ATTACHMENT G

 
CONTINUING DISCLOSURE CERTIFICATE

This Continuing Disclosure Certificate (the “Disclosure Certificate”) is executed and delivered by the Redevelopment Agency of the City of Santa Monica (the “Agency”) in connection with the issuance by the Agency of its $____________ aggregate principal amount of Redevelopment Agency of the City of Santa Monica Earthquake Recovery Redevelopment Project, 2011 Tax Allocation Bonds (the “Bonds”).  The Bonds are being issued pursuant to Resolution No. _____ of the Agency, adopted on ________, 2011, and an Indenture of Trust and First Supplement to Indenture of Trust, each dated as of April 1, 2006, and a Second Supplement to Indenture of Trust dated as of June 1, 2011 (collectively, the “Indenture”), in each case between the Agency and Union Bank, N.A., as trustee (the “Trustee”).  The Bonds are payable from and secured by certain Tax Revenues of the Agency.  The Agency covenants and agrees as follows:

Section 1.  Purpose of the Disclosure Certificate.  This Disclosure Certificate is being executed and delivered by the Agency for the benefit of the holders and beneficial owners of the Bonds and in order to assist the Participating Underwriters in complying with S.E.C. Rule 15c2-12(b)(5).

Section 2.  Definitions.  In addition to the definitions set forth in the Indenture described in the Official Statement, which apply to any capitalized term used in this Disclosure Certificate unless otherwise defined in this Section, the following capitalized terms shall have the following meanings:

“Annual Report” means any Annual Report provided by the Agency pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate.

“Annual Report Date” means the date that is eight (8) months after the end of the Agency’s fiscal year (currently March 1 based on the City’s fiscal year end of June 30).

“Dissemination Agent” means the Agency, or any successor Dissemination Agent designated in writing by the Agency and which has filed with the Agency and the Trustee a written acceptance of such designation.

“Listed Events” means any of the events listed in Sections 5(a) and (b) of this Disclosure Certificate.

“MSRB” means the Municipal Securities Rulemaking Board, which has been designated by the Securities and Exchange Commission as the sole repository of disclosure information for purposes of the Rule, or any other repository of disclosure information that may be designated by the Securities and Exchange Commission as such for purposes of the Rule in the future.

“Official Statement” means the Official Statement dated __________, 2011, related to the Bonds.

“Participating Underwriter” means E.J. De La Rosa & Co., Inc., on behalf of itself and Wells Fargo Bank, National Association, the original underwriters of the Bonds required to comply with the Rule in connection with offering of the Bonds.

“Rule” means Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time.

Section 3.  Provision of Annual Reports.

(a)        The Agency shall, or shall cause the Dissemination Agent to, not later than the Annual Report Date, commencing March 1, 2012, with the report for the 2010-11 fiscal year, provide to the MSRB, in an electronic format as prescribed by the MSRB, an Annual Report that is consistent with the requirements of Section 4 of this Disclosure Certificate, with a copy to the Trustee.  Not later than fifteen (15) Business Days prior to the Annual Report Date, the Agency shall provide the Annual Report to the Dissemination Agent, if other than the Agency.  The Annual Report may be submitted as a single document or as separate documents comprising a package, and may include by reference other information as provided in Section 4 of this Disclosure Certificate.  If the Agency’s fiscal year changes, the Agency, upon becoming aware of such change, shall give notice of such change in the same manner as for a Listed Event under Section 5(c).  The Agency shall provide a written certification with each Annual Report furnished to the Dissemination Agent to the effect that such Annual Report constitutes the Annual Report required to be furnished by it hereunder.  The Dissemination Agent may conclusively rely upon such certification of the Agency and shall have no duty or obligation to review such Annual Report.

(b)        If by fifteen (15) Business Days prior to the Annual Report Date, the Dissemination Agent (if other than the Agency) has not received a copy of the Annual Report, the Dissemination Agent shall notify the Agency of such non-receipt.

(c)        If the Dissemination Agent is unable to verify that an Annual Report has been provided to the MSRB by the Annual Report Date, the Dissemination Agent shall provide to the MSRB (with a copy to the Trustee and the Participating Underwriter) a notice, in substantially the form attached as Exhibit A.

(d)        Unless the Agency has done so pursuant to Section 3(a) above, the Dissemination Agent (if other than the Agency) shall:

(i)         determine each year prior to the Annual Report Date the then-applicable rules and electronic format prescribed by the MSRB for the filing of annual continuing disclosure reports; and

(ii)        if the Dissemination Agent is other than the Agency, file a certificate with the Agency to the effect that the Annual Report has been provided pursuant to this Disclosure Certificate, stating, to the extent it can confirm such filing of the Annual Report, the date it was provided.

Section 4.  Content of Annual Reports.  The Agency’s Annual Report shall contain or incorporate by reference the following:

(a)        Audited financial statements prepared in accordance with generally accepted accounting principles as promulgated to apply to governmental entities from time to time by the Governmental Accounting Standards Board, and as further modified according to applicable State law.  If the Agency’s audited financial statements are not available by the Annual Report Date, the Annual Report shall contain unaudited financial statements in a format similar to the usual format utilized by the Agency, and the audited financial statements shall be filed in the same manner as the Annual Report when they become available.

(b)        The following additional items:

1.         Assessed valuations and Tax Revenues for the fiscal year to which the Annual Report pertains, by means of an update to the “Historical Project Area Assessed Values Values” table for the Project Area shown in the Official Statement for the Bonds (Table _);

2.         Description of any Parity Debt (date, amount, term, rating, insurance) issued by the Agency in the fiscal year to which the Annual Report pertains and amount of all Agency debt outstanding payable with tax increment revenue from the Project Areas as of the end of the fiscal year to which the Annual Report pertains;

3.         Estimated annual debt service coverage for obligations of the Agency by means of an update to the “Projected Tax Revenues” table for the Project Area shown in the Official Statement for the Bonds (Table 8);

4.         Top ten property tax assessees in the Project Area for the fiscal year to which the Annual Report pertains, taxable value and percentage of total taxable value for the Project Area.

Any or all of the items above may be included by specific reference to other documents, including official statements of debt issues of the Agency or related public entities, which are available to the public on the MSRB’s Internet web site or filed with the Securities and Exchange Commission.  The Agency shall clearly identify each such other document so included by reference.

The Trustee shall have no responsibility for the content of the Annual Report, or any part thereof.

Section 5.  Reporting of Significant Events.

(a)        Pursuant to the provisions of this Section 5, the Agency shall give, or cause to be given, notice of the occurrence of any of the following events with respect to the Bonds in a timely manner not more than ten (10) days after the event, if material:

1.         Principal and interest payment delinquencies;

2.         Unscheduled draws on debt service reserves reflecting financial difficulties;

3.         Unscheduled draws on credit enhancements reflecting financial difficulties;

4.         Substitution of credit or liquidity providers, or their failure to perform;

5.         Issuance by the Internal Revenue Service of proposed or final determination of taxability or of a Notice of Proposal Issue (IRS Form 5701-TEB);

6.         Tender Offers;

7.         Defeasances;

8.         Rating changes; and

9.         Bankruptcy, insolvency, receivership or similar proceedings..

Note:  For the purposes of the event identified in subparagraph (9), the event is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent or similar officer for an obligated person in a proceeding under the U.S. Bankruptcy Code or in any other proceeding under state or federal law in which a court or governmental authority has assumed jurisdiction over substantially all of the assets or business of the obligated person, or if such jurisdiction has been assumed by leaving the existing governmental body and officials or officers in possession but subject to the supervision and orders of a court or governmental authority, or the entry of an order confirming a plan of reorganization, arrangement or liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or business of the obligated person.

(b)        Pursuant to the provisions of this Section 5, the Agency shall give, or cause to be given, notice of the occurrence of any of the following events with respect to the 2011 Bonds, if material in a timely manner not more than ten (10) days after occurrence:

1.         unless described in Section 5(a)(5), adverse tax opinions or other material notices or determinations by the Internal Revenue Service with respect to the tax status of the Bonds or other material events affecting the tax status of the Bonds.

2.         modifications to the rights of Bondholders;

3.         optional, unscheduled or contingent Bond calls;

4.         release, substitution or sale of property securing repayment of the Bonds;

5.         non‑payment related defaults;

6.         the consummation of a merger, consolidation, or acquisition involving the Agency or the Authority or the sale of all or substantially all of the assets of the Agency or the Authority, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms; and

7.         appointment of a successor or additional trustee or the change of the name of a trustee.

(c)        If the Agency determines that knowledge of the occurrence of a Listed Event under subsection (b) would be material under applicable federal securities laws, and if the Dissemination Agent is other than the Agency, the Agency shall promptly notify the Dissemination Agent in writing.  Such notice shall instruct the Dissemination Agent to file a notice of such occurrence with the MSRB in an electronic format as prescribed by the MSRB in a timely manner not more than ten (10) Business Days after the event.

(d)        If the Agency determines that the Listed Event under subsection (b) would not be material under applicable federal securities laws and if the Dissemination Agent is other than the Agency, the Agency shall so notify the Dissemination Agent in writing and instruct the Dissemination Agent not to report the occurrence.

(e)        The Agency hereby agrees that the undertaking set forth in this Disclosure Agreement is the responsibility of the Agency and, if the Dissemination Agent is other than the Agency, the Dissemination Agent shall not be responsible for determining whether the Agency’s instructions to the Dissemination Agent under this Section 5 comply with the requirements of the Rule.

Section 6.  Identifying Information for Filings with the MSRB.  All documents provided to the MSRB under this Disclosure Certificate shall be accompanied by identifying information as prescribed by the MSRB.

Section 7.  Termination of Reporting Obligation.  The obligations of the Agency, the Trustee and the Dissemination Agent under this Disclosure Certificate shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Bonds.  If such termination occurs prior to the final maturity of the Bonds, the Agency shall give notice of such termination in the same manner as for a Listed Event under Section 5(c).

Section 8.  Dissemination Agent.  From time to time, the Agency may appoint or engage a Dissemination Agent to assist it in carrying out its obligations under this Disclosure Certificate, and may discharge any such Agent, with or without appointing a successor Dissemination Agent.  If at any time there is not any other designated Dissemination Agent, the Agency shall be the Dissemination Agent.  The Dissemination Agent may resign by providing sixty days prior written notice to the Agency.

Section 9.  Amendment; Waiver.  Notwithstanding any other provision of this Disclosure Certificate, the Agency may amend this Disclosure Certificate, and any provision of this Disclosure Certificate may be waived, provided that the following conditions are satisfied:

(a)        if the amendment or waiver relates to the provisions of Section 3(a), 4 or 5(a), it may be made only in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature, or status of an obligated person with respect to the Bonds, or type of business conducted;

(b)        the undertakings herein, as proposed to be amended or waived, in the opinion of nationally recognized bond counsel, would have complied with the requirements of the Rule at the time of the primary offering of the Bonds, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and

(c)        the proposed amendment or waiver either (i) is approved by holders of the Bonds in the manner provided in the Indenture for amendments to the Indenture with the consent of holders, or (ii) in the opinion of nationally recognized bond counsel, does not materially impair the interests of the holders or beneficial owners of the Bonds.

Section 10.  Additional Information.  Nothing in this Disclosure Certificate shall be deemed to prevent the Agency from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Annual Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Certificate.  If the Agency chooses to include any information in any Annual Report or notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Certificate, the Agency shall have no obligation under this Disclosure Certificate to update such information or include it in any future Annual Report or notice of occurrence of a Listed Event.

Section 11.  Default.  In the event of a failure of the Agency to comply with any provision of this Disclosure Certificate, the Trustee may (and, at the request of any Participating Underwriter or the holders of at least 25% aggregate principal amount of Outstanding Bonds, shall), after receiving indemnification satisfactory to the Trustee, or any holder or beneficial owner of the Bonds may, take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Agency to comply with its obligations under this Disclosure Certificate.  A default under this Disclosure Certificate shall not be deemed an Event of Default under the Indenture, and the sole remedy under this Disclosure Certificate in the event of any failure of the Agency to comply with this Disclosure Certificate shall be an action to compel performance.

Section 12.  Duties, Immunities and Liabilities of Dissemination Agent.  The Dissemination Agent and the Trustee shall be entitled to the protections and limitations from liability afforded to the Trustee in Article 6 of the Indenture.  The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Certificate, and the Agency agrees to indemnify and hold harmless the Dissemination Agent, its officers, directors, employees and agents, against any loss, expense and liabilities which the Dissemination Agent may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including attorneys’ fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent’s negligence or willful misconduct.  The obligations of the Agency under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Bonds.  The Trustee shall not be required to consent to any amendment which would impose any greater duties or risk of liability on the Trustee.  No person shall have any right to commence any action against the Trustee seeking any remedy other than to compel specific performance of this Agreement.  The Trustee shall not be liable under any circumstances for monetary damages to any person for any breach of this Disclosure Certificate.

Section 13.  Notices.  Any notice or communications to be given under this Disclosure Certificate may be given as follows:

To the Agency:                                     Redevelopment Agency of the City of Santa Monica
_____________________
Sata Monica, CA _______
Fax (___) ________
Attention:  ____________

To the participating Underwriters:        


Fax:  (___)_______
Attention:  Public Finance

To the Trustee:                                     Union Bank of California, N.A.
_______________________
Los Angeles, CA _________

Any person may, by written notice to the other persons listed above, designate a different address or telephone number(s) to which subsequent notices or communications should be sent.


Section 14.       Beneficiaries.  This Disclosure Certificate shall inure solely to the benefit of the Agency, the Trustee, the Dissemination Agent, the Participating Underwriters and holders and beneficial owners from time to time of the Bonds, and shall create no rights in any other person or entity.

Date:  _____________, 2011

REDEVELOPMENT AGENCY OF THE CITY OF SANTA MONICA

By:                                                                  

_________________

 


EXHIBIT A

NOTICE OF FAILURE TO FILE ANNUAL REPORT

Name of Obligor:          Redevelopment Agency of the City of Santa Monica

Name of Issue:              City of Santa Monica Earthquake Recovery Redevelopment Project, 2011 Tax Allocation Bonds

Date of Issuance:          ____________, 2011

NOTICE IS HEREBY GIVEN that the Redevelopment Agency of the City of Santa Monica (the “Agency”) has not provided an Annual Report with respect to the above-named Bonds as required by Section ___ of the Indenture of Trust, dated as of April 1, 2006, as amended, by and between the Redevelopment Agency of the City of Santa and Union Bank of California, N.A., as trustee.  The Agency anticipates that the Annual Report will be filed by __________.

Dated:  __________

REDEVELOPMENT AGENCY OF THE
CITY OF SANTA MONICA

By:                                                                  

Title:                                                               

cc:  Trustee and Participating Underwriter