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<br />3 <br />be reduced by the amount of such indebtedness which is required by the Parity Instrument to be <br />amortized by prepayment or redemption prior to its stated maturity date. <br /> <br />“Bond Year” means the period from the Closing Date through February 1, 2025, and <br />thereafter the twelve-month period commencing on February 2 of each year through and <br />including February 1 of the following year. <br /> <br />“Bonds” has the meaning set forth in the Indenture. <br /> <br />“Business Day” means any day other than a Saturday, Sunday or legal holiday or a day <br />on which banks are authorized to be closed for business in California or, with respect to the <br />Bonds, on which the Principal Office of the Trustee is authorized to be closed. <br /> <br />“Capital Appreciation Parity Obligations” means any Parity Obligations the interest on <br />which is compounded and not scheduled to be paid until the maturity or prior redemption of <br />such Parity Obligations. <br /> <br />“Code” means the Internal Revenue Code of 1986 as in effect on the date of issuance of <br />the Bonds or (except as otherwise referenced herein) as it may be amended to apply to <br />obligations issued on the date of issuance of the Bonds, together with applicable temporary and <br />final regulations promulgated, and applicable official public guidance published, under the Code. <br /> <br />“Commercial Paper Program” means a program of short-term Parity Obligations having <br />the characteristics of commercial paper in that such Parity Obligations have a stated maturity <br />not later than 270 days from their date of issue and that maturing Parity Obligations of such <br />program may be paid with the proceeds of renewal short-term Parity Obligations. <br /> <br />“Debt Service” means, for any Bond Year, the sum of (a) the interest payable during <br />such Bond Year on the Outstanding Bonds and all Outstanding Parity Obligations, assuming <br />that all such Outstanding serial Bonds and Outstanding Serial Parity Obligations are retired as <br />scheduled and that all Outstanding term Bonds and Outstanding Term Parity Obligations are <br />redeemed or paid from Sinking Fund Installments as scheduled, (b) that portion of the principal <br />amount of all Outstanding serial Bonds and Outstanding Serial Parity Obligations maturing on <br />each principal payment date which falls in such Bond Year, including the Final Compounded <br />Amount of any Capital Appreciation Parity Obligations, (c) that portion of the principal amount of <br />all Outstanding term Bonds payable during such Bond Year and that portion of the principal <br />amount of Outstanding Term Parity Obligations required to be redeemed or paid from Sinking <br />Fund Installments becoming due during such Bond Year (together with the redemption <br />premiums, if any, thereon), including the Accreted Value of any Capital Appreciation Parity <br />Obligations; provided that, for purposes of calculating Debt Service, any Federal Subsidy to be <br />received by the City during such Fiscal Year shall be subtracted from such sum; and provided <br />further that the following adjustments and assumptions shall be made: <br /> <br />(a) in determining the amount of Debt Service constituting principal due in each <br />Bond Year, principal payments with respect to Parity Obligations which are or upon issuance <br />will be, part of a Commercial Paper Program, but which would not constitute Balloon <br />Indebtedness, shall be treated as if such Parity Obligations were to be amortized with <br />substantially level annual Debt Service payments over a term of 40 years commencing on the <br />date the calculation of Debt Service is made; <br /> <br />8.A. - Page 171 of 255 <br />799