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CC Resolution No. 12-036 Refinancing of the City's Debt RESOLUTION NO. 12-036 RESOLUTION APPROVING THE FORM AND AUTHORIZING THE EXECUTION OF CERTAIN LEASE FINANCING DOCUMENTS IN CONNECTION WITH THE OFFERING AND SALE OF CERTIFICATES OF PARTICIPATION RELATING THERETO TO REFUND THE CITY'S OUTSTANDING CERTIFICATES OF PARTICIPATION (2002 REFINANCE\G AND CAPITAL IMPROVEMENT PROJECT), AND AUTHORIZING AND D ERECTING CERTAIN ACTIONS WITH RESPECT THERETO RESOLVED, by the City Council (the "Council") of the City of Cupertino, California (the "City"): WHEREAS, the City, working with the Cupertino Public Facilities Corporation (the "Corporation"), has heretofore caused the execution and delivery of the Certificates of Participation ) (2002 Refinancing and Capital Improvement Project)(the "2002 Certificates"), representing undivided fractional interests of the owners thereof in lease payments to be made by the City as the rental for certain property pursuant to a lease agreement with the Corporation, to refinance various public capital improvements throughout the geographic boundaries of the City; WHEREAS, the 2002 Certificates are currently outstanding in the principal amount of $44,010,000; WHEREAS, the City, with the assistance of the Corporation, has determined at this time, due to prevailing interest rates in the municipal bond market and for other reasons, to refinance the 2002 Certificates and to implement a lease financing for such purposes; WHEREAS, it is in the public interest and for the public benefit that the City authorize and direct execution of the Lease Agreement (hereinafter defined) and certain other financing documents in connection therewith; WHEREAS, a preliminary official statement containing information material to the offering and sale of the Certificates described below (the "Preliminary Official Statement") has been prepared on behalf of the City; and WHEREAS, the documents below specified shall be filed with the City and the members of the Council, with the aid of its staff, shall review said documents. NOW, THEREFORE, it is hereby DECLARED and ORDERED, as follows: Section 1. Certificates of Participation (2012 Refinancing Project) (the "Certificates") are hereby authorized to be executed and delivered pursuant to the provisions of the Trust Agreement, as hereinafter defined. Section 2. The below-enumerated documents, in the forms on file with the Acting City Clerk, be and are hereby approved, and the Mayor, the City Manager, the Director of Resolution No. 12-036 Page 2 Administrative Services or the Director of Finance, or the designee thereof(each, a "Designated Officer"), are hereby authorized and directed to execute said documents, with such changes, insertions and omissions as may be approved by such officials, and the Acting City Clerk is hereby authorized and directed to attest to such official's signature: (a) a site and facility lease, by and between the City, as lessor, and the Corporation, as lessee, pursuant to which the City will lease certain existing property (the "Property") to the Corporation, for the purpose of leasing the Property back to the City pursuant to the Lease Agreement; (b) a lease agreement relating to the Property, between the Corporation, as lessor, and the City, as lessee (the "Lease Agreement"), so long as the total principal amount of the Lease Agreement does not exceed $46,000,000, and so long as the lease payments to be made by the City under the Lease Agreement results in net present value savings as compared to the lease payments with respect to the 2002 Certificates of at least 6%; (c) a trust agreement, by and among the Corporation, the City and The Bank of New York Mellon Trust Company, N.A., as trustee, relating to the execution and delivery of the Certificates (the "Trust Agreement"); (d) an escrow deposit and trust agreement, by and between the City and The Bank of New York Mellon Trust Company, N.A., as escrow bank, relating to the defeasance of the 2002 Certificates; and (e) a termination agreement, by and among the City, the Corporation and The Bank of New York Mellon Trust Company, N.A., as successor trustee for the 2002 Certificates (the "2002 Trustee"), whereby the City, the Corporation and the 2002 Trustee agree to terminate the documents relating to the 2002 Certificates. Section 3. The Council hereby approves a notice of intention, in the form on file with the Acting City Clerk (the "Notice of Intention"), together with any changes therein or additions thereto deemed advisable by any Designated Officer. The Acting City Clerk is hereby authorized and directed to cause to be published, once at least fifteen (15) days prior to the date to receive bids, the Notice of Intention in The Bond Buyer, a financial publication reasonably expected to be disseminated among prospective bidders for the Certificates. The Council hereby approves a notice of sale, in the form on file with the Acting City Clerk (the "Notice of Sale"), together with any changes therein or additions thereto deemed advisable by any Designated Officer. Magis Advisors, as financial advisor to the City (the "Financial Advisor"), is hereby authorized to cause to be furnished to prospective bidders copies of the Notice of Sale. Section 4. The Council hereby approves the Preliminary Official Statement, in the form on file with the Acting City Clerk, together with any changes therein or additions thereto deemed advisable by any Designated Officer. The Council authorizes and directs any Designated Officer to deem the Preliminary Official Statement "final" pursuant to Rule 15c2-12 under the Securities Exchange Act of 1934 (the "Rule"). The Financial Advisor is hereby authorized to cause to be furnished to prospective bidders copies of the Preliminary Official Statement. Resolution No. 12-036 Page 3 Section 5. Any Designated Officer is authorized and directed to cause the Preliminary Official Statement to be brought into the form of a final official statement (the "Final Official Statement") and to execute said Final Official Statement, dated as of the date of the sale of the Certificates, and a statement that the facts contained in the Final Official Statement, and any supplement or amendment thereto (which shall be deemed an original part thereof for the purpose of such statement) were, at the time of sale of the Certificates, true and correct in all material respects and that the Final Official Statement did not, on the date of sale of the Certificates, and does not, as of the date of delivery of the Certificates, contain any untrue statement of a material fact with respect to the City or omit to state material facts with respect to the City required to be stated where necessary to make any statement made therein not misleading in the light of the circumstances under which it was made. The Designated Officers shall take such further actions prior to the signing of the Final Official Statement as are deemed necessary or appropriate to verify the accuracy thereof. The execution of the final Official Statement, which shall include such changes and additions thereto deemed advisable by any Designated Officer and such information permitted to be excluded from the Preliminary Official Statement pursuant to the Rule, shall be conclusive evidence of the approval of the final Official Statement by the City. Section 6. The Final Official Statement, when prepared, is approved for distribution in connection with the offering and sale of the Certificates. Section 7. The Financial Advisor is hereby authorized and directed, on behalf of the City, to receive the bids at the time and place specified. in the Notice of Sale, to examine said bids for compliance with the Notice of Sale and to verify the bid with the lowest true interest cost as provided in the Notice of Sale. In the event two or more bids setting forth identical true interest cost are received, the Financial Advisor, on behalf of the City, may exercise its own discretion and judgment in making the award and may award the Certificates on a pro rata basis in such denominations as he shall determine. The Financial Advisor, on behalf of the City, may, in its discretion, reject any and all bids and waive any irregularity or informality in any bid. The Financial Advisor, on behalf of the City, shall award the Certificates or reject all bids not later than 24 hours after the expiration of the time prescribed for the receipt of bids unless such time of award is waived by the successful bidder. Section 8. This Resolution shall take effect upon its adoption by this Council. PASSED AND ADOPTED at a regular meeting of the City Council of the City of Cupertino this 17th day of April, 2012, by the fol lowing vote, to wit: Resolution No. 12-036 Page 4 Vote Members of the City Council AYES: Santoro, Mahoney, Chang, Sinks NOES: None ABSENT: Wong ABSTAIN: None ATTEST: APPROVED: /s/ ace Schm' /s/M k Santoro Grace Schmidt, Acting City Clerk Mark Santoro, Mayor, City of Cupertino