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<br />11 <br />THE 2018 BONDS <br /> <br />Authority for Issuance <br /> <br />The Dissolution Act authorizes the issuance of refunding bonds to provide savings to the <br />Successor Agency, provided that (i) the total interest cost to maturity on the refunding bonds or <br />other indebtedness plus the principal amount of the refunding bonds or other indebtedness does <br />not exceed the total remaining interest cost to maturity on the bonds or other indebtedness to be <br />refunded plus the remaining principal of the bonds or other indebtedness to be refunded, and (ii) <br />the principal amount of the refunding bonds or other indebtedness does not exceed the amount <br />required to defease the refunded bonds or other indebtedness, to establish customary debt <br />service reserves, and to pay related costs of issuance. <br /> <br />The issuance of the 2018 Bonds and the execution and delivery of the Indenture were <br />authorized by the Successor Agency pursuant to Resolution No. 2017-___ adopted on <br />December 18, 2017 (the “Resolution”), and approved by the Oversight Board pursuant to <br />Resolution No. 2017-___ adopted on December 20, 2018 (the “Oversight Board Resolution”). <br />Pursuant to the Dissolution Act, written notice of the Oversight Board Resolution was provided <br />to the DOF. On January 31, 2018, the DOF provided a letter to the Successor Agency stating <br />that based on the DOF’s review and application of the law, the Oversight Board Resolution <br />approving the 2018 Bonds is approved by the DOF. <br /> <br />Section 34177.5(f) of the Dissolution Act provides that when, as here, a successor <br />agency issues refunding bonds with the approval of the oversight board and the DOF, the <br />oversight board may not unilaterally approve any amendments to or early termination of the <br />bonds, and the scheduled payments on the bonds shall be listed in the Recognized Obligation <br />Payment Schedule and are not subject to further review and approval by the DOF or the <br />California State Controller. <br /> <br />Description of the 2018 Bonds <br /> <br />The 2018 Bonds will be issued and delivered in fully-registered form without coupons in <br />the denomination of $5,000 or any integral multiple thereof for each maturity, initially in the <br />name of Cede & Co., as nominee for The Depository Trust Company (“DTC”), as registered <br />owner of all 2018 Bonds. The initially executed and delivered Bonds will be dated the date of <br />delivery (the “Closing Date”) and mature on September 1 in the years and in the amounts <br />shown on the inside cover page of this Official Statement. <br /> <br />Interest on the 2018 Bonds will be calculated on the basis of a 360-day year of twelve <br />30-day months at the rates shown on the inside cover page of this Official Statement, payable <br />semiannually on March 1 and September 1 in each year, commencing on September 1, 2018, <br />by check mailed to the registered owners thereof or upon the request of the Owners of <br />$1,000,000 or more in principal amount of 2018 Bonds, by wire transfer to an account in the <br />United States which shall be designated in written instructions by such Owner to the Trustee on <br />or before the Record Date preceding the Interest Payment Date. “Record Date” as defined in <br />the Indenture means, with respect to any Interest Payment Date, the close of business on the <br />15th calendar day of the month preceding such Interest Payment Date, whether or not such <br />15th calendar day is a Business Day. <br /> <br />116