) days: 12-08-88 2563n/2338/003 BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 0: SUPPLEMENZ TO RESOLUTION NO. RA 88-14 2) Default in the due and punctual payment of the principal of any Bond when and as the same shall become due and payable, whether at maturity as therein expressed, by declaration or otherwise; 3) Default made by the Agency in the observance of any of the covenants, agreements or conditions contained in this Resolution or in the Bonds, and such default shall have continued for a period of thirty 30) days following written notice to the Agency; or m 4) The Agency shall file a petition or answer seeking reorganization or arrangement under the federal bankruptcy laws or any other applicable law of Cr) the United States of America, or if a court of competent jurisdiction shall approve a petition, filed m with or without the consent of the Agency, seeking reorganization under the federal bankruptcy laws or any other applicable law of the United States of America, or if, under the provisions of any other law for the relief or aid of debtors, any court of competent jurisdiction shall assume custody or control of the Agency or of the whole or any substantial part of its property; In each and every event of default described in 1) or 2) above the Fiscal Agent shall, and in each and every case of default described in 3) or 4) above, the Fiscal Agent may, and shall if so reguested by the holders of not less than a majority in aggregate principal amount of the Bonds at the time outstanding such request to be in writing to the Fiscal Agent and the Agency), declare the principal of all of the Bonds then outstanding and the interest accrued thereon, to be due and payable immediately, and upon any such declaration the same shall become and shall be immediately due and payable, anything in the Resolution or in the Bonds to the contrary notwithstanding. Such declaration may be rescinded by the holders of not less than a majority of the Bonds then outstanding provided the Agency cures such default or defaults including the deposit with the Fiscal Agent of a sum sufficient to pay all principal on the Bonds matured prior to such declaration and all matured installments of interest if any) upon all the Bonds, with interest at the rate of twelve percent 12%) per annum on such overdue installments of principal and, to the extent such payment of interest on interest is lawful at that time, on such overdue installments of interest, so that the Agency is currently in compliance with all payment, deposit and transfer provisions of this Resolution, and an amount sufficient to pay any expenses incurred by the Fiscal Agent in connection with such default. 12-08-88 2563n/2338/003 37- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 1:SUPPLEMENT TO RESOLUTION NO. RA 88-14 B. Application of Funds upon Acceleration. All of the Pledged Tax Revenues and all sums in the Funds provided for in this Resolution upon the date of the declaration of acceleration as provided in this Section 25, and all sums thereafter received by the Fiscal Agent hereunder, shall be applied by the Fiscal Agent in the order following upon presentation and surrender of the Bonds. First, to the payment of i) the costs and expenses of the Fiscal Agent and ii) of the Bondowners in declaring such event of default, including reasonable compensation to its or their agents, attorneys and counsel; Second, in case the principal of the Bonds shall not have become due and shall not then be due and payable, to the payment of the interest in default in the order of the maturity of the installments of such interest, with interest on the overdue installments at the rate of twelve percent 12%) per annum on the Bonds to the extent that such interest on overdue installments shall have been cc1leZted), such payments to be made ratably to the persons entitled thereto without discrimination or preference; Third, in case the principal of the Bonds shall have become and shall be then due and payable, to the payment of the whole amount then owing and unpaid upon the Bonds for principal and interest, with interest on the overdue principal and installments of interest at the rate of twelve percent 12%) per annum on the Bonds to the extent that such interest on overdue installments of interest shall have been collected), and, in case such moneys shall be insufficient to pay in full the whole amount so owing and unpaid upon the Bonds, then to the payment of such principal and interest without preference or priority of principal over interest, or interest over principal, or of any installment of interest over any other installment of interest, ratably to the aggregate of such principal and interest. C. Certain Remedies of Bondowners. Any Bondowner shall have the right, for the equal benefit and protection of all Bondowners similarly situated-- 1) by mandamus, suit, action or proceeding, to compel the Agency and its members, officers, agents or employees to perform each and every term, provision and covenant contained in this Resolution and in the Bonds, and to require the carrying out of any or all such covenants and agreements of the Agency and the fulfillment of all duties imposed upon it by the Law; 12-08-88 2563n/2338/003 38- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 2: SUPPLEMENT TO RESOLUTION NO RA 8B-14 2) by suit, action or proceeding in equity, to enjoin any acts or things which are unlawful, or the violation of any of the Bondowners' rights; or 3) upon the happening of any event of default as defined in this Section), by suit, action or proceeding in any court of competent jurisdiction, to require the Agency and its members and employees to account as if it and they were the trustees of an express trust. D. Non-Waiver. Nothing in this Section or in any m other provisions of this Resolution, or in the Bonds, shall affect or impair the obligation of the Agency, which is Cr) absolute and unconditional, to pay the principal of and interest on the Bonds to the respective Owners of the Bonds at the respective dates of maturity, as herein provided, or affect or impair the right, which is also absolute and unconditional, of such Owners to institute suit to enforce such payment by virtue of the contract embodied in the Bonds. No remedy conferred hereby upon any Bondowner is intended to be exclusive of any other remedy, but each such remedy is cumulative and in addition to every other remedy and may be exercised without exhausting and without regard to any other remedy conferred by the Law or any other law of the State of California. No waiver of any default or breach of any duty or contract by any Bondowner shall affect any subsequent default or breach of any duty or contract or shall impair any rights or remedies on said subsequent default or breach. No delay or omission of any Bondowner to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed as a waiver of any such default or acquiescence therein. Every substantive right and every remedy conferred upon the Bondowners may be enforced and exercised as often as may be deemed expedient. In case any suit, action or proceeding to enforce any right or exercise any remedy shall be brought or taken and should said suit, action or proceeding be abandoned, or be determined adversely to the Bondowners, then, and in every such case, the Agency and the Bondowners shall be restored to their former positions, rights and remedies as if such suit, action or proceeding had not been brought or taken, E. Actions by Fiscal Agent as Attorney-in-Fact. Any suit, action or proceeding which any Owner of Bonds shall have the right to bring to enforce any right or remedy hereunder may be brought by the Fiscal Agent for the equal benefit and protection of all Owners of Bonds similarly situated and the Fiscal Agent is hereby appointed and the successive respective registered owners of the Bonds issued hereunder, by taking and holding the same, shall be conclusively deemed so to have 12-08-88 2563n/2338/003 39- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 3: SUPPLEMENT TO RESOLUTION NO RA 88-14 74 appointed it) the true and lawful attorney-in-fact of the respective registered owners of the Bonds for the purpose of bringing any such suit, action or proceeding and to do and perform any and all acts and things for and on behalf of the respective registered owners of the Bonds as a class or classes, as may be necessary or advisable in the opinion of the Fiscal Agent as such attorney-in-fact. F. General. After the issuance and delivery of the Bonds, this Resolution, and any supplemental resolutions hereto, shall be irrepealable, but shall be subject to modification or amendment to the extent and in the manner provided in this Resolution, but to no greater extent and in no other manner. Section 26. CUSIP Numbers. CUSIP identification numbers will be imprinted on the Bonds, but such numbers shall not constitute a part of the contract evidenced by the Bonds and no liability shall hereafter attach to the Agency or any of the officers or agents thereof because of or on account of said numbers. Any error or omission with respect to said numbers shall not constitute cause for refusal by the successful bidder to accept delivery of and pay for the Bonds. Section 27. Severability. If any covenant, agreement or provision, or any portion thereof, contained in this Resolution, or the application thereof to any person or circumstance, is held to be unconstitutional, invalid or unenforceable, the remainder of this Resolution and the applicatiQn of any such covenant, agreement or provision, or portion thereof, to other persons or circumstances, shall be deemed severable and shall not be affected, and this Resolution and the Bonds issued pursuant hereto shall remain valid and the Bondowners shall retain all valid rights and benefits accorded to them under this Resolution and the Constitution and the laws of the State of California. If the provisions relating to the appointment and duties of a Fiscal Agent are held to be Unconstitutional, invalid or unenforceable, said duties shall be performed by the Treasurer. Section 28. Notices to Agency and Fiscal Agent. All notices to the Agency and the Fiscal Agent shall be personally delivered or sent by first class mail, postage prepaid, addressed as follows: 1) If to the Agency, to La Quinta Redevelopment Agency, 78-105 Calle Estado, La Quinta, California 92253 Attention: Finance Director. 12-08-88 2563n/2338/003 40- BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 4: SUPPLEMENT TO RESOLUTION NO. RA 88-14 71 2) If to the Fiscal Agent, to Security Pacific National Bank, 333 South Beaudry Avenue, 24th Floor, LOE Angeles, California 90017, Attention: Corporate TruZt Division Z24-30. Reference No.: 11-7- Section 29. Effective Date. This Supplernent to Resolution shall take effect upon adoption. EXECUTED the 2oZhday of December, 1988. a) Zedevel ment gency Cr) SEAL) AZTEST: Zecretary of thZZa Quinta Redeve lopinent Agency 12-08-88 2563n/2338/003 41 BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 5: STIPPLEMENT TO RESOLUTION NO. RA 88-14 STATE OF CALIFORNIA SECRETARY'S CERTIFICATE ss. RE ADOPTION OF RESOLUTION COUNTY OF RIVERSIDE I, SAUNDRA JUHOLA, Secretary of the La Quinta Redevelopment Agency, DO HEREBY CERTIFY that the foregoing Resolution was duly adopted by said Agency at an adjourned regular meeting of said Agency held on the 20th day of December, 1988, and that the same was passed and adopted by the following vote to wit: AYES: Members BohnenberZer. Bosworth, RushworZh Sniff, Chairman PZna NOES: Members None ABSENT: Members None ABSTAIN: Zembers None ZZecretary of LaZZinta Redevelopment Agency SEAL) STATE OF CALIFORNIA SECRETARY'S CERTIFICATE ssZ OF AUTHENTICATION COUNTY OF RIVERSIDE I, SAUNDRA JUHOLA, Secretary of the La Quinta Redevelopment Agency, DO HEREBY CERTIFY that the above and foregoing is a full, true and correct copy of Resolution NoZ RA 88-14 of said Agency and that said Resolution was adopted at the time and by the vote stated on the above certificate, and has not been amended or repealed Dated: December 20, 1988 1 Z Zecretary of theZZ Quinta Redevelopment Agency SEAL) 12-08-88 2563n/2338/003 A-l BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 6: SUPPLEMENT TO RESOLUTION NO. RA 88-14 EXHIBIT A FORM OF BOND) UNITED STATES OF AMERICA STATE OF CALIFORNIA COUNTY OF RIVERSIDE LA QUINTA REDEVELOPMENT ACENCY LA QUINTA REDEVELOPMENT PROJECT TAX ALLOCATION BONDS, SERIES 1989 INTEREST RATE MATURITY DATE ORIGINAL ISSUE DATE CUSIP Cr) PRINCIPAL AMOUNT: REGISTERED OWNER. The LA QUINTA REDEVELOPMENT AGENCY hereinafter sometimes call the Agency"), a public body, corporate and politic, duly organized and existing under the laws of the State of California, for value received, hereby promises to pay but solely out of the funds hereinafter mentioned) to the registered owner of this Bond as shown above or registered assigns herein sometimes referred to as registered owner"), subject to the right of prior redemption hereinafter mentioned, the principal sum specified above on the maturity date specified above, and to pay such registered owner on each interest payment date by check or draft mailed by first-class mail to him as his name and address appear on the register kept by the Fiscal Agent at the close of business on the fifteenth 15th) day of the month preceding each interest payment date the regular record date"), interest on such principal sum from the interest payment date next preceding the date hereof unless i) it is dated prior to the first regular record date in which event from January 1, 1989, or ii) the date hereof is on an interest payment date, in which event from that interest payment date, or iii) it is dated after a regular record date but before the following interest payment date and if the Agency shall not default in the payment of interest due on such interest payment date, in which event it shall bear interest from such interest payment date) until the principal hereof shall have been paid or provided for in accordance with the Resolution hereinafter referred to, at the interest rate specified above payable semiannually on March 1 and September 1 in each year commencZng on March 1, 1989. Both principal and 12-08-88 2563n/2338/003 A-2 BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 7: SUPPLEMENT TO RESOLUTION NO RA 88-14 70 interest and any premium upon the redemption prior to maturity of all or part hereof are payable in lawful money of the United States of America, and except for interest which is payable by check or draft as stated above) are payable at the corporate trust office of Security Pacific National Bank, Fiscal Agent for the Agency, in Los Angeles, California. This Zond, the interest hereon and any premium due upon the redemption of this Bond prior to maturity are not a debt of the City of La Quinta, the State of California or any of its political subdivisions, and neither the City, the State nor any of its political subdivisions other than the Agency) is liable hereon, nor in any event shall this Bond, said interest or said premium be payable out of any funds or properties other than the funds of the Agency as set forth in the Resolution hereinafter mentioned. This Bond does not constitute an indebtedness within the meaning of any constitutional or statutory debt limitation or restriction. Neither the members of the Agency nor any persons executing this Bond are liable personally on this Bond by reason of its issuance. This Bond is one of a duly authorized issue of Bonds of the Agency designated La Quinta Redevelopment Agency, La Quinta Redevelopment Project, Tax Allocation Bonds, Series 1989" herein called the Bonds"), in an aggregate principal amount of $8,000,000, all of like tenor except for bond numbers, interest rates, amounts and maturity) and all of which have been issued pursuant to and in full conformity with the Constitution and laws of the State of California and particularly the Community Redeveloprnent Law Part 1 of Division 24 of the Health and Safety Code of the State of California) and Article 4 of Chapter 5 of Division 7 of Title 1 of the Government Code of the State of California for the purpose of aiding in the financing of the Redevelopment Project referred to above. The Bonds are authorized by and issued pursuant to Resolution No. RA adopted by the Agency on December 1988 and a Supplement to Resolution approved thereby, copies of which are on file with the Secretary of the Agency and the Fiscal Agent said Resolution No. RA and Supplement to Resolution being herein collectively referred to as the Resolution"). All of the Bonds are equally secured in accordance with the terms of the Resolution, reference to which is hereby made for a specific description of the security therein provided for said Bonds, for the nature, extent and manner of enforcement of such security, for the covenants and agreements made for the benefit of the Bondowners, and for a statement of the rights of the Bondowners. By the acceptance of this Bond the registered owner hereof consents to all of the terms, conditions and provisions of said Resolution. In the manner provided in the Resolution, said Resolution and the rights and 12-08-88 2563n/2338/003 A-3 BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 8: SUPPLEMENT TO RESOLUTION NO. RA 88-14 67 obligations of the Agency and of the Bondowners may with certain exceptions as stated in said Resolution) be modified or amended with the consent of the Owners of sixty percent 60%) in aggregate principal amount of outstanding Bonds, exclusive of issuer-owned Bonds, unless the modification or amendment is for the purpose of curing ambiguities, defects or inconsistZnt provisions, in which case no Bondowners' consent is required. The principal of this Bond and the interest hereon are secured by an irrevocable pledge of, and are payable solely out of, the Pledged Tax Revenues as such term is defined in said Resolution) and certain other funds, all as more particularly set forth in the Resolution. Said Resolution is adopted under and this Bond is issued under and is to be construed in Cr) accordance with the laws of the State of California. The outstanding Bonds, or any of them, maturing on or after September 1, 1999 may be called before maturity and redeemed at the option of the Agency, in whole from the proceeds of refunding bonds and other available funds, at any time or in whole or in part from any other source of funds on September 1, 1998 or on any interest payment date thereafter prior to maturity in reverse order of maturity and by lot within any one maturity. Bonds so called for redemption shall be redeemed at a redemption price for each redeemed Bond equal to the principal amount thereof, plus accrued interest to the redemption date plus a premium expressed as a percentage of the principal amount of Bonds to be redeemed as follows: Redemption Date Redemption Price September 1, 1998 thru March 1, 1999.........102 September 1, 1999 thru March 1, 2000..........101 1/2% September 1, 2000 thru March 1, 2001..........101 September 1, 2001 thru March 1, 2002..........100 1/2% September 1, 2002 thru thereafter.............100 The Term Bonds maturing on September 1, 2012 shall be subject to mandatory redemption in part, by lot, on September 1, 2004 and on each September 1 thereafter to and including September 1, 2012 from Minimum Sinking Fund Payments on hand in the Bond Payment Fund, at the principal amount of such Bonds to be prepaid, without premium, plus accrued interest. The principal amount of such Bonds to be so prepaid and the dates therefor shall be as set forth in the Resolution. The date on which Bonds are to be presented for redemption is herein sometimes called the redemption date.11 Notice of call and redemption prior to maturity shall be given as provided in the Resolution. 12-08-88 2563n/2338/003 A-4 BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 9: SUPPLEMENT TO RESOLUTION NO. RA 88-14 68 This Bond is issued in fully registered forzn and is negotiable upon proper transfer of registration. This Bond is transferable by the registered owner hereof, in person or by his attorney duly authorized in writing, at the corporate trust office of the Fiscal Agent in the City of Los Angeles, California, but only in the manner, subject to the limitations and upon payment of the charges provided in the Resolution, upon surrender and cancellation of this Bond. Upon such transfer a new Bond of any authorized denomination or denominations for the same aggregate principal amount and maturity of the same issue will be issued to the transferee in exchange therefor. The Fiscal Agent shall not be required to register the transfer or exchange of any Bond during the period 15 days preceding selection of Bonds for redemption and as to any Bond selected for redemption. The Agency and the Fiscal Agent may treat the registered owner hereof as the absolute owner hereof for all purposes, and the Agency and the Fiscal Agent shall not be affected by any notice to the contrary. This Bond shall not be entitled to any benefit under the Resolution, or become valid or obligatory for any purpose, until the certificate of authentication hereon endorsed shall have been signed by the Fiscal Agent. It is hereby recited, certified and declared that any and all acts, conditions and things required to exist, to happen and to be performed precedent to and in the issuance of this Bond exist, have happened and have been perforined in due time, form and manner as required by the Constitution and laws of the State of California. IN ZITNESS WHEREOF, the Redevelopment Agency of the City of La Quinta has caused this Bond to be signed on its behalf by the facsimile signature of its Chairman and by the manual or facsimile signature of its Secretary, and the seal of said Agency to be reproduced hereon, all as of the th day of December, 1988. Redev opmen Agency SEAL) Th Zecretary of tZ<La Quinta Redevelopment Agency 12-08-88 2563n/2338/003 A-5 BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02 :: SUPPLEMENT TO RESOLUTION NO. RA 88-14 FORM OF CERTIFICATE OF AUTHENTICATION OF BONDS) This is one of the Bonds described in the within mentioned Resolution. By Fiscal Agent By Authorized Officer Y) FORM OF ASSIGNMENT OF BONDS) For value received hereby sells, m assigns and transfers unto Tax Identification No. the within-mentioned Bonds and hereby irrevocably constitutes and appoints attorney, to transfer the same on the books of the Fiscal Agent with full power of substitution in the premises. Dated: Signature Guaranteed NOTE: The signature to this assignment must correspond with the name as written on the face of the within Bond in every particular, without alterations or enlargement or any change whatsoever. 12-08-88 2563n/2338/003 A-6 BIB] 03-04-1997-U01 09:28:38AM-U01 RDARES-U02 88-U02 14-U02