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<br />7 <br />a rating on their short term certificates of deposit on the date of purchase of “P-1” by Moody’s and <br />“A-1” or “A-1+” by S&P and maturing no more than 360 days after the date of purchase, provided <br />that ratings on holding companies are not considered as the rating of the bank. <br /> <br />6. Investment agreements, guaranteed investment contracts, funding agreements, or <br />any other form of corporate note which represents the unconditional obligation of one or more <br />banks, insurance companies or other financial institutions, or are guaranteed by a financial <br />institution which has an unsecured rating, or which agreement is itself rated, as of the date of <br />execution thereof, “AA” and “Aa2”, respectively, by S&P and Moody’s, provided that (1) such <br />agreement shall require that if during its term the provider’s rating by either S&P or Moody’s falls <br />below “AA-” or “Aa3,” respectively, the provider shall, at its option, within 10 days of receipt of <br />publication of such downgrade, either (i) collateralize the investment agreement by delivering or <br />transferring in accordance with applicable state and federal laws (other than by means of entries <br />on the provider’s books) to the Authority, the Trustee or a third party acting solely as agent therefor <br />(the “Holder of the Collateral”) collateral free and clear of any third-party liens or claims the market <br />value of which collateral is maintained at levels and upon such conditions as would be acceptable <br />to S&P and Moody’s to maintain an “A” category rating in an “A” category rated structured <br />financing (with a market value approach); or (ii) at the sole expense of the provider, the provider <br />shall obtain the unconditional assumption of their remaining obligations under the same terms <br />and conditions of the investment agreement from an eligible replacement provider whose ratings <br />are at least “AA-” and “Aa3” by S&P and Moody’s, respectively; (2) if the provider’s rating by either <br />S&P or Moody’s is withdrawn or suspended or falls below “A-” or “A3,” respectively, the provider <br />must, at the direction of the City, the Authority or the Trustee, within 10 days of receipt of such <br />direction, repay the principal of and accrued but unpaid interest on the investment, in either case <br />with no penalty or premium to the Authority; (3) in the event that the provider shall default in its <br />payment obligations, the provider’s obligations under the investment agreement shall, at the <br />direction of the City, the Authority or the Trustee, be accelerated and, amounts invested and <br />accrued but unpaid interest thereon shall be repaid to the Authority or the Trustee, as appropriate; <br />and (4) should the provider become insolvent, not pay its debts as they become due, be declared <br />or petition to be declared bankrupt, etc. (“event of insolvency”), the provider’s obligations shall <br />automatically be accelerated and amounts invested and accrued but unpaid interest thereon shall <br />be repaid to the Authority or the Trustee, as appropriate. For purposes of this definition, a rating <br />category includes any rating with the same letter, regardless of the modifier. For purposes of <br />illustration, “A”, “A+” and “A-“ are in the “A” rating category. <br /> <br />7. Commercial paper rated, at the time of purchase, “Prime -1” by Moody’s and “A¬1” <br />or better by S&P. <br /> <br />8. Bonds or notes issued by any state or municipality which are rated by Moody’s and <br />S&P in one of the two highest rating categories assigned by such agencies. <br /> <br />9. Federal funds or bankers acceptances with a maximum term of one year of any <br />bank which has an unsecured, uninsured and unguaranteed obligation rating of “Prime -1” or “A3” <br />or better by Moody’s and “A-1+” by S&P. <br /> <br />10. Repurchase agreements for 30 days or less must provide for the transfer of <br />securities from a dealer bank or securities firm (seller/borrower) to the Trustee (buyer/lender), and <br />the transfer of cash from the Trustee to the dealer bank or securities firm with an agreement that <br />the dealer bank or securities firm will repay the cash plus a yield to the Trustee in exchange for <br />the securities at a specified date. <br /> <br />8.A. - Page 127 of 255 <br />755