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Resolution 2009-35 1 RESOLUTION NO. 2009-35 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF GILROY AUTHORIZING PROCEEDINGS AND DOCUMENTS RELATING TO REFUNDING OF OUTSTANDING AUCTION RATE SECURITIES AND FINANCING OF CAPITAL IMPROVEMENTS WHEREAS, the Gilroy Public Facilities Financing Authority (the "Authority") has been formed under a Joint Exercise of Powers Agreement dated as of March 21, 1994, between the City of Gilroy (the "City") and the Community Redevelopment Agency of the City of Gilroy, and is authorized thereunder to finance the acquisition and construction of public capital improvements for its members; and WHEREAS, in order to provide fmancing for the construction of a police station, fire station, corporation yard and playfield sports complex, the Authority and the City have previously authorized the execution and delivery of Certificates of Participation (City of Gilroy - Public Buildings Project) Series 2003 (Auction Rate) in the aggregate principal amount of $45,900,000 (the "2003 Certificates"); and WHEREAS, interest represented by the 2003 Certificates is computed at an auction rate, and the City and the Authority wish to refund the 2003 Certificates at this time for the purpose of converting the interest rate on the 2003 Certificates from an auction rate to a fixed rate for a short-term period; and WHEREAS, to that end, the Authority proposes to issue and sell its Gilroy Public Facilities Financing Authority 2009 Lease Revenue Notes (City of Gilroy Refunding and Capital Improvement Project) in the aggregate principal amount of not to exceed $55,000,000 (the ''Notes''), for the purpose of providing funds to refund the 2003 Certificates and for the purpose of financing the City's contribution to the cost of certain educational facilities of the Gilroy Unified School District (the "District Projects"); and WHEREAS, the Notes, and any bonds, notes or other obligations issued by the City to refund the Notes, will be secured by revenues consisting primarily of lease payments to be made by the City under a First Amended and Restated Lease Agreement between the Authority as lessor and the City as lessee, which amends and restates the original financing lease relating to the 2003 Certificates; and WHEREAS, the City Council has reviewed said proceedings and wishes at this time to approve all documentation and actions relative to the issuance and sale of the Notes by the Authority, in furtherance of the public purposes of the City; NOW, THEREFORE, BE IT RESOLVED, DETERMINED AND ORDERED by the City Council of the City of Gilroy as follows: RESOLUTION NO. 2009-35 2 Section 1. Approval of Notes. The City Council hereby approves the issuance of the Notes by the Authority in the aggregate principal amount of not to exceed $55,000,000 for the purpose of providing funds to refund the 2003 Certificates and to finance the City's portion of the District Projects. Section 2. Approval of Financing Agreements. The City Council hereby approves each of the following agreements required to implement the issuance and sale of the Notes, in substantially the respective forms on file with the City Clerk together with any changes therein or additions thereto deemed advisable by the City Administrator (including but not limited to changes and additions required to implement the City Council's direction as set forth in Section 3), and the execution thereof by an authorized officer of the City shall be conclusive evidence of the approval of any such changes or additions: . First Amended and Restated Site Lease between the City as lessor and the Authority as lessee, amending and restating the site and facilities lease relating to the 2003 Certificates. . First Amended and Restated Lease Agreement between the Authority as lessor and the City as lessee, amending and restating the financing lease relating to the 2003 Certificates, under which the City agrees to pay periodic rental payments which are sufficient in time and amount to provide a source of revenues to pay interest on the Notes and the debt service coming due and payable on any bonds, notes or other obligations issued by the Authority to refund the Notes. . Irrevocable Refunding Instructions given by the Authority and the City to Union Bank, N.A., as trustee for the 2003 Certificates, relating to the establishment and administration of funds to refund the 2003 Certificates. The Mayor or the City Administrator are each hereby authorized and directed for and in the name and on behalf of the City to execute, and the City Clerk is hereby authorized and directed to attest, the final form of each of the foregoing agreements. The City Council hereby authorizes the delivery and performance of each of the foregoing agreements. Section 3. City Council Direction Regarding Financing Structure. The Notes may be issued in one or more series maturing at different times, as directed by the City Council at the meeting at which this Resolution is adopted. At the direction of the City Council, the Notes (or any series thereof) may be issued as long-term bonds the principal of which is fully amortized through the final maturity of such bonds. Such direction of the City Council shall be recorded in the minutes of the meeting at which this Resolution is adopted. Section 4. Sale of Notes. The City Council hereby approves the sale of the Notes by negotiation with E. J. De La Rosa & Co., Inc. (the "Underwriter"). The Notes shall be Resolution No. 2009-35 3 sold by the Authority to the Underwriter under a Note Purchase Agreement among the Authority, the City and the Underwriter in substantially the form on file with the City Clerk together with any changes therein or additions thereto deemed advisable by the City Administrator or the Finance Director, whose execution thereof shall be conclusive evidence of the approval of any such changes or additions. The rate of interest on the Notes shall not exceed 6.00% and the Underwriter's discount shall not exceed 1.50% of the principal amount of the Notes. The City Administrator or the Finance Director are hereby authorized to accept a bid from the Underwriter to purchase the Notes, and to execute the Note Purchase Agreement on behalf ofthe City. Section 5. Official Statement. The City Council hereby approves, and deems nearly final within the meaning of Rule 15c2-12 of the Securities Exchange Act of 1934, the Preliminary Official Statement describing the Notes in the form on file with the City Clerk. The City Administrator is hereby authorized, at the request of the Underwriter, to execute an appropriate certificate affirming the City Council's determination that the Preliminary Official Statement has been deemed nearly final within the meaning of such Rule. The City Administrator is hereby authorized and directed to approve any changes in or additions to a fmal form of said Official Statement, and the execution thereof by the City Administrator shall be conclusive evidence of approval of any such changes and additions. The City Council hereby authorizes the distribution of the final Official Statement by the Underwriter. The final Official Statement shall be executed in the name and on behalf of the City by the City Administrator. Section 6. Official Actions. The Mayor, the City Administrator, the Finance Director, the City Clerk and any and all other officers of the City are hereby authorized and directed, for and in the name and on behalf of the City, to do any and all things and take any and all actions, including execution and delivery of any and all assignments, certificates, requisitions, agreements, notices, consents, instruments of conveyance, warrants and other documents, which they, or any of them, may deem necessary or advisable in order to consummate the issuance and sale of the Notes and all transactions relating thereto. Whenever in this resolution any officer of the City is authorized to execute or countersign any document or take any action, such execution, countersigning or action may be taken on behalf of such officer by any person designated by such officer to act on his or her behalf in case such officer is absent or unavailable. Section 7. Effective Date. This resolution shall take effect immediately upon its passage and adoption. PASSED AND ADOPTED this 3rdday of August, 2009, by the following vote: AYES: COUNCILMEMBERS: BRACCO, DILLON, TUCKER,aWOODWARD and PINHEIRO NOES: COUNCILMEMBERS: ARELLANO, GARTMAN ABSENT: COUNCILMEMBERS: NONE Resolution No. 2009-35 4 APPROVED: ~- Albert Pinheiro, Mayor Resolution No. 2009-35 I, SHA WNA FREELS, City Clerk of the City of Gilroy, do hereby certify that the attached Resolution No. 2009-35 is an original resolution, or true and correct copy of a city resolution, duly adopted by the Council of the City of Gilroy at a regular meeting of said Council held on the 3rd day of August, 2009, at which meeting a quorum was present. IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Official Seal of the City of Gilroy this 18th day of August, 2009. (Seal)