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Resolution No. 4275119 RESOLUTION NO. 4275 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CYPRESS, CALIFORNIA, ACTING AS THE LEGISLATIVE BODY OF THE COMMUNITY FACILITIES DISTRICT NO. 1 (SORRENTO HOMES) OF THE CITY OF CYPRESS, MAKING CERTAIN FINDINGS AND AUTHORIZING THE ISSUANCE, SALE AND DELIVERY OF THE COMMUNITY FACILITIES DISTRICT NO. 1 (SORRENTO HOMES) 1994 SPECIAL TAX REFUNDING BONDS, IN A PRINCIPAL AMOUNT OF APPROXIMATELY FOURTEEN MILLION EIGHT HUNDRED SIXTY -FIVE THOUSAND DOLLARS ($14,865,000); AUTHORIZING THE RETENTION OF BOND COUNSEL AND AN UNDERWRITER IN CONNECTION THEREWITH; APPROVING DOCUMENTS; AND AUTHORIZING BOND COUNSEL, THE UNDERWRITER AND OTHER PARTIES TO TAKE CERTAIN ACTIONS NECESSARY TO ACCOMPLISH THE ISSUANCE, SALE AND DELIVERY OF SUCH BONDS WHEREAS, pursuant to Resolution No. 3820 (the "Resolution of Formation ") adopted on September 10, 1990, by the City Council (the "City Council ") of the City of Cypress, California (the "City "), the City formed the Community Facilities District No. 1 (Sorrento Homes) of the City of Cypress (the "District "), a legally constituted public entity, organized and existing pursuant to the Mello -Roos Community Facilities Act of 1982, as amended, commencing with California Government Code Section 53111 (the "Act "), with the power to issue bonds for the purposes specified under the Act; and WHEREAS, pursuant to Resolution No. 3835 adopted by the City Council, acting as the legislative body of the District, the District authorized the issuance, sale and delivery of its Community Facilities District No. 1 (Sorrento Homes), 1990 Special Tax Bonds (the "1990 Bonds "), in the original principal amount of $13,590,000 and now outstanding in the amount of $13,195,000, all pursuant to and secured by an Indenture of Trust dated as of November 1, 1990 (the "1990 Indenture "), by and between the District and Bank of America National Trust and Savings Association, as successor to Security Pacific National Bank (the "1990 Trustee "); and WHEREAS, the District desires to refund in advance of their maturities its previously issued 1990 Bonds; and WHEREAS, the District hereby finds and determines that the issuance of its bonds, designated "Community Facilities District No. 1 (Sorrento Homes) 1994 Special Tax Refunding Bonds" (the "Bonds"), in a principal amount of approximately $14,865,000, the proceeds of which will be used, together with interest earnings thereon, to refund a portion of the 1990 Bonds, to pay costs in connection with the issuance of the Bonds, to provide for a reserve account and to make certain other deposits as required by an Indenture of Trust dated as of February 1, 1994 (the "Indenture "), by and between the District and Meridian Trust Company of California, San Francisco, California, as trustee (the "Trustee "), which is on file with the City Clerk and incorporated herein by this reference, is in the best interests of the District and is authorized by and in accordance with the Act; and WHEREAS, the District desires to retain Bond Counsel and an underwriter to advise the District in connection with the refunding of the 1990 Bonds and the issuance, sale and delivery of the Bonds, to prepare all documents in connection therewith, and to otherwise accomplish the lawful and expeditious refunding of the 1990 Bonds and issuance, sale and delivery of the Bonds; and WHEREAS, Whipple, Kinsell & O'Neal, Inc., Laguna Niguel, California (the "Underwriter "), has submitted an offer to purchase the Bonds in accordance with a preliminary draft of a Purchase Contract (the "Purchase Contract "), by and between the Underwriter and the District, and the District has caused to be prepared a Preliminary Official Statement (the "Preliminary Official Statement ") describing the Bonds; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF CYPRESS, CALIFORNIA, ACTING AS THE LEGISLATIVE BODY OF THE COMMUNITY FACILITIES DISTRICT NO. 1 (SORRENTO HOMES) OF THE CITY OF CYPRESS DOES HEREBY RESOLVE, ORDER AND DETERMINE AS FOLLOW: Section 1. Recitals. The above recitals are true and correct. Section 2. Findings. The City Council, acting as the legislative body of the District hereby finds and determines that it would be prudent in the management of the District's fiscal affairs to issue the Bonds and that such issuance shall not require repeating any of the procedures required for the approval of the 1990 Bonds as provided by Section 53363 of the Act. Section 3. Issuance. Sale and Delivery of Bonds Authorized. The issuance, sale and delivery of the Bonds in a principal amount of approximately $14,865,000, but in no event greater than $15,500,000, is hereby authorized for certain lawful and public purposes, including, without limitation, the purposes set forth in the foregoing recitals. The Bonds shall be dated, shall be in the form and in the denominations as set forth in the Indenture. The maturity dates of the Bonds shall be as set forth in the Indenture and the final maturity date shall be September 1, 2016. Principal and interest on the Bonds shall be payable in the manner and at the places as set forth in the Indenture. The costs of issuing the Bonds shall be paid from the proceeds of the sale of the Bonds and the District hereby designates any or all of the costs and expenses specified under Section 53363.8 of the Act as the "designated costs of issuing the Bonds" required by Section 53363.2 of the Act. Section 4. Retention of Bond Counsel and Underwriter for the Bonds. In connection with the lawful refunding of the 1990 Bonds and issuance, sale and delivery of the Bonds, the District hereby retains Burke, Williams, Sorensen & Gaar, Los Angeles, California, as Bond Counsel and Whipple, Kinsell & O'Neal, Inc., Laguna Niguel, California, as Underwriter. Section 5. Indenture of Trust. The District hereby approves the Indenture in substantially the form on file with the City Clerk, together with any changes therein or additions thereto approved by the Mayor, Mayor Pro Tem, City Manager or their designees and subject to Bond Counsel approval. The Mayor, Mayor Pro Tem or .City Manager shall execute and deliver the Indenture, and the City Clerk shall attest to such signature, in the name and on behalf of the District and execution and attestation thereof shall be conclusive evidence of approval of any such changes and additions. Section 6. Sale of Bonds. The District hereby finds that it is in its best interests and of benefit to the District to sell the Bonds on a negotiated sale basis. The District hereby approves the sale of the Bonds to the Underwriter, pursuant to the Purchase Contract, in substantially the form on file with the City Clerk, together with any changes therein or additions thereto approved by the Mayor, Mayor Pro Tem, City Manager or their designees and subject to Bond Counsel approval. The Mayor, Mayor Pro Tem or City Manager shall execute and deliver the Purchase Contract in the name and on behalf of the District, and execution thereof shall be conclusive evidence of approval of any such additions and changes. The Purchase Contract is hereby approved, provided the interest rate on the Bonds is the most favorable market rate as determined by the Finance Director in consultation with the Underwriter, and such interest rate does not exceed eight and one -half percent (8.5%), and the Underwriter's discount does not exceed two percent (2.0 %), and the total net interest cost to maturity on the Bonds plus -2- la/ the principal amount of the Bonds is less than the total net interest cost to maturity on the 1990 Bonds plus the outstanding principal amount of the 1990 Bonds. The minimum rate of interest to be paid on the Bonds is one and one -half percent (1.5 %). Section 7. Official Statement. The District hereby approves the Preliminary Official Statement describing the Bonds, in substantially the form submitted by the Underwriter and on file with the City Clerk. Distribution of the Preliminary Official Statement by the Underwriter is hereby approved. The District 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 District by the Mayor or the City Manager, each of whom is hereby authorized to execute the final Official Statement on behalf of the District. The City Manager or its designee is hereby authorized and directed to approve, subject to Bond Counsel approval, any changes in or additions to the form of the Preliminary Official Statement and a final form of said Official Statement approved by the Mayor, and execution of the final Official Statement by the Mayor or City Manager shall be conclusive evidence of approval of any such changes and additions. Section 8. Escrow Agreement. In connection with the refunding of the 1990 Bonds, the District hereby approves the Escrow Agreement dated as of February 1, 1994 (the "Escrow Agreement "), by and between the District and Meridian Trust Company of California, as escrow bank (the "Escrow Bank "), in substantially the form on file with the City Clerk and incorporated herein by this reference, together with any changes therein or additions thereto approved by the Mayor, Mayor Pro Tem, City Manager or their designees and subject to Bond Counsel approval. The Mayor, Mayor Pro Tem or City Manager shall execute and deliver the Escrow Agreement, and the City Clerk shall attest to such signature, in the name and on behalf of the District and execution and attestation thereof shall be conclusive evidence of approval of any such changes and additions. The 1990 Bonds Escrow Fund created by the Escrow Agreement shall be the designated "refunding fund" as set forth in Section 53363.5 of the Act, into which a portion of the proceeds from the Bonds shall be placed for the purpose of refunding the 1990 Bonds at the call date, in the manner and at the places set forth in the 1990 Indenture and the Escrow Agreement. Section 9. Use of Savings. The City Council acting as the legislative body of the District hereby determines that the net savings achieved through the issuance of the Bonds shall be used to reduce the annual special taxes levied in connection with the 1990 Bonds and hereby authorizes and directs the District officials and staff to make reductions in the levy of the annual special taxes which correspond to the net savings achieved through the issuance of the Bonds in accordance with the Special Tax Rate and Method described in Exhibit B to the Resolution of Formation, commencing with the annual levy of special taxes for 1994 -95. Such reductions shall be made on a pro rata basis. Section 10. Authorization to Proceed. All actions heretofore taken by the officers and agents of the District with respect to the refunding of the 1990 Bonds and issuance of the Bonds are hereby approved, confirmed and ratified. The District hereby authorizes and directs Bond Counsel, counsel to the District and the Underwriter to prepare all other documents in connection with the refunding of the 1990 Bonds and issuance, sale and delivery of the Bonds; to advise the District in connection therewith; and to otherwise accomplish the lawful and expeditious refunding of the 1990 Bonds and issuance, sale and delivery of the Bonds. District officials and staff are hereby authorized and directed to assist and cooperate in connection with the refunding of the 1990 Bonds and issuance of the Bonds and to take any and all actions which they, or any of them, may deem necessary or advisable in order to consummate the transactions described herein, including, but not limited to, the execution and delivery of any and all agreements, certificates, instruments and all other documents. i L Section 11. Certification. The City Clerk shall certify to the adoption of this Resolution. PASSED AND ADOPTED by the City Council of the City of Cypress, California, acting as the legislative body of the Community Facilities District No. 1 (Sorrento Homes) of the City of Cypress, at a regular meeting held on the 24th day of January, 1994. MAYOR OF THE CITY OF CYPRESS ATTEST: C Y CL Vexi Y OF CYPRESS STATE OF CALIFORNIA ) SS COUNTY OF ORANGE ) I, DARRELL ESSEX, City Clerk of the City of Cypress, DO HEREBY CERTIFY that the foregoing Resolution was duly adopted at a regular meeting of said City Council, acting as the legislative body of the Community Facilities District No. 1 (Sorrento Homes) of the City of Cypress, held on the 24th day of January, 1994, by the following roll call: AYES: 4 COUNCIL MEMBERS: Bowman, Keny, Nicholson and Partin NOES: 0 COUNCIL MEMBERS: None ABSENT: 0 COUNCIL MEMBERS: None ABSTAIN: 1 COUNCIL MEMBERS: Age 4 4C Y CL F Tp[:'�'ITY OF CYPRESS